Another year of the Broadband Communities annual summit is behind us, and it’s worth revisiting the most salient moments from the panels that touched on the wealth and variety of issues related to community broadband regulation, financing, and expansion today and in the future. We weren’t able to make it to every panel, but read on for the highlights.
Last Mile Infrastructure and the Limits of CARES Funding
The first day of the program saw some heavyweight sessions from Coalition for Local Internet Choice (CLIC) on last mile digital infrastructure. For communities at all stages of broadband exploration and investment — whether exploring an initial feasibility study, putting together an RFP, or already planning for the future by laying conduit as part of other projects — partnerships dominated the discussion, with timing and debt also serving as common themes.
ILSR’s Christopher Mitchel helped kick off the conference by moderating the first panel in the Rural/Editor's Choice track, and was joined by Peggy Schaffer from Maine's Broadband Office (ConnectME), Monica Webb from Internet Service Provider (ISP) Ting, and Roger Timmerman, CEO of Utah middle-mile network UTOPIA Fiber.
The group discussed the open access models to start, and the benefits that could be realized from two- or three-layer systems. UTOPIA Fiber has seen some explosive growth and spearheaded significant innovation recently as it continues to provide wholesale service to ISPs that want to deliver retail service on the network. Ting, which recently signed on to be one of two providers on SiFi Network’s first FiberCity in Fullerton, California, also acts as an example of what can happen when we break away from thinking about infrastructure investment and Internet access as one-entity-doing-it-all.
The relative merits of wireless (both fixed and small cell) generated a lively discussion, with the panelists talking about advances to the technology over the last few years which have dramatically improved usability; we’ve seen this over the summer in places like Champaign, Illinois and San Rafael, California, where groups have been able to stand up wireless systems quickly in order to bring connectivity to neighborhoods who need it for school, work, and staying otherwise connected as the pandemic continues.
We’ve also seen examples of it being used in rural and rugged parts of Pennsylvania, where people invested after being ignored again and again by broadband providers. Still, it’s a not a cure-all: Roger Timmerman pointed out that the lifespan of fixed wireless systems is one half to a quarter of fiber networks, and Peggy Schaffer talked about how in rural Maine geographic barriers still stand in the way.
The panel then dove into the benefits and barriers of CARES Act funds, which states, counties, and local governments have been making use of over the last six months to stimulate broadband expansion efforts by both public and private entities to connect more Americans. While the presence of funds has no doubt meant more investment in places that were previously unserved or underserved, as a group the panel pointed out the problem: CARES regulations stipulate that those who accept funds not only have to complete broadband buildouts by the end of the calendar year, but they have to deliver the services as well. For UTOPIA Fiber, this has meant saying no to CARES-funded projects that require any right-of-way component whatsoever, including crossing railroads, canals, or bridges. Schaffer pointed out that it’s been equally difficult in Maine.
The group ended by discussing the applications and services offered by open access networks, including scalable, ad hoc networks for schools, secure, closed networks for hospitals delivering telehealth services, and employee-exclusive networks for private business or municipalities. It remains an exciting, early look at what open access and software defined networks could look like down the road.
Broadband Partnerships and Financing
The second half of the day was dominated by a perennial theme of the conference: broadband partnerships. Representatives from ISPs, state broadband offices, municipal IT departments, and co-ops discussed what it took to make these relationships work, and how state and federal funding could act as force multipliers. Panelists shared the partnership projects they thought had been most successful and what they learned from them.
Participants emphasized the importance of getting local buy-in on projects before they got too far off the ground, lest obstacles sour things down the road. They also reiterated over and over that timing was key; both in the planning stages, but also in managing the expectations of potential users and partners involved.
Public entities stood at the forefront of the examples offered, including Alabama Power providing dark fiber for CSpire to make it out into communities they otherwise wouldn’t have been able to, the city of West Des Moines, Iowa building a citywide conduit system and engaging Google Fiber as its first lessee, and Fresno, California making use of its existing fiber infrastructure to partner with XG Communities and provide backhaul for the latter’s 5G deployment.
State and federal financial opportunities anchored the end of the day, with Joanne Hovis (the face of consultant group CTC as well as CEO of the Coalition for Local Internet Choice), leading panelists representing Maryland, Michigan, and Kentucky. From the discussion it’s clear that consideration of local conditions and strong state leadership remains key to any successful effort.
In Maryland, for instance, the strength of county-level governments meant that the state broadband office could help with ReConnect applications (the USDA’s $100 million broadband grant program running through the end of 2021) to get offers off the ground.
In Kentucky, Darryll Maynard shared that the state’s robust middle-mile network (KentuckyWired) played a role in partnerships formed to get fast, affordable, reliable Internet out to the areas lacking it; he emphasized the success they’ve seen with microfinancing projects (via county-level grants) and partnering with local electric cooperatives to use existing infrastructure. It is good to hear some of the positive benefits after so much bad news in the ProPublica investigation.
Charlotte Brewersdorff from Michigan Moonshot, which won CLIC’s National Network of the Year Award, also highlighted the success of working with partners across the state, and the moves the organization has seen by nonprofit, nontraditional players like philanthropic organizations as critical players in expanding the ecosystem of cooperation.
Municipal Success Stories
The first half of the second day of the conference saw equally fascinating conversations, with the case of Massachusetts’s Westfield Gas and Electric and its fiber arm — Whip City — serving as a standout among them. The network’s Information Technology Manager, John Leary, shared Whip City’s story, which began five years ago and which today covers more than 70% of the municipality. For him, the most dynamic change going on at the moment was the host of towns the network was currently advising in the western part of the state that in the process of building their own municipal networks (some 20 by the end of next year).
The Enterprise Center’s Deb Socia moderated an equally informative panel on how COVID has impacted communities around the country and the role broadband will play in the future of work. Along with Gary Bolles (Chair for the Future of Work at Singularity University) and Matt Dunne (Founder and Executive Director at the Center on Rural Innovation), she explored what it would take for small and large, rural and urban communities to bounce back. The movement of self-employed technology workers to places with quality connections and mitigating the devastation to tourism-based economies featured prominently in the discussion. And running throughout it was the surety that areas which refuse to invest in information infrastructure will not just feel the impact from the current pandemic, but will fall behind at an accelerated rate in the future as the pandemic returns over the next few years.
Christopher moderated the last panel of the day, highlighting some of the more unfamiliar municipal network success stories you may not have heard about, in the hopes that sharing their story would ease the road to success and help other cities meet challenges head on. David William from Ponca City, Oklahoma related how his city expanded its fixed wireless system to include a Fiber-to-the-Home buildout that started a little less than a year and a half ago. Carole Monroe, Chair of the Board for ValleyNet, talked about Vermont’s unique Communications Union District (CUD) approach to expanding broadband, and how its first one — EC Fiber — has fared over the last four years. Notable here is that EC Fiber amassed an eyebrow-raising $7 million in crowdsourced funds from those who wanted better broadband service. And finally, Mont Belvieu, Texas Director of Broadband & IT Services Dwight W. Thomas, Jr., and City Manager Nathan Watkins shared what it took for MB Link Broadband to succeed in a city without an electric utility already on the ground and achieve a 70% take rate among households.
The audience heard that for all of the projects, resident buy-in was key. We also learned that adding network services to existing utilities doesn’t necessarily mean a massive commitment of funds to new staff members; depending on local conditions and resources, community networks can contract out plant work or customer service positions.
The group also discussed lessons learned. Mont Belvieu would build incrementally if it had to go back and do it all again, and EC Fiber’s obvious focus on connecting areas where people invested in pre-sales meant that later on in order to link additional residents they had to do some overbuilding. Ponca City has had to contend with areas of the city where mass marketing is too expensive per capita but the utility still needs to get the word out, and so they’ve adjusted to doing direct marketing by placing signs in residents' yards.
Sausage Making of Fiber Financing
The final day of the conference featured panels that dug into the details of financing, the legal challenges facing community broadband initiatives, and the role of existing municipal utilities and electric cooperatives in connecting Americans over the next decade.
This first of these was one of the more interesting panels of the whole conference. Doug Dawson from CCG Consulting moderated, and set the tone by sharing that his read of the current financing climate is that banks are starting to tighten their belts a bit, operating with stricter and more scrutinized lending requirements which make the record low interest rates on loans less impactful in the larger context. He also said that he’s seeing municipal bond buyers begin acting more cautious. Both of these will impact capital availability for financing projects over the next half year, though things could change.
On the panel was a diverse group who, in sharing their experiences in building community broadband around the country, emphasized that what works for one community won’t necessarily be the best route for another. Another important takeaway was that local governance structures, appetites for risk, incumbent providers, and staffing resources all have a part to play — not just later on, but in the pre-planning stages when communities are looking for the best financing routes.
In one community residents might be open to taxing themselves based on millage rates, like in Lyndon Township, Michigan, where 66% voted to assess an average of $23/month to bring 25/ Megabit per second (Mbps) service for $35/month and gigabit service for $70/month. Because the construction was funded by property taxes rather than on the basis of the subscriber fees or take rates, the project was seen as low risk and the township was able to secure very low interest financing. Local officials then used the town’s financial advisor to get hooked up with the appropriate bond agencies, and engaged the county to act as fiduciary for the project. For what it’s worth, Lyndon needed a 38% take rate to make the network self-sustainable after it was complete; currently, it enjoys 80%, with high customer satisfaction rates.
And it doesn’t hurt to reach out for help; DeKalb Telephone Cooperative in Tennessee has been advising those looking to set up networks and then serving as backend operators, using their expertise in assessment, market analysis, and network management to facilitate projects in the area.
Broader points touched during the panel also included appealing to residents (including key stakeholders and broadband champions but also potential users) as early as possible, spending time and money investing in the planning stages, and not getting discouraged when project timelines stretch for one reason or another.
Who will connect America moving forward?
In an afternoon panel on who would serve to connect Americans as we move forward, the audience heard from two electric utility providers who over the last two decades expanded into the broadband space, as well as the managing director of Onward Eugene and the CEO of the Utilities Technology Council. We heard from speakers about the challenges they faced in moving from electrical utility service into the fiber space, and how they solicited community buy-in.
Hank Blackwood from Dalton Utilities shared how their strategy early on was directed by manufacturers in the area that wanted high-capacity connections, and how that served as the springboard for the utility to move into the residential space. All three panelists pointed out the economic benefits that came along with fiber investment, including attracting new startups and tech jobs (in Eugene, Ore.) and keeping carpet manufacturing in the area when so much of it has moved overseas in the last two decades (Dalton, Ga.).
From the point of view of the group, the public sector remains uniquely situated to take the long view on rates of return and investment for broadband infrastructure in a way that not only helps when building community-owned and operated networks but as a basis for then partnering with the private sector to deliver services. The biggest barriers mentioned were last-mile build costs, which Matt Sayre from OnwardEugene suggested could be offset in some ways by investment in middle-mile infrastructure that could be leased to third parties to recoup costs.
Finally, the group universally agreed that electric utilities are often the best partners for other electric utilities when doing things like hooking together to provide route diversity, add additional backhaul, or access middle-mile routes to save costs in getting to other areas. All panelists saw electric utilities playing a heavy role over the next five years in expanding fiber networks around the country, especially in smaller and more rural communities. When fellow utility providers were unavailable, they preferred working with local telephone or cable companies as opposed to national ones.
Key Legal Issues Affecting Community Broadband Initiatives
The penultimate panel on legal issues, directed by two partners from the law firm Baller, Stokes, and Lide as well as general counsel for the National Association of Telecommunications Officers & Advisors, covered the basic ground for communities considering getting into the broadband game. They highlighted the federal rules and regulations surrounding telecommunication service, eligibility for federal funds (both ongoing like ReConnect and stimulus money from the CARES Act), and what kinds of legal considerations communities and should make before embarking on projects themselves or with the intent of engaging a private or public partner in the endeavor.
For veterans of the Broadband Communities Annual Summit and regular followers of community broadband efforts around the country, one of the most commonly repeated assurances during the totality of the conference was familiar: none of this was rocket science. Expanding broadband access remains a matter of taking into consideration local needs and resources, marshalling volunteer efforts, having frank conversations, and taking accurate stock of existing political will.
As was pointed out by Christopher on Day 1 and Matt Dunne on Day 2, we have and will likely continue to see smaller communities leapfrog their larger neighbors in investing in network infrastruture, which shows that neither capital expenditures nor population density (as the monopoly telecom and cable companies keep repeating) are insurmountable barriers.
We can have competitive, universally available, high-quality, fast Internet access in the country.