News Release

GTA TelGuam Hagatna, Guam July 27, 2010

SAIPAN, CNMI (Marianas Variety, July 27, 2010) – GTA TeleGuam said Monday that a new Federal Communications Commission report on broadband deployment highlights the need for federal regulators to funnel broadband stimulus funding to areas of greatest need instead of building duplicate high-speed networks in already competitive market areas.

According to the FCC report released last week, one out of three counties in the United States and its territories is unserved by broadband. Within the unserved areas are 24 million people living in 8.9 million households with lower income levels than the nation as a whole.

The latest and most comprehensive report shows no unserved areas on Guam. However, three areas in the CNMI — Saipan, Tinian and Rota — lack broadband infrastructure. Also, the FCC excluded two county equivalent areas in CNMI because of data irregularities.

The FCC estimates that 1,024 out of 3,230 U.S. counties and territories are unserved by broadband. The minimum speed threshold for broadband is 4Mbps downstream and 1Mbps upstream.

"Privatization and competition have given Guam affordable choices and a world-class communications infrastructure," said Daniel J. Tydingco, executive vice president of external and legal affairs for GTA TeleGuam.

"Broadband stimulus funding sought for Guam should go to needy areas such as CNMI.

"Broadband is lacking where there is limited or no competition and where incumbent providers have little incentive to make adequate investments so they can maintain profit margins," Tydingco said. "Unfortunately, in these poor areas broadband access is limited or not affordable, stifling economic growth and expansion."

Tydingco said DSL costs in CNMI are two to three times higher than Guam. He said a basic T-1 connection from Guam to Saipan costs about $6,000 a month. This is the cost for a STM-1 connection (equivalent to100 T-1’s) from Guam to Los Angeles.

Unlike the CNMI, competition on Guam is fierce. Guam has two aggressive wireline-based broadband providers and four wireless carriers that blanket the island with their broadband coverage. There are 12 submarine cables with landing points on Guam, offering choice and route diversity.

"Communications providers on Guam have made demonstrable progress in infrastructure deployment and investment on the island," Tydingco said, noting that GTA TeleGuam alone has invested more than $75 million since the government of Guam privatized the company in Jan. 2005. Another $10 million is planned for 2010.

GTA TeleGuam contends that nearly $100 million in stimulus funding sought for Guam will tilt the competitive playing field in favor of one company and return Guam to pre-privatization days of high rates, slow innovation and poor service.

"A taxpayer-funded public overbuild of communications infrastructure on Guam will jeopardize competition, risk current and new investments on the island, and it will cost Guam a net-loss of good-paying telecom jobs," Tydingco said.

Last May, GTA TeleGuam formally asked the National Telecommunications and Information Administration to reject an $89.7 million second round funding request for Guam. NTIA previously approved a round-one request for $8 million to the same company.

A decision on the second broadband stimulus funding request is expected by Sept. 30.

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