December 15, 2006 4:00 AM PST
Cell phone coverage holes hurt public safety
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So why haven't carriers been able to fill in the coverage gaps left from retiring their old analog service or expand service to rural areas that have never had coverage? The answer comes down to economics. A single cell phone tower can cost between $500,000 and $1 million to deploy, and in many rural areas there aren't enough subscribers to pay for the up-front cost of building a new tower.
"Every one of our carriers is trying to cover these rural areas as quickly as they can," said Clay Dover, the incoming executive director of the Rural Cellular Association in 2007. "But without the population density, it's costly. So it makes sense to start rollouts in areas where there are more people."
A federal government program known as the Universal Service Fund has helped provide some cash for rural network construction. And it will likely continue to help operators looking to serve sparsely populated regions of the country. The program is funded by phone companies, which pay a fee based on the percentage of interstate telecommunications services that their customers use. Most operators pass on the charges to consumers.
Rural operators can also apply for low-interest loans from the Rural Utilities Service, a development agency of the U.S. Department of Agriculture. Funding for these loans will likely be debated next year, when Congress reauthorizes the Farm Bill.
The FCC also can encourage carriers to expand into rural areas through the allocation of new spectrum. For example, the 700MHz band of spectrum, now used for analog television, will become available for auction in 2007 in anticipation of a mandated conversion from analog to digital transmissions by all TV stations in the country. This spectrum, which travels up to three times farther than 1.9GHz cellular frequencies, could be ideal for use in rural areas.
One way to promote rural-area use of some of the spectrum would be to offer the licenses in smaller geographical blocks. This would encourage bidders who are interested in serving these specific rural regions to bid on the spectrum. It would also likely reduce the cost of the licenses, allowing smaller players--often the companies already serving rural areas--to be able to afford the price.
But even if carriers can get access to the capital to upgrade and expand their coverage, they still must get public approval for erecting new towers. Often they face resistance from community groups or from environmentalists. The FCC is currently accepting comments for new rules it may impose to protect migratory birds. These and other concerns are legitimate, and have to be balanced with the need to improve coverage, experts say.
Some companies are thinking of alternative ways to provide remote regions with wireless service. For example, a company called Space Data uses a balloon-borne wireless network based on standard technology from Motorola that can operate both on a standalone basis and as an extension of existing terrestrial wireless networks.
New rules from the FCC that allow satellite operators to use their spectrum to also provide terrestrial services could help rural regions. Satellite communications provider TerreStar Networks plans to become the first company to offer a mobile satellite and terrestrial communications network. The company's first satellite, currently under development and construction, is scheduled for launch in November 2007.
Guttman-McCabe of CTIA said business models for these new technologies have yet to be proven, but he believes that new-technology companies could partner with cell phone operators to eventually reach the goal of covering the entire country with some kind of mobile service.
"As an industry I think we are victims of our own success," he said. "The technology has become extremely important to consumers over the past few years and people depend on it. But we have to remember that this is a relatively young industry, and we're still building networks."
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