Good Afternoon, My name is Don Eller. I was born and raised in ...

The state and national Social Political Challenges will be grouped together since they are similar in
nature. There is a disconnect between many public servants, both civil and elected officials, and the
reality of the public, which they are supposed to serve. In order to provide phone service, stable reliable
electricity is required. In the early days of Yukon Telephone, my father found that he was spending more
time keeping the community generator going than working to provide phone service. He concluded that
if he was going to be doing the work he might as well be paid for it, so we ended up purchasing the local
electric utility in Tanana as well. Currently, in order to lower the cost electricity we have been looking into
alternative methods for generation. We were directed by the state agency, which controls the purse
strings for funding, that if we wanted any assistance we needed to pursue wind. The states directive was
based on results from a computer model which was in direct conflict with the two wind studies and 50
years of data from the Tanana Airport proving that commercial wind development is not economically
viable in the interior of Alaska. I was able to find though a hydro electric study done on a stream in
Tanana, by the predecessor to the current agency. The stream had year round flow, ideal geography
and soil conditions, making it great for a hydro electric site. When provided with the information from the
study, the agency totally discounted all the research and said, "traditional hydro electric development that
far north is unfeasible." The same state agency however, insists on pursuing the Susitna Hydro project
in spite of the fact that every economic study I have seen except the agencies, indicates it’s a bad idea.
My response to the state agency was this, "So the state is not willing to risk 5 million dollars proving that
hydro electric power is a viable alternative in an environment where electricity costs over $0.50 kwh and
there are no other known alternatives at this time, but it is willing to risk 5 billion dollars for a project under
similar conditions to Tanana where electricity cost $0.15 kwh with numerous other economical
alternatives."
As you can see, I really know how to win friends. I think it is genetic because in one of the best lines
ever spoken at the APUC, the precursor to the RCA, was blurted out by my father in the middle of a rate
case. Dismayed and disgruntled at the costs involved with lawyers and expert witnesses for the rate
case, my father enthusiastically said," My customers cannot afford your due process", and I agree. Is it
necessary for a utility with much less than a million dollars of revenue a year to go through a full blown
rate case that can easily cost over $100,000 for its 600 customers? It is an o.p.m. problem. That’s O P
M, other people’s money. I believe that the public servants would have a far more reasoned, rational and
researched approach if it was their money at stake. That said I am not here to bash our public servants.
The majority I work with are over worked, under paid, and doing a very good job.
I would be remiss in talking about rural issues if I did not mention the rural/urban conflict promoted by
some for political gain. Anchorage and Fairbanks are distribution hubs which benefit from rural Alaska.
Out of the 11 employees of our company, only 3 of them live in rural Alaska. Two of them are part-time
and all the rest live in the Mat Valley and greater Anchorage area. Out of the 2.1 million dollars spent on
a tank farm in Tanana less than $100,000 was spent in Tanana, all the rest was spent in Anchorage. We
are one state with rural and urban Alaska inter-dependant on each other.
Unfortunately, I do not have the answers to the social political challenges faced by me as a rural telecom
provider, us, as a state, or the nation as a whole. However, using sound economic and technical
analysis as is provided by ISER would be good place to start, if decision makers will listen.
I’m almost done, but not quite. It’s now time to talk about the easy stuff, the technical portion challenge.
In order for rural Alaska to fully participate in the broadband revolution, rural Alaska's current connection
to the rest of the world, the satellite, must be replaced with terrestrial networks. There are two reasons
why, cost and latency. A cheap satellite costs around $150 million dollars and the higher end versions
run about $450 million dollars. They have a life span of about 12 years, mainly because of the thruster
propellant needed to maintain a stable orbit, thus middle mile transport over satellite is expensive. A T-1
or 1.544 Mbps work of data over the satellite costs between $8000 and $12000 a month to rural AK. So
the ability to provide high speed internet to rural Alaska is not a technical issue but an economic one.
Villages simply cannot afford it.
Combine this with the physical limits involved in satellite transport and terrestrial middle mile transport
becomes a no brainer. Geosynchronous satellites orbit at 23,600 miles above the earth so even