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. 

Chattanooga's EPB Fiber Optics continues to stand out as a model for the municipal broadband movement, demonstrating the extraordinary impact that fast, affordable, reliable Internet access can have on economic development efforts. 

Now, a new research report from the Ewing Marion Kauffman Foundation highlights the network’s vital role in kick starting the development of what has become a thriving “entrepreneurial ecosystem” in this city of about 174,000.

Collaboration, Public Private Partnerships

The report, titled "Little Town, Layered Ecosystem: A Case Study of Chattanooga," credits the EPB network as the “spark” for an explosion of economic development since the network's launch in 2010. As the article notes, the EPB estimates that since the launch, Chattanooga has seen an influx of ninety-one new companies with approximately $50 million in venture capital contributions from six firms. 

According to the report, the network has also encouraged an entrepreneurial climate in this city that had a “long history of collaboration and public-private partnerships” even prior to the network launch. The report cites examples of the city's collaborative spirit in several non-profit entities, city officials, local anchor companies and universities, and the city’s recently opened Innovation District.

Yasuyuki Motoyama, director of Research and Policy at the Kauffman Foundation and one of the paper's authors, explains the lessons that other cities might take away from Chattanooga’s example:

"Chattanooga organized and mobilized its assets to orient itself to entrepreneurial initiatives. This demonstrates what a small-size city can do when factions from different sectors focus on a common goal and collaborate to achieve that goal. This case of Chattanooga provides lessons for other cities to leverage their own unique assets and to create equally successful ecosystems."

As of now, 41% of tribal lands do not have high-speed Internet access according to the FCC Broadband Report of 2016 released on January 29, 2016. That same day, the Government Accountability Office (GAO) published a study of high-speed Internet access on tribal lands. 

The GAO report (GAO-16-222) reviewed previous federal programs that aimed to improve Internet access and interviewed several tribal entities. The result reveals the perspective of communities impacted by the data and cooperation - or lack of both - among the different federal entities. Long before this report, the FCC had recognized the shortcomings of these programs and began to improve data collection and inter-governmental cooperation.

Highlighted Areas for Improvement

The GAO focused mainly on FCC and USDA programs from 2010 – 2014, especially those that specifically addressed tribal connectivity. GAO researchers collected the perspectives of several tribal entities, which provided useful qualitative data to understand the impact of Internet access on these communities.

Tribal officials noted that the important role the FCC and USDA programs had in expanding high-speed Internet access. Throughout the report are anecdotes of how the several programs have benefitted tribal lands. The outreach efforts of the two federal agencies, however, are not always well coordinated:

“Officials from one tribe said that multiple federal programs offering similar grants were confusing and that a federal one-stop-shop for outreach and training would help them better target the right programs for their situation.“ (p. 22)

The report also touched on the quality of quantitative data. In 2006, there was little meaningful data. Although the situation has improved, reliable data is still lacking. Tribal lands are often rural and sparsely populated, such that census blocks (the basis of much data collection) cover large areas. This method can grossly overstate the availability of Internet access in such an environment.

GAO Recommendations and FCC Action

A recent report by Victoria Rideout and Vikki S. Katz from the Joan Ganz Cooney Center at the Sesame Workshop delves into detail on the experiences of lower income families and Internet access. The report, “Opportunity for all? Technology and learning in lower-income families,” points to the promises of digital inclusion for educational opportunities, but also to the current inequalities in Internet access. 

The researchers highlight several key findings from the study in an effort to inform policymakers of the root causes, and effects, of these inequalities on lower-income families. They include issues of race (families headed by Hispanic immigrants are less connected), of access (mobile-only and inconsistent connectivity), and of affordability (despite the existence of discounted programs).

Discounted Programs Not Working

We’ve written several times about the failings of the large corporate providers’ discounted programs for Internet access. Over the past few years, Comcast’s Internet Essentials program has been a prime example. We reported on the Consumerist article that highlighted how the program benefits Comcast more than lower-income families. In 2013, our Lisa Gonzalez shared her own family’s experience with the program. 

Rideout and Katz’s report again show the real impact of these programs’ failures. Only 5% of those surveyed had ever signed up for the programs although many met the eligibility requirements. Even those that did receive the service sometimes found that it could not meet their needs. After all, the program only provides up to 5 megabits per second (Mbps) in download speeds. A parent of a seventh grader in Colorado explained to the researchers (page 11): 

As communities across the country realize the big corporate providers may never bring the kind of connectivity they need, public-private partnerships (PPPs) are sprouting up everywhere. A new report by Joanne Hovis, Marc Schulhof, Jim Baller, and Ashley Stelfox, takes a look at the issues facing local governments and their private sector partners.

Interjection from Christopher Mitchell: Partnerships are emphatically not sprouting up everywhere. To be more correct, enthusiasm around the idea of partnerships is sprouting up in many places. But compared to the hundreds of municipal networks currently in operation, we could maybe name ten partnerhips in existence today.

The Emerging World of Broadband Public-Private Partnerships: A Business Strategy and Legal Guide examines the practical considerations when investigating PPPs for better connectivity. The report was published by the Coalition for Local Internet Choice (CLIC) and the Benton Foundation. 

The Benton Foundation sums up the three models explored in the report:

Private investment, public facilitation – The model focuses not on a public sector investment, but on modest measures the public sector can take to enable or encourage greater private sector investment. Google Fiber is the most prominent example, but there is significant interest among smaller companies

Private execution, public funding – This model, which involves a substantial amount of public investment, is a variation on the traditional municipal ownership model for broadband infrastructure—but with private rather than public sector execution.

Shared investment and risk – In this model, localities and private partners find creative ways to share the capital, operating, and maintenance costs of a broadband network.

The authors also share expertise on a range of legal topics that often arise when working with a private sector partner. They share their years of experience with matters such as confirmation of authority at state and local levels, project planning, and common issues related to negotiating the agreement.

Only one in 11 households in the United States have fiber-to-the-home (FTTH) subscriptions, according to a 2014 Broadband Communities primer, but that might begin to change as more and more studies show the economic benefits of fiber. Most recently, the Fiber To The Home Council Americas funded a study in conjunction with the University of Colorado and Carnegie Mellon that showed a fiber dividend of $5,437 on a $175,000 home. Fierce Telecom reported on the results:

The boost to the value of a typical home – $5,437 – is roughly equivalent to adding a fireplace, half of a bathroom or a quarter of a swimming pool to the home.

The results of the study, which compared roughly 500,000 housing prices over the course of two years, have made their rounds on the Internet, even receiving coverage in the Wall Street Journal. It builds upon a small, but growing, body of research that links fiber deployments in homes and multiple dwelling units (MDUs) to economic growth.

As more research on housing prices and home Internet access surfaces, the value of FTTH deployments appears to be on the rise. A 2014 study by the consulting firm RVA LLC revealed a $5,250 increase in the value of a $300,000 home. Now, according to the newest study, a similar increase in value can be seen in homes worth half this amount.

The benefits of FTTH networks are not just relegated to single family homes. In 2014, the FTTH Council released a report that showed a 1.1 percent increase in GDP in communities that deploy gigabit broadband services, representing about $1.4 billion in total in the 14 gigabit communities studied.

The Council also conducted a survey in 2014 that looked at the effect of FTTH on multiple dwelling units, which we covered in an April story. Access to fiber increased sale and rental prices in MDUs by three and eight percent, respectively.

A few weeks ago, Harvard’s Berkman Center for Internet and Society released a report that documents the achievements of Holyoke Gas & Electric (HG&E) Telecom, a municipal electric utility that now provides fiber-optic broadband Internet to local businesses in several western Massachusetts towns. The utility’s move into fiber-optics has led to municipal savings for the City of Holyoke, as well as increased high-speed access in neighboring cities, and driven economic development. We interviewed Holyoke's Senior Network Engineer, Tim Haas, in a previous episode of the Community Broadband Bits podcast.

Because the state of Massachusetts has no barriers that prevent the creation of municipal Internet networks, HG&E has been able to compete on a level playing field with incumbent ISPs Comcast and Charter. HG&E is among 12 MLPs (Municipal Light Plants) out of 41 in the state to offer fiber Internet services. Researchers at the Berkman Center believe that MLPs could play a large role in expanding Internet access and business opportunities throughout the state as electricity revenues experience diminishing returns and data needs grow. For example, HG&E’s fiber connection was a factor in the Massachusetts Green High Performance Computing Center’s decision to open a $90 million data center in Holyoke. 

HG&E is a somewhat unique municipal network in that it offers services not only in Holyoke, but also in nearby Chicopee. It also assists Leverett and Greenfield with their own networks. In Chicopee, the utility provided fiber access in a collaboration with 35 local businesses. In Leverett, it is managing the municipal network, with services provided by a local private company. As for Greenfield, HG&E now serves as the ISP for City Hall and the city’s police station, both of which will function as Internet access nodes as the town looks to create a fiber and wireless network that extends into homes and businesses. 

Gig.U, a collaboration of more than 30 universities across the country has just released The Next Generation Network Connectivity Handbook: A guide for Community Leaders Seeking Affordable, Abundant Bandwidth. The handbook, published in association with the Benton Foundation, is available as a PDF online.

One of the authors, Blair Levin, has been a guest several times on the Community Broadband Bits podcast, last visiting in January 2015 to weigh in on public vs. private ownership of broadband networks. As many of our readers know, Levin was one of the primary authors of the FCC National Broadband Plan in 2010.

In a PCWorld article about the report, Levin commented on funding and on local control:

“Nearly every community we worked with saw public money as a last resort, when no other options for next generation networks were available,” he said. “But our group view was that the decision should be made by the local community.”

The report underscores the importance of local decision making authority, whether each community chooses to go with a municipally owned model, a public private partnership, or some other strategy.

Levin and his co-author Denise Linn also address issues of preparation, assessment, early steps, things to remember when developing partnerships, funding issues, and challenges to expect. They assemble an impressive list of resources that any group, agency, or local government can use to move ahead.

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