Who profits from a subscriber-owned telecom?

Telecom cooperatives aren’t like other utilities—you, as a consumer and a member own a portion of the business. And one benefit of that membership involves the allocation of excess revenue, called margins, in the form of capital credits.

Telecom co-ops operate at cost— collecting enough revenue to run and expand the business but with no need to raise rates to generate profits for distant shareholders. When a coop-owned BT  has money left over, it will be allocated back to you and other members as capital credits. When the co-op’s financial position permits, the co-op retires, or pays, the capital credits to members in cash or as a bill credit.

To give you an idea of how this policy can benefit co-op members and their communities, consider this statistic  about electric cooperatives:

In 2010, U.S. electric cooperatives retired $626 million in capital credits to current and former members. Since 1988, co-ops have retired $9.5 billion, based on data from the federal Rural Utilities Service and the National Rural Utilities Cooperative Finance Corporation (CFC), the premier private market lender to electric cooperatives.

We didn’t find a similar statistic for telecom co-ops, but we did find a couple of interesting examples.

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