Danville, Virginia, has long been one of the municipal network approaches that we like to highlight. Built in a region hard hit by the transition away from tobacco and manufacturing economies, the open access fiber network called nDanville has led to many new employers coming to town and has shown the benefits of a low-risk, incremental investment strategy for building a fiber network.
Jason Grey, Interim Utilities Manager, is back on the show to update us on their approach. He introduced the network to us three years ago on episode 22. Since we last checked in, Danville has continued expanding the fiber network to a greater number of residents and Jason talks with us about the importance and challenges of marketing to residents. We also discuss how they lay conduit as a matter of course, even in areas they do not plan to serve immediately with the fiber network. Read all of our coverage of Danville here.
On July 21, the City Council of Sun Prairie, Wisconsin passed a resolution to fund construction on a segment of what could become a citywide, high-speed fiber optic project. Construction will take place in the city’s Smith’s Crossing subdivision, parts of Main Street, and the Tax Increment Finance (TIF) District 9/St. Mary’s development area. It is slated to begin in early September and last through December 1, weather permitting, and will cost an estimated $640,000.
Moving ahead with the pilot project in Smith’s Crossing is the right way to go. I believe that as an early adopter of this technology we will have an economic development advantage which will attract companies that require this broad bandwidth.
The fiber-to-the-premises (FTTP) construction at Smith’s Crossing is seen as a testing ground for a larger FTTP network construction that would extend 200 miles of fiber and have the potential to connect all of the city’s homes and businesses. Currently Sun Prairie has about 30 miles of fiber. If Sun Prairie can successfully build out this citywide network - costing an estimated $26.7 million for the whole city - it could rival that of Reedsburg, Wisconsin, which began construction on its fiber-to-the-home network in 2003. Reedsburg has seen numerous economic development benefits and has created a considerable amount of community savings from lower prices.
The city of Sun Prairie initially invested in fiber optic technologies in 1999. In that year, the City built a fiber ring for the school system. Rick Wicklund, the manager of Sun Prairie Utilities, estimates the fiber ring will save the school $2 million by 2019. The fiber also runs to about 28 businesses and more than 130 Multiple Dwelling Units (MDUs), according to Wicklund. Now, Sun Prairie Utilities is looking towards residential markets.
SandyNet has introduced some incredible fiber connectivity deals for local businesses. Like residents, businesses can now get gigabit service for $60 per month and 100 Mbps for $40 per month. The utility also continues to offer enterprise connections, with rates established on a case-by-case basis.
Speeds are symmetrical which can be a critical factor for businesses that often must upload large amounts of data to work with clients.
Until SandyNet began to deploy the FTTH network, business customers that needed more bandwidth relied on the town's dedicated Wi-Fi service which offered advertised speeds of up to 30 Mbps download, however, that cost $175 per month.
Smaller businesses could sign up for traditional Wi-Fi - the system residents also used - but speeds maxed out at only 5 Mbps or 10 Mbps download. Prices were $25 per month and $35 per month respectively.
Wi-Fi business customers can now make the switch to fiber for no extra fee. Those that are new customers to SandyNet will need to pay a one-time $350 connection fee.
A few weeks back, we noted an excellent new report on Holyoke Municipal Light Plant in Massachusetts published by the Berkman Center for Internet and Society. This week, we discuss the report and lessons learned from it with David Talbot, Fellow at the Berkman Center. David gives us some of the key takeaways from the report and we discuss what other municipal light plants are doing, including how Holyoke Gas & Electric is using the state owned middle mile network to partner with other municipalities like Greenfield and Leverett.
Finally, David offers some insight into how the municipal light plants that have not yet engaged in expanding Internet access think about the challenges of doing so. You can listen to (or read the transcript of) episode 65, where we interviewed Tim Haas of Holyoke Gas & Electric.
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.
The city of Franklin, KY transferred ownership of its fiber optic network to the Franklin Electric Plant Board (EPB) for $2.5 million. The Franklin City Commission unanimously approved a resolution for the transfer of ownership at the June 8th meeting. The network, although no longer maintained by the city, is still under local control. The EPB is an extension of city government, but has its own board of directors. Pleased with the city’s decision, Mayor Ronnie Clark stated:
"Broadband is now the new utility, and who better to deliver those services than the local infrastructure experts, EPB. They have the manpower and the equipment, as well as the community's confidence in providing reliable utility service and exceptional local customer support."
"This network will be an excellent fit for us operationally, and will enable us to expand our role in serving our customers with the most robust broadband services available. We have big plans to add new services and grow our broadband customer base," said General Manager of EPB Bill Borders.
When a community invests in a municipal broadband network, it often does so because it hopes to reap economic benefits from the network. Many people and organizations have explored the positive relationship between municipal Internet networks and economic development, including a White House report published in January 2015. Municipal networks create jobs by ensuring businesses have fast, affordable, and reliable Internet access; the old DSL and cable networks just don't cut it. These networks improve the productivity of existing businesses and attract new businesses to communities, allow individuals to work from home more effectively, support advanced healthcare and security systems, strengthen local housing markets, and represent long term social investments in the form of better-connected schools and libraries. They also create millions of dollars in savings that can be reinvested into local economies.
"Upgrading to higher speed broadband lets consumers use the Internet in new ways, increases the productivity of American individuals and businesses, and drives innovation throughout the digital ecosystem." - Executive Office of President Obama
When municipalities choose to deploy fiber networks, they introduce Internet services into the community that are not only significantly faster than DSL and cable, but more reliable. With more reliable fiber connections, businesses and individuals are far less likely to experience temporary blackouts that can halt productivity in vexing and expensive ways. And because these networks are locally-owned and operated, business owners do not have to spend hours on the phone with an absentee Internet Service Provider like AT&T in the (albeit unlikely) event of a problem.
We at the Institute for Local Self-Reliance have catalogued numerous examples of economic development achievements that have occurred as a result of local governments deploying a municipal broadband network. Below, you can find a wide range of articles, studies, anecdotes, and other resources that speak to the economic successes enabled by municipal networks, organized by topic:
Look no further than Morristown, Tennessee, for an example of job creation thanks to municipal fiber. The city took advantage of its local electrical utility, Morristown Utility Systems, to provide gigabit speeds, and businesses jumped at the opportunity. In 2013, Oddello Industries, a furniture manufacturer, brought 228 jobs to the community after investing in a $4.4 million site expansion in Morristown. More recently, a call center looking to relocate to the city was wowed by the municipal utility’s offer to install fiber for free because the city valued the future economic benefits the call center would bring to Morristown over the cost of the fiber installation.
Our economic development fact sheet outlines several of the job creation opportunities that have resulted from municipal networks.
In 2012, Spirit Aerosystems opened up a new manufacturing facility in Chanute, Kansas, creating 150 jobs that require high quality broadband Internet.
HomeServe, a home repair company, expanded its call center to 140 employees because of Chattanooga, Tennessee’s robust municipal broadband infrastructure; in Chattanooga, HomeServe employees could get faster residential service than executives had in the company's Miami headquarters.
In 2015, Hardide Coatings, a surface coating manufacturer located in Henry County, Virginia, that relies on the municipal broadband provider MiNet, added 29 high-paying jobs to the local economy.
"You can't grow jobs with slow Internet." - Stephanie Rawlings-Blake, Mayor of Baltimore
The Dalles, Oregon, received a much-needed economic boost in the form of 200 jobs and millions of dollars in tax revenues when Google invested $1.2 billion in a data center that used the city’s municipal fiber network, Q-Life.
A new data center in Dawsonville, Georgia, created 12 high-paying jobs and expanded the local tax base thanks to the municipally-owned North Georgia Network.
Increased competition in Chattanooga, Tennessee, due to the city’s powerful municipal fiber network, induced Comcast to bring 150 new jobs to town.
The city of Mount Vernon, Washington has two things in common with our country’s first president, but unlike George, it boasts an impressive municipal broadband network that has attracted high-tech businesses. For example, a digital legal firm, Blank Law, relocated from Seattle to Mount Vernon in order to take advantage of faster speeds offered by the city’s municipal broadband network. While high-speed Internet was not the only reason Blank Law cited for choosing Mount Vernon over other towns (other reasons include quality of life and free parking), it played a significant role. Fiber is rarely the sole reason for a relocation, but it can often be a deciding factor.
Zeyuan, a Chinese wood floor manufacturer, and GOK International, a Chinese furniture assembly plant, built manufacturing centers in Danville, Virginia, knowing they would benefit from connecting to the city’s municipal broadband network.
"It's almost a feeling of disbelief when we tell companies today we can provide a gig to your business and to your house...These companies want to go where they can see the gig service." - Marshall Ramsey, President of the Morristown, Tennessee Chamber of Commerce
Pixel Magic, a visual effects producer, and Tapes Again, a media reproduction and processing company, both set up shop in Lafayette, Louisiana to support the state’s burgeoning film industry — and access to the municipally-owned LUS Fiber greatly facilitated these activities.
Faneuil, a customer care center, and SPARTA Inc., a defense contractor, were attracted to Martinsville, Virginia in large part because of the city’s municipal network, MiNet.
In the small Minnesota town of Gibbon, the fiber network from the RS Fiber Cooperative convinced the owner of Advocate 3D to take up residence in town where the family could live the small-town life but the business could still obtain the high-speed, reliable connectivity they needed for their 3D printing business.
Municipal networks serve existing businesses and keep critical jobs in town:
Image
The small Minnesota town of Windom nearly entered crisis mode when Fortune Trucking, a local company that employed 47 people in a town of 4,600, announced that slow Internet speeds might force it to leave town. Although the company’s headquarters were located a mile outside of the Windom’s jurisdiction, community members successfully lobbied to bring municipal fiber to Fortune, saving those jobs and stabilizing the local economy.
Alpha Natural Resources, a coal mining company, stayed in Bristol, Virginia, thanks to the BVU municipal fiber network
When the city of Princeton, Illinois set up a municipal broadband network, it kept 300 jobs in the community with the global industrial machinery company, Ingersoll Rand.
"Municipal broadband can be a powerful lever against the digital divide that condemns people to the isolation and reduced economic opportunities experienced by many of our low-income, disabled, and people of color community members" - Kshama Sawant, Seattle City Councilmember
In this Podcast, Chris speaks with Curtis Dean of Iowa Municipal Utilities about the prevalence of municipal networks in that state, focusing in on economic development results starting at 11:10. Dean highlights Hansen’s Clothing, a high-end men’s clothing manufacturer in Spencer, Iowa that expanded its online business exponentially when it connected to the municipal broadband network.
Municipal networks support home-based productivity:
In 2010, DirecTV announced the creation of a virtual call center, allowing 100 residents in southwestern Virginia to work from home, relying solely upon municipal broadband access.
150 home-based English teachers in Powell, Wyoming were connected to students in South Korea by the Korean venture capital firm, Skylake Incuvest; this unorthodox pairing was made possible by Powell's investment in FTTH.
Medical companies Ohio Health and Cardinal Health; Battelle Memorial Institute, a non-profit that relies on quantum computing to encrypt information; and numerous educational facilities use Dublin, Ohio’s municipally-owned fiber network, Dublink, for their healthcare, education and research needs.
"We are embarking on new initiatives with our local school district and regional colleges and universities to leverage broadband and to facilitate discussion between schools and the business community to strengthen, retain and attract quality workforce" - Dana McDaniel, Deputy City Manager of Dublin, Ohio
Lakeland, Florida invested in dark fiber community infrastructure, and has since reaped the rewards; the Florida Polytechnic University and Lakeland Regional Health, a medical center, both rely on the network for their operations. (Jump to 16:30 of the Broadband Bits Podcast for more details).
Municipal networks initiate tech booms and incubate start-ups:
"...in the 21st century, in this age of innovation and technology, so much of the prosperity that we're striving for, so many of the jobs we want to create, depend on our digital economy" - President Barack Obama, Speech at Cedar Falls Utilities
One Bay Area city, San Leandro, has used a city-owned fiber conduit to rival Silicon Valley tech companies, and now houses the world’s largest cluster of 3-D printing firms, along with the Westlake / OSIsoft Technology Complex, a tech campus.
The city of Dublin, Ohio, is home to the Dublin Entrepreneurial Center, a combination start-up incubator and data center located in the city’s metro center offices that now lists more than 80 tenants.
In the town of Spanish Fork, Utah, a municipal network is responsible for community savings of $2 million annually, as well as local government revenues exceeding $1 million, which can be used for community projects and initiatives.
Howard County, Maryland, has seen significant public savings (of up to $3 million a year) and impressive technological advances in its school system since switching to municipal broadband services.
Municipal networks increase home values:
Housing prices increased by 50 percent in one year when Google decided to locate a data center in the city of The Dalles, Oregon, in 2006 on account of its advanced technological infrastructure and high-speed municipal broadband access.
Another study, this by the Fiber-To-The-Home Council Americas in conjunction with researchers from the University of Colorado, showed that single family homes that can boast a FTTH connection are worth, on average, 3.1 percent more than their fiberless counterparts.
This White House report (which, by the way, utilized ILSR data!) finds that the existence of municipal networks and the market competition that these networks stimulate has tremendous economic benefits for local businesses and communities. The 37-page report highlights the successes of Chattanooga, Tennessee; Wilson, North Carolina; Lafayette, Louisiana; Scott County, Minnesota; Leverett, Massachusetts; and the Choctaw Nation Tribal Area in Oklahoma.
The New York Times highlights municipal fiber in a recent article: “For the Tech Savvy With a Need for Speed, a Limited Choice of Towns With Fiber.”
A report by the Government Accountability Office (GAO), “Federal Broadband Deployment Programs and Small Business,” argues that municipal broadband access positively affects small businesses by allowing them to streamline operations and improve efficiency.
Why do many municipal broadband networks end up being built in conservative districts, crossing political lines? Jim Baller, Joanne Hovis, and Ashley Stelfox of the Coalition for Local Internet Choice, in conjunction with Broadband Communities’ Masha Zaegar, argue that job creation and economic development is the “killer app” for local fiber networks.
Robert Pepper, Vice President of Global Technology Policy at the multinational tech company, Cisco, published an op-ed in The Huffington Post, which highlights the need for universal broadband adoption. Read: The Key to Social and Economic Development? Broadband Adoption.
"The message to policymakers is clear: If you want to increase economic growth, focus on broadband." - Robert Pepper, Vice President of Global Technology Policy at Cisco
Corporate site selectors have been placing more and more emphasis on broadband Internet access as they look for locations in which their companies can thrive. For more on this, read: “The Importance of Broadband to Economic Development.”
Does Broadband Boost Local Economic Development? ask researchers at the Public Policy Institute of California. They find that broadband access has a statistically significant economic benefit in the fields of business management, utilities, and technology.
A Novermber 2016 report from the consulting firm Analysis Group and funded by Fiber-to-the-Home council shows how competition drives lower prices and better download speeds for everyone. Specifically, the report focused on markets with Gigabit service.
Chris interviews Michael Curri, President of Strategic Networks Group, an organization that provides technical advice regarding broadband Internet to both firms and municipalities; Curri indicates a multiplier effect of ten times - meaning a return of $10 for every dollar invested where economies effectively utilize broadband.
Many communities, like Bozeman, Montana, view municipal broadband as a potential economic growth model that will allow them to catch up to other cities that have embraced high-speed Internet access; in this Community Bits Podcast, Chris speaks with Brit Fontenot, Economic Development Director for the city of Bozeman; David Fine, Bozeman Economic Development Specialist; and the President of Hoplite Industries, Anthony Cochenour.
"Having the infrastructure in place around technology, as well as the asset of this really historic and charming downtown, is a really interesting intersection and I think a lot of people are drawn to that." - Kimberly Van Dyk, Director of Planning and Community Revitalization of Wilson, North Carolina
A Knoxville news station, WBIR, covers Chattanooga's municipal network, focusing on the economic opportunities it has created - opportunities that Knoxville has missed out on because of its lack of high-quality service.
Consolidated Electric Cooperative, a nonprofit, member-owned cooperative, will soon offer gigabit broadband in rural North Central Ohio. They intend to first offer the gigabit to local schools and then to businesses.
According to eSchoolNews, Consolidated Electric Cooperative will provide 15 school districts with gigabit connectivity. The school districts will then have greater access to online resources and be better able to comply with mandated online testing in Ohio. In the article, Doug Payauys, vice-president of information systems for Consolidated Electric Cooperative, described the need for improved Internet access in schools:
"Technology is creating a shift in today’s classroom, and it’s transforming the way teachers educate and students learn. As the country becomes a more digital-based society, schools must work to transform lesson plans and accommodate new technologies”
The gigabit broadband will also improve the Wi-Fi in the school districts, providing more bandwidth for wireless learning devices. Wireless connections almost always depend on wireline backhaul to ensure each access point does not have a bottleneck between the user and the larger Internet. With better Wi-Fi, the schools hope to support an online curriculum for students to learn at their own pace.
Consolidated Electric Cooperative also intends to offer the gigabit connectivity to local businesses. They already offer some broadband connections to businesses through their Enlite Fiber Optic Network. They first began to develop this network in 2010 with some costs covered through the Broadband Initiatives Program created by the stimulus effort. Since then, they have expanded the network which now consists of 200 miles of fiber optic cable from Columbus to Mansfield, spanning five rural counties in North Central Ohio.
Athens, Tennessee, has struck a deal with Chattanooga's EPB and the Volunteer Energy Cooperative (VEC) that could facilitate the city's interest in a municipal fiber network. According to the Times Free Press, the Athens Utility Board (AUB) hammered out the final agreement earlier this month.
AUB is leasing fiber from VEC that carries a gigabit signal from EBP to the AUB system.
According to the article, AUB has explored the prospect of developing their own fiber network as early as November 2013 and now offers Internet access to one business in a local business park. AUB General Manager Eric Newberry told the AUB Board that they plan to approach other local businesses to set up additional commercial accounts. They plan a slow buildout and urge local businesses, many of them clamoring for a reliable connection, to be patient as they take next steps.
Athens is part of the Chattanooga-Cleveland-Dalton area in the southeast corner of the state and home to around 13,500 people. In March, the City Council voted unanimously to pass Resolution 2015-11 supporting local authority for telecommunications. [See the PDF of the Minutes p.1]
Thusfar, the investment has cost $58,258.69 for labor, materials, and equipment. The Board had budgeted $100,000 for the project.
The Amherst Business Improvement District (BID) recently hired a firm to prepare an engineering study aimed at bringing fiber connectivity to its downtown reports MassLive.
In 2007, the community began offering free Wi-Fi downtown after receiving a grant from the Defense Advanced Research Projects Agency (DARPA) and the National Science Foundation (NSF) to build a wireless mesh network. The city worked with UMass Amherst, DARPA, and NSF to deploy the system. In 2013, the city invested in upgrades which increased speeds and extended the network's geographic coverage area.
Community leaders feel Amherst needs fiber to boost economic development now and in the future. Sean Hannon, Amherst Information Technology director, told MassLive:
"Fiber is needed because it's the only medium that can support those speeds at the distance we need. It also should support new network equipment 20 to 30 years from now."
The study will examine optimal routes, methods, and cost estimates for deployment.
The Amherst BID is a nonprofit economic development organization whose members include local property owners, business owners, and residents. Their focus, as defined by the community's 2011 Improvement Plan, is to improve the downtown area through economic development, events, marketing, beautification, and special projects.
