Zayo Logo

Breaking Barriers, Building Futures: How Carriers Can Drive Rural Economic Development


Millions of households still lack adequate access to high-speed Internet access in rural America—and that comes with some serious social and economic impacts.

At least 9.3 million rural residents don’t have adequate broadband service. But the Federal Communications Commission (FCC) relies on self-reported data, so that number is likely much higher. For example, Broadband Now—an independent research group—suggests some 42 million Americans are underserved.

Without adequate connectivity, citizens can’t fully participate in the digital economy. Communities have a harder time retaining residents and attracting employers. And businesses, schools, hospitals, and community colleges are getting left behind.

“The challenge of connectivity is not new, but as we move to an increasingly connected, digital world, the cost of leaving out rural communities amplifies,” according to Deloitte’s report on connecting rural communities. “With 5G technology coming to major cities, barring concerted action, the digital divide between rural communities and the rest of the world will be exacerbated, with large swaths of rural Americans at risk of being left behind.”

A Gap in the Middle

Large swaths of rural America lack adequate middle-mile infrastructure, which results in sub-standard broadband performance and reliability—if they have access at all.

The challenge for carriers and broadband providers is that middle-mile infrastructure is costly and complex to install. In some areas, the terrain poses a challenge—consider, for example, the Appalachian mountains in West Virginia. In other areas, the climate is a factor—in Alaska, the ground is frozen at least half the year. This makes it hard, if not impossible, to install fiber.

But perhaps the biggest obstacle is money. Local carriers can’t get enough of a return to justify a major investment in rural broadband expansion. This means those communities are at risk of falling further and further behind.

The Rise of Public-Private Partnerships

That’s where a model involving public-private partnerships can help. As a response to the COVID-19 pandemic—when consumers, schools, hospitals, and businesses became increasingly dependent on digital technologies—the federal government authorized $87 billion in funding for broadband access and adoption, including $65 billion as part of the Infrastructure Investment and Jobs Act to address the digital divide.

This investment provides an opportunity for public-private partnerships to extend and expand middle-mile infrastructure. For example, companies like Zayo that already have an extensive network can partner with governments, foundations, and telecommunications co-ops to ensure that middle-mile infrastructure extends beyond its current reach.

Zayo’s Network Expansion

Through $92.9 million in funding from the National Telecommunications and Information Administration (NTIA) Middle Mile Grant Program, Zayo is using these funds to extend network infrastructure across eight states and more than 2,100 route miles. Zayo, in turn, works with local ISPs and broadband providers to address the specific needs of each underserved community—and to identify other potential areas of expansion.

Marginalized communities that will benefit from this funding were selected based on socio-economic indicators and current broadband speeds—where median broadband access is below 100 Mbps download speed and 25 Mbps upload speed. In many of these areas, a significant percentage of residents fall under the federal poverty rate.

For example, as part of its El Paso to Dallas Project, Zayo is building a high-capacity middle-mile fiber route spanning over 644 miles to establish broadband across Western Texas—with the capacity to serve entire rural communities along the route.

Driving Economic Development

Fiber provides a long-lasting, reliable, and scalable solution for connecting underserved areas. It can also support 5G and cloud computing, which are vital to competing and growing in today’s digital economy.

Increasing access to broadband in rural areas is linked to increased job and population growth, higher rates of new business formation and home values, and lower unemployment rates, according to the Federal Reserve Bank of Richmond.

The construction of high-capacity middle-mile fiber routes in rural areas can level the playing field for students, healthcare workers, and small business owners. For example, when schools are connected to fiber routes, they’re able to provide essential online resources and remote learning opportunities for students and faculty.

Connected businesses can access a wider talent pool and previously untapped markets. This can create jobs and foster entrepreneurship while boosting local economies. Indeed, a 10% increase in broadband penetration was estimated to lead to a 1.2% increase in real per capita GDP growth.

While it comes with an upfront cost, increasing broadband access in rural areas offers long-term benefits, such as a boost in productivity and innovation—and leads to a higher quality of life for all.

Interested in learning more about middle-mile opportunities?

Download our latest eBook, The State of Carrier Growth 2024.