Qwest ‘actively pursuing’ broadband stimulus, CEO says

Qwest CEO Ed Mueller this week said the company is “actively pursuing” the second phase of broadband stimulus funding.

“I would say we are cautiously optimistic about being able to participate but there is still, I think, a lot of confusion,” Mueller told participants on the company’s fourth quarter earnings call this week.

Mueller hinted that the company might have some input on the issue of how to define unserved and under-served areas. “There is not a clear strategy of what broadband would look like in the long haul and what really is unserved or under-served but more to come there,” he said.

Like other large incumbent carriers, Qwest did not participate in the first funding round.
Some carriers cited a requirement to meet Net Neutrality guidelines along with issues of ongoing sustainability as reasons for not participating.

Although the second funding round requirements do not mention changes to Net Neutrality guidelines, Qwest’s Colorado president Chuck Ward two weeks ago told a local newspaper that the company felt the guidelines for the second round of broadband stimulus applications were more favorable than those for the first round. Ward said projects in rural areas within 50 miles of a city or town would have not have been viable under first round guidelines but might be under second round guidelines.

His comments appear to refer to a change in the funding structure for what administrators call “non-remote” projects. The first funding round had two funding options – grants up to 100 percent in remote rural areas, and 50/50 loan/grant combinations in non-remote rural areas. In the second round, that distinction is eliminated and a base 75/25 grant/loan combination will be used for all projects.

“The new approach provides the Rural Utilities Service with flexibility to seek a waiver if additional grant resouces are needed for areas that are difficult to serve, and priority for those who seek lower grant levels,” administrators wrote in the January 15 announcement of the second funding round.

Mueller’s comments this week are the strongest suggestion Qwest has made yet about the possibility of participating in the second funding round. “If we can make money at it we think the rules have improved,” Mueller said.

The government agencies responsible for administering the broadband stimulus program began accepting applications this week for the second round. Organizations interested in receiving funding have until March 15 to apply.