americans deserve access to affordable, quality health care. so let's start over and do this right for the american people. thank you for listening. >> c-span -- created by america's cable companies in 1979. brought to you as a public service by your television provider. >> as we continue our series on "the communicators," talking with some of the telecommunications associations headquartered in washington, this week we are joined by shirley bloomfield, the head of the ntca. she is here to talk about some of the legislative and policy issues her association faces. what is the ntca, first of all? >> the ntca is a national trade association. we represent 900 small, local providers that are in pretty

much every state in this country. basicvide what used to be telephone service. they are now broadband providers. they have also become the one- stop shop service providers for immunity's. they do video, wireless, data centers, whatever technologies their communities require. we resent their interests here in washington, d.c. >> who are some of your members? >> we have everywhere from the largest cooperative in the telecommunications cooperative in south carolina with 100,000 subscribers, to numerous small companies, family-hell, locally owned. that have 400 or 500 subscribers a piece. if you looked at the map of the united states, we serve about 40% of the landmass but about 5% of the kinds -- customer base.

when you think about here in washington, where you have a large provider providing service, 130 scrappers, my folks -- subscribers per mile. my folks average six or seven consumers per mile.. differentr concerns than the verizons, at&ts? >> by definition. when you think about what a rural community looks like, that you have a huge obstacle of distance. geography that kind of works against you. my folks are out there stringing fiber, which is an incredibly important new technology come out to their subscribers, schools, hospitals. they're going through a lot of land where you do not have a lot of people. if you are a service provider like verizon or at&t, you get about 130 subscribers per mile of wire. your costs are the same because the fiber doesn't get any

cheaper base on where you are putting it in the ground. but the number of customers you have to sustain costs is very different. yet at the same time, in rural america in some ways it is even more important you bridge some of the handicaps of distance so they can have access to educational opportunities and health care opportunities. the technology in some ways takes on an even greater role.. >> given the geographical issue you have been talking about, what is a legislative or policy issue you are promoting? >> one of the tenets that is incredibly important is universal service. the idea that all americans, no matter where you live, should have access to comparable and affordable telecommunications services. as we have gone over this -- through this evolution from plain old telephone service to a broadband world, how do we ensure rural americans have access to those same services and applications that come

across on those networks? that has been a big focus for us , legislatively, and with the talkingking -- fcc, about how important it is, what that means, and how that mechanism has allowed folks in rural, high-cost areas to have comparable services.. matthewng us is schwartz, a reporter with medications daily. >> thank you. fcc instituted massive reforms of the universal service regime. they reduced the amount of support they give cairo areas -- the rural areas, in some instances. they implemented a regression formula that has been the subject of much angst. toy compare rural telcos similarly situated peers to see if the cost is high. how has this affected your members? >> it is phenomenal, the impact. the regression analysis has

created angst at the fcc -- you can't imagine the angst it has begun to create outside. understanding what the regression analysis does, it is an incredibly collocated statistical model based on all these different variables that try to compare apples to apples. trying to compare the cost of a company in alaska where they have basically three months relating to investment, to a company down in the panhandle of florida, you really can't even begin to come up with a model that works all the way across the country for these different geographies. beene biggest impact has , 900arriers i represent carriers, they have felt such a chill about regulatory uncertainty that they have really slowed down investing. at a time where we as a society look at broadband and say broadband is going to be so important as we make sure

people have opportunities to get health care without driving four hours to a hospital, or children have access to do all the things that they -- to make sure they stay comparable to urban counterparts, i have seen my member companies really slowed down in their investment. we did a survey recently. about 70% have either stopped or slowed down some investment they had planned and on the books. because you are putting money in the ground in a very capital- intensive industry. you don't know if you can recover costs. you are pretty nervous putting that dollar into the ground. >> can you quantify how many dollars it has cost the industry? -- we of those respond had a very good response rate, but it is then going state-by- state to figure out what projects have been pulled.

a couple has been years ago, under president obama's first administration there had been a big stimulus effort to do broadband funding, and stimulus funding for broadband support. what we have seen as a number of those projects either aren't going to get done, or a lot of folks have turned the project back because it is a partnership, and they can't be sure they can return their portion of the annulus invest -- stimulus investment. that is really a shame. one thing we found is every dollar that goes in the ground for broadband has a multiplier effect in terms of the local economy. not even necessarily so much in the rural area. the economic boost actually goes to the urban areas. >> surely that could not have been the fcc intent, to slow down broadband buildout. rules't they argue the have eliminated waste in some

areas, allowing companies to more efficiently put up broadband? >> i hear where you're coming from, and i think the universal service system is actually a very complicated network. a lot of different rules, regulations, how it applies to different carriers. then you add on the lifeline. there is a lot of moving pieces. i think the thing that was a little difficult that we sometimes do here in washington, we become so academic. we think about it from an academic perspective. there must be a formula. there must be a model. there must be an answer from an ivory tower. i think what would have really helped the fcc would be getting on the ground, seeing how the carriers make decisions, make investments, and what does it mean. i will give the fcc a huge amount of credit for the fact we are now working towards a seventh order of reconsideration, which means that throughout the course of the last two years since the order came out they basically

have come back and said, you know what, we know there is some tweaks, we need to make some changes. so we continue to stay at the table and have some very constructive dialogue with them on how to make this work in the real world. >> is that because of the new commissioners that have come into the fcc? ,> the new commissioners have neither one has voted on the transformation order. they have a clean slate. both are incredibly thoughtful individuals. role working on the senate committee, one commissioner has long been familiar with these issues. both of their reactions have been that this is so complex. carriers supposed to figure this out? until they can figure it out, they will fear regulatory uncertainty. while they are feeling bad, they are simply not going to build. they really understand the connection between that. to your point, how do you build

?nto a broadband world it to creatern incentives for broadband deployment? we have some ideas. >> you identified the problem your association members face. but what is the solution you are advocating? >> there is a few things. one, let's him complicate this. complicated and is done on an annual basis. you figure out what it is going to be next year. the formula changes for the next year. when you are putting in telecommunications, you are billing it for the long run. you don't say, this is a one- year project. typically it is long-term. we need a longer run on how long these provisions say in place so

we can better assess the impact. and companies can feel better about it. the other thing we need to do is really create a fund that will support broadband. right now the way it has been structured, first of all there is no connect america fund for rural carriers. that is really the broadband fund. it has been put in place for large carriers and midsize carriers. it is not in place for small carriers. >> why? >> we are still working on that. wet is the next stage, where designate a fund for these 900 small companies. the way the order is currently written, your support is tied to posts -- voice service. what we see across the country is a lot of people are dropping landline telephones. young people, people on a budget, the redundant value of that network is not apparent to them. so if you are out in a rural area and have dropped your voice

service, your broadband provider can't get support to provide you broadband. broadband, stand-alone broadband -- so the cost becomes prohibitive. if this was partially an initiative to support broadband, tying it simply to voice service in an era where frankly voice is not the driver anymore, broadband is, we have to make sure that standalone broadband support is tied to broadband services. >> with three commissioners fcc been at a the standstill? >> it is harder without the full, women -- full complement. tom wheeler to see and michael riley. a full complement of commissioners increases the breadth and discussion of the debate. it also spurs, it is time to

take action on some items that had pat -- kind of been languishing for a while. i think that will be very good for some movement on all the different issues facing communications. >> matthew schwartz? >> you said the rules affect broadband buildout and investment and infrastructure. do they have a more grievous effect on the continued viability of certain companies, for example, a cap on the amount the fcc will support, $250? there have been a lot of labor request. manyere have not been approved. have you noticed? with perhaps one or two. danger?our members in >> i hope not. part of our job is to make sure we figure out first ball had to correct this, and second of all, how to create a broadband future for their consumers. it is a really good question. a big part of that problem with

is retroactive. applying to investments urd made. you didn't know what you did not know. you put money in the ground thinking you would complete it. suddenly you are finding the rug pulled out from an eq. that is tough for folks. prospectively, if we can get the cap, instead of having caps be triggers, the fcc is trying to make sure folks are not bending too much money, that things are within a budget, which is very important. but if you took that, instead of making it a hard cap, make it a trigger. you tripped the trigger, we need to look at your cost, where they so high? -- why are they so high? i had a company in indiana last week that laid off 45 employees added 200. -- out of 200.

they serve part of indiana university, a lot of medical clinics. that is a big chunk of your workforce. it means a lot to your community and what you can do going forward. we see a lot of that. the other thing is folks trying to figure out new ways to get new revenue streams. that is not an unhealthy part of the process. how do you monetize your network? how do you provide different video services? maybe you need to open a data center, maybe you need to think more aggressively about some i.t. services. that is the entrepreneurial spirit that i'm hoping will pull folks through it. >> i am trying to get my mind around what is so wrong in practice with comparing motherly situated companies against it -- similarly situated companies against each other. >> a couple things. first of all, a lot of data gets put into that formula. you have to make sure you are comparing apples apples. fcc took a ago, the

look at putting a model onto all rural character -- carriers. what they found, after some really intense analysis, is that things like soil content. in west virginia you have a lot of rocks. that changes what it costs to plow fiber into the ground. alaska, montana, north dakota, you have three months a year when you can dig. as you go through complex analysis, the amount of road miles or stop signs, things that get thrown into it, you wind up comparing apples to oranges. that is where the model gets tough to work with. >> is it possible to compare apples to apples? if they come up with a model that takes into account road models and soil and the difficulty of building and make it similar, would that satisfy ntca? >> we will see.

if you can come up with that model -- i say that jokingly. it is a tough statistical model to come up with. think about my 900 carriers. they are all so unique. it is one of the things that is not a homogeneous kind of industry. i think it has been hard. it is difficult to do. if there are models that could be created and they could choose to opt into the models if they thought that might be a better path, you are always going to have unique circumstances. i don't think we are always going to be able to address with a one-size-fits-all. >> you are watching "the communicators" on c-span. this week we are looking at the ntca, the rural broadband association. the headloomfield is of that association. are the economies of scale against your smaller members? >> it is not easy. i will say again, it is tough to

do it when you have a small population base you are building out towards. however, there are a couple things we have seen the last two years that have helped in terms of scope and scale. some folks are realizing that there is a lot of synergy they can get from working together in different business areas. one of the initiatives i find very exciting is in about 30 states my carriers have come together within the state and build state fiber networks. owners, as you will, of their own state fiber network. -- these state fiber networks are doing an amazing for connecting a lot of large institutions. they are able to kind of share on the network, not only in their own service territory, but also the revenues they are able to generate by being able to create that scope and scale coming together. there is more initiative we are seeing in that regard. the flipside is the beauty of

these locally owned and controlled companies is they are all about their customers. we should hope to get this kind of customer service. they are running into the general manager in the grocery store and it is like, hey, you haven't brought broadband out to my place. they are connected with their customer. they know what their needs are. i had a ceo of one of my companies say they started a terrific relationship with a local health clinic. they do home heart monitoring. he was bringing his mother every day to the heart clinic and had one of those moments of, you know what, i should talk to this clinic about how we can get senior citizens connected up using tele-medicine. it is those kinds of initiatives that are the best part of why sometimes big boxes aren't always the best bet. medicine the kind of

thing that wasn't really contemplated in the last iteration of the two indications act? does ntca have a position on how the communication act should be revamped? >> there are probably so many different pieces we could take a look at. you are right. when you think about it, the internet was only mentioned a couple of times. interestinge is an one. in part you have the transmission peace, the part we worry about. what are the rules, the regulations, how do you do cost recovery? you have other pieces outside of our typical realm. medical licensing of doctors. doctors have a very tough time being licensed cross -- to cross state boundaries. when you're doing tele-medicine, you are crossing state boundaries. those rules in the medical field easier so you can generate more interest in tele-medicine.

we run a top -- health-care trust for our own member companies and their employees. we actually provide health insurance for tens of thousands of rural americans who work for providers. we changed to allow recovering payments for tele-medicine. but you have to get insurance providers thinking this is a covered service, then an initiative's will take off. but i'm very bullish on the opportunity for tele-medicine. if your parents live in a rural community, you can check on them, how do you use technology to make sure they open the fridge or the medicine cabinet. i think about the diagnostic things that can be done. it is pretty amazing. >> what can be done from washington with the statutes to encourage that sort of technology? at it fromhen i look our perspective, and you might get a different answer if you were talking to the mlk -- cineican tele-medi

association, my guys need to be able to bill those networks. if they can't bill those networks -- dsl simply won't cut it. it is not fast enough to carry a lot of diagnostics. a lot of them still have old copper in the ground and are providing dsl service. you need fiber in the ground to do the things you want to do. i would go back to, i need to find ways my companies can do cost recovery so they can put the plans in the ground that allow those services. >> shirley bloomfield, does the cost recovery include federal money? >> universal services is a support mechanism between carriers. i know folks like to think universal service, it must be a tax, a subsidy. absolutely not. it is a mechanism whereby money is collected from other carriers, pooled, and

redistributed based on cost. the concert was the value of the network increases the more people you get on the network. it was a notion and a philosophy that was adopted in 1930. 1935 was the first communication act. have the principle of universal service. that has become part of the cost recovery mechanism. >> before we run out of time, i want to get your take on the potential upcoming spectrum auction. >> spectrum is a very exciting initiative. i will tell you, i think spectrum is a great opportunity. we are all mobile. we all want spectrum ability. my concern on the way past auctions have gone, about 80% of spectrum is held by two large carriers, and we see more and more of the nationwide presence. what happens when a large carrier buys that spectrum, they have a buildout requirement, and the requirement is by population. they can essentially build out

in their urban areas and never have to build out to rural areas. we would love to see some smaller licensing areas. my carriers, about half of seem already dowhom mobile spectrum, they just can't do much because of interoperability and access to handsets. tight of a swiss cheese effect -- kind of a swiss cheese effect. >> what would enable more small carrier participation? >> licensing is key. licensing is daunting for them even to get into. you are not going to buy into the lexington market when all you really want to do is serve eastern kentucky. interoperability. being able to get that interoperability between the carriers and roman agreements, is really important so you can actually hand off that traffic. my guys can make a business case out of it. i have 100 companies that own 700 megahertz. they have the ability to do

anything with that spectrum. as customers continue to year n for both ther speed and capacity that fiber can build, you want to augment that with mobility, with spectrum. >> if we can jump topics to the problems rural members have been facing with calls not completing. this is a big deal. a lot of people in cities might not know it, but rural call completion is something that has been testing the fcc. has the fcc and increased focus on it done anything to solve the problem? >> this is a heartbreak issue. you are right. people outside of washington don't understand it, but what is going on is i might be calling my grandmother in michigan. what is going on is that call gets handed off to an intermediate carrier of some they use aually lease-cost router to carry the call. then it gets completed to a rural area.

ons matters because access the other end is higher than they are getting in the middle piece. i have done these test calls. it is horrifying when 20% of calls you are making end in dead air. what it is doing to small businesses and safety. we have literally had numbers of cases of people not getting through to a surgeon or a health clinic. there is a real epidemic. it.fcc has put attention on that has been terrific. every time they put attention on it we see attached down for a couple weeks, then everybody -- it runs rampant again. there is an order the fcc is planning on voting on in the next week. i think that will be a really good start. there is more work to be done, to be honest with you, to ensure folks are getting penalized when that happens. it is a life-threatening situation. >> what is the order? >> and order on call completion. they will look, other ways to do

remedies that will tap down some of this bad actors. >> unfortunately, we are out of time. ,hirley bloomfield of the ntca the rural broadband association. matthew schwartz of "medications daily." >> thank you. "communications daily." >> thank you. >> c-span -- created by america's cable companies in 1979. brought to you as a public service by your local television provider. >> you can watch the entire interview with secretary bill sunday,day -- vilsack here on c-span. >> every dollar that is spent on snap, that benefits a struggling

family, also generates the economy. it generates one dollar and $.85 in economic activity. if you can buy more at the grocery store, you will buy more at the grocery store. that means the grocer has to stock more. has toans the grocer purchase more that has been packaged and trucked to the facility. all of those are jobs in the supply chain. it also means producers, farmers, ranchers, have a market to sell more. it has an impact. what we are able to do with the additional support was to give folks a little extra help during a tough time. stimulate the economy most effectively, because within 30 days the moneys are in the economy circulating. occurred takesw somewhere around the next 10 years $11 billion out of the system. why are more people dependent

on food stamps even as the economy improves? >> when the president came into office, they were states were less than 50% of the population already eligible for snap was not participating. now you see partisan patient -- participation rates at 60%. we now have a historic high in terms of the number of people eligible participating. the numbers are not necessarily a reflection of the current economic circumstance. they are a reflection of something more systemic in the american economy in the last several decades. the president talked a lot about this recently, the need to rebuild the middle class and that the gap between richard -- rich and poor and he needs to grow in this country. >> you can watch the entire interview with secretary vilsack sunday on "newsmakers," here on c-span. span's series "first

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