Cell phone coverage making inroads on rez

WINDOW ROCK, April 10, 2008

C

ell phones are taking over the phone market these days, especially in places like the Navajo Nation where it's too expensive and impractical to run land lines - conventional poles and lines - to all areas.

Wireless technology, by contrast, goes everywhere: the Laundromat, supermarket, wellness center, the workplace.

Navajo youth, in particular, have been quick to snap up cell phones, flooding their friends with text messages and customizing their ring tones with their favorite pop song or movie phrase.

St. Michael High senior Joanna Rieck has had her Verizon phone for a year and calls it her "lifeline." It enables her to keep in constant contact with her friends, who all have cell phones as well.

But is cell phone popularity among Navajos accompanied by equal attention to cell phone carrier coverage on the Navajo Nation?

Rieck says that she gets good reception in Window Rock and St. Michael but not in nearby Fort Defiance.

It's a common story - in fact only one provider, Cellular One, offers reception across large parts of the reservation.

Why is there such inconsistent coverage?

In Rieck's case, the short answer is that Verizon Wireless does not have the equipment in place to provide coverage in Fort Defiance.

Significant barriers

The longer answer is that the industry faces significant barriers to expanding service to the Navajo Reservation.

Most cell phone carriers hesitate to invest the money necessary to extend their coverage on the reservation because they see it as a "high cost area," thanks to the combination of relatively low population scattered across a very large land base.

The companies do not see enough of a market to justify "building out" on the Navajo Reservation, according to representatives for several major carriers.

But as the interest and demand for mobile phones has grown, Navajo consumers are making noise that is being heard by the large companies. Indeed, demand is moving faster than the service.

One example of this is the recent wave of cancellations by AT&T Wireless of numerous wireless accounts based on the reservation.

AT&T cancelled the accounts because it was incurring big costs for "roaming" calls - customer calls made outside its coverage area. Such calls utilize other companies' transmission towers, and AT&T must pay a per-minute fee to those providers, usually Cellular One on the Navajo Reservation.

Under AT&T's contract with reservation residents, it picks up the roaming charges unlike most agreements off-reservation in which the customer pays roaming fees.

On some accounts, those costs have risen so high - there are almost no AT&T towers on the rez so most calls here involve roaming - that the company is losing money.

The cutoff point comes when customers have over three consecutive months in which 50 percent or more of their calls are made off-network. AT&T waives the usual penalty for early termination of a contract, and refers the customer to a wireless carrier better suited to meet their needs, the company said in a statement.

AT&T called such termination "a common practice in the industry."

It added that this is not an issue for more than 99 percent of its wireless customers, although the Navajo Nation is part of that one percent for which it is a problem.

Neither the company nor tribal regulatory officials would release information on the number of Navajo cell phone customers who have been cut off, but at least a half dozen have filed verbal and - in one case - a written complaint with the Navajo Nation Telecommunications Regulatory Commission, according to director Ernest Franklin.

Franklin said he became aware of the problem in January when one of his relatives was terminated.

Filling a gap

The carrier AT&T refers its terminated customers to is usually Cellular One, the dominant carrier for the Navajo Reservation.

Some interpret Cellular One's ubiquitous presence on the reservation as a monopoly of the Navajo wireless market. Company network director Brian Gilbert says that is not the case.

Gilbert said Cellular One has gone after the Navajo market more aggressively than any other carrier because it makes good business sense for the wireless carrier, whose market is the Four Corners area.

"When we first started out, the Navajo Nation was like a big donut hole in the middle of our service area," Gilbert said.

Now Navajo customers make up the majority of Cellular One's customers and the company, based in Show Low, Ariz., owns most of the cell phone towers on the reservation.

Why has it been able to build on the reservation while other carriers like AT&T and Verizon have not?

Cellular One says one big reason is that it has tapped the Universal Service Fund, a federal subsidy aimed as expanding wireless service in rural areas.

It applied for and qualified as an "eligible telecommunications carrier" under the Federal Communications Commission, and gained access to money from the Universal Service Fund.

ETC status "made a big difference in how rapidly we expanded," Gilbert said.

It also figured into the decision by Navajo Nation, through the president's office and the tribal Telecommunications Regulatory Commission, to support Cellular One's business efforts on the reservation, said Franklin.

But competition should be on the way, Franklin added, and that's good.

Competition coming

In 2006 the Navajo Nation Council passed a resolution streamlining the process by which permits and leases are given to cell phone carriers looking to build on tribal land.

The resolution eliminated a number of steps in the application process by delegating the review process directly to the tribe's Land Department, rather than requiring council approval for each application.

Now the time from application to incorporating cellular equipment takes four to six months rather than two years, Franklin said.

The resolution also cuts the annual lease fee in half from its original price of $24,000, and promotes the placement of new equipment onto existing towers rather than requiring each carrier to build its own towers.

This can be done at a fraction of the annual lease fee for a tower, in addition to saving the upfront cost of constructing a new tower.

Since Cellular One owns most of the existing towers, carriers who wish to build out their networks on the reservation will likely be paying rent to hang their transmitters on those towers.

Apparently, not all carriers are aware of the changes in policy-at least not AT&T.

On March 28, Franklin met with AT&T representatives to discuss the problems caused by its early termination of reservation customers. Talk eventually turned to options for such customers and discussion of the new resolution to entice new carriers.

AT&T spokesman Brian Brokowski said the company looks forward to "explore future partnership opportunities to enhance the wireless service available to the (Navajo) nation."

T-Mobile, another major wireless carrier, said although it will "continue to rely on its roaming partner" for service on the reservation, it has "no plans" to cut off its reservation customers due to roaming expenses, according to company communications director Peter Dobrow.

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