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Riverside, California, Now Offering Dark Fiber for Lease

muninetworks.org - June 12, 2019

Named the Intelligent Community of the Year by the Intelligent Communities Forum in 2012, Riverside, California has continued to work toward broadband expansion, digital inclusion and take full advantage of their fiber optic infrastructure. To offer more options for commercial and institutional entities in the community, the city council approved a dark fiber leasing program to be operated and maintained by Riverside Public Utilities (RPU). Officially launched in 2018, the program makes the city’s 120-mile dark fiber network available for Internet service providers (ISPs), wireless operators, and mobile carriers to lease and provide service to industrial and commercial customers. 

Becoming an Innovation Hub

Riverside’s growing reputation as a smart city has helped turn the community into a hub for start up companies, especially in the technology industry. Located just east of Los Angeles, Riverside was ranked as 19th on MSN Money’s list of the best cities in the U.S. to grow a business and several large companies, such as SolarMax, have recently located there

While the fiber network was originally constructed for running the operational facilities of power and water, the city had the foresight to finance and construct fiber to every city facility. With the new leasing program, this original network is now an essential backbone for providing the city’s businesses and industries with the high-speed service they need to compete with surrounding communities. 

Open for Business

The dark fiber network connects office buildings, industrial properties, and data centers throughout the city and includes seven buildings which are already connected to the network with more on the way. With the goal of making dark fiber connections available throughout Riverside, RPU is continually adding more locations and will construct extensions to unserved areas as requested. Customers are responsible for installation costs and the current base rate to lease the network is $125 per strand-mile per month with a one mile minimum.

Riverside’s dark fiber leasing program is just one aspect of the city’s larger plan to close the digital divide. In 2005, Riverside established SmartRiverside, a non-profit innovation and digital inclusion program established to support the broadband and technology efforts. Programs through SmartRiverside include the Digital Inclusion program which offers free refurbished PCs to families in need. With its comprehensive approach including both infrastructure expansion and more people-focused programs, Riverside is paving the way for how to best close the digital divide. The new dark fiber leasing program will further solidify Riverside as a leader in innovation.

Listen to Christopher interview Steve Reneker way back in 2012. At the time, he was the Chief Innovation Officer and Executive Director of SmartRiverside and they discussed the program for episode 11 of the Community Broadband Bits Podcast:

Tags: riversidecaliforniadark fiberleasemuni

SiFi Speaks on Fullerton Open Access Project - Community Broadband Bits Podcast 360

muninetworks.org - June 11, 2019

This spring, SiFi Networks and Fullerton, California, announced that they will be working together to deploy an open access Fiber-to-the-Home (FTTH) network across the city of 140,000 people. SiFi will fund and build the network and has already signed up two providers to offer Internet access service to the public. This week, Christopher speaks with Ban Bawtree-Johnson, CEO of SiFi Networks.

Ben and Christopher discuss the plan, the company, the partnership, and the project. They talk about the advantages of encouraging competition wherever the market allows and other reasons for advancing the open access model. In addition to encouraging multiple ISPs in the community, the infrastructure will allow smart city applications and innovation to thrive.

Project construction will include microtrenching, a method that SiFi feels confident will work in Fullerton and considers key to the deployment schedule. Ben provides some detail on the project's “three-layer” open access model that will include a separation of infrastructure, operations, and provision of services.

Learn more about the different open access models on our open access page.

We want your feedback and suggestions for the show-please e-mail us or leave a comment below.

This show is 25 minutes long and can be played on this page or via iTunes or the tool of your choice using this feed. You can listen to the interview on this page or visit the Community Broadband Bits page.

Read the transcript for this episode.

Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license. 

Tags: audiopodcastbroadband bitsfullerton cacaliforniapartnershipopen accesspublic v private

Take This Survey, Help Direct Broadband Policy, and Get Free Coffee!

muninetworks.org - June 11, 2019

Coffee and broadband and Craig Settles of Gigabit Nation and cjspeaks.com — these three things go together naturally. Craig and the International Economic Development Council (IEDC) is asking for your opinions about the future of broadband. In appreciation for your time, you’ll receive a $5 Starbucks Card emailed directly to your computer or smartphone. The deadline is Friday, June 14th at 11:59 p.m. PT.

Share your thoughts and take the survey!

From Craig:

Word has it that several Senators want a better handle on the economic impact broadband in US. While this is a notable goal, how much weight will be given to community input? Lord knows we need locally-generated data to fight FCC’s regressive broadband policy-making.

Since the best source of knowledge of broadband’s impact on local economies are local economic development pros, I am surveying some of them nationwide. Int'l Economic Development Council (IEDC) has been my long-term partner, and ETI Software provided sponsorship.

This year’s short survey explores community broadband’s impact on business attraction, personal economic development, and low-income individuals becoming entrepreneurs. Can community broadband reduce the Homework Gap and what factors prevent broadband adoption?

What happens to local economies when broadband and telehealth together reverse hospital closings, reduce unnecessary visits to the ER, and increases mental health treatments?

Pass the word on to of your community’s econ dev pros, nonprofits, and local organizations dedicated to economic development. Encourage them to complete their survey today! 

Btw, respondents get a Starbucks Card.

Take the survey here.

Tags: surveycraig settlesgigabit nationeconomic development

Transcript: Community Broadband Bits Episode 360

muninetworks.org - June 11, 2019

This is the transcript for episode 360 of the Community Broadband Bits podcast. In this episode, Christopher speaks with Ben Bawtree-Jobson from SiFi Networks about how the company is building an open access network in Fullerton, California. Listen to episode 360, or read the transcript below.

 

 

Ben Bawtree-Jobson: We found a great solution here economically to deliver the same solution to a city but without that city taking on any burden, and that is the case in Fullerton. There's no financial burden to the city whatsoever.

Lisa Gonzalez: Welcome to episode 360 of the Community Broadband Bits podcast from the institute for Local Self-Reliance. I'm Lisa Gonzalez. Not long ago, fiber optic network developer SiFi Networks and the city of Fullerton, California, announced that they will be working together to build an open access Fiber-to-the-Premise network throughout the city. They've established an aggressive timeline and a partnership in which the company will fund the infrastructure development, find ISPs to operate on it, and handle the task of connecting businesses and residents to the network. In this interview with SiFi Networks CEO Ben Bawtree-Jobson, we learn more about the company, their approach, and the plan to connect people in the southern California city. We find out more about SiFis other projects and how they've adapted their model to suit working in the U.S. Ben explains some of the company's thoughts on micro trenching, allocation of risk, and the many uses they foresee for the fiber network beyond Internet access for the population of Fullerton. Here's Christopher with Ben Bawtree-Jobson of SIFi Networks.

Christopher Mitchell: Welcome to another episode of the Community Broadband Bits podcast. I'm Chris Mitchell with the Institute for Local Self-Reliance. I'm in Minneapolis, and today I'm talking to Ben Bawtree-Jobson, the CEO at SiFi. Welcome to the show, Ben.

Ben Bawtree-Jobson: Thank you for having me.

Christopher Mitchell: Well, I'm excited to have you. I'm a huge fan of science fiction, and I think we're going to be talking nothing but future interplanetary plane travel, right?

Ben Bawtree-Jobson: Yeah, perhaps. Yeah, we often get confused with our brand.

Christopher Mitchell: So tell me, what is SiFi — S-I-F-I — what is SiFi all about?

Ben Bawtree-Jobson: SiFi's name actually comes about through the technology that founded the business, which coincidentally, we don't actually use a lot of or at all. Sewer Infrastructure Fiber Installation is what it stands for. One of our founders Mike Harris liked the way that the name played up against Wi-Fi etc. But it seems to have stuck, and we like it. And what it really represents now is the future of networking in the USA, where we're predominantly doing all of our business at the moment.

Christopher Mitchell: And what's your vision?

Ben Bawtree-Jobson: Well, our business is as a developer, so we're a fiber optic network developer specializing in developing last mile infrastructure. And we do so using a three layer model, so it's the separation of infrastructure, operations, and service provision. So our vision really is to create as many last mile fiber optic networks as we can across the USA in a long term sustainable fashion. So we're all about long term, dry, low yielding, risk mitigated investments, so everything we do is based around 30 year plus type investments, which is a little bit different to your traditional telecoms or technology based investment. So yeah, that's part of the reasons we set up the business, is we believed that fiber was no longer really an entertainment medium but more of a core utility and so needed an investment structure around it that enabled its characteristics to be best communicated, enhanced, and then invested in by private capital markets.

Christopher Mitchell: And so, you've mentioned three different layers. Now you build the physical layer, and what are the other layers?

Ben Bawtree-Jobson: The three layer model? Yeah, we start off with the physical layer, but then we are actually heavily involved through a separate entity, SiFi Networks Operations, or as we call it, SNOW, in the ongoing operations and management of that infrastructure. The way that we treat the project is as a project-based finance, so each city we do is completely self-sufficient and sustainable in its own right. So we have independent contracts from that into all the various partners for the project, including SNO, who conducts the management of the network via the network operating center, and that's done in partnership with a close partner of ours, Nokia,

Christopher Mitchell: And then the third layer is the independent ISPs right? And I deliberately pluralized that.

Ben Bawtree-Jobson: Yes, exactly. Last but not least, our ISPs, plural. We believe in creating competition, not just in the short term but the long term, so wherever possible, wherever a city has sufficient scale, you know, to justify more than one ISP into the market, we like to ensure that there is competition with a second ISP on day one. And that sort of, I guess, brings us to our first market where we've proven that out, are in the process of proving that out with our first two ISPs, Ting and Gigabit Now.

Christopher Mitchell: Great. Well, before we talk about that first market in Fullerton, California, just briefly, how did you get into all this?

Ben Bawtree-Jobson: So I was working with one of the founders and looking to expand out his existing businesses overseas and looking at new opportunities, and one of the new opportunities that was put across his desk was a novel and interesting way to deploy fiber in sewer lines, which is where the business got its name from, and that was presented by Mike Harris. Mike Harris is a telecoms expert based out of the UK. He originally set up his first business, Total Network Solutions, sold that to British Telecom back in 2005, and has been involved in telecom since. And he brings the telecoms side of the business to SiFi, where I was with Roland Pickstock and that was more finance and construction orientated. And so, when we were presented with the opportunity to invest in fiber, Roland and Mike saw, you know, the vision of the merger of fiber being a real estate/infrastructure asset class and it requiring a lot of construction and a lot of finance in order to make a dent in any market. So I was tasked with doing the due diligence on a business plan, which we ultimately decided to go ahead and move forward on and go forth and try and conquer. And we found out pretty swiftly that our first views on the U.S. market, whilst the principals of fiber were correct, probably our views on the executing in the U.S. Market went quite great. And so, we went through a couple of stages of pivoting around PPPs and trying to work with major incumbents to no avail. Ultimately, after setting up a great platform from an operational standpoint and a partner standpoint, we found the right solution and sort of cracked that economic code to unlocking last mile open access networks, which I think is a very new segment really for the U.S. market.

Christopher Mitchell: Yes. I think it's quite exciting to see. I mean, it's something that has been tried largely by local governments but I think has tremendous potential moving forward. So let's talk about where you're doing it first, and that's Fullerton. You've got about 140,000 people there, a city, in the Los Angeles metro region. What is the plan for Fullerton?

Ben Bawtree-Jobson: Yeah, so the plan for Fullerton is that we'll pass every single building within the city. We'll be doing that over the course of the next two years, so it's a relatively rapid build program.

Christopher Mitchell: Yeah, sorry, let me just jump in — relatively rapid. You know, 140,000 people, so I mean, what, you're looking at 60 - 70,000 premises in two years. That is a remarkable, and especially with some of the California challenges in terms of extra regulations.

Ben Bawtree-Jobson: Yeah. Relationships are key. I don't think it's any sort of secret recipe as to why I'm based in California. I think you need to be on the ground, you need to be working with the cities incredibly closely, especially in terms of getting through expedited permitting processes and understanding some of the nuances about the technology that we do implement and to meet those types of timescales for delivery.

Christopher Mitchell: How exactly do you plan on doing this? Are you gonna be on poles? Are you going to be digging your own trenches? How does it work?

Ben Bawtree-Jobson: We advocate for underground construction at all possible opportunities, so in Fullerton, I think about 99.5 percent of the entirety of the build will be underground. The only parts that will be above ground are really where we aren't even building it, and that's our backhaul connectivity out of town. We believe in underground wherever possible because of the security of the asset underground, and the longevity of the assets. It's a lot easier and more cost effective to maintain than having to have, you know, a dozen bucket trucks running around town to deal with, you know, lines being cut due to squirrels or arborists up in the trees.

Christopher Mitchell: One of the articles — actually I think several of the articles mentioned micro trenching. Is that something you have a lot of confidence in?

Ben Bawtree-Jobson: Yeah, that's right. We've got a lot of faith in that. We've seen it, we've deployed it. It's not the golden bullet answer to everything. There's an awful lot of other ingredients that go into the mix in making one of these projects sustainable, but it does start with having a cost effective means to actually deploy these networks and micro trenching is a fantastic solution to do that. So yeah, we're not going as shallow as some of the worrying articles you hear about from Google.

Christopher Mitchell: Well, can you just briefly describe the method you use? Because I do think some of the people have different impressions about what it entails. Are you cutting into streets and about how deep?

Ben Bawtree-Jobson: Micro trenching itself for us means one to one and a half inches wide. You hear some mictro trenching units going out there, they're digging three inches wide, 26 inches deep. It's really sort of not a micro trench; that's more of a mini trench, I guess. Micro trenching for us is narrower and shallower, so we're anywhere from 12 to 16 inches deep, one to one and a half inches wide, when we're running our micro trenching solution.

Christopher Mitchell: And are you going to be in any of the wastewater infrastructure? I saw that was brought up or that may have just been a reference to, as you said, the legacy of your history.

Ben Bawtree-Jobson: Yeah, exactly. It is more of a legacy at this point. I mean, it's a very unique piece of technology that enables us to build it in the sewer lines, but whilst it's got fantastic capabilities, it's limited in terms of its application. So when you're building fiber at home in the manner that we do, which is a mesh architecture where you've got multiple cabinets creating diversity throughout the city, you're essentially building up and down both of nearly every single street. And importantly, if you're doing that, you're serving hopefully as many homes as you possibly can outside of the Right-of-Way. So that means you're breaking out at such regular intervals that it doesn't really make sense to go within the sewer line where you're restricted from your point of entry and exit by your manholes. So it's really great for creating metro rings, for fiber to the tower type deployments, but if you're looking at true Fiber-to-the-Home on a large scale in the last mile, it doesn't really have much of place, except for, you know, maybe bypassing tricky railroad easements or areas that are troublesome to get through, through more conventional techniques.

Christopher Mitchell: As you're describing the going down and trying to connect to every home ideally, it makes me wonder if that's part of the vision you have for why you're embracing open access is, you know, many of the advocates, particularly in Europe and in Asia from the ones that I've heard from, open access is seen as a way of really maximizing take rate because you can offer so many different services and packages.

Ben Bawtree-Jobson: Yeah, that's quite right. The more you can have an open environment, you create more natural competitive forces and thus you get improvements in service, improvements and diversity in types of products and price that is going to market. The other thing about when we think about open access, we think about our network as being open not just for Fiber-to-the-Home. It's open for 5G, it's open for smart city, it's open for private health care and educational networks to transverse it. So when we're building these networks and when creating, you know, an economic case for investment, it isn't just based around Fiber-to-the-Home. It's based around creating a network architecture in a city that can actually support all of the future needs of that city in one infrastructure. It's quite an unfamiliar strategy for deploying infrastructure to us Europeans to have multiple similar infrastructures in place to provide the same service, so having a telco, a cable co, and then a fiber co is something of a odd proposition to a European. And it's probably no coincidence that our investors are also European at this stage, but we are certainly open to working with U.S. based investors as well, that's for sure. And we hope that they will be strong advocates of this type of solution as well because we believe, you know, through better market competition and dynamics, you do get a better take rate ultimately. And the more demand points that you can utilize across the city, whether it be Fiber-to-the-Home, whether it be smart city applications or private networks for health and education, ultimately the lower you can start to bring down that wholesale point which then enables more affordable services to then ride over it as well or create new opportunities where services were previously too costly — for example, your smart city services. You know, the main barrier to deploying smart city is the cost of connectivity. Now if you can pay for the vast majority of your returns that you need to meet investors needs through Fiber-to-the-Home and private networks and 5G/4G connectivity, you can bring down that cost of the demand point to a city to such a point where actually deploying smart city applications, like smart metering or SCADA systems or smart street lights, can all become very possible because you're bringing down that cost.

Christopher Mitchell: You were mentioning some of your investors. I think it's worth highlighting that you and your investors are taking on the risk. You're not asking Fullerton to guarantee you any revenue, I don't think, or to provide you any kind of backstop. Is that right?

Ben Bawtree-Jobson: Yeah, 100 percent. We have a private, 100 percent privately funded model. There is a bit of confusion in the market around SiFi and what we used to do, which was, you know, advocate for and try to work with municipalities for the municipality themselves, taking some ownership and thus risk in the network. We pushed down that river for a long time and didn't yield any results, so whilst we think that's a great model, we found a great solution here economically to deliver the same solution to a city but without that city taking on any burden, and that is the case in Fullerton. There's no financial burden to the city whatsoever.

Christopher Mitchell: And so, would you say that at this point you've kind of added a new model and you could return to that, you know, as you build up Fullerton, if a city is saying, no, we'd be open to taking on some risks, that's still a possibility for working with you in the future?

Ben Bawtree-Jobson: I wouldn't close the door. I'd say it would have to be a compelling opportunity to, to go down that path again. I think we learned a lot of lessons about thinking the opportunities were there from the various governmental leaders and authorities and then, you know, investing a lot of our time, energy, and efforts into it and unfortunately not getting to an end result despite the project having fantastic merit. So I think if we were approached by a city that is wanting to go down that route, we'd be very open to having a discussion and sharing lessons learned with them, and if those lessons learned, you know, mean that they're still very eager to push forward and go down that route, then we would be open to looking at it. But I wouldn't say it's our first priority. We're not going out there at the moment seeking those opportunities, but if they come our way we're happy to have those discussions.

Christopher Mitchell: That makes sense. You know, you have an interesting area from my perspective, because I'm strongly supportive of open access. I'm also very focused on community ownership, and so I'm always curious when I look at an approach that you're bringing up, because you own the network — I don't know what your contracts with Ting and Gigabit Now are, but I'm curious if in a few years you were to say, you know what, maybe we want to change our business model and just go with one provider, for instance, what kind of a risk is there of that sort of thing happening?

Ben Bawtree-Jobson: In a given city that we go to that that's not really possible. So for Fullerton, that won't be happening due to the nature of our agreements. When we go to other cities, it's really an economic exercise of what makes sense in that city. You know, you go to a city of a certain size, it's hard to get a great ISP, like a Gigabit Now, like a Ting, to engage in that if there aren't enough subscribers available in that market to actually make it worth their investment. While we deploy the capital, you know, they still need to be deploying all the various operational needs for marketing sales in that community. We still bear bear the burden of all the maintenance and etc. of the infrastructure on SiFi's side, but it's still a big commitment into a community for an ISP when they think about, you know, the marketing and sales activities they have to deploy. So some of it's an economies of scale argument. From a philosophical standpoint, myself personally, I believe that the prior model that we had, you know, the PPP model for municipalities was probably the best for the resident. It brought down cost of capital — cost of money is cheaper with a municipal underwrite — and ultimate ownership possibilities that there were in the types of agreements and deals that we had probably led to ultimately the best solution for the end customer in the long run. But unfortunately [there were] too many political barriers in the way to getting those projects off the ground. And I'd say this is probably, I believe, the very next best alternative, where you can have a fully privately funded network and still have the three layer model and still have competition on the network.

Christopher Mitchell: So can you tell us anything about any other projects you're working on? Any other communities that we should know about?

Ben Bawtree-Jobson: I can't go into too many details that aren't already in the public domain, but you know, we're heavily active in East Hartford in Connecticut. We're very active in Saratoga Springs, New York, and also in Salem, Massachusetts, where in those three cities we've won RFPs for broadband development agreements, and some of them have smart city components on day one, where we will be providing connectivity for smart city applications from day one on those networks. And you know, they're not in build out stage yet, but stay tuned and they shouldn't be too far away. And we're working with, you know, I'd say a few dozen other cities at the moment looking into 2020, so there's no shortage of cities that need this, Chris. I know you know that already.

Christopher Mitchell: That's right.

Ben Bawtree-Jobson: So we do have a bit of almost a waitlist accruing, which is a great situation to be in. But yeah, exciting times, I think, now that we've managed to sort of crack the economic code on, you know, competitive or open access privately funded networks. It's going to be a really interesting next couple of years.

Christopher Mitchell: I guess last question that pops into my head is, I presume that other ISPs could join the network. I'm assuming you're not going to — I mean, 140,000 population. That would be one would be one of the larger municipalities in terms of municipal fiber if it was, and so in my mind, I know that it could support many more ISPs on an open access network.

Ben Bawtree-Jobson: Yeah, I think it's always that dichotomy of finding an attractive proposition for the ISP at the same time as balancing out the economic situation to ensure that there's enough security. So yeah, I agree. On a fully open access basis, Fullerton can definitely handle more ISPs on that network. However, getting the ISP engaged and interested to operate in an open access environment with the same credibility and track record as the likes of Gigabit Now and Ting, that's another story. Yeah, we always have a balancing between those two factions, and what I think will happen is that over the course of the next few years, you'll see two things happen: One, more confidence in this type of model as we build it out, roll it out, and find success, and two, more ISPs getting more confident in not having to own and control all the infrastructure themselves, which has been the way for so long, you know. Regional ISPs still building out the rural networks or suburban networks in their various markets is quite uncommon in the rest of the planet but very common here. And so I think as we get to scale and then we have more cities that are good working base cases for ISPs to join, then hopefully there'll be other ISPs that come along and say that they want to be part of the journey.

Christopher Mitchell: I hope so, and I wish you a lot of luck because I've long felt that we won't truly know what's possible with open access — I mean, in terms of we already know that it can lower prices, and that's pretty obvious and not hard to prove. But it'll be curious to see what happens with innovation when we have one million, five million customers on open access networks and we see what comes next. So I really appreciate your contribution to that cause.

Ben Bawtree-Jobson: Yeah, well five million's not a bad target to get to.

Christopher Mitchell: Yes.

Ben Bawtree-Jobson: If we could get there alone, we'd be elated.

Christopher Mitchell: I'll bet. Well, thank you for your time today.

Ben Bawtree-Jobson: Thanks a lot, Chris. It's been great.

Lisa Gonzalez: That was Ben Bawtree-Jobson sharing more about the plan to develop a fiber optic network in Fullerton, California. We have transcripts for this and other podcasts available at muninetworks.orgs/broadbandbits. Email us at podcast@muninetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is @communitynets. Follow muninetworks.org stories on Twitter. The handle is @muninetworks. Subscribe to this podcast and the other podcasts from ILSR, Building Local Power and the Local Energy Rules podcast. You can access them wherever you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter at ilsr.org. While you're there, please take a moment to donate. Your support in any amount helps keep us going. Thank you to Arne Huseby for the song Warm Duck Shuffle, licensed through Creative Commons, and thank you for listening to episode 360 of the Community Broadband Bits podcast.

Tags: transcript

Big Things Happening in Clarksville, Arkansas: Gigabit FTTH on the Way

muninetworks.org - June 10, 2019

Clarksville, Arkansas, began their journey toward better local connectivity like many other communities we’ve interview and written about: by first focusing on fiber as a tool to enhance electric utility efficiencies. Four years after making the choice to deploy fiber, the town has chosen to use that fiber to offer Internet access to the community. Gigabit connectivity is on the way to every premise in Clarksville.

Kicking it Off

On June 1st, about 400 people gathered for an event to celebrate three achievements for Clarksville: a new high school campus, re-branding of the municipal utilities, and a fiber splicing to kick-off their upcoming citywide Fiber-to-the-Home (FTTH) deployment. They enjoyed free food, tours of the new facility, and learned more about the new infrastructure that will bring fast, affordable, reliable connectivity to residents and businesses. John Lester, General Manager of Clarksville Connected Utilities, told us about the event and the new project.

Re-branding 

As CCU has worked to update connectivity for the town of around 10,000, Lester and other leaders at the utility have recognized that it's also time for a re-branding. After more than 100 years, the Clarksville Light & Water municipal utility retired “The Waterdrip Guy” and adopted a new name and a new logo. In order to reflect the city’s transition to a more forward thinking and competitive attitude, they transitioned to Clarksville Connected Utilities (CCU); the utility Commission approved the change in March. Their new logo uses the utility locate colors. 

From Light to Light-Speed

In 2017, we reported on Clarksville’s investigation into the possibility of deploying fiber for SCADA operations and how they kept their eye on future uses as part of the decision making process. When determining how best to use the fiber and its extra capacity, city leaders decided to allocate 12 strands each for different specific sectors in the community. They determined that 48 strands would be enough for the electric utility’s needs and chose to allocate 12 strands each for educational facilities, healthcare institutions, public safety needs, and government facilities. Almost 200 strands were allocated for future uses.

Pilot Project and Beta Customers

It was about two years ago that the city’s municipal network began to connect the Clarksville Public Schools with a 10 gigabit wide area network (WAN) and 1 gigabit Internet access. The school also gained access to the city utilities’ network operations center for the location of back up servers. “We’ve got our own ‘Clarksville Cloud,’ so to speak,” says Lester.

Soon after, CCU established themselves as an Internet access provider and have connected approximately a dozen local businesses and organizations. CCU served several of their beta customers for more than a year, taking advantage of the opportunity to work through any problems. In addition to the school district, they’ve served the regional medical center, and Johnson County facilities. Retail beta customers have included the local cinema, law offices, retail shops, and the University of the Ozarks. We shared the story of 25 new positions that started in Clarksville through a partnership between the network and the Clarksville Regional Economic Development Organization. CCU also leased dark fiber for the County Assessor, and established point-to-point wireless for at least one local business.

The utility has engaged in two surveys in order to help determine if a FTTH venture would obtain adequate support in Clarksville. Speed and reliability came in as the top issues that concerned respondents. CCU asked questions such as the importance of bundling, how many households were cord cutters, and how many already streamed or if they were even able to do so with current Internet access. CCU wanted to know what factors might compel potential subscribers to switch from their current ISP to a municipal network. They discovered that people in Clarksville want speed, reliability, reasonable prices, in-home Wi-Fi at no extra charge, and local service. Around 65 percent of those who answered the survey said they’d switch in order to subscribe to a local ISP and almost 50 percent said that they wanted CCU to contact them regarding Internet access from the utility.

Deciding to Do It Themselves (Mostly)

At one point in the process, CCU considered working as a wholesale provider and working with a retail ISP which would offer Internet access to the community via publicly owned infrastructure. Upon closer examination, CCU determined that a wholesale approach wouldn't be financially favorable to the community. They anticipated rates would be higher and working with a private provider would add a layer of complexity that CCU leadership felt would not benefit the vision they had for the network.

In order to offer VoIP services, however, Clarksville wanted to work with a company that has experience and selected Pinnacle Telecom of Fort Smith. Residential customers and small businesses will interface with CCU, but larger businesses that need more complicated voice solutions will work directly with Pinnacle.

CCU came to the decision to operate as an Internet access provider after extensive study and deliberation. After a business case study with CCG Consulting, a complete design with Finley Engineering, and careful scrutiny of both, they better understood some important questions that needed to be addressed before moving ahead.

First, the utility needed to determine whether or not they should offer video as part of the service they planned to offer. Increasingly, communities that are investing in fiber optic networks are opting not to invest in the equipment and processes necessary to provide video to subscribers. With so many options available to stream, cable TV is losing popularity. Clarksville won’t be offering video as part of their services and will instead provide information and resources to subscribers that will help them discover new streaming options. CCU might offer workshops on streaming and promotions that offer free streaming devices as marketing tools.

Second, how fast would Clarksville deploy the infrastructure? CCU and the city decided that deployment should happen quickly. Altice had acquired Suddenlink, the incumbent cable Internet access provider, and CCU wanted to be prepared in case Altice might try to deploy faster than CCU in order to snatch up subscribers. The city decided on a two-year deployment strategy.

The Big Bonding Unknown

In order to deploy the network in two years, Clarksville needed to be able to issue revenue bonds to finance the project, which when complete will cost approximately $10 million. Before moving forward, CCU needed to resolve the uncertainty surrounding their legal authority to bond ito develop broadband infrastructure. In Arkansas, communities with electric utilities can offer telecommunications services, but the law has been unclear on the ability for those same communities on bonding.

The city issued an RFQ for a law firm with knowledge of the matter in order to find a legal opinion. They ultimately hired a firm that had taken on a former Windstream counsel who was able to contribute to the analysis so the firm’s bond attorneys could render an expert opinion. Attorneys favored Clarksville’s authority to bond for fiber optic infrastructure.

This past legislative session, restrictions in Arkansas eased somewhat when lawmakers made changes to allow local communities to apply for federal grants. In another positive development, the state legislature clarified state law so municipalities can bond to finance broadband infrastructure. SB 471 passed and was adopted into law in April.

Read the bill, which was part of a larger piece of legislation, here.

At the end of April, Clarksville issued revenue bonds for a 15 year term. The issue included $7.5 million for the fiber project and included additional funding for equipment they need for their smart grid project, and equipment for the water treatment plant. 

The utility plans to bring FTTH to every premise within the city limits and fixed wireless to other locations that are outside the city and more difficult to reach. Most households outside of the city have no options other than satellite.

Setting Rates, Growing Interest

In January 2019, Lester felt confident that the project would move forward and on the CCU Facebook page he encouraged residents to go to the website and register their interest — within seven days, 300 people had signed up; since then, an additional 200 have registered. With a strong early interest, finances lined up, and support from the CCU Commission Board, Lester feels Clarksville is moving in the right direction. 

The utility has decided to use crowd fiber to determine in what order of progression they will build in the community’s fourteen deployment areas. By focusing first on areas where they know people are interested in taking service, CCU can expect more revenue sooner and word of mouth to help spread the news about the service.

Rates for various tiers of service still need to be approved, but the utility plans to offer symmetrical gigabit access with no data caps for around $89.95 per month. There will also be a symmetrical 100 Megabits per second (Mbps) option for approximately $44.95 per month and possibly two other speed tiers in between.

The city will offer a range of services for businesses, including the ability to order service at symmetrical 500 Mbps that bursts to gigabit capacity for around $300 per month. CCU will offer eight tiers to commercial subscribers, including several lower priced options in for small businesses, such as a symmetrical 100 Mbps at $59 per month. Larger entities can get dedicated connections up to 2 gigabits. No data caps apply and there will be no connection fees.

Learn more about the project at the Clarksville Connected Utilities FTTH Information page.

Using Light for More Than Connectivity

Clarksville is also in the process of building its second solar power plant, which will make it the first city in the state where its city asset needs are met with 100 percent renewable solar energy. The solar projects and the broadband network are both designed to help attract new businesses and reduce costs for folks in Clarksville. In a recent Arkansas Business article, Lester commented:

"The effort is designed to position Clarksville as a town with the quality of life of a small town, but one that can think and do big things," Lester said. The original [solar] plant was expected to "save our customers approximately $500,000 annually while growing our existing renewable generation supply portfolio."

Construction on the fiber network should start in July and Lester anticipates that the first subscribers will be online in October.

Lester shared some photos of the June 1st event to celebrate the new high school, re-branding, and fiber splicing:

Image credit Clarksville Chamber of Commerce.

SB 471Tags: clarksville arArkansasFTTHgigabitmunilegislationscadaelectric

Community Broadband Media Roundup - June 10

muninetworks.org - June 10, 2019

California

Council votes to pursue study of municipal broadband by Anne Ternus-Bellamy, Davis Enterprise

 

Colorado 

Loveland council approves agreements, contracts for municipal broadband by Julia Rentsch, Loveland Reporter-Herald

 

Idaho

If your broadband bill is too high consider moving to Idaho, they get the Internet for free by Kieren McCarthy, The Register

In short, the value of municipal networks has been reflected, yet again, in the real world with real services. In Ammon, Idaho fast Internet access comes at half the price, with no restrictions and no lock-in to cable giants. 

 

Kentucky

"Without that you can't thrive and you can't succeed"; Broadband key to Appalachian growth, WYMT 

 

Maine

Minot board OKs study on broadband service by Eriks Petersons, Sun Journal 

 

Michigan

City hires new director to help close Detroit’s digital divide by Patreice A. Massey, Michigan Chronicle

 

Minnesota

How Klobuchar, Stearns County and the Legislature want to improve Internet access by Nora G. Hertel, Saint Cloud Times

 

New York

Municipal Internet? Dryden could be the first in New York by Matt Butler, Ithaca Times

 

Pennsylvania

ISPs tell FCC Pennsylvania is covered; Researchers disagree by Beth Brelje, Reading Eagle 

 

Texas

Best Internet service in Texas? It might be in tiny Mont Belvieu by Dwight Silverman, Houston Chronicle

Watkins said MB Link has “blown out of the water” the city’s original projections. They expected to have 400 households signed up in the first year, but as the 1-year mark in June nears there are more than 1,200. They anticipated 60 percent penetration in three years, and MB Link is already at that point.

 

Vermont

A new strategy for rural broadband by Laura Sibilia, The Commons

 

Virginia

Broadband expansion of $7.9M in rural Virginia includes Bedford, Campbell, Appomattox counties by Rachael Smith, The News and Advance

 

Wyoming

A good broadband network is key to Wyoming's economy. So why is it taking so long to build? By Nick Reynolds, Casper Star Tribune 

 

General

FCC proposes capping fund used to close the digital divide, Benton Foundation 

Summary conclusions for designing an FCC broadband grant by Doug Dawson, POTs and PANs

Digital gap between rural and nonrural America persists by Andrew Perrin, PEW Research Center

FCC broadband report: What broadband competition problem? By Karl Bode, Techdirt

FCC under fire for considering major change to federal funding for school technology by Sara Friedman, The Journal 

State’s role in broadband grants by Doug Dawson, POTs and PANs

New study explores cost of fiber deployment in rural areas, Fiber Broadband Association 

Study: Broadband reduces unemployment, especially in rural areas by Carl Weinschenk, Telecompetitor

Apartment renter broadband study: Almost half would pay higher rent to get fiber by Phil Britt, Telecompetitor

Ripping Huawei out of US networks could be a nightmare for rural providers by Colin Lecher, The Verge

Rural Telecommunications Congress launches webcast series focusing on rural broadband innovation by Drew Clark, Broadband Breakfast 

Better broadband lowers unemployment rates, study says by Karl Bode, VICE 

Electric cooperatives and precision agriculture: Addressing the digital divide in the U.S. by Eric Oeth, PrecisionAg 

 

Tags: media roundup

Transcript: Community Broadband Bits Episode 359

muninetworks.org - June 7, 2019

This is the transcript for episode 359 of the Community Broadband Bits podcast. In this episode, Christopher interviews Travis Carter, CEO of US Internet, about his plans to bring fiber optic connectivity to every home and business in Minneapolis. Listen to the interview, or read the transcript below.

 

 

Travis Carter: There's a lot of houses and a lot of blocks and a lot of people that want service, and it just takes time. And it also takes a lot of money. It's the balance.

Lisa Gonzalez: Welcome to episode 359 of the Community Broadband Bits podcast from the Institute for Local Self-Reliance. I'm Lisa Gonzalez. This week we have a return guest on the show, Travis Carter, CEO of US Internet. The company, a local Internet service provider, has been deploying their fiber network in Minneapolis for several years now, and Travis is here to talk about the process. He explains what it's like to coordinate with city officials and talks in depth about the actual process involved in obtaining the necessary permits and permissions to build a fiber optic network in a metropolitan area. He talks about the learning curve for both the company and city officials and explains the business decisions US Internet has made in order to continue their expansion. Travis also addresses some of the practical matters related to customer service and hiring and shares some personal experiences. Before we get to the interview with Travis however, we want to bring a special message from a former guest about an upcoming event.

Ron Placone: Hey everybody. Ron Placone here. Myself along with Fight for the Future, are holding an epic livestream for net neutrality on June 11th. June 11th marks one year since the FCC repealed net neutrality. Without net neutrality protections, the Internet as we know it and all the shows and podcasts that everybody loves could cease to exist. Well, we're here to tell the FCC and Congress that we demand net neutrality. Join us at epiclivestream.com on June 11th to take our Internet back. That's epiclivestream.com

Lisa Gonzalez: Thanks Ron, and now onto the interview with Travis Carter from US Internet.

Christopher Mitchell: Welcome to another episode of the Community Broadband Bits podcast.

Travis Carter: There you go.

Christopher Mitchell: I'm Chris Mitchell with the Institute for Local Self-Reliance, and I'm standing — sitting next to Travis Carter, the man who gets me to do those introductions in such a lively manner.

Travis Carter: I love them. Well done, sir. Well done.

Christopher Mitchell: Welcome back.

Travis Carter: Thank you. Hey, this is the third time.

Christopher Mitchell: Yes, and I think we're gonna have at least one more as I try to tackle you in the field to learn some of these processes.

Travis Carter: Wonderful. Let's do it.

Christopher Mitchell: You know, the introduction actually follows the exact same intonation as, I think it's the "Leroy Jenkins" —

Travis Carter: Oh, World of Warcraft. There you go.

Christopher Mitchell: — the famous video.

Travis Carter: The classic — wow.

Christopher Mitchell: If you listen to how I do the intro, it's actually pretty similar to —

Travis Carter: Which if you're real nerd, they're re-releasing this fall by the way.

Christopher Mitchell: Oh really?

Travis Carter: So if you'd like to rerun that, you're welcome to.

Christopher Mitchell: I remember the first time I saw that clip and I fell in love.

Travis Carter: Oh yes, my youth. World of Warcraft, it was such a great game.

Christopher Mitchell: So for people who didn't hear your other two appearances, who are you and what do you do?

Travis Carter: My name is Travis Carter. I'm the recently nominated CEO of US Internet, and we are a Minneapolis-based Internet service provider, the last of the 175 of us that started in 1995. Over the years, as a lot of people know that understand the industry, the technologies have shifted. We've been through a wireless iteration. We've been through various telecommunications-type technologies: DSL and frame relay, et cetera, et cetera. And for the last nine years, we've been rolling out fiber in the south side of Minneapolis to the residents and businesses and multidwelling units. This is actually, yes, our ninth season of actually deploying fiber in the city of Minneapolis, and we're starting to get a pretty good size footprint out there.

Christopher Mitchell: I'd say. Yeah. I think you told me before — is it 65 - 75,000 houses?

Travis Carter: Yeah, I think we're just past our 75,000th home we've passed, and again, I don't like to emphasize that it's just homes. It's whatever we pass: businesses, schools, apartments, et cetera.

Christopher Mitchell: Right. You recently had a pretty sizable and recurring attack, a denial of service attack, on your network.

Travis Carter: Which is what I thought it was on a Sunday night at eight o'clock central time. Because I'm not a big TV watcher, I was assuming there was something malicious happening on the Internet, but after some analysis we determined there was a show called Game of Thrones and it was the final season. Now, to put it in perspective, we usually go through the Superbowl and the Final Four and all of these very highly streamed you know, episodes that go on, but they dwarfed in comparison to Game of Thrones. That is the single largest streaming consumption that we've seen since the inception of the company. It was unbelievable.

Christopher Mitchell: And that was the first day, right?

Travis Carter: It was season eight, episode one, and then it continued on up until this last Sunday when the finale happened. So I'm assuming next Sunday will be relatively normal.

Christopher Mitchell: Right. Do you know what's the biggest peak? The first episode or the last episode or somewhere in between?

Travis Carter: Almost all the same. You know, I think we were pushing somewhere in the neighborhood of 30 - 35 gigabit of just Game of Thrones. It just boggles my mind if you think about it from a national level or even an international level, how much consumption was happening just to show this one television show.

Christopher Mitchell: Yeah, how much electricity did it take to move it out there?

Travis Carter: I suppose I should probably watch it now, if that many people are.

Christopher Mitchell: Well, it depends. There's some people who found the ending sufficiently unbelievable or not fun. I myself also haven't seen it. I pick and choose a little bit and I hadn't gotten into that because in part it'd have to be amazing for me to dedicate that amount of time to it.

Travis Carter: Yeah. Yeah. Well, and then the first thing I didn't know is they're 90 minutes long, so we had effectively this 90 minute denial of service attack happening. But luckily because it's a fiber-based network, it really had zero impact on it. It was just the new high, and we hadn't seen anything like that in the past. So at least we now know we can handle Game of Thrones.

Christopher Mitchell: And even like five, seven years ago, people would be talking about how that could bankrupt you because of the transit costs, your costs of getting that content. How much did it cost you for those 30 to 35 gigabits?

Travis Carter: The little secret in our industry: almost nothing.

Christopher Mitchell: Right.

Travis Carter: Yeah, the fiber's there. That's hooked up to people's homes. It's hooked up to the, you know, content delivery networks — in this case, Akamai. So we effectively went from a computer in our data center to all of these homes. There wasn't Internet per se; it was delivering locally. So a little bit of electricity and that was about it.

Christopher Mitchell: Right. Now, tell me about your goal for Minneapolis.

Travis Carter: So the ultimate goal, which I hope to realize here in the next five years, is to have Minneapolis be the first NFL-size city that'll be fully 100 percent covered with fiber optic connectivity in every square inch of the city. Now, if you look at a map of Minneapolis, the vast majority of Minneapolis is actually what we call the south side, the south side of Minneapolis, and we're about three quarters done at the end of this season. And so we'll continue through finishing south Minneapolis. Then, we'll make our way up to north and northeast, which geographically are smaller so it won't take us as long to cover. And then, we will have the entire city complete. Now there will always be little pockets and roads and things that may be stragglers, predominantly the downtown corridor. They don't really like you digging up — they being the city — digging up streets that they just remodeled a year ago, so we might have to wait five, six years to be able to get in there. But in the interim, we're going to get all the neighborhoods and the vast majority done and then continue to expand out from there.

Christopher Mitchell: I told you I was just on Hennepin for a comedian and I saw orange conduit on Hennepin. Is that for you?

Travis Carter: Yup. That's us. Yeah. As the city is resurfacing and redoing the main corridors, we're getting our conduit in at that time. So down Hennepin Avenue in Minneapolis, we're about halfway down this year, we'll finish it up next year, and then we'll have a complete fiber conduit through the downtown corridor on that street, coinciding with the street that's being remodeled.

Christopher Mitchell: And then also right around there — I think it might be ninth, I'm not sure. Maybe eighth — one of them is just totally gone, and so you're getting in there as well.

Travis Carter: You've got it. Yeah, it's really key and it's something we learned along the way, is if you get plugged into the streets department, especially in these downtown hard surface areas, you can get in alongside them. It's a couple of years in the making, but you can definitely get in there and make it happen.

Christopher Mitchell: And so how does that work? I mean, is it just like they tell you like, okay, you've got this week in May where you can do it, or how does it — ?

Travis Carter: Yeah, they give you a time slot to get in, and so you need to be very coordinated. You need to have all your parts and pieces. You get in there, you do the construction, and you get out, and then you let the next sub contractor go in. So think of it like layers of the cake. You know, we'll go in from a network standpoint, then the water/sewer guy, you know, da da da da da, till ultimately they overlay the road and the sidewalks.

Christopher Mitchell: And talking about Minneapolis, I understand you recently got a — it's almost like a superpower.

Travis Carter: Yeah. I didn't even really honestly appreciate this when I discovered it, and I didn't even understand that apparently cities have this concept that they put out. I don't know if this is a federal or a local thing, but at least for Minneapolis they have this 20 year plan, which Minneapolis, you know, I thought was pretty original, called it Minneapolis 2040, right. So, okay. Yeah, I just happened to be perusing through there and I happened to look in the technology section, and deep buried in the technology section was a line in there that said that one of the charters of this 2040 plan was to enable fiber optic connectivity for every citizen in Minneapolis. I thought, oh, that's cool. That's us, right? Yeah, that must be us because as far as I know the incumbents aren't doing it anymore. And so I'm like, oh that's cool we're in there, and I just kind of forgot about it. Well fast forward, I was at a city meeting with the — I like to go down there every year to give them an idea of where we're going to be working and meet all the people, and I just happened to mention that we were in this 2040 plan and you could literally see on their face like, "Oh really?"

Christopher Mitchell: You're a celebrity now.

Travis Carter: I didn't even — they were like, oh well that kinda sorta changes everything. And it's really — I don't want to say it's like this ultimate power, but we're now part of the plan and when you're a part of the plan for a city, that's kind of the recipe for what's going to happen over the next — So it's really helped us navigate some of these more challenging projects. I always just say, "Hey, we're in the plan," and things seem to happen.

Christopher Mitchell: Right, yeah. "I don't know if you knew, but we're in the plan.'

Travis Carter: We're in the plan. Yeah, yeah.

Christopher Mitchell: You've got that going for you.

Travis Carter: What do you want me to tell them? We're in the plan, I mean . . . I didn't even ask to be in the plan. I don't even know how we got in there, but we're in the plan.

Christopher Mitchell: I think there's some sense — a lot of people, and I would even say myself, don't really know how you have to interface with the city. But one of the things that you and I have talked about, if I remember correctly, is that, you know, you have this active ethernet network approach, or an ethernet network, and so you need to have these different buildings — not a lot of them, but a few of them in the city of Minneapolis, some point the city of Saint Paul, perhaps

Travis Carter: We'll see.

Christopher Mitchell: My city. But where you're doing that then, you are in a central location for several neighborhoods and you have all of your fiber coming in there and you deal with that. That's your local office, central office, right?

Travis Carter: Correct. Yeah.

Christopher Mitchell: And so to get that permitted, you have to build a building or something like that, and you have to tell the city what you're going to do. And you tell the city, I need this building to do x, y, and z, and they look at you like you're talking in a different language, I'm guessing, because the zoning has an anticipated this kind of a building.

Travis Carter: Yeah. So the city has kind of these standard templates for types of buildings. If you wanted to build a gas station or a restaurant or, you know, the normal things that we see every day, there is a process for that. Then they have what they call the exceptional use case. And our model is very similar — it's actually identical to the way that the original phone companies, Ma Bell put their networks in. They would build a building in the neighborhood, and they would run their copper cables out to everyone's home. Well we're doing effectively the same thing. We're putting a building somewhere in the neighborhood, and then we're running our fiber cables out to everyone's home and business. So what happens is, when you need to build this building, you need to apply for a conditional use permit to go into the neighborhood. So now you fall into a whole separate process, okay? And the process is fairly well defined, but if you'd never been through the process before, it could seem very cumbersome. And I understand the city's point; you know, they don't want people building random this or that. So you go down, and you have your architect drop your plans, and you have all of your studies and your surveys done, and you take it down to the city, you have a neighborhood meeting, and you just go through what it's going to be. And six months later, you will get a stamp that says approved, and then from there you build your central office and then you operate it. First time we went through it, I was pulling my hair out because I didn't understand the process.

Christopher Mitchell: You did a pretty good job.

Travis Carter: Well yeah, not much left. This last time — well, luckily there's a guy that works for me that did most of it, but anyways, you know, it was a more — we kind of knew what to expect. And I think when you're building these kinds of networks, it's fear of the unknown. You know, you don't know how to navigate the city, you don't know how to navigate the permitting department, et cetera, et cetera. But once you figure that out, it's a fairly regimented and standardized process. For everything you do in the city you got a permit. You just got to get used to that, and there's a permit and there's a timeline and there's a cost associated with that.

Christopher Mitchell: There was someone at a conference I was at this year who actually, in regard to Right-of-Way processes — more for wireless for 5G, but but would be useful for this as well — who suggested that cities should have a one or two page document that just says if you want to do this, here's how you go about it, here are the steps that you have to go through. Because I think a lot of this stuff you had to just sort of figure out, right? I mean, there was no place where you could sort of prepare yourself: okay, I'm going to do one, two, three, four, five, six, seven. I think you probably had a sense I'm going to do one, two and three and see what happens next.

Travis Carter: The other thing you have to realize from the city's standpoint is in some of these neighborhoods we've been in, this public Right-of-Way hasn't been disturbed since the sewer and water lines were put in. Again, going back to the building, there's not this reoccurring process. So what I think the city does really well is if you want to apply for this license or that license that they do every day, there's a process, but when you go down to, like, the city and say, "Hey, I would like to install fiber optic cables in the public Right-of-Way deep in the neighborhoods," you got to kind of work with them to determine, you know, the process and how to do the permits and the costs and you know, all this stuff. But once you get that momentum going, it's pretty straight forward actually,

Christopher Mitchell: Or, once you get in the plan, right? I mean, coming back to the beginning of this is that if you can go in there and say, "Hey, I want to do this thing, and it's a part of the comprehensive plan," you get a different reaction from those people.

Travis Carter: It certainly does help, but if you're starting out kind of greenfield — right, we're going to go into Saint Paul. We're not in the plan. We've never worked with the city before.

Christopher Mitchell: You've heard rumors that they're difficult to work with because I keep telling you that.

Travis Carter: Yeah, no one's ever mentioned that they wanted us to even be there. You just have to kind of start working through the process. How do we permit? Here's the permit process that works in Minneapolis. You know, here's what we've experienced before. Find a champion at the city to help work this through. And it can be very frustrating and take a lot of time, but I think ultimately you get there.

Christopher Mitchell: So let's talk about one of the more fun things you get to do. In fact, you probably didn't have a chance to do this before. You raised your prices.

Travis Carter: We have this balance between the debt load we're taking, our costs to hiring people and insurance, et cetera, and then being able to fully cover a city. We've learned over the years, there's certain areas of the city that our uptake is going to be higher than others.

Christopher Mitchell: Right. So like, let's just fill in a little bit of background for people again who aren't familiar. You already have services available across the entire city.

Travis Carter: Yes.

Christopher Mitchell: And so you built this wireless network, and you have a sense of where more people wanted it than other people in other parts of the city. So you have a sense of — absent even looking at any other data, you simply know how many people have come to you from how many city blocks and where to sign up for broadband.

Travis Carter: Correct. There's a desire for broadband. So we know where those pockets were, and so we were able to put our fiber facility down there first, A, because it resolved the contention of our wireless network — if you take a wireless node and you hook it up to fiber, you've got capacity — and then we also knew where the people that wanted the consumption or wanted the Internet were at. So we've been continuing to move out. Now when we get into some of these areas that the uptake isn't quite as good as it is in other areas, it puts a strain on the financials. So what we had to look at is say, where is that sweet spot between being the cheapest player in town to being the best value in town, which then gave us enough ammunition or enough financial capacity to facilitate our banking requirements so that we could go everywhere. You know, it's a spreadsheet exercise, honestly. And so by doing what I would consider a relatively minor increase, it now gives us enough financial capacity that we can just literally go from east to west or north to south without trying to cherry pick areas that we know we can get the return on.

Christopher Mitchell: And so, another bit of context I think is that you have long offered the greatest value in terms of — I mean your entry price was like $35 a month, right/

Travis Carter: Yup. Yeah, we started out at like $30, then we went to $35 and now we're at $50, and that's where we'll stay.

Christopher Mitchell: And it's worth noting, you like to talk about this a little bit, people seem to like you on Yelp.

Travis Carter: Yeah, well, they either like me or they hate me, you know.

Christopher Mitchell: There's not very many who hate you from what I can tell.

Travis Carter: No, they just — it's usually those — the people that have us or the service is available, five star all day long.

Christopher Mitchell: You were like a 4.7/4.6, right?

Travis Carter: Yeah, 4.7. We dropped to a 4.6.

Christopher Mitchell: Ugh.

Travis Carter: Yeah, well I learned that if you don't give a guy $1.16 credit for his unused days when he canceled he got mad, so we're fixing that. Anyways, so he gave me a one star review after being with us for four years of perfect service. You know, there's just people that are like that, and then you have the people that we're not there yet and they're usually the crabby ones.

Christopher Mitchell: Okay. So actually among your active customers, you're doing better than your rating might suggest because some people are ranking you down because they can't take your service.

Travis Carter: You got it. Or, we have this little thing here in Minnesota as you're well aware of called the weather. You know, the fundamental problem we have is weather. We had a really brutal winter this year. It's been a little slow going here getting ready for spring and summer. And because our fiber facility is all underground and we freeze like an ice cube here, we can really only build six, seven, eight months out of the year, and so we have a lot of variables we're dealing with. And the thing that other people always forget and I challenge people to, is Minneapolis is not a huge city by the mega city standpoints, but go buy a new pair of shoes and try to walk up and down every block. There's a lot of houses and a lot of blocks and a lot of people that want service, and it just takes time. And it also takes a lot of money. It's the balance.

Christopher Mitchell: And so in this case, you decided to raise your rates from $35 at the base to — you increased the speeds that are available. You went to $50. Now if I sign up at $50, what check am I actually gonna write you at the end of the month?

Travis Carter: $50.

Christopher Mitchell: That's so weird.

Travis Carter: Yeah, and it's month to month, so there's none of these games where, here, sign up for 12 months, and then maybe, you know, we'll play the cable company lottery. I have cable at home. I don't know what my bill is every month. I'm always curious to see what it is. It's $50 a month, you get 300 Megabits up and down, which is more than enough for most people, and that's it. And you can cancel at any time, sign up at any time. I try to have this mantra inside the business, which is "be the customer." So, how would you want to be treated, and that's what we try to do.

Christopher Mitchell: Right, and then you also have a gigabit for how much?

Travis Carter: Gigabit's $70, and then we have a 500 Megabit in the middle, which is $60, just because some marketing person told me I had to have three choices. You know, I would literally, at some point in the future, I would love to just be gigabit only. You know, I think it's —

Christopher Mitchell: We talked about that a little bit.

Travis Carter: It's a little bit of an old school kind of marketing thing, you know, to be honest with you. But 300, 500 and a gig, they seem to be the right speeds for the right value, and our adoption rate has never been higher.

Christopher Mitchell: Right. One of the things you mentioned was that you saw very little dropoff from when you are raised the rates.

Travis Carter: Yeah, I think we had 14 people cancel directly due to rates, and I think last count, nine of them signed back up.

Christopher Mitchell: You're still the best deal in town.

Travis Carter: Well, there was that emotional arc. You know, I'm mad at Travis so therefore I'm going to cancel and show him, and then they look at the other two options and go, darn, I better turn it back on because —

Christopher Mitchell: Right, but let's be clear about this. You didn't do it because you're trying to buy your third house in the Caymans or something like that. This is what the spreadsheet tells you had to be done to be able to serve every last premise in Minneapolis.

Travis Carter: Yup. The banks have a very defined box you need to stay in. You know, you've got three metrics that the bank uses to determine your ability to borrow money, and so those three numbers have to be green every quarter. And in order to maintain that status and to continue growing — the thing in our network is if we actually stopped, we would be far more profitable.

Christopher Mitchell: Sure. I can imagine that.

Travis Carter: Than if we continue to expand.

Christopher Mitchell: Right, because I mean if you stop building, you would have almost no expenses.

Travis Carter: Yeah.

Christopher Mitchell: I mean, if you can off the top of your head, I'm curious if you know, if you look at, like, the cost that you have for keeping everyone employed, your customer service people, how does that compare to just the cost you shell out to expand your network every year?

Travis Carter: Oh, I'm just going to it a little bit wing it here, but three quarters of it goes to expanding than it does to actually maintaining and running what we have today. This is the beauty of fiber. We have a wireless group and fiber group, and the wireless guys always have a super complicated, you know, process of getting people connectivity. The fiber guys just plug people in and you never hear from them again, you know, so there is not a lot of ongoing costs to run the fiber network.

Christopher Mitchell: So if you just took a year off, if in 2020 you said that we're not going to expand any more, you could basically Scrooge McDuck it.

Travis Carter: Oh, if this was purely Travis needs to buy a bunch of houses and drive a bunch of cool cars, I wouldn't lay another foot of fiber in the ground. There's enough in the ground that honestly I could live for the rest of my life comfortably.

Christopher Mitchell: Yeah.

Travis Carter: But from a career standpoint, that isn't what we're trying to accomplish. I really want to be the first NFL city. I don't know why. I mean, I just think it's a personal goal of mine.

Christopher Mitchell: It's because you love the football team so much.

Travis Carter: Yeah. We have one, don't we? So it's just, you know, getting service out there and getting people happy. And it's a little bit intoxicating to have the best product in our town, so when you come into a neighborhood, it's like the circus coming to town. You know, everyone's excited about you, and there's a lot of heavy equipment, and we're drilling and we're hooking people up. And you know, at the end of the day, 99 percent of the people are happy.

Christopher Mitchell: Right, and then there's a few people for whom, you know, one or two flowers on the corner property has been disturbed.

Travis Carter: Yes. What I tell my crews is make sure you have a stack of $20 Starbucks gift cards because it's amazing how much that will solve a problem. You know, somebody's petunia got dug up. I apologize for that. We try not to, but a nice latte usually fixes it.

Christopher Mitchell: Sure, I hope they're able to get more than one for $20.

Travis Carter: Well yeah, I don't know. I haven't been there in forever.

Christopher Mitchell: Me as well. So there's actually one thing I just wanted to throw on you, which I know you and I talked about a little bit, and that's that, you know, you put yourself out there when you build a network and some people have been critical. You got a really positive note from someone, and I think it's worth noting that people should do this. If they feel that they're getting really good service from a small company, they should send a note because it touched you.

Travis Carter: Oh, I almost fell out of my chair. You know, I logged into reddit where I usually have my fans and my non-fans, and I had a young lady who had emailed me and said, "Hey, I just wanted to say thank you for your hard work. Because of the facility you brought to me, I was able to graduate college and I've got my degrees in various IT and I'm out looking for my first job." And she just said thank you, and I was trying to find out where the slam was in here. You know, she was just generally thanking us for all of our hard work, and I said, "Hey, can I share it?" And so I sent it to you and a bunch of my other friends like, hey, check this out. After 25 years in the Internet business, we have one person we touched positively. But if they couldn't watch Game of Thrones . . .

Christopher Mitchell: Oh man, it's all over.

Travis Carter: We'd have a mutiny.

Christopher Mitchell: Yeah, I mean, it is amazing how something like that or, you know, if for instance you had an outage when a lot of people were streaming the Superbowl or something like that. I mean, that's one of those things where you could — You know, you talked about your price increase. You lost a few people. You would lose a lot of people the next day, I think.

Travis Carter: We had an issue in the winter where we had some ice freezing that caused us — remember it was really cold here in February.

Christopher Mitchell: I was in North Carolina for that week.

Travis Carter: You're lucky. I was stuck here. But we had some damage that happened on one of the fibers and it took us like a day to, you know, get it fixed. And yeah, we had some real unhappy people during that time. You know, I always go back to this water analogy. When it just works, people just expect it to work. When it doesn't work and you can't take a shower, you can't watch, you know, your stuff or you can't do your work, that's a real problem, and these people are not afraid to voice that sentiment.

Christopher Mitchell: Right, as soon as it's back online, they're emailing.

Travis Carter: Oh yeah, and then a few days later they forget all about it and you know, back off we go. But we really try our best to minimize any sort of service interruptions that we can.

Christopher Mitchell: And so the last thing is, and this is something that you had brought up with me when we were hanging out one time, your hiring practices. And I'm curious about this because I think, you know, this is something that small companies, local governments, lots of different people that are hiring for these kinds of jobs, which don't require a college degree in many cases for outside plant. What are you looking for for someone who's going to be putting conduit in the ground and things like that?

Travis Carter: You know, honestly, I went to college nine days. I don't like to brag, so I'm not a big —

Christopher Mitchell: You're like Doogie Howser. You got done in nine days.

Travis Carter: Yeah, I'm just not really — really honestly, in all the years I've been doing this, I like to sit across from the person and get a feel for who they are. Can they show up to work on time? Can they be reliable to get the task done that we need to get done? More so than what their resume says, I try to hire the person and the personality, and you know, we give people second chances. I have people that work for me that have a fairly jaded past. It's not my issue. As far as I'm concerned, they have taken care of that responsibility, and heck, you know, I wasn't super crazy when I was 18, but I did some things and we all did that. You know, we're 18, 19, 20 years old, and so why should they have to not get a job from me because I really need their help and they need a good paying job. It's a symbiotic relationship. So I don't get too caught up in much of anything other than the fact that I'm just like, hey, I got your back if you got my back. Everyone that works for me is spot on.

Christopher Mitchell: You said some of those hires have been — some of the people who may have had a background that would have caused other people not even to give them an interview, some of them have been your best workers.

Travis Carter: Well, I have a guy that went through a state sponsored program, you know, where he was incarcerated. And I forget the number, but he told me there was like 12,000 people that had gone through this program, and he was the only one who had a job when he got out in the entire history of the program. He's the greatest guy in the world. You know what, he made a mistake. Who am I to judge, right? He's a great guy and he's a hard worker and he's there for us every day. And you know, as far as I'm concerned, he paid his ticket, and now he's back at work. And I've got many examples like that.

Christopher Mitchell: So as far as I know, you're one of a small group of people who have listened to every episode. So when this comes out, are you going to listen to it?

Travis Carter: Oh, I always listened to it, and I always go, that's the way my voice sounds. No, you know, it's my Tuesday morning ritual and —

Christopher Mitchell: Sometimes Wednesday mornings.

Travis Carter: Sometimes Wednesday morning, much to my chagrin, but you know, I will text you and say, "Is there a problem today?"

Christopher Mitchell: Right.

Travis Carter: But no, I do listen to it, and I try to just get the message out there. You know, I think a lot of people are worried about getting into this type of business. I'm not going to lie, it's a lot of work and it's a lot of challenges and there's a lot of things that happen that are outside of your control. But at the end of the day, it's very, very rewarding.

Christopher Mitchell: So actually, that brings up another question for me, which is, you talk about this a lot, the nine days of college. Where did you learn all the financial stuff you need to know? Because you make the case that this is more about financial than anything else.

Travis Carter: Well, I'm really good at pretending, but I've got guys that work for me, my CFO and my financial guy. I mean, it's like watching Michael Jordan and Scottie Pippen play basketball. These guys are unbelievable.

Christopher Mitchell: Well, some of it's rubbed off because you just did back of the envelope stuff.

Travis Carter: I just sit and be quiet and listen. You know, when it's technology or digging in the dirt, I'm there. I've got all the i's dotted and t's crossed, but on this financial stuff — we actually have this joke internally. There's two types of money. There's cash that I'm used to. This is the cash that we can use to buy a hamburger for lunch. And then there's spreadsheet money, and spreadsheet money is what we take down to the bank to get more cash that we can spend. So you just got to find good people that know how to do the spreadsheet money. I'm real good at the cash side of it.

Christopher Mitchell: Great. Thanks for coming in today.

Travis Carter: Thank you so much. It's always fun.

Lisa Gonzalez: That was Travis Carter, CEO of US Internet talking about what it's like to build a fiber optic network in Minneapolis. We have transcripts for this and other podcasts available at muninetworks.org/broadbandbits. Email us at podcast@muninetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is @communitynets Follow muninetworks.org stories on Twitter. The handle is @muninetworks. Subscribe to this podcast and the other podcasts from ILSR, Building Local Power and the Local Energy Rules podcast. You can access them wherever you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter at ilsr.org. While you're there, please take a moment to donate. Your support in any amount keeps us going. Thank you to Arne Huseby for the song Warm Duck Shuffle, licensed through Creative Commons, and thank you for listening to episode 359 of the Community Broadband Bits podcast.

Tags: transcript

Breckenridge Revises Open Access Network Plans, Chooses ALLO as Exclusive Provider

muninetworks.org - June 6, 2019

Up in the Rocky Mountains, the Colorado ski town of Breckenridge has decided to set aside plans to operate its new fiber network as open access, opting instead for a single Internet service provider (ISP).

In May, Breckenridge selected ALLO Communications, a Nebraska-based telecommunications company, as the sole ISP for the town’s planned fiber network, Fiber9600. Town officials had initially planned to run Fiber9600 — named for Breckenridge’s elevation of 9,600 feet above sea level — as an open access network with multiple providers offering services to residents and businesses. However, after interviewing several prospective companies, officials decided to have ALLO be the fiber network’s only provider, at least at first.

Hello ALLO, Goodbye Open Access

Other companies in addition to ALLO responded to a Request for Interest Breckenridge released last fall, but town officials concluded that working with just one provider at the beginning will give Fiber9600 the best likelihood of success and selected ALLO as their preferred partner. Gallagher explained the decision to Summit Daily:

“We realized that if we came out of the box with two of these folks, that neither one of them would probably succeed and we would quite frankly fail delivering service . . . It was more important for us to ensure somebody succeeded with this effort, given the fact that we’re going to spend a lot of money putting in the infrastructure.”

Under the agreement with Breckenridge, ALLO will be Fiber9600’s sole provider and network operator for an initial term of 10 years, which can be extended for up to two additional 10 year terms. If the town ever decides to sell the fiber network, ALLO will also have the right to place the first offer. After ALLO’s lease has ended, Breckenridge could choose to operate the network as open access, but that isn’t guaranteed as part of the agreement.

According to Assistant Town Manager Shannon Haynes, preliminary subscription tiers from ALLO have been set at:

  • 20 Mbps symmetrical - approx. $30/month
  • 300 Mbps symmetrical - approx. $60/month
  • 1 Gbps symmetrical - approx. $90/month

Fiber9600’s Higher Purpose

Breckenridge began its broadband journey in 2016 when town residents voted to opt out of restrictive state law SB 152, which prevents public investment in broadband infrastructure, alongside 25 other Colorado communities. In Breckenridge, 89 percent voted in favor of reclaiming local authority.

A main reason why the town ultimately decided to invest in a fiber network was the lack of competition among existing providers. As in many communities across the country, most residents’ only choices for broadband access were a telephone monopoly or a cable monopoly — CenturyLink and Comcast in Breckenridge’s case. The anemic competition resulted in poor customer service, high prices, and speeds that were lower than promised, especially when the town’s population multiplied during peak season. While an open access approach would have brought even more options to Breckenridge residents and businesses, town officials expect that ALLO’s arrival will still inject some much-needed competition into the local broadband market.

In October 2018, town council approved the first $8 million of project costs, and they are planning to spend no more than $25 million total on the network. At the time, Councilmember Gary Gallagher told Summit Daily:

“We see this as a cornerstone investment for the town for the next 50 years and beyond. Much like previous councils had the foresight to secure water rights and land bank for the future, this fiber backbone enables the town to be proactive towards future developments and ensure that we’re in charge of our technological destiny.”

Construction started last month on phase one of the fiber network. This first phase will deploy 17 miles of fiber in central Breckenridge to serve as a backbone for the rest of the Fiber9600 network. Town officials hope to have some subscribers online by the end of the year.

Public Infrastructure, Private Services

This is not the first time that ALLO has leveraged public infrastructure to connect homes and businesses with high-speed Internet access. In the company’s home state of Nebraska, ALLO partnered with Lincoln to build a citywide fiber network by leasing access to the city’s conduit system.

Similarly, Breckenridge is not the first community that has opted to launch an open access network by partnering with only one ISP. In Westminster, Maryland, for example, city officials decided to make Ting Internet the sole provider on its new fiber network. After an initial period of exclusivity, additional ISPs will be able to offer services via the network, bringing even more choices to city residents.

Learn more about the promises and pitfalls of public-private partnerships by reading our 2016 report, Successful Strategies for Broadband Public-Private Partnerships.

Tags: breckenridgecoloradoopen accessalloFTTH

Vinton, Iowa, Goes Forward with Cedar Falls and ImOn

muninetworks.org - June 5, 2019

Vinton, Iowa, is moving ahead with plans for a Fiber-to-the-Home (FTTH) network. This small town is home to only 5,100, but soon it will have Internet service that rivals the largest cities. Broadband Bytes, the blog of the Community Broadband Action Network, posted that Cedar Falls, Iowa, and ImOn Communications will be key to Vinton’s efforts to build the community network.

Steady Progress Since 2015

Since fall 2015, Vinton voters have been awaiting the results of their broadband vote, and the town has been steadily moving forward on plans to improve Internet access. Slow DSL connections limit businesses and residents, and cable is only available in some areas of the community. In 2017, Vinton began to develop a feasibility study for the project, and by Spring 2018, the town had an estimate of $8.9 million for the cost to connect all 2,100 premises within the 4.74 square miles of the community. 

The project has drawn attention from the Taxpayers Protection Alliance (TPA), a corporate sponsored group that works to spread misinformation about municipal networks. Their questionable methods to attempt to sway community leaders failed, however, and the project is still advancing. The need for broadband is strong in this town. 

Moving Forward: Working with Others and Answering Questions

Building a FTTH network is no small task, but Vinton can look to Cedar Falls for advice. Cedar Falls has been a trailblazer -- it was one of the first cities to develop a municipal network for Internet access. Vinton will be collaborating with Cedar Falls to use the centrally located headend, equipment needed to provide high-quality TV programming over the fiber network. BroadbandBytes reports that ImOn Communications will handle “wholesale telephone switching, internet bandwidth and transport, and wholesale billing services” for Vinton’s new network for the first five years of operation.

After the agreement with ImOn is complete, Vinton Municipal Communications Utility (VMCU) will take over. Vinton will enter into a Chapter 28E Intergovernmental Agreement with Cedar Falls, Waverly Utilities, the City of Bellvue, and Indianola Municipal Utilities to become fifth co-owner of the headend.

The Oelwein Daily Register has also posted video of the Vinton Municipal Electric Utility board discussing the financial plans for the network. These are the questions and discussions that communities engage in as they develop their plans for the future. Watch the discussion below:

 

 

The folks at iVinton are working to get people engaged by encouraging them to sign up for site surveys via the iVinton Facebook page, which suggests construction will start this July:

 

If you want to learn more about Vinton, check out the city’s website or enjoy this clever marketing video Get Active, Get Local from Vinton Unlimited and the Vinton Parks and Recreation Department. It doesn't inclue information about the new broadband project, but it's a fun way to encourage residents to stay healthy while showing off the town's amenities: 

Image courtesy of the Vinton Public Library.

Tags: vintoniowaFTTHcedar fallsvideo

An Inside Perspective on Urban Fiber Deployment: US Internet's Travis Carter - Community Broadband Bits Podcast 359

muninetworks.org - June 4, 2019

We regularly share stories about new fiber optic networks from local communities, cooperatives, and even local independent Internet access companies. Once in a while, we like to get an idea of what practical matters affect deployment and this week, we brought Travis Carter on the show to share his experiences. Travis, CEO of US Internet, has been working within the city of Minneapolis as the company deploys a fiber optic network to serve residents, businesses, and other premises.

Travis explains the way the company has changed and describes what it’s been like to go from an ISP that offered fixed wireless to one that also provides fiber optic in a large city. He offers some firsthand knowledge on the permitting process and shares the lessons he city staff have learned in working with a municipal structure. Travis explains how being part of the city’s long term vision for better connectivity has helped cut through some red tape that used to slow down the process.

In addition to working with the city to deploy their infrastructure, Travis and his colleagues at US Internet need to achieve a balance of revenue and investment that keeps the company growing and viable. Christopher and Travis discuss some of the types of decisions that all private firms make, including customer service, hiring practices, and taking on debt.

Learn more about US Internet in episode 194 and episode 301 of the Community Broadband Bits podcast. 

We want your feedback and suggestions for the show-please e-mail us or leave a comment below.

This show is 40 minutes long and can be played on this page or via iTunes or the tool of your choice using this feed. You can listen to the interview on this page or visit the Community Broadband Bits page.

Read the transcript for this episode.

Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license. 

Tags: US Interneturbanminneapolisminnesotaaudiobroadband bitspodcast

Community Broadband Media Roundup - June 3

muninetworks.org - June 3, 2019

California

Fullerton FiberCity Network will use open access approach by Phil Britt, Telecompetitor

 

Colorado

Loveland launches broadband push by Jessica Benes, Reporter Herald

 

Delaware

Delaware expanding broadband in rural counties by Dani Bozzini, 47ABC

 

Georgia

Georgia unveils plan for Internet service in rural areas by Mark Niesse, The Atlanta Journal-Constitution

“The solution to broadband in the state of Georgia is not a rifle-shot, one-size-fits-all solution,” Nunn said. “It’s a patchwork that involves many different providers working in partnership to address the needs in various parts of the state.”

 

Maine

Towns can soon avoid fee for broadband devices on poles, WABI 5

 

Massachusetts 

Community meeting to address need for municipal broadband, The Falmouth Enterprise

 

Minnesota

2019 MN tribal nation broadband profiles, Blandin Foundation 

 

North Carolina 

Town of Highlands making broadband progress by Jessi Stone, Smoky Mountain News

 

Oregon

Walden bill aims to aid power co-ops, rural broadband, KTVZ

 

General

USTelecom says broadband map problems can be fixed for $10-$12 million by Phil Britt, Telecompetitor

What does the FCC’s Broadband Deployment Report tell us about the digital divide? By John Horrigan, Benton Foundation 

Democrats criticize FCC broadband report by Marguerite Reardon, CNET

"Our statutory mandate is not only to determine whether all Americans currently have access to advanced telecommunications capabilities," he said. "But also whether progress in deploying such services is proceeding at a reasonable and timely pace, and an affirmative response to the latter inquiry is completely consistent with the facts on the ground."

Reactions to the FCC's 2019 Broadband Deployment Report by Robbie McBeath, Benton Foundation 

FCC: Broadband deployment is reasonable, timely...again by John Eggerton, Multichannel News

Net neutrality legislation: A framework for consensus, Internet Society

Who should be eligible for broadband grants? By Doug Dawson, POTs and PANs

When I read grant rules one of the first things that is always obvious to me is that the people writing the grant rules don’t understand the wide range of business structures that currently operate broadband networks. There are numerous partnership and other arrangements that differ significantly from the traditional model of a single ISP that owns the network and sells retail products to customers. 

Digital gap between rural and nonrural America persists by Andrew Perrin, PEW

 

Tags: media roundup

Douglas County PUD: Innovation a Must to Serve Both Rural and Urban Regions

muninetworks.org - June 3, 2019

Washington's Douglas County Community Network (DCCN) began as a way to improve the local Public Utility District’s electric system; construction of the network started in the late 1990s. Two decades later, people living in some of the state's smallest communities have access to fast, affordable, reliable connectivity that equals their neighbors in the county's busy cities through the publicly owned fiber network.

Restrictions Didn't Stop Douglas County PUD

Due to Washington state restrictions, the Douglas County Public Utility District (DCPUD) and other PUDs cannot offer telecommunications services directly to the general public; they can only provide wholesale service. In Douglas County, private providers deliver Internet access, voice, and video to subscribers in both rural communities and more densely populated areas. Six different providers offer a range of services via the open access network. The DCPUD also offers other services, including dark fiber, that businesses find useful and has invested in a carrier grade colocation facility in East Wenatchee.

The concept for the DCCN came about when the utility was searching for a way to upgrade their existing microwave system that they used for power control. With microwave, they would only have the ability to connect point A to point B, but with fiber, the DCPUD could connect points between substations. Around this same time, leaders at the DCPUD were learning of the growing interest in excess capacity from municipal electric utility fiber optic networks for broadband. At the time, communities that knew they would not be served by the large corporate ISPs were those investing in fiber infrastructure. 

“That was us,” says DCCN Coordinator Ben Carter. “They were telling us that they weren’t going to roll broadband out … Obviously, the business decision makes itself.” Rather than bringing a new service to a place where the largest population center was only around 12,000 in 2000, corporate Internet access companies were aiming for large cities such as Seattle and Portland.

Instead of installing the microwave upgrade, the DCPUD decided to invest in more versatile fiber and take advantage of the excess capacity for better connectivity. After the DCPUD had started to deploy the network, large corporate cable and telephone companies that already offered Internet access in the region decided to also invest in fiber infrastructure.

Rural Communities First

Large corporate Internet access companies focus on the most densely populated areas to obtain as much revenue as possible with the least amount of investment. The DCPUD began by connecting rural areas first, however, because their mission isn't profit-driven. 

Decision makers at the PUD knew that people living in the most rural areas, such as Waterville and Douglas, were the least served in the county. While they planned to bring the network to more populated places, such as East Wenatchee, residents and businesses living in the cities already had the option to subscribed to cable or DSL. The smallest communities — places with names like Badger Mountain and Bauer’s Landing — depended on expensive and unreliable satellite Internet access. Douglas County PUD knew that that incumbent Internet access providers wouldn’t upgrade services in the rural areas. They decided to serve the least connected areas first because the need was the most critical.

“We weren’t in it to compete with the private [companies],” says DCPUD Public Information Officer Meaghan Vibbert,”These rural communities weren’t going to get that service and so that’s why we decided to serve them first.”

In a few of these communities, households had no Internet access because dial-up connections were so bad they didn’t work. After the PUD deployed the fiber network in the early 2000s, residents and businesses went from nothing to 100 Megabit per second (Mbps) Internet access. “It was light years beyond what you could get anywhere,” says Ben Carter. In the first cluster of rural centers where the Douglas County PUD deployed, the largest community was home to about 700 people, he estimates. Since then, upgrades have brought most of the county up to gigabit symmetrical access.

About ten years ago, the DCCN connected to the network that belongs to the Okanagan County PUD in order to allow physicians and medical staff the ability to hold virtual meetings between Wenatchee and Okanagan clinics. The meetings allowed patients to be treated locally instead of making a 2.5 hour drive between facilities to see the physician they needed for their specific health concerns. For the elderly and others who found the trip difficult, the ability to obtain a consultation with an expert through a local clinic was more than just a time saver.

Seed for the Need

The DCPUD initially applied utility cash reserves toward fiber deployment in order to get the network up and running for both electric system use and broadband. Over the years, they’ve continued to expand the network when extra cash reserves allowed because the infrastructure helped to enhance electric service.

Prior to December 2010, when the telecommunications division became fully self-funded, the DCPUD had spent $27.2 million in seed money to deploy fiber throughout the county. At that time, the network connected almost 1,400 premises out of 8,200 premises passed. Since 2010, the PUD’s telecommunications division has invested another $6.3 million and has now passed 15,500 premises with 4,600 connected to the DCCN fiber network, which has reached about 720 fiber miles.

View a map of current availabilty.

High-Speed for Ag

There are about 42,000 people who live in Douglas County, which covers about 1,900 square miles. Agriculture, retail, and healthcare are some of the biggest sectors of the economy, with farming and related industries employing about twice as many people as retail.

Wheat, apples, and cherries are the main crops and, while there are a few large scale corporate operations doing business in the area, most are family farms that use the DCCN’s fixed wireless service. The PUD has long-term plans to deploy fiber to farms that are located in the far reaches of the county, but wanted to offer some type of service immediately. DCPUD leadership felt it was necessary to bring the farms online as soon as possible with wireless that is supported with the DCCN fiber. About 150 subscribers use the DCCN fixed wireless service.

Minnesota’s RS Fiber Cooperative has taken a similar approach. By deploying fiber in the more densely populated areas first, the organization worked through challenges and gained revenue that they plan to later used toward expansion to areas currently served with fixed wireless. Read more about their approach in our 2016 report RS Fiber: Fertile Fields for New Rural Internet Cooperative.

Farmers in Washington and elsewhere need access to fast, affordable, reliable connectivity that offers symmetrical connections. In addition to checking accurate commodities prices, farmers often face difficulties submitting crop reports if they don’t have a reliable connection with strong upload capacity. As innovations in agriculture advance, farmers are using high-speed connectivity combined with other technology, as in the case of drones, to monitor their crops for better yields. Multiple ISPs offering services on the DCCN offer symmetrical service.

Connecting Public Facilities

Being mostly rural and located in the center of the state, there aren’t many municipal facilities in Douglas County, but the DCCN connects them all. Several of the communities consist of a “county shop” and a small school. In Mansfield, for example, fewer than 100 children attend the K-12 school building, which is considered the heart of the community and is the largest employer. Each rural population cluster has similar locations and all are connected to the DCCN, including the facilities in Waterville, which is the county seat. Even though these rural schools are tiny, they have gigabit connectivity and pay only $54 per month; alternatively, they could pay $27 for 100 Megabit per second (Mbps) connections. About 30 public facilities in Douglas County connect to the DCCN; all public facilities pay the same rate.

Working as A Wholesale Provider

In Washington, PUDs aren’t allowed by law to offer Internet access and can only provide wholesale service, which means the DCPUD works with multiple ISPs. As Carter says, “Their business needs don’t necessarily line up with our needs…” The DCCN has been developed as a service, rather than to make profit, and sometimes the companies that use the infrastructure to offer services request the PUD to make choices that won’t be the best outcome for the DCCN in the long term. 

He thinks, overall, they work well together providing a service with which national Internet access companies struggle to compete at an affordable price. People in the county prefer working with local entities, such as the DCPUD and the companies that offer services via the DCCN. There are currently six companies that provide some type of service on the DCCN. Two offer retail Internet access, one of which is based in Douglas County and one located in Grant County. As is the case in Grant County, where the local PUD also owns and operates a wholesale fiber optic network, one ISP offering retail services has about 90 percent of the subscriptions. You can listen to Christopher interview Russ Brethrower from the Grant County Public Utility District in episode 279 of the Community Broadband Bits Podcast.

Lessons Learned

Innovation is key, says Carter, “Push it.” When the DCPUD began their investment, fiber connectivity was still new. By combining ideas and existing tools, he says, new ideas and tools are born; often, new ideas can also reduce costs.

The DCPUD uses the “Safe Shared Access Ethernet Fiber Method,” which varies from traditional FTTH installation. Traditionally, fiber runs to the house and electronics are placed on or in the house and powered for service. In 2005, a DCPUD engineer suggested putting switches by the transformers, typically mounted on utility poles, and run Cat5 cable to the house, rather than running fiber all the way to the house. At first, Carter didn’t like the idea, but after thinking it over and considering the fact that a significant number of the electronics that were deployed on houses still had not been lit, he thought it was an idea worth exploring. After finessing the equipment and possible designs, and vetting the configuration for a couple of years, the DCPUD adopted the approach.

Carter says the only time the performance of the connection is affected is if two or more households on the same switch have gigabit connectivity and are both running speed tests simultaneously. The DCPUD hasn’t encountered an issue yet, but if they ever do, they have processes in place to add a second switch for any subscriber who wants to be able to make full use of their gigabit at the same time as their neighbor.

As a result, the DCPUD has reduced their fiber plant costs by 75 percent, which includes the amount of fiber and number of ethernet switches and ports. Carter can’t put a dollar figure on the unspent costs, but says, “We saved about 2/3 off of what we were spending previously.” The DCCN is now cash flow positive, which Carter attributes, in part, to their innovative approaches. Focusing on costs is one of the keys that has kept the DCCN going for so long, says Carter.

Working with Microtrenching

The tendency to explore innovative practices also has the DCPUD examining new ways to deploy in the city. Now that most of the rural areas are connected to the DCCN, the DCPUD is deploying in more densely populated areas of the county, such as East Wenatchee where the DCPUD is almost finished passing every premise. Unlike the greenfield construction methods or pole attachment processes that they’ve used in the rural areas, the PUD has adopted a microtrenching approach. With no conduit path within the communities where they need to deploy and a desire to reduce the impact they cause on the existing infrastructure, the DCPUD decided microtrenching was the most affordable, least impactful, and most flexible method to bring the DCCN to the neighborhoods in the cities.

Their first pilot project with microtrenching was not difficult to install, but the material technicians used to restore the surface cracked when the temperature dipped below freezing. Their second attempt ended the same way. After experimenting with filler and patching techniques, and consulting county experts about road surface materials, their third attempt lasted through a cold and snowy winter without problems. Carter is hopeful that they've found the secret sauce for their needs.

Their goal is to finish East Wenatchee and to wire every premise within five to eight years. Expansion, says Carter, is driven by revenue so they haven't developed any firm deadlines.

Check out this video from the DCPUD on microtrenching:

Image of East Wenatchee by Thayne Tuason [CC BY-SA 4.0]

Tags: douglas countywashingtonpudpublic utility districtopen accesselectric

First Ever Dura-Line Technology Summit Digs Into Microtrenching

muninetworks.org - May 31, 2019

Before your community can start bringing better connectivity to municipal facilities, offering dark fiber to businesses or local ISPs, or supplying Internet access to residents, you must develop the infrastructure. In the past couple of years, a growing interest in microtrenching has spawned questions from local communities looking for options to traditional excavation. On May 1st, infrastructure product and system manufacturer and distributor Dura-Line held their first Technology Summit focused exclusively on microtrenching. The Austin, Texas, event attracted 200 professionals interested in learning more.

Special guest speakers included:

  • Dan Urban - Corbel Communications Industries, LLC
  • 
Chris Levendos - Crown Castle
  • Jed Zook - Douglas County PUD (Washington state)
  • Richard Thomas - Mayor of Mt. Vernon, NY

At the event, attendees were able to view a live demonstration of the step-by-step microtrenching process.

 

As Dura-Line notes in their press release, increases in urbanization and the critical need for high-quality connectivity will continue to drive innovation for new deployment strategies. While microtrenching has had mixed results in places such as Louisville, other communities are working through issues and having success. In Washington, the Douglas County Community Network (DCCN) is using the deployment technique and making it pay off, after facing problems related to inclement weather.

Enthusiasm at the event has encouraged Dura-Line to consider planning for a second Summit. Tim Grimsley, Vice President of Global Customer Engagement said:

“We even had several people already asking about next year’s topic and location. Our goal for each Dura-Line Technology Summit is to educate people on the benefits, techniques, and best practices of a focused topic. We look forward to providing this new annual event because ultimately the services we provide as an industry help advance communication around the world.”

Dura-Line released this video after the event, highlighting the microtrenching demonstration:

 

For another short explainer on the microtrenching process, check out this video from the Douglas County Community Network (DCCN). Learn more about how the Douglas County PUD began serving rural and urban areas and how microtrenching has played a key role in their deployment:

Dura-Line Tech Summit Press ReleaseTags: microtrenchingconduiteventinfrastructure

After Decades of Municipal Telephone Service, Small South Dakota City Upgrading to Fiber

muninetworks.org - May 30, 2019

Beresford, South Dakota (pop. 2,000), has a long history of providing for itself. Located in the southeast corner of the state, Beresford operates its own electric utility as well as a municipal liquor store and golf course. For nearly 90 years, the city has also provided communications services to the community with the Beresford Municipal Telephone Company (BMTC), which currently offers DSL connectivity to residents and businesses.

In response to subscriber requests for faster speeds, BMTC recently decided to replace its old copper lines with a fully fiber optic network. The Fiber-to-the-Home (FTTH) upgrade will improve the network’s capacity and reliability, and city officials are optimistic about the potential benefits of better connectivity. “This is really a game changer for us,” said Beresford Mayor Nathan Anderson in a press release announcing the project.

Project Details

Over the next year, BMTC will deploy 70 miles of fiber to replace its current network. The new FTTH network will be capable of gigabit speeds, which over ten times faster than what BMTC can offer now.

“Our copper infrastructure has supported our many services over the years,” explained BMTC General Manager Todd Hansen, “but fiber optic cable improves speed, provides stability and will increase bandwidth.”

City officials believe the new fiber network will help the community grow. “Fiber is really going to help us to recruit and retain people to come, live, work, play and spend in Beresford,” Mayor Anderson said. “It’s potentially going to open new opportunities not just for residents but also for businesses.”

Beresford plans to spend approximately $5 million building the new network. At a March city council meeting, council members decided to commit $2.5 million to the project. The city expects to finance the remaining costs by issuing bonds.

BMTC will start construction on the FTTH upgrade in the fall.

Fiber: Coming to a City Near You

While national broadband monopolies have repeatedly failed to invest in necessary upgrades, community owned broadband networks across the country have been deploying fiber to replace out-of-date copper and cable lines.

In Iowa for example, several cities have decided to upgrade their municipal cable networks to fiber, including Muscatine, Coon Rapids, Spencer, and Harlan. Rural telephone cooperatives, such as 3 Rivers Communications in nearby Montana, are also replacing their old DSL networks in favor of high-quality, reliable fiber.

Tags: beresford sdruralmuniupgradeFTTHsouth dakota

Transcript: Community Broadband Bits Episode 358

muninetworks.org - May 30, 2019

This is episode 358 of the Community Broadband Bits podcast. In this episode, Christopher speaks with two leaders from Centeral Virginia Electric Cooperative about the co-op's new subsidiary, Firefly Fiber Broadband. Listen to the episode, or read the transcript below.

 

 

Melissa Gay: What I've learned along the way is how absolutely satisfying and how gratifying an experience it is to be involved in this, and how our predecessors must have felt in the 30s when they turned those lights on.

Lisa Gonzalez: Welcome to episode 358 of the Community Broadband Bits podcast from the Institute for Local Self-Reliance. I'm Lisa Gonzalez. In early 2018, the Central Virginia Electric Cooperative announced details of their plan to deploy Fiber-to-the-Home to members across their service area. Beginning with the pilot project, they plan to bring high quality Internet access to members in some of the least connected areas of the state. This week, Christopher talks with Gary Wood and Melissa Gay from the co-op. Gary and Melissa describe why CVEC decided to take on the project and what Internet access is like in the region. They discuss the reason why this project makes sense, including the multiple uses for the fiber that will benefit both Internet access subscribers and electric customers. During the conversation, we get to hear about the process that led to the decision to deploy fiber to this region of Virginia, how the cooperative is funding the project, their marketing techniques, and the lessons learned from taking on the Firefly Broadband project. You can learn more about the CVEC project at muninetworks.org and by visiting the cooperatives update page mycvec.com/community/broadband. Now let's learn about the Firefly Broadband project from the Central Virginia Electric Cooperative with Gary Wood and Melissa Gay.

Christopher Mitchell: Welcome to another episode of the Community Broadband Bits podcast. I'm Chris Mitchell with the Institute for Local Self-Reliance up in Minneapolis. Today I'm talking to two people from Virginia who come with very high recommendations from Jon Chambers, a frequent guest. We're gonna introduce you first to Gary Wood, the president and CEO of the Central Virginia Electric Cooperative. Welcome to the show.

Gary Wood: Thank you, Chris. Looking forward to talking today.

Christopher Mitchell: Great. And we also have Melissa Gay, the communications and member services manager for CVEC as well. Welcome back — or welcome to the show, I should say.

Melissa Gay: Thank you.

Christopher Mitchell: So let me start by asking you, Gary — maybe just tell us a little bit about the area. What is central Virginia?

Gary Wood: Central Virginia is a service territory for our electric co-op. It covers the area between Charlottesville and Lynchburg. On the western side of our service area, it borders up along the Blue Ridge mountains. We go up to the Blue Ridge Parkway and the Appalachian Trail and some mountainous areas, and then it runs all the way down to about 30 miles west of Richmond, the capital of Virginia. We have a mix of that mountainous terrain to the west and then some flatlands down to the James River, which is the main river that courses through Virginia, so we have some lower areas along there. It's mostly wooded and farming territory in the rural areas. The places we serve are fairly sparsely populated outside of the cities of Charlottesville and Lynchburg and around a few smaller towns in the rural counties. We touch into about 14 different counties in Virginia, but it's a pretty rustic and rural area. Beautiful place to visit, and I hope some of your listeners will have a chance to come visit us sometime.

Christopher Mitchell: Tell me, Melissa you from the area?

Melissa Gay: I sure am. Born and raised in Amherst County, which is a neighboring county for our headquarters here at Central Virginia Electric Cooperative. We're headquartered in Nelson County.

Christopher Mitchell: Great. And Gary, are you also a native to the area?

Melissa Gay: I am. I grew up about 15 minutes from our headquarters, moved away for a while at college and after college when I was first married, and then found my way back and have been back in the area now for about 30 years. So, it's a very familiar place for me.

Christopher Mitchell: That's great. I mean, it'll inform some of this discussion to know that you have such an attachment to the area, both of you, given that you're taking on a really important task — you know, investment for generations. We'll be talking about the fiber network y'all are building. So, I guess, let me start with you, Melissa and just ask you, you know, where did this idea of a fiber network that your cooperative would run, where did that come from?

Melissa Gay: Well, the cooperative began to explore this for its internal use, for the electric grid use. We need that fiber to improve our security at our substations so we can have video surveillance of those areas. Particularly with cybersecurity concerns on the rise for any utility in the nation, we saw a need for that, and our board of directors certainly has approved and agreed with the need for that as well as the need to improve our reliability. Being able to use reclosers and things that will improve the response time for eliminating outages or closing outages, we know that that will be important. And as everybody is moving into smart TVs and smart thermostats and everything is "smart" these days, we will find that we, the electric company, can work with our members to regulate their energy use and save them money, so that they're not using the thermostat at times when they're not home but it's a peak load for another segment of our member population. And so, we can work to pull that demand back when we need and give it to them when they need. It's a win-win situation. They would save the money and we could regulate our load a little more closely. So it started there. We knew that we would benefit from fiber which would link all of our substations together — a lot of other cooperatives call that a ring — so that you have a continuous loop of fiber all around your system so you can do the surveillance at your substations and link all of your members in. And then of course, the other huge piece of this is our member need. We're looking at our communities where our youth don't have access to the Internet like their peers in larger cities across the nation, and even within our own counties we're seeing the inequality of the availability of broadband from just one side of the county to the other. So those students are in churches and in McDonald's parking lots and go into friends' houses and staying at school later to do their homework, whereas other students are at the comfort of their home and you know, can really settle in and concentrate on their studies. And we see that all the way through the college generation and adults, for people who want to do online business, online courses, work at home. So we know the need is there for our members, and we really are at a deficit and a disadvantage in the rural corners of our service territory, very similar to the 1930s when the bigger utilities didn't want to come and provide that power here in the rural areas. We're finding that it's not a very cost effective model for larger Internet service providers to come into these small pockets and provide the Internet.

Christopher Mitchell: Yeah, we've heard that many times, I think, the same dynamic happening in a lot of different places because, well first of all, it's predictable. Like, a lot of us saw this coming just based on history as you noted from the 30s. Gary, I'm curious if you can tell us a little bit about Internet access across your electric footprint. You know, I definitely get a sense that it's not what you wanted it to be and that's why you're investing significantly, but what is it like in terms of the access? Is there anything or is it just that it's inadequate?

Gary Wood: It's certainly inadequate. There are areas where there are no options whatsoever, but in other areas there's cell phone coverage that can meet some needs. A lot of times that has data caps. The cell phone towers are not throughout the area so sometimes it's hard to get a good signal depending on where your home is. The DSL service from the incumbent telephone companies are only available in a few of the areas around the counties. Where it is available, it's not available very far from their switch and it's not a reliable signal. Where they do have it, it tends to be oversubscribed, so during peak times the speeds are a little slow. We do have satellite availability, but in the mountains here and with the trees — not all of our members want to cut down their trees to get the satellite signal.

Christopher Mitchell: I should say not. I mean, maybe if it was decent.

Gary Wood: That's right. And then the problem if you get it is the data caps on that and the expense, and again, it tends to slow at peak times. I think out of our 38,000 accounts, about 900 of them had access to fiber when we looked at the start of this project, so it's a very limited area that has true high speed. There are a few wireless providers, but in the terrain we have, that's a difficult technology to keep the signal reliable. It has weather problems in addition to the terrain and the trees, and the areas that they have subscriptions, they tend to oversubscribe also and be a little slower at peak times. This has been a problem for a while. Our co-op goes back — 1997, even in dial up days, we didn't have local dial up options here when that was the technology that was used to be online, and our co-op started a dial up Internet service and ran it for a number of years until a few other options came around. And we tried broadband over power line for a while because speeds had moved up a little bit beyond dial up and no one had any options. We tried a third party with that for a while. We've tried reaching out to other folks to ask incumbent providers if they would move on to our lines, whether it's a cable provider in the area or a telephone provider, and offered to allow them to attach to our poles without charging them annual fees if they would just provide service to everybody. And we haven't found any takers because it's tough to make the numbers work for a lot of those folks to give them the returns they want, so the result is we have an area that has very limited — I would say probably less than 10 percent of our customers have anything that would resemble true high speed, anything around 25 megabit or even above 10 megabit, service that's reliable and affordable.

Christopher Mitchell: When you were trying to figure out how to solve that, I'm curious if you originally thought that fiber was feasible or if you just evaluated all your different options. Like, how did you go about deciding on the plan to roll out this network?

Gary Wood: Well, it's interesting that at the start of this conversation you mentioned that Jon Chambers had talked about Central Virginia because Jon Chambers was a part of what opened our eyes to the potential of building fiber. We had assumed it would be too expensive, and I was at a conference that Jon spoke at and talked about some other co-ops in some areas similar to ours where the economics had worked and they'd built up systems. From his talk, I came back, discussed it with our staff, and we decided to engage Conexon and do a feasibility study just to see — to either prove to us that we couldn't afford the fiber or to understand what it would take to put it in. And that was probably early 2017, in that time frame that we did the feasibility study, and it came back and showed that it was very marginally acceptable. When we first looked at it, there was seven years before our subsidiary would get to a positive cash flow on an annual basis, and it was year 11 before we paid off those first years of losses and kind of got to a simple break even. Our board gave us the go ahead as a staff to start the first year as a pilot project and serve as a proof of concept that we could meet the cost and revenues in the feasibility study, but also to look for ways to drive the cost down further and to bring in some other revenues if we could from outside sources to help strengthen the business case for the fiber buildout.

Christopher Mitchell: Great. Melissa, do you want to just give us a sense of what the plan is right now?

Melissa Gay: So we have a 27 substations, and as Gary mentioned, we serve parts of 14 county and 37,000 plus members. And our plan is to pass each and every one of those homes with the option for Fiber-to-the-Home gigabit speed service within a five year timeframe. So that requires us to have contractors on the ground to build at 15 to 20 miles of construction a week, so that we can hit our target. That includes the make ready engineering process where they stake out each of those areas and the design is done and make ready construction where they actually change out the poles if they need to be taller and move the transformers around. You have to put it on the anchors to make sure that those poles can help hold that additional weight, so we put in the extra anchors. And then the final piece of that is the actual fiber construction where you see, you know, they're put in the strand on and lashing the fiber on, and then the splicing, and then the pace of getting it into the home and finally lighting up all of these homes across our service territory.

Christopher Mitchell: Well, did I jump a step then? Because Gary, I sort of jumped in and you were talking about getting the costs down. Was there an interim step that I missed there?

Gary Wood: We did start that first pilot year. We've had good success as far as being able to show that we can keep the costs in line close to where the feasibility study showed they could be. And we've found a significant amount of support from outside through various subsidies, incentives, grants, the Connect America Fund, some state grants, and then local county incentives, so that together we've offset a big part of the cost, capital costs, and some of the first year's operating losses that we would've had if we did not have those outside dollars coming in.

Christopher Mitchell: I mean, it's amazing to me, and I love hearing that. I mean, the fact that you won in the Connect America Fund auction. You were successful in that, right? That's the part of the Connect America Fund that you tapped into.

Gary Wood: Absolutely. We were very fortunate in the Connect America Fund and Conexon was very helpful to us because they were very familiar with the bidding process and they did some work to help co-ops become qualified bidders in that auction. Our co-op was able to get $28.6 million over the next 10 years in award from that auction, and that's going to certainly help strengthen the business case for our buildout.

Christopher Mitchell: Now, Melissa, you identified — and very well, I think, in sort of an understated way — the enormity of the challenge, but I am curious about something. It's a little bit of an off the wall question, and that is, was the hardest part of this picking a name for the fiber subsidiary?

Melissa Gay: Oh, that was the most fun. It was very hard. Certainly we had some great options on the table. We have a partner in creation and design with this, aside from our own management team and even input from our employees, the Central Virginia Electric Cooperative employees and the board. The Blue Ridge Design Group in Charlottesville partnered with us, and they listened to all of the ideas of the project and the scope, and you know, they've got that creative flair of course. They gave us several options, and we also had suggestions from our employees. We put out a survey, and we asked, and we had one final suggestion from employees and then one that had come from the pool from the Blue Ridge Group. So we've vetted those ideas. We vetted logos for each of those and all of the supporting colors and all of the design pieces for each of those. And then we put that to a vote. We went out to our member advisory council members and let them see each of those and give their input. It was a fun process. Probably one of my favorite things from the startup, since I don't do design and don't pick substations and also don't do dollars. I'm in the communication side. So I'd have to say this has been one of the most exhilarating experiences to see the Firefly come to life and think about how it's so representative of our beautiful Blue Ridge mountains. We do have fireflies here in the summer. Our children run around and catch them and they put them in jars and let them light up. So it's a very meaningful name for us and sort of the double meaning there of lighting up all of these households with fiber across our service territory.

Christopher Mitchell: Yeah, I like that, although growing up in Pennsylvania, I have to say that I always knew them as lightening bugs before I learned the term firefly.

Melissa Gay: Well, and we like that term too, and we're counting on the fact that our members know that they're lightning bugs. We play on that with "lightning fast Internet." So we sort of like that, being an electric company and often an electric bolt looks very similar to lightening, so you can kind of tie it all in together when you're doing your design and marketing piece.

Christopher Mitchell: And so, let me ask you first, Gary, but I'd love to get a reaction from Melissa as well. But have there been any interesting surprises along the way that you can share with us? Any insights that you now have that you may not have expected a few years ago?

Gary Wood: Well we could do a whole separate podcast just on the things we have learned.

Christopher Mitchell: Sure.

Gary Wood: And there's so many. We have learned a lot of new things about the way that fiber goes together. We've learned about the way the state laws require you to work in Virginia with a subsidiary and have it set up to sell Internet. We've learned what some of our local folks think in a very positive way about the co-op and how there are people who, even if they have another service, they love their co-op so much that they want to switch to anything that we're providing. We've learned about how our employees think about our projects when we start out, and we learned how a lot of them have really stepped up to the plate at a really busy time to help us out. There's just a lot of positives out of it. There's a few little funny stories that may be in there. I'll have to be careful about which one suitable for a podcast that I can tell. But Melissa, maybe you want to take off a little bit.

Christopher Mitchell: We'll do the extended version later.

Melissa Gay: I would echo everything that Gary said, and you know, I thought as he was talking, the county support — I have had an opportunity in my role now to go and accompany Gary to some of these meetings and meet these county leaders and to see that they're in this just as well as we are. You know, their residents are begging, crying, demanding for this Internet. I mean this is, you know, life or death it seems to some of these folks. They cannot get it, and they're just feeling so cut off and so alienated. And I feel so satisfied when I walk out of those doors and I can say, okay, you know, we serve more than half of this county and therefore when this project concludes, Central Virginia Electric Cooperative and Firefly are going to offer half of this whole county the opportunity to get gigabit speed Internet for $79.99 with no data cap, no contract, and bringing a wholesome product to our members. And so for me, what I've learned along the way is how absolutely satisfying and how gratifying an experience it is to be involved in this and how our predecessors must've felt in the 30s when they turned those lights on. You know, I get calls every day from members who say, "Oh please Melissa, tell me you're coming." I have one who promised to bribe me with elderberry syrup to my office, fresh off of her farm and . . .

Christopher Mitchell: You have to make sure you're revisiting that conflict of interest policy, I think.

Melissa Gay: Exactly, exactly. But I get those calls all the time, you know, and they're telling me just how this is going to be such a life changing experience for them. And they tell me about, you know, how they've wanted to pursue their degree, their first degree or you know even their second degree if they want to do a masters or beyond; and how they've wanted to work from home and they're renting a space, you know, right in town so they can get the Internet, so that they can live their dream and live where they want to live, but they have to still commute within their own town to a place that has that Internet; and how I'm going to change their lives and we're going to save them money; and how their kids won't move back here because they don't have the Internet, so they're staying in the rural areas and their families are split. So for me, the biggest surprise was just how satisfying it would be. And I knew it would be impactful, but I don't think I truly ever grasped the human element of this, the real piece of the member-centric goal here of getting Internet into those homes. So I have loved that — and the partnership. The members have offered to lobby on the hill. They want to lobby to their local representatives. They want to write letters and really get involved in, you know, deciding their fate here for that. And that has been exciting as well as just partnering and meeting more of our politicians and our local representatives and again, helping them to see what we're doing and that we're part of the solution.

Christopher Mitchell: Gary, did you want to share any of those stories?

Gary Wood: One set of stories is around the access to members' property. When you get out in rural areas, people are very protective of their privacy and of their property, and there are times where it's difficult for the electric co-op to plan to be on lines just to upgrade pole lines because people are concerned about us driving through when there are crops in the ground or they're concerned about us having access and who it is that will be behind their house and in their field. And we know that there are a few of those members out on our lines. We've had several of them meet the contractors as they're first out working on the fiber project. One of them met them at a gate that was locked, and the crews are trying to figure out how to get through, and he came up to them and said, "The gate's locked and it'll stay locked and you won't come on my land. I don't allow co-op people here." And he had a conflict that went back several years where he thought he hadn't been treated fairly related to a billing. He in fact used my name and said, "You can call Mr. Wood and tell him that once he resolves my issue and my money is returned—" It was about $85 he thought he was owed. He said, "Then we can talk about whether you get here." So the next day one of our employees went by and talked to him, and they went by and told him that we understood his issues and we wouldn't need to get on his property because he would've been the only one we would've served off of that fiber and that we didn't want to bother him, we wouldn't build that fiber. And he said, "wait a minute, you were coming on to build the — is this the Internet service?" And he said, "Tell the crews to be out there tomorrow morning. I'll have the gate open and coffee waiting for them." So it kind of changed his view of the co-op again. And we had another gentleman who showed up when there was some underground work going in on his job, and he showed up and didn't stop to hear about what it was for and asked the guy leave the property immediately. He was very upset that they had come in and not first knocked on his door and scheduled everything with him, and he was the same way. The day after, when he heard that it was for the fiber, he called back and said, "Tell that crew to come back over and let's keep this thing moving." So, it's such an important service for these folks that people who otherwise are really careful and standoffish about who is on their property are waving folks in, just saying, please, let's get here and get started. That tells me something about the desire for that service, and there's so many different reasons for it: for the education side, certainly for entertainment purposes, for telemedicine, whether that is people who just want to use some of the teledoc type applications on their phones. They don't have good cell phone coverage and if they have Wi-Fi, they can use a cell phone, go online, and have a doctor prescribe medicine for them without having to go out to a clinic that may be 30 miles away and sit in a waiting room with other sick people. Just a lot of different purposes. Everyone has been welcoming to us. We've done about 700 miles of construction on make ready. We're a little behind that as far as the total fiber because of the order everything has to be built in. But we've had 700 miles that we've had trucks on doing work, preparing for the fiber to come after them, and from that we've had one consumer, one member who has asked us not to be on his property. So that's a pretty incredible number in today's world.

Christopher Mitchell: Those are really interesting stories. I actually hadn't heard that level of interest before. There's one municipal utility in Tennessee that had said that they were so well liked in providing this service that sometimes their workers would be greeted with offers of a beer from the homeowner, which they wanted to discourage.

Gary Wood: Yes, and it wouldn't surprise me if some of our contractors haven't had some offers. I haven't heard all of them, but it wouldn't surprise me.

Christopher Mitchell: They may not tell you about that one. So there's a lot of really good individual stories that you and Melissa have shared, but I'm curious about the overall take rate that you're seeing in areas. You know, for instance, the pilot area — what did you see in terms of the total amount of interest?

Gary Wood: Well, if we look at our first substation, we had essentially three circuits out of the substation. Two of those had no incumbent providers with any real options, just the wireless and the satellite and maybe a little bit of cell phone use. On the third circuit, there was an area where there was a little more high speed, a little bit of cable availability. So if you take the two circuits that had no other existing options, we're at 50 percent on initial signups, which is well in excess of the 35 percent our feasibility study assumed for the first two years.

Christopher Mitchell: Okay.

Gary Wood: So that was just a really good take rate for the first time through. When you consider a lot of these folks, we had people who'd never had any type of Internet service because they just didn't have anything available, and we still have some who are trying to figure out what do you do when you have broadband — how do I use it?

Christopher Mitchell: You invite the grandkids over.

Gary Wood: Exactly, exactly.

Melissa Gay: Even with an email — can you help me set up an email account?

Gary Wood: Right. I understand I need the Internet, but now how do I use it? We're very happy with that. In the area where we had a competitor who was already there, we're about 35 or 36 percent, so we still did very well. We met our goal for the areas without competitors in the areas where we did have competitors. And we had assumed that we'd have a lower take rate in the areas where there were already people who had options, but there's a lot of demand. We're still seeing signups in that area, even though we've gotten beyond that initial build out, and now we'll go back and put people in and connect people. A couple of weeks at a time, we'll go down and put a little group on together, and people are still signing up. We expect that to continue on really for years, adding another two to three or four on a circuit per week.

Christopher Mitchell: Yeah, I'll bet. One of the things that we see is that there's a continual growth, and that's fueled in part by the fact that you probably will see very little churn. You won't have hardly any disconnects, so word of mouth will get around and . . .

Gary Wood: Yeah. As of today, we started people online last year in December, and I am not aware of a single disconnect.

Christopher Mitchell: Yeah, that's impressive, especially since you're facing competition in some of those. Often you'll see a real price war effort, but you know, with reputation that your co-op has, you probably won't have to worry too much.

Gary Wood: Right. Yeah, I'm sure going forward we'll see some, but it has surprised us. We anticipated that we would have good demand and a lot of interest. It's surprised us that it's been a little better and that it's been as consistent across the board. When we moved to our second area that we were building in, there was some fiber that the county had built in a portion of that area.

Christopher Mitchell: Right. That'd be Nelson County, I'm guessing, right?

Gary Wood: In Nelson County, yeah. And yet, we are still seeing take rates over 30 percent in areas where members have had options to connect to fiber.

Christopher Mitchell: Were you going to buy the Nelson County network?

Gary Wood: Well, we went to the local counties and asked them to consider incentive packages for us, and as we talked to the different counties, some of them had different ways to approach it. Nelson County offered instead of giving us a financial incentive, they offered to transfer at no cost the 70 plus miles of fiber that they had built over the last eight years or so, so we accepted that. It has been built with grant money for the most part, so it comes with no debt. It does have to be operated as open access network, a portion of it that was built with grant dollars, because that was one of the requirements of the grant. And we'll have to operate it as open access for about another 10 years to meet the grant requirements, and then we'll have the fiber after that to do with as we please. That's a little quirk that's just special to Nelson County, and it was their way of offering us an incentive to build out in all of the electric co-op area and to reach just beyond the co-op area where we can to extend service to others.

Christopher Mitchell: It's a fascinating story and I'm thrilled because stories like this are what's going to bring the connectivity we need to everyone in the country. As we're wrapping up, let me ask you, Melissa, is there anything else that you wanted to share that I didn't ask you about?

Melissa Gay: I would echo Gary's sentiment for all of the partnership with our employees across the cooperative and just taking on a subsidiary, reopening our subsidiary and introducing a whole different set of employees yet sharing the member base. And I think that, you know, non-regulated states don't share in that experience, but being in Virginia and for an electric utility, not to be able to offer the Internet and they can only offer electric service. For states that are regulated, I would say that that was a new experience for us as well. CVEC has had a subsidiary in operation multiple times, but it didn't employ a whole different set of employees. And so that has been a unique experience for us and one that has really helped us to grow and bring on a whole new set of employees. So for me, that has been a unique piece of this as well, just dealing with and introducing and embracing a new set of employees. However, the customers are the same, so your electric customers right now are also your Internet customers. So we're sharing those people and sharing experiences with those people and impacting two sides of their lives: electricity and Internet.

Christopher Mitchell: It's . . . I assume it's like trade offs. There's some benefits and negatives about having to form the subsidiary, but I appreciate that you're looking at it as a, you know, positive story.

Melissa Gay: They're certainly making it happen. Without those folks to sign up and schedule all of the services — and they have a whole new billing, you know, that they have to take on, so we really appreciate that they are there to take trouble calls and question calls. And so that has been a unique experience, like I said, for a regulated versus a non-regulated state.

Christopher Mitchell: Right. Gary, is there anything, any comments you wanted to share?

Gary Wood: The other overarching feeling and thoughts that I have about our start into this whole project has been how positive it's been for all the people that it's touched. Certainly for the members who are getting broadband Internet service, they're extremely happy. For the local politicians, even the elected officials at the state level and the federal level, they're struggling to find a solution to rural broadband, and they're embracing electric co-ops and seeing with our project and several others in the state and a number of them across the nation, that electric co-ops are a big part of the solution for rural broadband; that we know something about infrastructure in the rural areas and we can take on big projects that have very low margins in the out years and make them successful; and that our employees, um, have taken it on knowing that there's extra work, there's more material moving through, that there are more contractors in the area, more phone calls coming in, and embracing that because they see what it's doing to change people's lives. It really has created a good feeling that goes throughout the project. People are more patient, even though they are tense times whether it's with members or with our employees or with our contractors and with the folks who are helping provide some of the funding and support. VDOT, our local Department of Transportation has been very helpful in trying to help us make sure we get our permits timely because they see the need. Everybody wants to be part of the project. They want to be part of the success story. They want to be part of the solution to provide rural broadband. It's a daunting task when you first take it on. It's a whole new business for us, but I feel like we've done it very successfully. We've had really good consultants, we've had really good contractors, and really across the board, everybody wants it to be a success and they're all willing to play a part in it. It's just been a really positive story for us.

Christopher Mitchell: Well, I really appreciate your time today. I think I've kept you longer than I promised, but it's been a great discussion with a lot of interesting things that we haven't heard from other projects that I would have thought were pretty similar. So thank you for taking the time today.

Gary Wood: Absolutely. Thank you, Chris.

Lisa Gonzalez: That was Melissa Gay and Gary Wood from the Central Virginia Electric Cooperative. We have transcripts for this and other podcasts available at muninetworks.org/broadbandbits. Email us at podcast@muninetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is @communitynets Follow muninetworks.org stories on Twitter. The handle is @muninetworks. Subscribe to this podcast and the other podcasts from ILSR, Building Local Power and the Local Energy Rules Podcast. You can access them wherever you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter at ilsr.org. While you're there, please take a moment to donate. Your support in any amount keeps us going. Thank you to Arne Huseby for the song Warm Duck Shuffle, licensed through Creative Commons, and thank you for listening to episode 358 of the Community Broadband Bits podcast.

Tags: transcript

Decatur I-Net Plans Draw Comcast Acrimony in Georgia

muninetworks.org - May 29, 2019

At a May 6 City Commission meeting in Decatur, Georgia, city leaders approved a project budget of $2.35 million to build a municipal I-Net and award the construction contract to Georgia-based Network Cabling Infrastructures, Inc. The decision came amid demands from cable giant Comcast that the community of about 24,000 immediately begin paying exorbitant fees for infrastructure the city has used under a past local franchise agreement. The case of sour grapes was resolved, but it once again reveals how the large corporate monopolies don't hesitate to flex their muscles when things don't go their way.

Conflict Over I-Net

The infrastructure at the center of the dispute dates back to the late 1990s to a franchise agreement Decatur made with MediaOne, which Comcast has since acquired. As part of the deal, MediaOne agreed to connect city facilities with a fiber network, and the city permitted the cable company to recover some construction costs through a 25 cent charge on subscribers’ monthly bills, up to a total cap of $200,000. MediaOne finished building the I-Net in 2000. Since then, Decatur has used the infrastructure without paying fees to MediaOne or Comcast for critical city operations.

Last year after working with a consultant, Decatur decided to replace the aging I-Net with a new, city owned fiber network and began to search for a contractor to build it. Comcast was one of several companies that responded to a Request for Qualifications (RFQ) issued by Decatur in October, but it did not meet the requirements established by the city.

Less than one month after Decatur notified Comcast that it was not selected, the company told former City Manager Peggy Merriss that it planned to retire the I-Net right away, unless the city paid for its use. A few months later, Comcast reiterated its intentions to current City Manager Arnold, explaining that the company had acquired a state franchise to replace the local franchise agreement that ended in 2009. According to Arnold, Comcast decided to charge the city approximately $370,000 annually for use of the current I-Net until the new one is built.

At the Decatur City Commission meeting on April 15, City Manager Andrea Arnold explained to city leaders and attendees that Comcast was seeking payment from the city for use of the Institutional Network (I-Net) that connects public buildings, reported local news site Decaturish. At the April 15 meeting, Arnold stated:

“The heavy handed approach taken by Comcast grossly violates the way the city operates. Instead of working towards a creative solution to satisfy both parties, Comcast is bullying the city into making a hasty, uninformed decision.”

For its part, Comcast pointed out that it attempted to renegotiate with the city after the original local franchise agreement expired and that the cost Arnold quoted was not their lowest offer. Andy Macke, Vice President of Government and Community Affairs at Comcast, said in a letter to Arnold:

“Contrary to your characterization of the company as ‘bullying’ the City, Comcast has allowed the City to enjoy free use of the I-Net for ten years longer than was required, during which time you have been fully aware of Comcast’s desire to convert the network to a commercial arrangement.”

However, if the arrangement between the city and Comcast — in which the city used the infrastructure for no additional fees — has continued for almost ten years, city leaders in Decatur don't appear to have been made "fully aware" of Comcast's desire.

On May 20th, after negotiating with Comcast, the Decatur City Council approved an interim network services agreement to pay the cable company $12,500 per month for two years or about $300,000 in total.

From the Monopolist’s Playbook

Comcast’s decision to demand payment right after being denied the construction contract raises questions, especially since Comcast was content to allow Decatur access to the network without demanding payment for nearly a decade. Often companies who are party to expiring franchise agreements try to argue that they have supplied connectivity to municipalities "for free" through such arrangements. In actuality, Comcast and similarly situated cable companies obtain free or reduced cost access to a municipality's Rights-of-Way, as well as the ability to reach thousands or tens of thousands customers (often with little or no competition) and to make municipalities dependent on them for connectivity. In the case of Decatur, subscribers contributed to the construction costs, possibly paying for the construction of infrastructure which Comcast claims it owns.

Comcast and other large cable providers have taken advantage of the end of local franchise agreements to impose additional fees on local governments across the country as these agreements expire. For example, when the lease agreement that Martin County, Florida, had with Comcast for its I-Net was about to end, the company attempted to raise rates by 800 percent. Instead of paying the exorbitant fees, Martin County chose to build its own fiber network, saving the the community millions of dollars. More recently, West Bloomfield Township, Michigan, fought with Comcast over ownership of their I-Net. The township is now considering building its own network and began searching for consultants in late 2018.

Replacing an Aging Infrastructure ... and Comcast

The planned fiber network will connect 14 city buildings and 10 school locations; the local school system will contribute about $650,000 towards the cost of building the network. A redundant ring design and underground deployment will make the new I-Net more reliable than the current network. The increased reliability and capacity should improve the city’s public Wi-Fi and allow for use of smart city applications.

Decatur plans to start construction of the new network in June and hopes to have it completed within a year.

Image of downtown Decatur courtesy of the City of Decatur.

Tags: georgiadecatur gaI-Netcomcastfranchiseright-of-way

Firefly Fiber All the Buzz in Central Virginia - Community Broadband Bits Podcast 358

muninetworks.org - May 28, 2019

The Central Virginia Electric Cooperative (CVEC) announced in January 2018 that they had solidified plans to deploy fiber across 14 counties for smart grid operations and to bring Fiber-to-the-Home (FTTH) to the region. The project, dubbed Firefly Fiber Broadband, is underway, and we’ve got President and CEO Gary Wood along with Communications and Member Services Manager Melissa Gay on the podcast this week to discuss the multi-year project.

During this interview, we learn about the CVEC service territory, which is a mix of a few denser populated areas and very rural communities where poor Internet access, when it’s available, is a real problem. CVEC members have been dealing with unreliable connections, oversubscription, and outdated technologies for years. Those problems will be eliminated, however, with FTTH from the co-op that many have come to trust. By obtaining grants, working with local communities, and approaching the process in a strategic manner, CVEC plans on bringing gigabit connections to about 37,000 potential subscribers within five years.

Gary and Melissa describe the cooperative’s process, the discoveries they made about attitudes toward the co-op from members in the community (including some interesting stories), and lessons learned. We hear about some of their marketing approaches that focus on the uniqueness of the region and what it was like to establish a subsidiary in accordance with state law. Through all the hard work, Melissa and Gary have nothing but accolades for employees of the cooperative and compliments for local officials who helped get the project off to a strong start.

Learn more about the status of project from CVEC.

We want your feedback and suggestions for the show-please e-mail us or leave a comment below.

This show is 40 minutes long and can be played on this page or via iTunes or the tool of your choice using this feed. You can listen to the interview on this page or visit the Community Broadband Bits page.

Read the transcript for this episode.

Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license.  

Tags: podcastaudiobroadband bitscentral virginia electric cooperativevirginianelson county varural electric coopFTTHruralelectricitysmart-grid

Community Broadband Media Roundup - May 28

muninetworks.org - May 28, 2019

California

Guest Opinion: Palo Alto needs a citywide municipal fiber-to-the-premises utility by Jeff Hoel, Palo Alto Online

 

Idaho

Fiber Optic Utility brings faster and better Internet to Ammon by Ariel Schroeder, KIFI

National surveys show that having fiber optics installed in your homes increases its value over 3%.

For for a $75,000 home, it's going to typically increase the value of the home by over $4,000.

"This is because home buyers are getting smarter and they know that the Internet is very much like sewer and water. They want it, they know they are going to pay for it every month, and that matters to them what that monthly bill is. So they are motivated to try and find good connectivity at the lowest price possible," Patterson said.

Amid network growth, Ammon Fiber to host information meeting by Ryan Suppe, Post Register

Task force created to improve broadband Internet in Idaho, KLEW News

 

Illinois

Jacksonville City Council will meet May 28 by Kristine Gonzales-Abella, West Central Reporter 

 

Maine

Business Breakfast: Municipal broadband projects ‘contagious,’ experts say, Portland Press Herald 

Towns can soon avoid fee for broadband devices on poles, Seattle PI

 

Michigan

Closing the digital divide by Justin Dawes, Grand Rapids Business Journal

 

Missouri

Missouri legislators bring rural broadband closer to reality by Eric Bohl, Buffalo Reflex

 

Montana

Tester bill would help build out broadband, close digital divide in rural America, Char-Koosta News

 

North Carolina 

Town of Highlands making broadband progress by Jessi Stone, Smoky Mountain News

 

Texas

‘We do not have coverage here:’ Texans take on federal broadband maps by Paul Flahive, Texas Public Radio

“If we sit around and wait for the telephone company or the cable company or the federal government or anyone else to do it for us, it’s never gonna get done— we’re always going to be at the tail end of the food chain,” Hunt said.

 

Washington

Tacoma faces two legal challenges over new business model for Click by Debbie Cockrell, The News Tribune

 

West Virginia

Still in the weeds on broadband: State stuck waiting for federal action by Matt Combs, The Register-Herald

 

General

Congress can end the digital divide or replace it with a speed chasm with its broadband infrastructure bill by Ernesto Falcon, Electronic Frontier Foundation 

House lifts curtain on LIFT America Act by John Eggerton, Multichannel 

Pew to launch broadband access and state policy explorer by Lucas Ropek, GovTech 

Speed goals for FCC grants by Doug Dawson, POTs and PANs

POTUS fight threatens rural broadband bucks by John Eggerton, Multichannel

Broadband monopolies are acting like old phone monopolies. Good thing solutions to that problem already exist by Ernesto Falcon, Electronic Frontier Foundation 

Comcast does so much lobbying that it says disclosing it all is too hard by Jon Brodkin, ArsTechnica

Rural cooperatives deliver high-speed Internet for less by Lucas Laursen, IEEE Spectrum 

 

Tags: media roundup

KentuckyWired: Statewide P3 Project Difficulties Drag On, Multiply

muninetworks.org - May 24, 2019

The fifth anniversary of the announcement of the KentuckyWired project is approaching later this year. As voters start to assess their candidates’ job performance, the unfinished and over budget middle mile public-private partnership (P3) has become an albatross that incumbents aren’t able to easily cast off. When we last discussed the project in 2017, we shared our observations and misgivings. Not much has changed, except some of our concerns have played out and the project has become troubled by new problems.

In Case You’re Just Arriving to the Party… 

The statewide, massive middle mile project officially began when Kentucky announced in late 2014 that they would build a fiber optic network in order to bring better connectivity to rural areas. They planned to find a private sector partner and sought bids. In the fall of 2015, Australian firm Macquarie won the contract for what soon became an even larger endeavor — a fiber optic network that would enter every county in the state at a minimum of one location. The network would consist of approximately 3,200 miles of fiber and connect about 1,000 public facilities. At the time the project was developed, the state estimated that deployment would cost approximately $300 million.

With early bipartisan support, the state allocated $30 million from their budget, which they expected to combine with $23.5 million in federal grants. When the Kentucky Economic Development Finance Authority issued $232 million in tax-exempt revenue bonds and $58 million in taxable revenue bonds to complete financing, Bond Buyer named the issue the “Deal of the Year” for 2015. Macquarie’s timeline estimated an optimistic one-year completion for the entire statewide project.

Macquarie Capital, as the entity managing the project, included in the agreement with the state a requirement that they and their partners, including Black & Veatch from Kansas and Ledcor of Canada, would build, operate, and maintain the network for 30 years. During the course of those three decades, the state would pay them approximately $1.2 billion and when the term was over, Kentucky would own the infrastructure free and clear. During the contract period, Kentucky would make “availability payments” which would increase over the course of the contract, regardless of the status of construction. State facilities would no longer need to lease lines or pay AT&T for services because KentuckyWired would replace AT&T at state facilities. The shift would eliminate the $27 million per year telecommunications fees that Kentucky paid to AT&T.

Kentucky planned to first connect 173 school districts and use federal E-rate funding to contribute to availability payments. They anticipated that schools would be connected to the network within the first year and the E-rate dollars would be made available right away. In the past, E-rate funds had been used to pay AT&T for services through a long-term arrangement, and when the state tried to solicit new bids expecting KentuckyWired to bid on the contract, the company was ready to sue. E-rate regulations disqualified the project from using the funds as intended in 2015 and the state was stuck in a bind: facing pressure from the telecommunications giant and caught owing availability payments while their anticipated stream of funding was now cut off. Eventually, the state chose to continue their contract with AT&T. The events lead to a gap in funding to the tune of $11 - 13 million annually. It foreshadowed other problems that would plague their celebrated project. 

According to a story developed by ProPublic and the Louisville Courier Journal, State Auditor Mike Harmon had looked into the shortfall as part of the 2018 report on the project. Harmon’s team found that the Commissioner of Education in 2015 informed Finance and Administration Cabinet Secretary Lori Flanery along with former cabinet secretary Mary Lassiter that the project would not qualify for the E-rate funds but those warnings were ignored.

Obtaining easements from private property owners added to the delay. While the KentuckyWired project is supposed to be working with municipal networks in the state, it’s natural to expect some hesitation from local municipal network officials. For example, Glasgow’s Billy Ray expressed concern about a new entrant with the financial backing of the state competing in their service area. “We have some concerns about what is their ultimate goal,” he said. It doesn’t appear that KCNA or Macquarie did much to ease concerns from local officials in order to move the project along.

More Shifting of the Risk

As we covered in our 2017 article, the state established the Kentucky Communications Network Authority (KCNA) to operate and maintain the infrastructure. As per the contract between the state and Macquarie, the KCNA has had the responsibility of obtaining pole attachment agreements. As is often the case, large incumbent ISPs like AT&T can delay the launch of a new entrant’s project by prolonging negotiations for the agreements. The KCNA and Macquarie also grossly underestimated the number of poles that AT&T owned in the state, which greatly complicated their ability to obtain pole attachment agreements.

As part of the partnership agreement, Macquarie would also have the ability to lease capacity to ISPs and share the resulting revenue with the state. Macquarie estimated that the firm could garner as much as $600 million over the 30-year term. All this delay cut into the revenue that Macquarie had expected to obtain from the project.

ProPublica and the Courier looked into 2015 negotiations between Kentucky and Macquarie; the results indicate high risk for the state but not for its partner. In addition to the availability payments, made regardless of whether the network is up and running, Kentucky agreed to pay the firm if the state was not able to secure pole access in less than a month. Obtaining the agreements took more than seven months and all the while the state’s obligation to pay “penalties” to Macquarie due to the pole attachment debacle in addition to availability payments to partners continued to pile up. In February 2019, Macquarie and Kentucky negotiated a settlement that ended in a payout to the firm of $93 million.

The timeline of the project has been pushed back to a 2020 completion date.

Experts have gone on record describing the overly-ambitious construction schedule as “unrealistic” and “wildly aspirational.” Phillip Brown, who used to work for the KCNA but left to work for ISP Crown Castle told the Courier Journal that he believes the quixotic construction schedule resulted from an attempt to convince lawmakers and the public to back such a large project:

“What would the reaction to KentuckyWired have been if the state had said at the beginning it will take us until 2020 and it’s going to cost about $400 million?" Brown asked. "Well, maybe the state doesn’t do the project, but it also means that we don’t have those false expectations that were created by a schedule that wasn’t achievable."

The state made the mistake of letting its desired costs on paper dictate an ultimately impossible construction schedule, he said.

The Affect in Frankfort

When it became clear that lack of access to E-rate funding created a 45 percent funding gap, and the state was still on the hook to Macquarie and others for availability payments, state lawmakers began to lose enthusiasm for KentyckyWired. There were calls to scale back the project to serve only the eastern area of the state. Governor Matt Bevin, who assumed office in December 2015, at one time supported reducing the scale of the project but has reversed course. In 2016, Bevin proclaimed that the state had solved the funding issue, but no one seems to know the details of how the administration planned to accomplish that feat.

Besides the fact that the state would face off against Macquarie and its partners if the contract were broken, the long-term future of the project depends on the ability to reach urban areas beyond those in the east. Reducing fiber miles deployed needs to be balanced against loss of potential revenue.

Lawmakers have granted permission for KentuckyWired to borrow some, but not all, funding to help right the ship as it related to the Macquarie settlement. Legislators have kept a close eye on how much they’ll allow because it has the potential to negatively impact the entire state’s credit rating. There’s still talk of ending the project, but as 2020 approaches, most in the Bevin Administration continues to work to shore up support:

"We're on the cusp — the eve, literally — of this project being completed and starting to produce revenues, and we're having a discussion about terminating this project? It makes no sense, financial or otherwise," [KCNA Scott] Brinkman told state lawmakers. "It makes no sense."

Not everyone in the Bevin administration has been expressing support for the project, however, including the generously compensated Chief Technology Officer Charles Grindle. He’s made several public appearances and bruskly voiced negative feelings about any switch from AT&T to KentuckyWired for state facilities. While Grindle may be justified in his concern for an abrupt change in provider, his willingness to accept invitations to “exclusive conferences” where famous acts perform and his repeated praise about the virtues of AT&T as a “trusted partner” could cast a shadow on the motivation for his disdain for the project. Regardless, it exemplifies the tight hold large ISPs such as AT&T have on state government.

Almost There

Phillip Brown notes that some of the largest state entities, including the University of Kentucky and other educational institutions, are likely to have access to the network when the first of six rings is completed in the fall of 2019. By working with other Internet access companies in the state that have their own fiber, KentuckyWired has been able to cut some costs and reduce construction time. 

A few local communities, however, have given up on waiting for the project and some just aren’t close enough to the proposed route to think it will benefit their need for better connectivity. Lechter County is moving forward with their own project, and Hopkinsville is upgrading their system to fiber through their electric utility. Telephone and electric cooperatives in Kentucky continue to offer services and expand to more premises.

Political Fall-out

To no one’s surprise, challengers who want Bevin’s job are using the problems surrounding KentuckyWired as a way to both lambast his performance and make their own promises for broadband across the state. Those who support the project claim Bevin, who inherited the project from former Governor Beshear, has not done enough to keep it on schedule. In the other camp are those who say he should have ended KentuckyWired long ago.

Politicians running for Governor who believe the project should be scrapped argue that funds should be distributed on a local level, some to large ISPs and some to rural co-ops. A few point to the success of rural cooperatives as a promising solution to the state's rural broadband problem. Others believe the only way to proceed is to move forward with the project and remain committed to a public-private partnership model.

What Is A True P3? No.

We’ve articulated misgivings about the statewide approach of KentuckyWired in the past and those concerns remain, although now we see the damaging results.

First, the state's P3 put too much risk the shoulders of Kentucky and too much gain in the lap of Macquarie. One wonders if the state was too rushed in developing the schedule and contract. We wonder if attorneys for the state consulted technical experts who had deployed fiber optic networks in territories where AT&T operates. Did they listen to warnings about what to expect from the incumbent?

As we covered in our 2016 report, public-private partnerships have potential but need to include shared risk and shared reward. Often a public entity enters negotiations considering themselves at a disadvantage, which is typically inaccurate. Clearly all the risk in Kentucky fell on the state; Macquarie and their partners gain financially regardless of whether or not they deploy the KentuckyWired network. The firm sought a guarantee-type arrangement at one time when they considered investing in Utah’s UTOPIA network around the same time they began negotiating with Kentucky. The UTOPIA deal fell through. We’ve had our doubts about Macquarie from the beginning.

Few public-private partnerships don’t find their way on to our Community Networks Map because the shared risk, shared reward arrangements are few. In places like Westminster, Maryland, where both public entity and private sector ISP are motivated to invest in the network, the P3 has succeeded, earning accolades from experts, gaining subscribers, and expanding.

Going With the Preferred Local Option and Connecting Subscribers

Westminster’s P3 with ISP Ting is also successful because it is a local project that offers last mile connections. While the future of KentuckyWired is yet to be determined, middle mile publicly owned networks don’t have the track record that compares to last mile projects. Middle mile projects still require investment from ISPs that want to use the infrastructure, which may prevent smaller ISPs from participating because they don’t have the capital to develop the last reach of the project. 

Local communities scattered across Kentucky have their own needs. We still believe that a statewide project operated and managed by a state entity is less likely to understand and respond to those needs as well as the people who live and work within those communities. When we wrote about the project in 2017, we noted that Kentucky was, at least, working to address the lack of broadband in rural areas. Since then, little has changed in areas where co-ops or municipalities are not making investments in broadband networks.

Tina Sparkman in Letcher County told the Courier Journal that she relies on satellite Internet access because it’s her only option. Her rates are high and she hits her bandwidth cap early in every billing cycle. Her college-age children don't visit as often as she'd like because they need access to the Internet to complete assignments. “We can’t wait 10 more years for Internet,” she says.

Until KentuckyWired is launched, we won't know if the project will help attract better broadband to rural areas. On a positive note, when or if Kentucky and their partner complete deploying fiber throughout their state, they will have resources in place for private sector providers who may be interested in offering 5G or fixed wireless services. Once again, Kentucky's agreement with Macquarie might hinder what the state can do with their own infrastructure for the remainder of the contract.

In 2017 we wrote:

Time, money, and politics will limit whether Kentucky stays steadfast and completes the project as planned, or decides to reassess the choices they've made so far. However they move forward, they've established some important lessons on scale, partnerships, and thoroughly preparing a sound plan. From our perspective, it has not done much to change our argument that large scale investments are best done at the local level and public-private partnerships are significantly riskier than many realize.

Things appeared difficult in 2017 and after five years of compounding problems, disagreements, and significant financial troubles, are still troubled. As state leaders and project officials keep their eye on a fall launch, Kentuckians such as Tina Sparkman are done waiting for the state and are acting locally. She's joined the Lechter County Broadband Board and the group recently applied for a grant as they pursue local solutions for better connectivity. Go, Tina, go.

Image of Kentucky landscape by David Mark from Pixabay.

Tags: kentuckypartnershipstate policyfinancingat&tmiddle mileruralmacquariee-ratepoles

Transcript: Community Broadband Bits Episode 357

muninetworks.org - May 24, 2019

This is the transcript for episode 357 of the Community Broadband Bits Podcast. In this episode, Christopher interviews Monica Webb and Adam Eisner from Ting Internet about how the company is partnering with municipalities to connect communities across the country. Read the transcript of the interview below, or listen to the podcast episode. 

 

Monica Webb: We're really selecting communities that are very interested in Ting coming to town. They work with us very productively, and we end up with a very strong presence and reception from the communities.

Lisa Gonzalez: Welcome to episode 357 of the Community Broadband Bits podcast from the Institute for Local Self-Reliance. I'm Lisa Gonzalez. Once again, we have an interview to share that Christopher recorded while in Austin at the 2019 Broadband Communities Summit. This time our conversation is with two folks from the Internet access company and mobile service provider Ting. As you'll hear in the interview with Monica Webb and Adam Eisner, the company is known for a lot more than what we at MuniNetworks tend to focus on. They share some of their history and discuss how it has become a partner with several municipalities in order to bring high quality gigabit Internet access to local communities. Monica and Adam also talk about the different projects that Ting is working on and the ones that they've developed so far. Ting is experimenting with different models to get their services to subscribers. Along the way, they've continued to emphasize strong customer service and learn some lessons, which they share with us. They talk about some of the ways municipalities can make adjustments to help companies like them quickly and efficiently deploy high speed networks. They also offer some examples based on their own experiences. Now, here's Christopher with Monica Webb and Adam Eisner from Ting.

Christopher Mitchell: Welcome to another episode of the Community Broadband Bits podcast. I'm Chris Mitchell. I'm with the Institute for Local Self-Reliance. I am worn out after a wonderful set of days here at the Broadband Communities event in Austin, Texas, and I'm talking with two of my favorite people — one who's been on the show before, one who's new. Welcome back to Ting employees, the people who make Ting work, Monica Webb, the director of market development and government affairs for Ting Internet.

Monica Webb: That's correct.

Christopher Mitchell: Or just welcome. Sorry, this is really fun because I've known Monica for a long time and Adam I haven't known for quite as long, but he's a very relaxed guy. Adam is the vice president for networks for Ting.

Adam Eisner: I am very excited to be here. Thanks for having me.

Christopher Mitchell: So we're going to talk a bit about what Ting's doing. You've worked in many public private partnerships, you've learned different lessons. There's a new model in Fullerton, California. That's exciting. We're going to talk about a number of different things, but the first thing, I think it's always worth noting some of the people who listen to this show do remember Tucows, so just briefly remind us where Ting came from.

Adam Eisner: Tucows is the parent company, I guess is the best way to say it. You know, been around for across three decades now — very old Internet company. Started as a software download website in the 90s, turned into a domain name registrar that is currently — you know, we're the second largest registrar in the world behind GoDaddy.

Christopher Mitchell: You can say it. It's Hover, and actually Robert Wack and I were just using it yesterday. He was having issues, was on help desk with them, and I've been on help desk three or four times with Hover over the years and it's a wonderful experience.

Adam Eisner: Yeah, so it's interesting you say that. You know, hover.com is our retail arm of that domain name registrar, which is actually a wholesaler, so it's got lots and lots of different retailers on it and Hover's one of those. But, Hover was this domain name business that we built that had this great idea around great customer service, great interfaces, you know, fair pricing. And that actually was the genesis or the idea behind Ting mobile, which was the next business Tucows sort of launched, which was a mobile provider, a mobile virtual network operator, using those same principles, and that business then took off. And so, you know, between this now very established domain name business and this great mobile business that took off and is ranked one of the best mobile providers in America now by Consumer Reports, we went, okay, well we have two stable businesses that are generating a lot of cash that we want to invest appropriately. Where else can we spend that cash in areas where people have lousy relationships with their providers or could benefit from a better customer experience? Then we moved to broadband.

Christopher Mitchell: Well, I have to say, I've been a longtime customer of Ting wireless as well. I have been very happy with it. I've never become a shareholder of Ting or of Tucows I guess because I feel like it would be a conflict of interest and people would be like . . . you know, because I am frequently praising you publicly. So from my very, very powerful perch in this industry . . . So Monica, I'm curious, can you run down — maybe you could start running down the projects that Ting is involved in around the country.

Monica Webb: So currently we have eight markets that have been announced. One of them, Westminster, Maryland, is largely complete. We have six that are lit are in various stages of construction. Holly Springs, North Carolina, is almost finished. So we have subscribers on six of those networks running live, and we have very active construction. And those particular projects vary from Sandpoint, Idaho, you know, where we have population of 7,500, right up to Centennial, Colorado, where it's a population of 100,000. So they represent a variety of sizes of municipalities and certainly geographies and also, you know, maybe most interestingly different models in terms of how we work with local stakeholders, how we work with other partners in the model that we're deploying in those markets.

Christopher Mitchell: So here we are, we're in Texas right now, and you had a stake in UVA, the University of Virginia, in the National Championship. How are you tied to UVA?

Monica Webb: Well, you know, Charlottesville was ground zero for Ting internet, in that that was our very first market, and interestingly, when we closed on that sale, we went out to celebrate by going a game, a UVA Cavaliers game. So, I feel like we all support that team over other US college basketball teams.

Christopher Mitchell: There are no Toronto Rapids in the eyes of Elliot.

Monica Webb: That's right. But you know, perhaps most exciting for us is this year we undertook a partnership with UVA where we actually supply the Internet for the public at both the stadium, where the Cavaliers play, as well as their UVA football stadium. We brought fiber in, and then we have wireless access points and have worked really hard to provide a robust and seamless wireless experience for all of the attendees to those games. So we feel, you know, very vested in UVA itself, and as I said, it also had an instrumental moment with us when we first embarked on our deal in Charlottesville.

Adam Eisner: We had this funny thing where, you know, I think Duke was playing in UVA at the stadium and Lebron James was there, and we were all sort of looking around going, "I wonder if he's on Ting Wi-Fi? Is Lebron James using our Wi-Fi? Because that would be pretty awesome." So you get all these, you know, funny sporting anecdotal stories, like UVA won the national championship for basketball a few days ago and they're having a homecoming sort of thing in a couple of days at the football stadium and we all sort of went, we gotta make sure the Wi-Fi is still on even though football season is over. So, you know, we have a lot of people in and around that organization and those sports, so it's been pretty cool.

Christopher Mitchell: So Adam, let me stay with you for a second because people that are long time listeners will know Monica's background — been with Ting for many years now. Prior to that, we had interviewed you when you were with Wired West in Massachusetts. But Adam, as far as I know, you were kind of thrust into this position at Ting and I wonder if you can just tell us a little bit about that.

Adam Eisner: Yeah, so I'm a bit of a Tucows lifer. You know, I've been at the company for about 15 years, which in internet years is a lifetime, and boy, I'm not even the longest serving employee by a long shot. And so, you know, my genesis through the company was kind of starting in marketing, ended up running the wholesale division of Tucows on a product level for a number of years, so the domain name, email, SSL sort of businesses, and after a number of years was kind of looking around the organization just because Tucows is really good about affording you different opportunities to do different things if that is your interest. And so, [I] kind of said, "Hey, are there other things that I could get involved in here?" And so, at that point the company was looking at getting into the broadband space, so, you know, they said, "What about this fiber idea?" And so, I basically locked myself in a room and started looking up the elements to, you know, what goes into deploying fiber, and shortly thereafter, we were on our way. And so ever since then I've really been involved pretty deeply in finding the markets, building the markets, operating the markets, and it's been a lot of fun to watch it go from this idea that what was effectively a software and services company to something that's now an ISP in a whole number of areas. Interestingly, Tucows was owned by an ISP, has a lot of ISP DNA in it, so although, you know, the space is a little new from the terms of deploying fiber and running a Fiber-to-the-Home project, a lot of people in the building that grew up in ISPs somewhere.

Christopher Mitchell: Historically, the companies that have tried to get into this, particularly in a sort of bigger way where you're picking different markets across the country rather than just picking up a name brand in one area, I think they've struggled a bit. Like, RCN, a lot of those companies have consolidated over the years and they've really faced challenges. You seem to have been more successful. We're not going to talk about specific take rates, but my impression has been that in all of your markets you're not getting ready to bail out. It seems like it's working.

Adam Eisner: Right, yeah. I mean, we're really happy with the way it has gone so far, and you know, just us introducing new markets I think is indicative of that. I think we're lucky in that, until recently anyway, we had a little bit of an advantage of being a startup inside of a large successful company. So, you know, there were no preconceived notions about how we were going to pull this off, but we're also well supported, well capitalized to be able to take our time to figure that out and do it. And so, I think that's really benefited us as we've gone out and sort of, you know, spread the word and gone into new markets.

Monica Webb: I think our expansion has been fairly thoughtful. As Adam mentioned, we do have a startup culture, so we felt like we had a good handle on it when we started to scale up. We have, you know, obviously a world class customer experience to rely on as well, fantastic branding and marketing, and that has really allowed us to succeed in these communities. We have a very local-centric approach in the communities. We're not going into giant metros. You know, we're really selecting communities that are very interested in Ting coming to town. They work with us very productively, and we end up with a very strong presence and reception from the communities.

Christopher Mitchell: And you're using a variety of different models. I think I might simplify it into into three, briefly. And we can do a tree in how these branch out as we go down because each community seems to be somewhat unique. But, you bought a company and so you are a company in Charlottesville in which you are just a total private company. In Westminster, the city — Robert Wack's city — really led the effort, built a network, and you partnered to operate on the network, which is — you know, you're doing some equipment-type stuff also but we've done a podcast on that. People who are interested can go back and look at that. But that's where you're leasing municipal assets. My impression was in some ways that you thought that maybe that would be a common model moving forward, but in many other cities — and this is still at the second model that I'm elaborating on — you're leasing municipal assets but less so. And then the third model was just announced this week— which is now several weeks ago because we're canning the best interviews to let them age like a fine wine. In Fullerton, California, SiFi Networks is launching — a private company building an open access network to enable other private companies to compete on services. So anyway, is that a pretty fair, like, way to break them down?

Monica Webb: Chris, you get an A+.

Christopher Mitchell: I didn't really ask you a question, so . . .

Monica Webb: You know, I think what I would say is we're not afraid of dirt and hard work, and that's something that we have, you know, painfully but definitely successfully figured out over time — how we can build networks efficiently and effectively. However, what we know we do best and can scale most efficiently is the provision of a fantastic customer service experience and the marketing of those services, and so, when we partner with, for example, the city of Westminster or SiFi networks and they're taking on that piece of design and construction —

Christopher Mitchell: Adam's job. When they're doing Adam's job, right?

Monica Webb: That's right. When we offload Adam's responsibilities, yes. So it does allow us to scale faster and as I said, you know, provide the same fantastic customer experience but just not take on so much of the design and construction responsibilities.

Christopher Mitchell: So that's what you see as the value add. I mean, like, I think companies that succeed often know what they do well and so you're very focused on that customer experience.

Monica Webb: Yeah, I would say that's been the defining characteristics that Tucows has really built its reputation on, is providing a genuinely human customer experience. And you know, all of the other core administrative functions we have down to a science, ao it really does allow us to offload something that is . . . you know, it can be a difficult from a timeline perspective, it can be difficult from a resourcing perspective, to other entities and we can look for other markets where we can make sure Adam stays busy.

Adam Eisner: Yeah. I don't think we came into it thinking that we wanted to become a construction company. The easier it is for us to provide, like, this great service we're talking about is . . . You know, the easiest way to allow us to do that is probably the most important thing, and so if we can do that in connection with adding a lot of addresses to our portfolio, to our network, boy, we're pretty happy with that. So whether we're doing that or someone else is doing that on the construction side, we're pretty okay either way, I think. You know, we didn't get into it thinking we'd be a construction company, although here we are and I think we're pretty darn good at it. And it's important and you know, strategic to us; it's not the only way for us at this point. We're happy to do it any number of ways.

Christopher Mitchell: I'm curious what lessons you've learned aside from the challenge of getting places on time with the airlines being what they are. I know that you both do a lot of travel, and sometimes it's challenging as Monica's arrival here was, but what have you learned that may have surprised you in terms of taking Ting from, you know, the very first network that you were working on in Charlottesville to where you are today?

Adam Eisner: Ooh, you know, there's, so much. I don't think we necessarily underestimated, but we've learned a lot about just what it takes to be able to build a network from the ground up. If you think about it as a service provider, software company that we were historically, we — and I'm looking at Monica here. Like, you know, Monica and I have had to do a lot of pulling of the organization into — and others, obviously it's not just us — but explaining to people inside the organization that we're going to have a fleet of trucks now, when historically we were largely a group of support, operations, development, and any myriad number of things. It was a real new idea for us. And so—

Christopher Mitchell: Yeah, you're managing a fleet a thousand miles away and 2,500 miles away, maybe now.

Adam Eisner: Yeah. And if I think about my product days at Tucows, if you had a big project that you needed to finish on time for something, not to say it always worked perfectly, but boy, you could add some resources there to finish a project in short order. You know, construction, you can't really do that. There's so many different elements, third party sort of things that can have an impact on your build that you have to learn a lot to figure out how to mitigate properly. And I think we're there, but you know, there was a lot of learning around all of that to get there.

Monica Webb: The other thing I would add to that that is interesting given our software dev. roots is that we've been able to do a lot of internal work on billing and provisioning and workforce management that is going to ultimately really help our operation be as efficient as it possibly can be. I think the other learning — and I think we came into this particular aspect of the business with our eyes open, but it's just, I think what we've realized is that you can have a recipe for how you interact with municipalities for success on permitting, success on franchise agreements, success on leasing or potentially purchasing land, but you really need to be very specific in the initial discussions to make sure that they understand this is an enormous impact. We're talking about building infrastructure, the scope of which hasn't been seen since the large cable build out in the seventies. This is going to overwhelm their permitting department if they don't have really super streamlined processes already in place. So I think that, you know, what we've taken from that is each municipality is different in terms of their capabilities there and that we really need to be upfront with them with how much throughput we're going to need in order to build this network so that their constituents aren't waiting around for years to get the service.

Christopher Mitchell: Well, I'd like to push in on that for a second because I'm curious if you can talk a little bit about maybe what you've seen that's worked well for cities and areas in which you might encourage cities to think about their processes they may not even be aware of. Because Monica, you come from a background in which you are really representing the other side, the interests of the cities, and now I think you have a very full picture. At the same time, I mean, it's worth noting for people who aren't familiar, Elliot Noss has done a tremendous amount for the open Internet. The guy in charge and the guy that I've always associated with all of this stuff, you know, he's long been committed and put in his personal time and company time to things that matter for the open Internet worldwide and net neutrality and things like that. You've remained strong supporters of net neutrality as you've gotten in the business of wired access. So, I'm just curious if you can just talk a little bit about maybe how your perspective of government has shifted, and then we can roll into any ways you might suggest cities would be thinking about how to improve their processes.

Monica Webb: Well, one thing I would say about open Internet, Elliot really believes strongly in everybody having a fair and equitable experience on the Internet. Our tagline is "unlock the power of the Internet," and that comes through in the fact that we give this great customer experience and we are more than happy to stand up for policies that support an open internet. Sometimes we don't actually have the bandwidth personally to get in the trenches, but that's why we support other organizations that are doing that work. We sign letters to legislators, we do whatever we can because it really is important to protect the right for everybody to have free and open access to the Internet. I'll use permitting for an example. We'll say to cities, okay, we're going to be putting through a lot of permits. We're going to need you, you know, to make sure that your processes are streamlined. They'll say, absolutely, we'll do that, and then it comes down to it and that's more than more than often not the case.

Christopher Mitchell: You bring a wheelbarrow full of permits into city hall and their eyes fall out of their heads, right?

Monica Webb: And, you know, some things that have worked for example, is sometimes our contact at the city will actually work with the various departments to make sure that even though they're not the permitting department, that person will make sure — our point of contact — that the permits are moving through. We will say to them, you know, here's our timeline of how we need the permits processed. We need to have a permit in our hands within a month of the initial submission. So let's work back and figure out what your approval timelines are with each different department to make sure that that can happen. Make sure that you have a permit category that is appropriate for what we're doing so that we're A, not paying a lot of money to do it, but also it's getting to the right people in the right hands as soon as possible. If there are any ways to streamline it where we can help, tell us in advance and let's make that happen. So it really is getting into the nitty gritty details of how each task is performed that we're reliant upon to successfully deploy. That is the secret to the success.

Christopher Mitchell: Well, I mean, the impression I get is that when you're approaching them, you're working with cities, first of all, that are going to be open to working with you, but you found that they're pretty receptive to trying to identify these challenges and solve them.

Monica Webb: Some are better than others. One of the other things that one of the towns that we're working with has been wonderful about is just increasing the size of the permit basically. So not limiting it at a few blocks or so many houses or so many square miles but actually saying this'll be a blanket permit for the city, and then you'll just supply us with the plans and we'll review them one phase at a time. That has been enormously helpful. So I would say the cities genuinely want to streamline. It's just a matter of how that actually happens. You know, larger cities, there can be more steps, more red tape to getting that kind of thing done, so we generally find that the smaller towns are more receptive to making things happen quicker.

Christopher Mitchell: Sure. Well, and I'm just thinking, I mean, you actually have a broad view because you're in very red states, very blue states, and purple states. It's worth remembering, towns, you know, they're not subject to the state voting patterns always, just in terms of the politics.

Monica Webb: Yeah, I mean, I would say we haven't seen a difference based on, you know, what the state level politics are. It's really — as they say, all politics are local, and certainly when it comes to processes like permitting that fall under local politics, it really does come down to what the local administration makes as a priority.

Adam Eisner: One other thing there is that we're typically working with municipalities where we're not trying to sell them on the idea that broadband's a transformative thing, so we're generally working with municipalities who, conceptually anyway, are onboard with the idea that this is going to be a good thing. But you know, the proof is in the pudding. When it comes down to the people you're working with initially may be onboard, but as you get deeper into especially larger cities — as Monica was saying it's usually easier with smaller ones — you know, you've got to make sure that all the pockets that you're going to be dealing with are of that same belief. Although generally that's the case, but sometimes there's a bit of cajoling involved in certain places.

Christopher Mitchell: I'm curious what extent you can discuss some of the tradeoffs between different municipal assets that you've leased? I think you've leased conduit, you've leased dark fiber, and you know, the arrangements of dark fiber may have been different in different places, so what are some of the tradeoffs that you're seeing as you're doing this?

Adam Eisner: You know, the more assets that you're leasing, the less control you have over where they are, how accessible they are. Even with those municipal — you know, like I said, everybody's on board with the idea of broadband. Depending on who they've been working with and what they understand, pricing models can be very different as an example. So there can be some real challenges if you're relying entirely on municipal assets because they're typically not designed to be exactly in line with what your objectives are. So we're finding more and more that we're moving to, you know, some hybrid solutions there, where maybe it's some empty duct as opposed to a full duct of fiber that we're trying to lease, as an example. And we're also cognizant of the fact that when municipalities are building these things, there's obviously only going to be a limited amount that's going to be for, you know, a private entity that wants to come in and lease some assets there. So we're finding ourselves in every market, doing it a little differently. Generally speaking, pretty thankful for what is there for assets that we can use, but, you know, we have long conversations with each municipality that we're working with right now on what they have, what they're able to make available, and how that might fit into our build plans, which as we get better at it, you know, we tend to take more in house. And so, it's a bit of an ebb and flow, if that makes sense.

Christopher Mitchell: Are you considering . . . Would it make sense for you to just, like, say, come to Saint Paul, Minnesota, and start being an ISP there on your own without leasing anything, or are you generally thinking about leasing assets in order to get into a market?

Monica Webb: I don't think we actually need to to have municipal assets made available to us in order to enter a market. What we do want to see though is that a municipality is open and interested and engaged in the process of bringing an ISP in because it really is just a different — having a different perspective, wanting to work productively with us.

Christopher Mitchell: You're telling me I should move?

Monica Webb: Yeah. Toronto's got four seasons

Adam Eisner: At this point, assets are definitely nice to have, but like Monica was saying, it wouldn't preclude us from going in somewhere if we thought that the city had the right sort of attitude to this if the competitive situation was such that particularly citizens didn't have access to fiber. So a lot of the markets we go into are one phone company that everybody's really frustrated with and one cable company that everyone's really frustrated with. So, you know, if we're sort of ticking off those boxes and it's a market that can sort of sustain gigabit Internet that we're looking at, we're in that mode where we're still looking

Christopher Mitchell: And are you looking in Canada as well? I get that question every now and then from Canadian folks.

Adam Eisner: Yeah. You know, we're in a real weird spot where we're this Canadian company that doesn't do anything in Canada . . .

Christopher Mitchell: Elliot did say once said that he'd have to build 10 markets in the United States before he would build in Canada because he felt that he wasn't taken seriously until he had achieved more market success. You know, he may have just been joking, but . . .

Adam Eisner: This is a bit of a personal answer, but I think that there's a lot more — if I think about where I live in Toronto, I'm not saying that the options are amazing. However, Bell is spending something like $2 billion in Toronto to build fiber to every home effectively, nd they're starting to do that across the province of Ontario. Telus out west is doing something similar. You know, Rogers, who's a cable provider, is spending a lot of time going to DOCSIS 3.1 and so on and so forth. So competitively, you know, there's a lot of action there. It's a much smaller country population wise, and so there are fewer markets in which to look at that don't have one of those three people or two, you know, really investing a lot of money right now in upgrading the network. That said, the pricing is garbage, but that's another story.

Christopher Mitchell: Now I'm going to avoid the obligatory joke about the exchange rates.

Adam Eisner: Right? Yeah, let's not even get into that. And so, you know, if you look at the U.S., there's just so many more opportunities where, what I was describing earlier, just around bad service, not a lot of options. You know, if you look at a place like Sandpoint, Idaho, you have companies, enterprises coming to you and saying, "Please help. We get a meg up and a meg down." You know, there's a lot of places where we feel like we can solve that problem here in the U.S. Relative to what's in Canada.

Christopher Mitchell: Thank you. Thank you both for taking some time. I love to talk to you in person. You know, Ting is a fun company and I'm excited to see where you all go.

Adam Eisner: We're still having a lot of fun. Thanks for having us.

Monica Webb: Yeah, thanks for having us, Chris.

Lisa Gonzalez: That was Monica Webb and Adam Eisner from Ting, discussing their company's experiences deploying Internet networks and working with local communities. We have transcripts for this and other podcasts available at muninetworks.org/broadbandbits. Email us at podcast@muninetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is @communitynets. Follow muninetworks.org stories on Twitter. The handle is @muninetworks. Subscribe to this podcast and the other podcasts from ILSR, Building Local Power and the Local Energy Rules podcast. You can access them wherever you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter at ilsr.org. While you're there, please take a moment to donate your support in any amount keeps us going. Thank you to Arne Huseby for the song Warm Duck Shuffle, licensed through Creative Commons, and thank you for listening to episode 357 of the Community Broadband Bits podcast.

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