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NYTimes Examines Sixth Circuit Reversal: Potatoes And Pinetops

The Sixth Circuit Court of Appeals issued their order on August 10th supporting the states of Tennessee and North Carolina in their challenge from an FCC decision from February 2015. Both states objected to the FCC’s decision to preempt state laws preventing municipalities from providing fast, affordable, reliable connectivity via municipal Internet networks. The Appellate Court Judges reviewed the legal arguments, the precedent, and the interplay between federal authority and state sovereignty. 

The impact of their ruling will affect more than a few pages in a law school text book. Access to high-quality Internet access positively impacts real people and businesses and, as Cecila Kang captures in her recent article in the New York Times, the people who depend on it fear the outcome if their state legislators take it away.

Family Farm Fear

Kang profiles Vick Family Farms, a family potato farm in Wilson, North Carolina.  The Vick family chose to invest in a processing plant when they learned that Wilson’s Greenlight would provide the necessary connectivity. Greenlight allowed them to increase sales overseas. Now, they may lose that connection:

“We’re very worried because there is no way we could run this equipment on the internet service we used to have, and we can’t imagine the loss we’ll have to the business,” said Charlotte Vick, head of sales for the farm.

As Kang notes in her article, the FCC has no plans to appeal the decision, so battles will resume at the state level. Advocates will need to be twice as vigilant because incumbents - the only ones that come out ahead from this decision - may try to push state legislators for even tougher anti-competitive state barriers.

Pinetops: Poster Child For Good Connectivity

Kang checks in on the small town where Wilson’s Greenlight began offering Fiber-to-the-Home (FTTH) Gigabit service about 14 months ago. Pinetops, a nearby community of about 1,300 people, sought help from Wilson in the hopes that Greenlight would spark economic activity in their struggling community. Centurylink, the incumbent only offered DSL, grossly inadequate for local businesses. 

When Greenlight expanded to Pinetops, the town saw the beginning of a rebirth of sorts. Now the community waits in limbo, wondering what will happen next.

Kang introduces readers to Tina Gomez:

Tina Gomez, a Pinetops resident, quickly saw Greenlight’s benefits. She recently got a telework job with General Electric, which requires reliable high-speed internet service to run a customer service software program. Ms. Gomez, 37, also started online courses in medical billing and coding. Before subscribing to Greenlight, finding telework was a challenge because the existing home internet service was too slow, she said.

Now the political squabble over broadband may hurt her livelihood. Mark Gomez, Ms. Gomez’s husband, said they would move from Pinetops to Wilson when their broadband service was disconnected.

“We can’t stay if the basic services we need aren’t here,” Ms. Gomez said.

Beyond The Courtroom

Executive Director of Next Century Cities Deb Socia summed it up when she told Kang:

“This is about more than North Carolina and Tennessee...We had all looked to the F.C.C. and its attempt to pre-empt those state laws as a way to get affordable and higher-quality broadband to places across the nation that are fighting to serve residents and solve the digital divide.”

Open Access Muni On The Way In Campbell River, B.C.

Located on the southern end of British Columbia’s Vancouver Island sits the coastal city of Campbell River. The community recently received a $50,000 grant from the Island Coastal Economic Trust (ICET) to pursue better connectivity through a municipal open access network initiative.

Retain and Attract

The “Salmon Capital of the World” is also home to other industries that increasingly need access to fast, affordable, reliable connectivity. Approximately 31,000 people live in Campbell River. The island’s forestry and mining companies need to have the ability to transfer large data files, such as 3D renderings, detailed maps, and similar geographic files, to business associates. In addition to making the current situation better for existing industries, community leaders want to attract new industries. From a July Campbell River Mirror article:

“We need to retain our existing businesses and enable them to grow in place,” [Economic Development Officer Rose] Klukas said in a release. “We are also looking to attract and support technology and creative sector entrepreneurs – designers, programmers, software engineers, and more – and competitively priced, high-speed broadband is a must-have.”

The ICET grant will fund the completion of a fiber-optic ring that's owned by the city and currently used only for municipal operations. The city will expand the ring and allow Internet Service Providers (ISPs) to offer services to local businesses via the fiber-optic infrastructure.

The First Of Its Kind

This project will be the first open access municipal network on Vancouver Island. In addition to the more immediate need of better connectivity for Campbell River, ICET hopes to determine if this same model can be duplicated elsewhere on the island.

Hudson, Ohio, Issues RFP for FTTH Study

Hudson is bringing better connectivity to local businesses with Velocity Broadband, its gigabit fiber network, and is now exploring the potential of Fiber-to-the-Home (FTTH) for the rest of the community. The city recently issued a Request for Proposals (RFP) for a feasibility study to review the possibilities for service to residents. Proposals are due August 26.

From the RFP Summary:

This project will result in the production of a Feasibility Study containing a residential needs assessment, deployment strategy options and construction cost estimates. The desired outcome of this planning effort is to provide a tool for the city to establish if Hudson residents want this service and determine a successful deployment strategy and the associated cost to implement fiber to the homes (FTTH) within the City of Hudson. 

The city wants the study completed by the end of 2016.

We’ve covered Hudson’s venture into accelerating connectivity for businesses since 2014. The community of 23,000 started by incrementally building out a fiber-optic institutional network (I-Net) over a period of about ten years, which it later expanded to offer gigabit service to businesses. Chris interviewed Hudson City Manager Jane Howington last December about the city’s Velocity service. Check out episode #181 of the Community Broadband Bits podcast for that conversation. Since the launch, local businesses have been excited to obtain fast, affordable, reliable connectivity.

The full RFP is available on the city's website.

For Rural Pinetops, Being A Gigabit Community Means Business In North Carolina

Unless you live in a rural community, you probably assume becoming a Gigabit community is all about the miracles of speed. Speed is important, but so is Internet choice, reliable service, and respectful customer service. It’s also about being excited as you consider future economic opportunities for your rural town.

Businesses Struggling With Old Services

Before Greenlight began serving Pinetops, the best community members could get was sluggish Centurylink DSL. Suzanne Coker Craig, owner of CuriosiTees, described the situation for her business:

Suzanne used to be a subscriber to Centurylink DSL service at her Pinetops home, but years ago she just turned it off. “We weren’t using it because it used to take forever; it just wasn’t viable.” She now has Greenlight’s 40 Mbps upstream and downstream service. “It’s just so very fast,” she said.

Her business, a custom screen printing shop, uses an “on-time” inventory system, so speed and reliability is critical for last-minute or late orders:

“We work with a Charlotte company for our apparel. If we get our order in by 5 p.m. from here, the next day it will be delivered. That’s really important for business.” Before Greenlight, Suzanne described how “We had been sweating it out.”  Suzanne’s tee-shirt store only had access to 800 Kbps DSL upload speed. She would talk to the modem. “Please upload by 5 p.m. Please upload.” Now she can just go home and put her order in at the last minute. “We are comfortable it will upload immediately….It’s just so much faster. Super fast…Having Greenlight has just been very beneficial for our business.” 

She also subscribes to Greenlight from home and her fiber connection is able to manage data intense uploads required for sending artwork, sales reports, and other large document transfers. As a Town Commissioner, Suzanne sees Greenlight service in Pinetops as more than just a chance to stop "sweating it out."

“I just see a brighter future for our town now,” she reflected. “It’s a neat selling point. It’s difficult in small rural areas to get good technology-based companies. This now opens the door for us to recruit just those kinds of businesses…It’s hard to imagine a business that does not need Internet access.” 

Without Reliability, Speed Is Nothing

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Brent Wooten is a sales agent and Manager for Mercer Transportation, a freight management business with an office in tiny, rural Pinetops, North Carolina. Pinetops is now served by Wilson’s community-owned, Gigabit fiber network, Greenlight.  Brent’s work, moving freight across the country via trucks, requires being on time; he’s an information worker in a knowledge economy.  “I am in the transportation business,” said Brent. “Having reliable phone and Internet are critical to running my businesses.” Being off line means losing businesses and never getting it back.

Before Greenlight came to town, Brent’s business paid Centurylink $425 per month for a few phone lines, long distance, an 800 number, and Internet access at 10 Megabits per second (Mbps) download and 1.5 Mbps upload. He was also wasting hours and even days each month trying to get his Internet fixed. “Every time they would tell me the problem was my equipment. It was always my fault.” But Brent had an IT expert on hire. “Never once was the problem actually my equipment.” He described long waits to reach customer agents whose heavy foreign accents made communication difficult and about the company’s unresponsive office hours. “I was told they could send someone the next afternoon, but I needed the network to work now....”

Brent’s experience with Greenlight was the complete opposite. When Brent’s corporate office changed the location of their backup servers, Greenlight staff were helping him at 6:00 a.m. and at 10:00 p.m., and were on the phone within seconds of his call. “It is a very refreshing situation for me -- the consistency of service, and the responsive and respectful customer service by local workers.” 

Internet Choice

When Greenlight came to the community, Centurylink changed their tune. Within hours of his business phone being ported to Greenlight, a Centurylink representative called him. “He offered to cut my current prices in half and double my Internet speed, from 10 to 20 Mbps…My Centurylink 10 Mbps speed never tested at more than 6 Mbps.”

Brent chose to keep his Centurylink phone service, but he kept his 25 Mbps symmetrical Greenlight Internet service because upload speed is critical to his business. “My computer screens don’t freeze up anymore. Greenlight service is flawless. The sheer speed of fiber is amazing and they are available 24 hours a day, I am served by local workers, it is saving me money and I get better service.” 

Greenlight brought Brent residential telephone and internet choice for the first time in more than a decade. “Greenlight saves me $140 a month at home,” he bragged. When Greenlight’s marketing director first arrived at Brent’s house, he learned Brent was being charged twice for his internet service. Brent had an in-law suite attached to his house where his mother used to live. “The Centurylink representative on the phone said I needed to have a second DSL account.” Not with Greenlight.

An Odd Way Of Competing

Brent described how he had been a Centurylink residential customer since 1989. “When I called to cancel my home telephone service, the woman just gave me my confirmation number and told me to have a nice day.” No attempt was made to keep Brent’s residential business.  “They did the same thing on my mom’s phone line. She had telephone service since before 1968.” When she passed away, Brent called to disconnect her line. “The person on the other end of the line did not even offer condolences.” He compared that to the human touch that originates from a service company that is community owned: “Greenlight’s installers even cared enough about my welfare to tell me they had discovered a water leak under my house when doing the installation. They told me they would have tried to fix it for me but they did not have the right tools.”  

The Intangibles

How do you put a value on the intangibles?  For Brent Wooten, Greenlight fiber service has not only strengthened his ability to do business, but has given the community a sense of hope that didn’t exist before access to fiber.

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“As a citizen and Town Commissioner, I am extremely excited to have the opportunity to have access to this service, and super excited about future opportunities that it will make available to us. It is an example of hometown people who care about serving you and bringing a higher quality of living to the community...It gives a sense of hope for Eastern North Carolina ... not just lip service.” 

Will It Last?

On August 10, 2016, the U.S. Court of Appeals for the Sixth Circuit reversed the FCC ruling that permitted Greenlight to expand to its fiber-optic service to Pinetops. What this means for these businesses and residents who now rely on fast, affordable, reliable Internet access remains to be seen. Along with Suzanne, Brent, and the rest of Pinetops, we hope Greenlight is able to continue to serve this rural community. They are using fiber to reach for new economic development opportunities and in only a few months, the community of 1,300 is optimistic about a future with better connectivity.

North Carolina Communities Create West-Next Generation Network

Drawing inspiration from a previous project in the Research Triangle, communities around Asheville are joining forces. The goal is high-speed Internet access.

West - Next Generation Network (WestNGN) is a multi-government collaboration in the Asheville area to encourage investment in fiber-optic networks for Gigabit (1,000 Megabits) connectivity to the region.

An Established Model

The Research Triangle, the area around Raleigh, Durham, and Chapel Hill, started a new collaborative model to bring Gigabit connectivity to their communities. Six municipalities and four universities there established the North Carolina Next Generation Network (NCNGN). The project encourages private sector providers to develop ultra-fast networks.

The Land of Sky Regional Council is an Ashville-based multi-jurisdictional development organization that includes Asheville, Biltmore Forest, Fletcher, Hendersonville, Laurel Park, and Waynesville. 

A Wide Impact

The Land of Sky Regional Council will provide project management by setting up a steering committee, analyzing regional data, and drafting a Request for Proposals (RFP) for Gigabit service. The group hopes high-speed Internet service will boost economic development. 

They want to reach 125,000 customers south and west of Asheville. As Smoky Mountain News reported the project costs for the first year total $35,000. Each community will pay $4,000 and then contribute proportionally based on population. For instance, Asheville will pay $11,893, and Waynesville will pay $4,877. 

Waynesville is the seat of Haywood County, which is working to improve connectivity by developing a broadband master plan. While the Haywood County Economic Development Council’s planning focuses on opportunities for the county, Waynesville is collaborating with communities in nearby counties through the WestNGN project. 

"An Awesome Opportunity"

Andrew Tate, President and CEO of the Henderson County Partnership for Economic Development, explained how the WestNGN model works to local news BlueRidgeNow:

“It allows our local units of government to apply leverage to the private sector to further deploy broadband, especially to areas that wouldn't get it otherwise or that wouldn't see it. ... Most of those areas are not the areas we focus on in terms of employment or industrial development, but I think it's a wise move. I think it's an awesome opportunity for local governments to collaborate with one another and look for an opportunity to improve the region."

Port of Ridgefield, Washington: Dark Fiber Network On Deck

The Port of Ridgefield is planning to build a municipal open access dark fiber-optic network that could provide access to high-speed Internet connectivity for the Washington state community of 7,000. 

Planning Stage

Town officials held a public informational meeting in late June to update residents and businesses on the fiber project, which is still in the planning stage. Estimated cost of the proposed 42-mile fiber backbone is $2.4 million, Nelson Holmberg, Port of Ridgefield vice-president of innovation, told us.

Currently, the Port has budgeted $500,000 from town funds for this year’s portion of the project, the Vancouver Business Journal recently reported. Holmberg told us:

"We are moving  forward with construction design and policy work. The Port will not be the operator, nor will it offer service on the backbone. Retail service will be offered by the [Internet Service] providers  who ride on our fiber. We're simply building the infrastructure and making it available to providers."

Holmberg told us that a firm construction timeline has yet to be set. According to the Business Journal, the Port of Ridgefield will make use of existing assets and take advantage of opportunities to reduce costs. The Port hopes to work with Clark Public Utilities and the Clark Regional Wastewater District to plant conduit whenever there is new trenching and pull fiber through conduit that is already in place.

A Mixed Bag

Currently, Internet service in the Port is a "mixed bag," Holmberg told us, with the offerings including Comcast Business, Comcast or CenturyLink to the home, satellite and point-to-point wireless and even dial-up.

The Port's fiber development project is needed to help retain and attract business, Holmberg continued. The availability of high-speed Internet connectivity is especially important to modern industries that depend on being able to transmit and receive large amounts of data.

Holmberg told us:

"Businesses [in the Port] complain they can't get the bandwidth or speeds they need, and are excited about the opportunity that they see in our system. As an anecdote, Washington State University Vancouver - at the south end of our planned loop - has a need to send 1 Terabyte (over 1,000 Gigabytes of data) of research to the main campus in Pullman, Washington once a week. Because they don't have the bandwith they need, they are literally downloading to a hard drive and overnighting the hard drive to Pullman."

Keeping Up With The Speed Of Dark Fiber

Port of Ridgefield is among a growing number of communities that are seeking to make high-speed Internet connectivity available to businesses and providers via dark fiber, i.e. fiber optic cable that is not currently active or “lit.” In the Northwest, the Idaho towns of Port of Lewiston, Port of Clarkston, and Port of Whitman are working together to use dark fiber assets for commercial connectivity via a similar open access model.

As more communities in the region invest in essential Internet infrastructure, those that don’t have publicly owned networks or private providers to provide high-speed connectivity in their communities will be disadvantaged.

“Accessible and reliable high-speed Internet infrastructure and connectivity is a critical component of successful economic development activity in our region,” said [Columbia River Economic Development Council president, Mike] Bomar. 

“Our region’s ability to add fiber connectivity to our list of business amenities will provide a direct competitive advantage to our existing companies and in our ongoing work to attract and recruit new enterprise into the area across a diverse array of industries.”

TN Study Suggests Stamping Out State Barriers

The results of a statewide Tennessee survey on residential and business connectivity are in and they ain't pretty. Thirteen percent of the state - more than 834,000 people - don’t have access to 25 Megabits per second (Mbps) download and 3 Mbps upload, which is the FCC's definition of broadband. Authors of the study make a number of recommendations, the first of which is removing state barriers that stifle Internet infrastructure investment.

"...A More Open Regulatory Environment"

The study, commissioned by the state’s Department of Economic and Community Development (TNECD) earlier this year, includes feedback from more than 23,000 households and businesses. 

From page 13 of the report:

The State of Tennessee could consider lifting administrative burdens and restrictions to broadband infrastructure investment to fostering a more open regulatory environment. 

In the report, the authors provide detailed reasoning for why the state should embrace an open regulatory environment to encourage competition. They note that state barriers impact electric cooperatives, municipalities that operate electric utilities and cannot expand beyond their own service areas, and municipalities that do not operate electric utilities but can only build telecommunications infrastructure in unserved areas with a private partner.

The FCC came to the same conclusion in February 2015 and rolled back Tennessee state laws in order to encourage competition. Tennessee is leading the charge against the FCC's decision with North Carolina (even though NC's Attorney General criticized the law). The parties have filed briefs, attorneys have presented oral arguments, and now the Sixth Circuit Court of Appeals is considering the case.

The report goes on to recommend other policies, including dig-once, smart conduit rules, and one-touch make ready. Some of these policies have been challenged in other states by the big incumbents, such as the AT&T fight in Louisville against one-touch make ready. It’s no secret that Governor Bill Haslam has been content to let these same corporate gigantaurs effectively run the show in his state for some time now. 

Business Critical

Beyond recommendations, findings from the study were also revealing. The press release from the TNECD stated that the study shows fast, affordable, reliable connectivity is especially important to Tennessee’s businesses:

Businesses participating in the assessment reported broadband enabled 43 percent of all net new jobs and 66 percent of revenues. In addition, 34 percent of businesses classified broadband as essential to selecting their location, and 56 percent noted that it was essential to remain in their location. Sixteen percent of economic development agencies reported that businesses frequently chose not to locate in an area due to insufficient broadband. (emphasis ours)

Both business and residential participants cited reliability as the most important factor to them when analyzing their connectivity. Businesses also considered upload speed critical to their use of the Internet.

Urban vs Rural

While the survey determined that 13 percent of people in the state don’t have access to 25 Mbps / 3 Mbps, the “vast majority” were rural folks. According to the survey, 98 percent of urban participants DO have access. Those would include people who live in places such as Chattanooga, Pulaski, and Clarksville - all towns with municipal networks.

The survey found a correlation between access to the Internet and a number of factors, four of which were the most prevalent:

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  • The economic status of the community 
  • Number of ISPs (level of competition)
  • Type of connection
  • Population density 

Removing state regulatory barriers would allow a number of these rural areas to partner with municipalities that have already invested in Internet infrastructure. Nowhere else is this situation more apparent than in Bradley County. Cleveland Utilities (CU), the electric, water, and sewer provider in the county would like to partner with nearby Chattanooga EPB Fiber Optics to bring fast affordable, reliable connectivity to customers but state law forbids it. Bradley County and a number of other rural communities have appealed to state lawmakers because it is a matter of economic urgency and educational necessity for their children. They are still waiting.

Bills to eliminate the state barriers have been introduced but while the number of State Legislators supporting them has increased, the movement does not have the force to restore local authority...yet.

Break Down The Barriers 

Haslam referred to his administration’s report as “a starting point” and TNED Commissioner Randy Boyd cautioned that, “Not every option included in the report may be the answer for Tennessee, nor is there one simple solution.” 

It must be hard to hold the line as expert opinion and evidence chip away at the flawed logic behind Tennessee's state barriers. It's becoming increasingly apparent that the laws do not benefit the people of Tennessee; they are in place strictly for the big cable companies and telcos that operate there.

For the full report, visit the TNECD website.

Glenwood Springs, Colorado: Fiber Frontier

Glenwood Springs was the first community in Colorado to invest in publicly owned Internet infrastructure, the Community Broadband Network (CBN), and offer services to local businesses. The community, originally named “Defiance,” was also one of the first U.S. communities to have electric lights. Their open access municipal network has improved connectivity throughout the community and helped establish robust competition in this western frontier town.

Dial-Up Just Didn’t Do It; City Steps In

Bob Farmer, Information Systems Director at Glenwood Springs, spoke with Christopher Mitchell for episode #206 of the Community Broadband Bits podcast and he shared some of the network’s history. Before community leaders chose to take matters into their own hands, Qwest (now CentuyLink) and AT&T were offering dial-up services to residents and businesses. The city approached the incumbents and asked them to make upgrades to improve local connectivity but were told by both companies that they had no plans to make improvements.

Bruce Munroe, former Director of Information Services, was interviewed in 2005 about the community's plan to invest in fiber and the incumbents' reaction. He said:

“When we started, we were told that it wouldn’t be profitable for them to provide service,” says Munroe. “But they also said ‘you can’t do it either.’ There was no interest in [pursuing] anything until we said we were going to do it.” Glenwood moved ahead anyway after its city council approved a municipal service plan based on keeping businesses in town. “We were protecting our economic base,” says Munroe, who noted that businesses were leaving because they didn’t have speedy access to the Internet. 

Farmer recalls that a citizens group formed to advance the prospect of publicly owned Internet infrastructure. While a plan surfaced to offer triple-play via fiber-optic connectivity to the entire community, pushback from local fixed wireless Internet access providers and other businesses eventually led community leaders to scale back. The city chose instead to offer businesses and community anchor institutions (CAI) connectivity via an open access fiber-optic network in 2000-2001 and use the backbone to create a fixed wireless network for residential access. While a number of private wireless providers used the CBN to offer residential services, the city did not actually offer fixed wireless directly to residents until 2009. According to Farmer, they never advertised and had less than one percent of the subscriber base.

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In his interview with Christopher, Farmer described some of the difficulties with the plan in a town the size of Glenwood Springs where there were already a number of wireless providers:

“[A]t that point we were directly competing with the existing wireless providers and many of them became resellers on our network”

There were a relatively high number of wireless providers offering services in Glenwood Springs - as many as seven at one time - which made the market very competitive. Farmer believes the town's population of a little less than 10,000 does not support a high number of competitors. Connectivity throughout the community is certainly better than it was before the public investment, but it has been a challenging journey, recalls Farmer.

As Farmer also noted in the interview, the open access model created problems when larger regional providers bought out smaller local ISPs. When providers on the CBN were not dedicated enough to maintain relationships with the customers they served the city felt the fallout. Customers encountered problems with the network and let their providers know, but the providers failed to promptly inform the Glenwood Springs Internet division. As a result, customers were frustrated and chose to cancel service.

Anchor institutions and businesses still connected via the fiber-optic network, but connecting included hefty installation charges. Over time, the city drastically lowered the connection charges, encouraging more businesses and institutions to connect to the CBN. Glenwood Springs has forged ahead to bring better connectivity to local businesses and CAIs and, while the city has had to contend with the problems of being one of several providers in a competitive market, the CBN has created an environment beyond one or two providers and prices are held in check.

City Savings

In addition to keeping prices reasonable for businesses and CAIs, the city is able to keep its own telecommunications costs down by self-provisioning. Farmer estimates that Glenwood Springs saves approximately $140,000 per year because it uses the CBN rather than obtaining comparable services from a private provider. He adds that, because the network adds redundancy, savings may actually be much higher; with a network that doesn't go down, efficiency is always optimal.

There are 25 municipal facilities connected to the CBN, including wastewater, water treatment, and electric department facilities. Glenwood Springs also uses the CBN to connect fires stations, the Community Center, and its Municipal Operations Center.

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Just as importantly, Glenwood Springs is able to budget because their costs are predictable. When local communities depend on big private providers for services, they are at a disadvantage because those corporations have the ability to increase rates and communities have little say in the matter. If a community has no alternate provider, they have no leverage to negotiate.

In Martin County, Florida, for example, the franchise agreement between the county and Time Warner Cable was coming to a close. The ISP planned to raise rates by more than 800 percent. Rather than submit to corporate piracy, the community partnered with the school district and invested in their own Internet infrastructure. In addition to taking control of their own connectivity decisions, Martin County and its parner are saving millions each year.

A Plan To Expand, A Vote To Reclam Autority

By 2008, the municipal electric utility had invested approximately $3.5 million to deploy the fiber system for communications purposes and the electric system. The city began to consider using the network for more than just business connectivity, possibly offering services directly to residents.

At the time, Public Works Director Robin Millyard said, “It’s like having a Ferrari in a garage on a gravel road.” The City Manager noted that the network was, “[A] tremendous asset available to this community that’s being underutilized.”

The city considered the possibility of selling off the wireless network and expanding the existing fiber-optic network to serve all businesses and households in the community in order to offer triple-play. The city had already commissioned a feasibility study to look at the plan. City leaders anticipated funding the $12 million expansion with a revenue bond.

By 2008, Colorado's SB 152 had passed the state legislature, so before the city could expand their offerings, the voters had to reclaim local authority through referendum. In April, voters passed the measure 707 to 605 in the single-issue election. The municipality now had the legal option to expand its network. If any future expansion required issuing a revenue bond or some other form of bond, the community would need to vote again to authorize the financing. After several months of study, however, the City Council ultimately chose not to pursue such a big project.

Instead, Glenwood Springs decided to begin providing direct Internet access to businesses, rather than only offering the fiber infrastructure on which third party providers could offer services to commercial subscribers. By working directly with commercial customers, the city was able to improve its reputation and take on more customers. The demand for services from the city has risen approximately 20 percent each year. He attributes the increased interest in the city’s efforts in part to better customer service.

The CBN Today And Tomorrow

Businesses can sign up for one of three tiers, with all speeds symmetrical so upload is as fast as download, a critical component of business Internet access.

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All tiers include a public IP address, no data cap limit, and no long term contract:

  • Fiber Optic 50 - 50 Megabits per second (Mbps) for $70 per month
  • Fiber Optic 100 - 100 Mbps for $105 per month
  • Fiber Optic 250 - 250 Mbps for $175 per month

Glenwood Springs CBN also offers Enterprise services that include speeds of up to 1 Gigabit per second (Gbps) and private network connectivity with speeds as fast as 10 Gbps.

The fixed wireless service the city offers to residents is being discontinued because there are ample wireless providers in Glenwood Springs and because the equipment is outdated. Instead, the community is looking again at the possibility of providing connectivity directly to residents, this time via Fiber-to-the-Home (FTTH).

Glenwood Springs is engaged in the operations and maintenance phase of a pilot project that has passed 36 homes. The pilot project is testing the waters in one neighborhood; nine households have subscribed so far. Subscribers can choose basic service of 100 Megabits per second (Mbps) upload and download (symmetrical) for $40 per month or symmetrical Gigbit service (1000 Mbps) for $780 per month. The pilot program cost just under $20,000 from the electric utility's existing budget.

An increasing number of communities are choosing to experiment with pilot programs, such as Owensboro, Kentucky, and Westfield, Massachusetts. As well as giving the community a chance to see the advantages of superior Internet access, thus raising demand, a pilot project provides the opportunity to resolve unanticipated problems with technology or administrative operations.

The Future In "Defiance" And Elsewhere In Colorado

They call themselves Glenwood Springs, but this western Colorado town of about 10,000 people have held on to the spirit of those who called it "Defiance." The people of the community are deciding for themselves the best course and following their own path. Each election season - fall and spring - more communities are asking voters to exercise that spirit by opting out of SB 152 and taking back local authority. Glenwood Springs was the first and has been joined by dozens of others; we expect to see more who choose to exercise their right to self-determination.

The Tacoma Click Saga of 2015: Part 4: Accumulating Spillover Effects

This is the last in a four part series about the Click network in Tacoma, Washington, where city leaders spent most of 2015 considering a plan to lease out all operations of this municipal network to a private company. Part 4 highlights Click’s often unseen “spillover effects” on the City of Tacoma’s economy and telecom marketplace over the network’s nearly 2 decades in operation, contributions that Tacoma should expect to persist and even expand in the future.

We published Part 3, an analysis of why the municipal network is positioned to thrive in the years ahead within the modern telecommunications marketplace on June 21st. In Part 2, published on June 7, we reviewed why Tacoma Public Utilities considered the possibility of leasing out all of the Click operations. On May 31, we published Part 1, which reviewed the community's plans for the network.

Part 4: Click’s Accumulating “Spillover Effects”

Regardless of any impending changes with Tacoma Click’s operations, it’s clear that the network has and will continue to support and enhance the overall economic interests and the public good in the City of Tacoma. “Spillover effects” - the benefits to the community that don’t show up clearly in any financial statements - tend to appear after communities developing their own municipal broadband networks.

Click’s spillover effects start with the broad economic development benefits that arose when Click appeared. Before Click came to town, Tacoma was a city in economic decline. Many businesses had fled downtown for the suburbs over the 50-plus year period after World War II. 

While we can’t give Click all of the credit for the city’s efforts to rebound from that period of economic downturn, analysts like the U.S. Conference of Mayors cite the $86 million Click network as a major component. The network was part of an ambitious and highly successful economic development effort in the 1990s that helped to revitalize Tacoma. In 2005, the Sierra Club named Tacoma’s revitalization effort one of 2005’s top 12 economic development projects in the nation

As part of Tacoma’s revitalization project, the city opened a new downtown branch of the University of Washington that remains successful today. And as we noted in a 2010 article about Tacoma Click, more than 100 high-tech companies arrived in Tacoma within a couple of years after the network launch. This means that many current Tacoma citizens also arrived in town through jobs that Click helped create.

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Broadband Competition Spills Over Too

A recent study from the Organisation for Economic Co‑operation and Development (OECD) shows that the arrival of a municipal network in a city typically improves competition in the local broadband market. That is, municipal networks tend to prompt private broadband companies to lower prices and improve services in places where there are municipal networks. Indeed, a Tacoma resident reported a few years ago that Comcast customers had been consistently paying about half of what Seattle Comcast residents were paying for the same services. It’s also likely that Comcast would have delayed its 2008 upgrade of its infrastructure in Tacoma if the city had never built Click in the first place.

This evidence suggests that, were it not for Click’s impact on the ISP marketplace, the city’s Internet services from private ISPs like Comcast would likely be slower and more expensive than they are today. If Click disappeared and the city had no municipal broadband service to compete with Comcast, citizens, businesses, and government agencies in the city could expect prices to increase while customer service declines.

What many people in and outside of Tacoma may not realize is that, like most community-owned networks, Click strives to keep prices for telecom services below market rates for the good of the community. The city of Tacoma also saves on telecommunication costs because it uses Click rather than leasing. Click has essentially contributed untold savings to the City of Tacoma.

So who would be the big winner if Tacoma decided to lease out Click to a private company? Tacoma businesses and residents? The private ISP that would take over the Click’s operations? Leasing Click to a private company would almost certainly benefit Comcast more than any other party. The company with the dubious distinction as both the largest media company in the world and a perennial contender for most hated company in America has the most to gain.  

Another Historical Moment for Click

As the importance of broadband access expands, we expect the City of Tacoma to see the wisdom in the words of Tacoma’s former mayor Bill Baarsma, who in 1999 described Tacoma Click’s historical significance for the city and its potential for the future:

“This is the single biggest economic decision the council has made since the turn of the last century, when the City Council decided to move forward with the construction of the first hydroelectric dam on the Nisqually River. Things are happening here that are happening nowhere else."

In the years immediately following Click’s launch, this municipal network helped the City of Tacoma to re-emerge from a decades long economic slump. The question facing Tacoma between leasing Click to a private ISP and keeping Click as a publicly owned and operated asset will once again culminate in a pivotal decision with far-reaching implications for Tacoma’s future.

Our observation of community-owned networks around the United States suggests that the benefits of keeping and remaking Click as a city-owned asset will only become more apparent in the years ahead. A renewal and restructuring of Click operations to meet the needs of the changing telecom landscape would help to optimize the network’s potential as a driver of local economic development and cost savings. These changes will allow the Tacoma leaders of today to carry on the legacy of the city officials who took the initiative to create the historic Click network nearly 20 years ago.

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Photo of Tacoma Skyline: Dean J. Koepfler, Tacoma News Tribune Staff Photographer, through Creative Commons

Photo of East 21st Street Bridge at Night: AFreeman, through Creative Commons

Fibrant Gets The "OK": Will Expand To Local Government, Manufacturers in NC

Salisbury’s fiber network, Fibrant, is about to connect to three more large customers in North Carolina.

The Salisbury Post writes that Rowan County government and two local manufacturing facilities will be connecting to Salisbury’s municipal fiber network. After considering the needs of several local manufacturers and the Rowan County Government, Rowan County Commissioners gave the necessary approval to expand Fibrant to serve their facilities.

Local Manufacturing Wants Fibrant

The manufacturing facilities, Gildan and Agility Fuel Systems, are both located outside of Salisbury’s city limits, but within Fibrant’s service area. State law requires they obtain permission from the Rowan Board of the Rowan County Commissioners to allow Fibrant to extend service to their location.

Rowan County government also wants to connect to Fibrant and the same law applies to them. The County will use Fibrant as a back-up to their regular Internet connection for a while before deciding if Fibrant should become their primary service service provider.

Meanwhile, Gildan and Agility Fuel Systems just want the high-speed and reliability of the Fibrant network. Gildan is a Canadian manufacturer that makes activewear clothing. Since 2013, the company has worked to expand its existing yarn spinning facility, bringing skilled manufacturing jobs to the region. Agility Fuel Systems makes alternative fuel systems for large trucks. Currently, Agility Fuel Systems uses a connection speed of 20 Megabits per second (Mbps). Fibrant can offer capacity connections up to 10 Gigabits per second (Gbps).

The Agility Fuel System’s North Carolina Director of Operations, Shawn Adelsberger, actively pushed for a Fibrant connection. According to the Salisbury Post, Adelsberger wrote to Rowan County in May:

“Such connectivity will help us to maintain our networked manufacturing equipment, to maintain operation for our global customers and to not have product deliver risk due to network slowdowns and interruptions.”

A Bit Of A Process

Connecting to Fibrant is not easy outside of Salisbury’s city limits. A 2011 North Carolina state law prevents the creation of new municipal networks and imposes restrictions on existing ones. Fibrant cannot extend outside of its service area, and any extension has to go through several layers of approval.

Although the two manufacturing facilities and most of Rowan County are technically within Fibrant’s service area, Rowan County still needs to approve any new extension of the fiber network. After that, each Rowan County municipality must also authorize any Fibrant extensions into their city limits.

After the County Commission approved the expansion, Fibrant Director Kent Winrich told local media, "In my opinion, this is a big deal for economic development for Rowan County.”