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PBS Takes A Look At Internet Cooperatives

We aren’t the only ones noticing. As rural communities take control of their connectivity by banding together to form broadband cooperatives, their efforts are getting attention. Earlier this month, PBS News Hour featured a story on the Wired West and RS Fiber Cooperatives.

Ivette Feliciano visits with local residents, business owners, and community leaders in both western Massachusetts and rural Minnesota where both initiatives are rewriting the rules for rural dwellers. She visits with Jake Reike, a farmer from Renville County; he talked with Chris during the Community Broadband Bits podcast episode #198. He described for us how improving local connectivity was what his family needed to maintain their farming lifestyle.

Feliciano also sought out expert Susan Crawford, who explained why people in these sparsely populated communities need high-quality connectivity and why they refuse to wait for big providers who may never come to their rescue.

Download a copy of our report RS Fiber: Fertile Fields for New Rural Internet Cooperative, to learn the details of one Minnesota farming region is bringing better Internet access to its people and businesses. There is much to be gained by joining forces.

For more on Wired West, we recommend WiredWest: a Cooperative of Municipalities Forms to Build a Fiber Optic Network, from the Berkman Center. Crawford helped author that report that dives deeper into the situation in western Massachusetts.

Get Your Applications Ready For Minnesota's $35 Million

The Land of 10,000 Lakes wants to become The Land of 10,000 Lakes With High-Speed Internet Access. 

The Minnesota Department of Employment and Economic Development (DEED) will begin taking applications for the Border-to-Border Broadband Development Grant Program on July 22, 2016. The program offers a total of $35 million in funding for projects in unserved and underserved areas. The application submission period closes on October 3, 2016.

The Grant Program

The Border-to-Border program will pay for up to 50 percent of project development costs, awarding a maximum of $5 million per grant. This round of funding sets aside $5 million specifically for underserved areas, and $500,000 will be set aside for areas that contain a significant proportion of low-income households. Officials estimate this year's $35 million in funding will impact an additional 2,000 Minnesotans.

Since May 2014, the Border-to-Border program has provided over $30 million in assistance to over 30 projects throughout Minnesota. This latest funding opportunity brings the total funding up to $65.4 million. It is the largest funding appropriation for the program to date.

Still Not Enough

The Governor’s Task Force on Broadband estimated that Minnesota needs $900 million to $3.2 billion of investment to bring high-speed Internet access to all in the state. The latest funding for the Border-to-Border program, although more than past years, is still not enough. Minnesota Lieutenant Governor Tina Smith stated:

“Broadband isn’t nice, it’s necessary if we want Minnesota’s economy to work for everyone, everywhere in the state. This new investment will connect businesses to customers, students to learning opportunities, and patients to their doctors. This is an important investment but we have a long way to go...”

Learn more about the Border-to-Border program and our suggestions for how to improve it by downloading our May 2016 policy brief Minnesota's Broadband Grant Program: Getting the Rules Right

To learn more about the program or to apply visit the DEED website here. Applications will be accepted from July 22nd through October 3rd.

Minnesota's Broadband Grant Program: Getting the Rules Right

Publication Date: 
May 12, 2016
Author(s): 
Scott Carlson
Author(s): 
Christopher Mitchell

In its first two years of implementation, the Minnesota Border-to-Border program distributed $30 million to 31 rural Minnesota communities. But the state has not put enough money into the program and needs to put more focus on getting investment in Greater Minnesota cities to spur economic development.

“This funding is essential to greater Minnesota communities that are being left behind,” says Christopher Mitchell, Director of the Community Broadband Initiative at the Institute for Local Self-Reliance. “The current disbursement is only meeting a fraction of the state’s high-speed Internet needs as it is. The program’s rules must be reconsidered to meet economic development goals for the state.”

"Getting the Rules Right" is a policy brief on the Border-to-Border Broadband program. It covers what the program is, how it works, and why funding must be expanded in order to serve more greater Minnesota communities.

Download the Report here [pdf]

Economists: Munis Improve Access to Banking Services

A new study conducted by two economists from a major banking institution says that municipal broadband networks contribute significantly to helping low income households gain access to banking services.

Major Findings, And Why Does This Matter?

The researchers concluded that access to the Internet is a more significant predictor of access to banking services (specifically, having a bank account) than both race and education level. They found that when low income families get access to Internet service, their likelihood of having access to banking services increases by 10%.

Economists commonly focus on access to banking services as a key indicator of financial inclusion for low income households. A bank account enables basic human stability and prosperity as it facilitates financial planning, paying for recurring expenses, and allays negative effects of unexpected financial shortfalls from traumatic events. Bank accounts also allow individuals to build working capital and financing for small business enterprises.

Financial inclusion is a significant concern not just in developing nations but in some wealthy countries as well. Currently, the U.S. ranks 23rd out of 38 high-income nations on the World Bank’s Global Financial Inclusion Database. 

Municipal Networks: Catalysts For Equal Opportunity

The authors suggest that in addition to directly improving Internet access through better availability, municipal networks improve Internet access by improving local Internet service competition. They note that collaborative efforts between local governments and private industry can also improve Internet access and financial inclusiveness.

What can be done to advance the goal of getting fast, affordable, reliable Internet access - and access to banking - for all? The authors of the study suggest that municipal broadband projects in particular increase the likelihood that everyone, regardless of race or income, will have access to banking services.

They offer the city of Boulder, Colorado, as an example:

Boulder, Colo., which ranks at the top of our Financial Inclusion Metropolitan Index, is one of a few areas in the U.S. with financial inclusion levels that rival those of the Nordic countries. Interestingly, the city once owned miles of fiber that its residents could not take advantage of because of laws limiting municipal broadband. But the city challenged the telecommunications industry at the polls in 2014 and won. In doing so, Boulder has become one of a growing number of municipalities that have voted to allow their local governments to increase competition by offering Internet service to residents. This speaks to the mindset of a community that has embraced technology as a way to lift up everyone that calls Boulder home.

Boulder voters didn't just approve the change in the law and forget about it. By the following April, the city began offering free Wi-Fi in the downtown area and consultants are now finishing up a feasibility study.

There's More To Life Than Money, But It Helps

Communities hoping to build municipal networks generally have to first confront the issue of how a network can make its return on investment and have direct economic development benefits for local businesses and residents. But beyond these types of direct economic benefits, this study reveals one of the many important human benefits of municipal networks that tend to fly under the radar. 

In addition to improving financial inclusion for the disadvantaged, there are a number of other “under the radar,” spillover benefits of municipal networks. These include increased home values, better access to healthcare services including telemedicine, reduced car usage and access to various types of e-services, and bridging the digital divide.  

RS Fiber Ignites - Community Connections Video Podcast Part 2 of 2

On Wednesday, November 18, 2015 Christopher Mitchell sat down with Bill Wallace of US Ignite and Mark Erickson of the city of Winthrop, Minnesota. In part 2 of our ongoing series, Chris, Bill and Mark talk more about the "nuts and bolts" of building a network. Come back each Wednesday for new video content!

This interview is paired with ILSR's report, RS Fiber: Fertile Fields for New Rural Internet Cooperative. The report documents a groundbreaking new model that’s sprung up in South Central Minnesota that can be replicated all over the nation, in the thousands of cities and counties that have been refused service by big cable and telecom corporations.


RS Fiber Ignites - Community Connections Video Podcast

On Wednesday, November 18, 2015 Christopher Mitchell sat down with Bill Wallace of US Ignite and Mark Erickson of the city of Winthrop, Minnesota, to talk about the exciting applications communities can develop if they have the connectivity they need.

This interview is paired with ILSR's report, RS Fiber: Fertile Fields for New Rural Internet Cooperative. The report documents a groundbreaking new model that’s sprung up in South Central Minnesota that can be replicated all over the nation, in the thousands of cities and counties that have been refused service by big cable and telecom corporations.

Stay tuned for Part 2 of this video podcast on RS Fiber, to be released Thursday as part of our ongoing series featuring community and policy leaders in the field.

WiredWest: a Cooperative of Municipalities Forms to Build a Fiber Optic Network

Publication Date: 
April 20, 2016
Author(s): 
David Talbot
Author(s): 
Waide Warner
Author(s): 
Susan Crawford

In 2010, communities in rural western Massachusetts began a group that would evolve into the WiredWest Cooperative. Over the past six years, the group, formed to bring better last-mile connectivity to the unserved and underserved areas of the state, has faced a number of challenges. Most recently, disagreements with the Massachusetts Broadband Institute (MBI), the state agency tasked with distributing funds for last-mile connectivity, have threatened WiredWest's regional cooperative model.

In a new report released by the Berkman Center, authors David Talbot, Waide Warner, and Susan Crawford share the story of these communities' attempt to band together to establish a fiber-optic network.

In WiredWest: a Cooperative of Municipalities Forms to Build A Fiber Optic Network, we learn not only how this region came together, but how they developed their business plan and procured funding, how they anticipate the network to affect affordability, and the ways they have adjusted the plan as circumstances required. The authors also take the time to share some history of cooperatives, and address how the cooperative model - used in the past for electricity and telephone - can benefit the communities in rural western Massachusetts.

Berkman Center Releases Report on WiredWest Cooperative, MBI

In 2010, communities in rural western Massachusetts began a group that would evolve into the WiredWest Cooperative. Over the past six years, the group, formed to bring better last-mile connectivity to the unserved and underserved areas of the state, has faced a number of challenges. Most recently, disagreements with the Massachusetts Broadband Institute (MBI), the state agency tasked with distributing funds for last-mile connectivity, have threatened WiredWest's regional cooperative model.

In a new report released by the Berkman Center, authors David Talbot, Waide Warner, and Susan Crawford share the story of these communities' attempt to band together to establish a fiber-optic network.

In WiredWest: a Cooperative of Municipalities Forms to Build A Fiber Optic Network, we learn not only how this region came together, but how they developed their business plan and procured funding, how they anticipate the network to affect affordability, and the ways they have adjusted the plan as circumstances required. The authors also take the time to share some history of cooperatives, and address how the cooperative model - used in the past for electricity and telephone - can benefit the communities in rural western Massachusetts.

Key Findings from the report:

  • WiredWest enabled dozens of small towns to come together through a unified structure and a shared vision of citizen cooperation across municipal borders, a model replicable nationwide.
  • WiredWest has developed and vetted a detailed financial model, drafted an operating agreement, and obtained $49 deposits from more than 7,100 residents who have pledged to subscribe to Internet access services.
  • WiredWest’s plan is designed to achieve economies of scale by centralizing operations and aggregating demand for network equipment and services. WiredWest still must resolve the question of how to balance cooperative versus local ownership of network assets within the boundaries of individual towns.
  • The scale of the project would also allow WiredWest—in likely contrast to single-town networks in the same area—to provide television services, which a majority of pre-subscribers want.
  • WiredWest plans to offer 25 Mbps service for $49 a month, 100 Mbps service for $79 a month, 1 Gbps service for $109 a month, telephone services for an additional $25, and TV services at prices to be determined.
  • In December of 2015 a consultant hired by the Massachusetts Broadband Institute (MBI) issued a highly critical analysis of the WiredWest financial model, but WiredWest responded with a point- by-point rebuttal asserting that the analysis was inaccurate and misleading.
  • In January of 2016 the administration of Gov. Charlie Baker asked MBI to “pause” on funding last-mile projects and later asked MBI to analyze all options, without mentioning WiredWest.

Struggles In The State

As we reported late last year, one of the biggest hurdles for WiredWest has been opposition from MBI. Talbot, Warner, and Crawford dedicate significant coverage to the problems between WiredWest, MBI, and Governor Charlie Baker's administration. To learn more about what has happened in Massachusetts with WiredWest and look deeper into the authors' analysis of what WiredWest could mean for the region, download the report.

RS Fiber: Fertile Fields for New Rural Internet Cooperative

Publication Date: 
April 18, 2016
Author(s): 
Scott Carlson
Author(s): 
Christopher Mitchell

A new trend is emerging in rural communities throughout the United States: Fiber-to-the-Farm. Tired of waiting for high-quality Internet access from big companies, farmers are building it themselves. 

Communities in and around Minnesota’s rural Sibley County are going from worst to best after building a wireless and fiber-optic cooperative. While federal programs throw billions of dollars to deliver last year’s Internet speeds, local programs are building the network of the future. 

In “RS Fiber: Fertile Fields for New Rural Internet Cooperative,” the Institute for Local Self-Reliance (ILSR) and Next Century Cities documents a groundbreaking new model that’s sprung up in South Central Minnesota that can be replicated all over the nation, in the thousands of cities and counties that have been refused service by big cable and telecom corporations.  

Connecticut Focuses on Local Leadership

At the end of March, city leaders across the state of Connecticut converged on a conference to discuss the deficiencies of Internet access and ways to move forward such as a regional network, municipal networks, and public private partnerships. Over the past year, the communities of New Haven, Hartford, and Manchester, have explored several of these possibilities. What pathway they choose depends in part on the outcome of the conference.

The Conference: A Long Time Coming

The conference High-Speed Broadband Infrastructure: A Toolbox for Municipalities took place the state capital Hartford, Connecticut, on March 23, 2016. The presenters, featuring the mayors of New Haven and Hartford, addressed the diverse needs of Connecticut’s communities.

And those needs are many. The Office of Consumer Counsel just released two reports on Connecticut’s connectivity. The first report describes the deficiencies of Internet access in Connecticut. It narrates many of the struggles small, local institutions face in trying to receive adequate Internet service from incumbent providers. The second report recommends a matching grant program for pilot projects based on lessons learned from other states’ programs. 

The conference and reports came out of an initiative called the CT Gig Project. Based out of the Offices of the Consumer Counsel and the Comptroller, the CT Gig Project encouraged communities to coordinate Requests for Qualifications (RFQ) to generate information from private providers about building a statewide, open access, gigabit network. (Chris spoke about the details of the CT Gig Project with Connecticut’s Consumer Counsel Elin Katz and the State Broadband Policy Coordinator Bill Vallee in Community Broadband Bits Episode #118.) In 2014, more than 40 communities joined the initiative that New Haven and Hartford spearheaded. The process ultimately brought the towns together, setting the stage for the conference, but it would not have taken off without the previous work of Manchester over ten years ago.

Manchester’s Old Fight Empowers Communities Today

In the mid-1990s, Manchester became one of the first cities in New England to create citywide fiber network. City leaders utilized a key component of right-of-way (ROW) regulation, the Municipal Gain Law, to quickly deploy fiber throughout the city on the existing utility poles.

seal-manchester-ma.png

The Municipal Gain Law provides the municipality a position (gain) on each utility pole that is standing in the municipal ROW.

Manchester connected public buildings to one another for internal communication via the “FiberNet”, but still purchased their Internet access through the incumbent provider, SNET (later bought by Frontier Communications). SNET brought the town to court over the Municipal Gain Law. After a fierce legal fight, the case came to a successful resolution in the early 2000s. Now, with the push to improve connectivity for the rest of the state, Manchester is well situated to revisit the possibilities of its “FiberNet.”

According to Chief Information Officer Jack McCoy, Manchester has over 20,000 properties, so a Fiber-to-the-Home (FTTH) project would prove expensive. If Manchester built the network on its own, the economic development potential might make up for the costs. FiberNet already runs throughout the town; bringing fiber to businesses and homes could provide new vitality to the local economy. McCoy suggested the city would consider leveraging FiberNet assets to partner with a private provider. Mayor Jay Moran old us, "All options are on the table."

Hartford: Slow and Steady Wins the Race

While Manchester has been taking its time investigating options, Hartford pushed forward. The state capital and one of most populous cities in Connecticut with 125,000 people, Hartford immediately jumped at the opportunity presented by the CT Gig Project. According to the Office of Consumer Counsel's first report, many in Hartford do not have ready access to affordable high-speed Internet for their homes or businesses even though Hartford is a hub of economic and political activity.

seal-hartford-ct.png

Incumbent providers have deployed fiber throughout the city but several small businesses have been quoted tens of thousands of dollars for fiber installation. These small businesses have had to get creative to manage. For instance, an incubator space in the Conference of Churches constructed a wireless connection from a State building a half-mile away to receive somewhat adequate speeds. 

Although one of the first to join the CT Gig Project, Hartford maintains realistic timetable expectations. Efforts to get high-quality Internet access into Hartford have slowed as the city administration enters the budgeting season. Chief Information Officer Sabina Sitaru in the consolidated IT department of the city and school system of Hartford explained that, although momentum for the CT Gig project has slowed, the demand for better Internet access still exists. Grassroots efforts are trying to keep up the energy, and the conference bolsters that support.

In New Haven, Ideas and Plans Abound

Much like Hartford, New Haven moved quickly ahead. The city signed onto the CT Gig Project, and the Mayor Toni Harp spoke favorably of an open access network in a 2015 WNHH Community Radio Interview. In fact, by late summer 2015, the New Haven Board of Alders had passed a resolution to explore a feasibility study for a regional network. Community leaders supported the plan, but before the community could commission a feasibility study, an offer to partner with the incumbent got the attention of New Haven's leadership.

In late August 2015, Frontier pitched a public-private partnership through its subsidiary SNET. Frontier had previously purchased the incumbent company SNET in 2014 and had moved the regional headquarters into the city of New Haven. The introduction of the idea of a municipal network, however, changed the conversation around Frontier’s role in the city. This partnership offer, however, did not grow into a viable plan.

seal-new-haven-ct.jpg

Considering Frontier's horrible reputation with customers, including snaillike speeds and frustrating customer service, New Haven is better off without Frontier as a partner. They have toyed with communities in the past, alluding to partnerships only to eventually back out. In 2007 - 08, Frontier continued to string along Lac qui Parle County as it looked for a partner to develop a County wide fiber optic network. Finally, after a formal request for a partnership from the County went ignored by Frontier, the County decided to work with local cooperative, Farmers Mutual Telephone Company. As customers abandoned Frontier for better connections on the new network, Frontier tried to bully them with steep early termination fees. Read more about it in our 2014 report, All Hands On Deck: Minnesota Local Government Models For Expanding Fiber Internet Access.

There are still many opportunities to close the digital divide and build economic potential, explained New Haven City Controller Daryl Jones. The city is considering offering free Wi-Fi on the green during concerts and may sell advertising to local businesses that will run over the Wi-Fi, possibly as splash pages. A local company in New Haven has been involved in improving Internet access in public housing in New York City -- New Haven may work with them. 

“How do you eat an elephant? One bite at a time.”

Jones repeated that age-old proverb in describing the situation. The problem of slow, unaffordable Internet access does not have a quick and easy fix, but Connecticut won’t stop trying. The two new reports and the conference are just a few more new bites out of this elephantine problem.