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Lit Communities Secures Funding for Public-Private Partnership in Ohio
A recent announcement by fiber network builder, operator, and consulting firm Lit Communities signals both a proof of concept for a new public-private partnership and that progress is accelerating for residents in one region of Ohio who will soon enjoy Fiber-to-the-Home (FTTH) service from a new provider.
In a press release last week [pdf], the company announced it had secured significant funding from private firms Stephens Capital Partners and The Pritzker Organization to support its work in partnering with communities that are looking to leverage their existing information infrastructure to finish connections to residents in cities and towns around the United States. The news means an infusion of cash for Lit Communities’ local last-mile venture, Medina Fiber, which will bring new fiber service to tens of thousands of homes in Medina County (pop. 180,000) at lower costs by utilizing the existing publicly owned, middle-mile open access Medina County Fiber Network (MCFN).
Publicly Owned Middle-Mile Supporting Privately-Owned Last-Mile
The collaboration will allow Lit Communities to save money and expedite residential rollout by connecting to MCFN. It is also a sign of success for local officials who have been looking for ways to use the existing infrastructure to spur high-speed Internet access beyond government buildings, schools, and commercial transport to hundreds of thousands of Ohioans in the near future.
MCFN will continue to own and operate the middle-mile portion of the network, with Medina Fiber owning and operating the last-mile residential connections as a private entity, paying MCFN for backhaul with the fees it generates from households that choose to subscribe.
Lit Communities began life as a consulting firm working with communities considering infrastructure investment and looking for design and business plan assistance. But the firm also saw opportunities to work with communities that wanted to pursue partnerships to connect households without serving as network operator. Medina County and MFCN seemed like a natural fit, and in 2019 Lit Communities established its builder/operator wing and formed Medina Fiber as a regional Internet Service Provider (ISP).
The Medina County Fiber Network consists of 151 miles of fiber connecting each of the population centers in the county with 144 strands in a redundant ring. It was built using 20-year Recovery Zone Bonds totaling $14.4 million issued in December of 2010, and backed by Brunswick City, the Village of Seville, Medina City, Wadsworth City, the Village of Westfield Center, and Cascade Capital Corporation. The project got a boost shortly thereafter by a federal Comprehensive Community Infrastructure grant of $1.4 million. Currently, 13 providers operate on the network and serve commercial, medical, and other entities, with the bonds paid back through fees generated by offering dark and lit fiber services up to 40 Gigabits per second (Gbps). In February 2020, the network announced that revenue had met its $100,000 monthly bond payment.
With the funding agreement signed just 30 days ago, construction began last Monday. Medina Fiber has already buried 3,000 feet of fiber in the last week, and is optimistic about the progress it will make over the next 12 months.
In an interview last week CEO Brian Snider and Chief Marketing Officer Ben Lewis-Ramirez shared that they anticipate connecting Medina Fiber’s first users in June in the Westfield Center and Seville areas. Guided by community interest, Phase 1 aims to bring fiber to more than 50,000 homes in the next 36-60 months.
A Model for Elsewhere?
Depending on how it goes, this could be the first of many similar-looking partnerships. Lit Communities has Competitive Local Exchange Carrier (CLEC) status across Ohio, but has also been pursuing talks with cities outside the state. Ten years from now we might see a collection of regional networks like Medina Fiber that utilize capacity on city-owned fiber to blanket neighborhoods with high-performance service and bring competition. The company is in the planning stages in Kentucky, Texas, Pennsylvania, and Virginia.
In the meantime, 2020 saw the firm work with York County, Pennsylvania to build 30 miles of fiber to extend the York County's middle-mile infrastructure in the area. They also worked with Botetourt County, Virginia to extend ten miles of fiber to more than 200 rural homes and improve connectivity in the area.
Medina County, however, does present obstacles. Sections in the northwest and southeast parts of the county are the farthest from MCFN’s existing middle-mile infrastructure. Medina Fiber leadership would ideally like to deploy a fixed wireless solution for those communities in the interim while it works to get fiber everywhere. There are other considerations as well. The Lorain-Medina Electric Cooperative is in the process of deploying backbone fiber to its electric substations in the northwest part in Ashland, Huron, Lorain, Medina, and Wayne counties as the co-op considers extending FTTH to its membership, so residents there might see high-speed service from one or both sooner rather than later.
Ramirez alluded to the opportunities offered by the model back in 2019:
We can separate layers of the network for residential service [and] business service. We can offer telehealth. We can offer a backhaul for cellular providers and the wireless carriers. We can offer capacity to the community itself for smart city applications that are bandwidth-heavy. And we can do all of that with the same network infrastructure . . . in a way that's extremely consumer-friendly.
Lit Communities envisions similar collaborations with communities elsewhere across the state and country, while ensuring the firm remains sensitive to local needs and existing infrastructure. While it is willing to act as builder and operator of the last mile FTTH network, Snider believes financial security and widespread benefits are most assured when cities and towns have skin in the game.
For more background on Lit Communities, MCFN, and the Medina County project, listen to Christopher talk with MCFN's David Corrado as well as Lit Communities CEO Brian Snider and Chief Marketing Officer Ben Lewis-Ramirez on Episode 386 of the Community Broadband Bits podcast below.