EMPOWER Broadband, a subsidiary of Mecklenburg Electric Cooperative (MEC), is asking the Federal Communications Commission (FCC) to waive financing requirements attached to the provider’s takeover of thousands of subsidized broadband locations from RiverStreet Networks. It’s a move the cooperative says will save it millions of dollars in errant additional penalties.

It’s also highly representative of the ongoing challenges facing a program that has long been criticized for dysfunction and mismanagement.

The FCC program not only fell short of fulfilling its original promise, it now risks boxing numerous communities out from what could be a generational funding opportunity made possible by the 2021 infrastructure bill.  

During the 2018 Connect America Fund (CAF) Phase II auction, RiverStreet was awarded $32.1 million in financing to provide high-speed Internet to 13,518 locations in Virginia. RiverStreet is looking to divest 3,757 locations across three counties, poised to receive $8.1 million in annual CAF II broadband deployment support.

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According to a May RiverStreet filing with the FCC spotted by Broadband Breakfast, the divestment is necessary because the company “encountered certain obstacles that have prevented it from meeting its CAF II buildout milestones in the assigned CBGs.”

We talked to residents of Mount Olive, North Carolina, about their struggle to get better Internet access and the importance of connectivity for their community. Listen to our conversations above, or read a summary below.

North Carolinians are fed up with slow, expensive, and unreliable Internet access. Communities across the state are seeking solutions, but are running into barriers, especially in rural areas.

The town of Mount Olive, home to about forty-six hundred people, is one such example. Only recently, after working with local Internet service provider Open Broadband, are they getting decent Internet access for residents and local businesses. 

Charles Brown, Town Manager of Mount Olive, told us about the challenges the community faced before Open Broadband came to town. Getting high quality Internet access to a regional airport located just outside of town was a priority for local leaders — it generates around $21.1 million in local economic impact — but after going to every big Internet provider in the area and reaching out to their congressional representatives, they couldn’t make it happen.  

It wasn’t until Brown and other town officials reached out to local Internet provider Open Broadband that they found a path forward. 

OpenBroadband was able to install towers on the town’s water tanks and connect the airport. They also worked with the town to set up free public broadband access in downtown Mount Olive — something that’s especially popular during the North Carolina Pickle Festival, which draws more than 30,000 people to the area each year.

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Brown said:

People living in the service areas of Piedmont Electric Membership Corporation now have the opportunity to express their interest in broadband Internet access from RiverStreet Networks. In one of a series of pilot projects that we covered earlier this year, the two entities are getting started with planning on how to bring better connections to rural folks. People in the community — both members of Piedmont Electric and non-members — are encouraged to go to join.buildpiedmont.com and show their interest.

When enough people in specific areas have expressed their interest in receiving service from RiverStreet, the subsidiary of Wilkes Communications Co-op, will examine deployment.

The first phase, according to Piedmont Electric, will be a wireless solution for rural premises with Piedmont’s infrastructure as a backbone. Fixed wireless will deliver 25 Megabits per scond (Mbps) download and 3 Mbps upload and Fiber-to-the-Home (FTTH) could follow for some areas, depending on various factors:

By registering your address at the website, you are expressing your interest in having RiverStreet services. It’s really that simple! Once enough interest has been expressed in a specific area, RiverStreet will consider expanding their service network there. Bringing fiber optic service to a neighborhood is expensive and requires a large amount of resources and labor. The more supporters in your zone, the more likely RiverStreet is to bring high-speed internet service to your door.

Check out this short promotional video on the partnership to encourage people to express their interest:

“We are excited to work with RiverStreet in order to provide this critical need,” [Piedmont President and CEO Steve] Hamlin said. “While we know it will take years to mature and RiverStreet may not be able to serve everyone with wireless technology, we are happy to announce this first step in helping bridge the digital divide.”

In an effort to find ways to connect some of the state’s most disconnected communities, RiverStreet Networks and North Carolina’s Electric Cooperatives recently announced that they will work together for a series of pilot projects across the state. The initiative has the potential to discover new options for high-quality Internet access for residents and businesses in areas that have been left behind by national Internet service providers.

Going All Out 

North Carolina’s RiverStreet Networks is bent on bringing high-quality connectivity to people living and working in rural North Carolina. After expanding their physical infrastructure through deployment, the communications cooperative started to acquire other fiber networks in various areas across the state. Most recently, RiverStreet merged with TriCounty Telephone Membership Corporation. 

For RiverStreet, branching out among areas of the state were there is no high-speed Internet access is an opportunity to tap into an underserved market, not only an underserved population. It’s become obvious in recent years that rural communities want high-quality Internet access at least as fervently as in densely populated areas where big corporate ISP already have a monopoly. After upgrading their own members, RiverStreet was looking for growth; partnering with electric cooperatives is the next step to reaching more subscribers.

Listen to RiverStreet’s Greg Coltrain and Christopher discuss the merger and RiverStreet's plans to bring broadband to rural North Carolina:

Urban areas in North Carolina don’t have the same challenges obtaining high-quality Internet access as rural communities, but telephone and electric co-ops are taking more steps to change that imbalance. Cooperatives are filling gaps and finding opportunities where national ISPs don't see a high enough profit margin. Wilkes Communications/RiverStreet Networks and TriCounty Telephone recently merged to find those gaps and serve North Carolinians left behind.

Acquiring and Expanding 

In September 2018, TriCounty Telephone Membership Corporation merged with Wilkes Telephone Membership, the parent entity of Wilkes Communications and RiverStreet Networks. The cooperative also acquired Peoples Mutual Telephone Company and Peoples Mutual Long Distance Company, which took Wilkes into southern Virginia. 

When they added several other smaller companies, the cooperative continued to implement their strategy to bring broadband to rural communities without limiting themselves to one region. In addition to counties in central North Carolina, the cooperative now serves people along the north border, in a few south central counties, and in three counties far in eastern North Carolina that brush the eastern shore.

President and CEO Eric Cramer told the Journal Patriot in September that, where national ISPs turn away, Wilkes sees opportunity:

“Larger companies have abandoned these areas, so we think there is an advantage to grow there. A number of rural counties are looking to partner with companies like ours to help bring broadband like we’ve done here in Wilkes. .... These buildouts are much harder and take longer to produce results than acquisitions.”

Merging with TriCounty made sense because TriCounty had reached its potential due to size and scale limitations. TriCounty’s Vice President for business development Greg Coltrain recently told WNCT Channel 9 that the cooperative was considering the quickest way to bringing high-quality Internet access to rural North Carolina and achieve long-term success when they chose to merge with Wilkes: