Most of us are familiar either with Metcalfe's law or the general principle of it: networks are more valuable the more people are on it. The common example used to illustrate is a telephone. One person on a telephone network is useless. Two people is an improvement. With millions, you are far more likely to be able to call the person you want to. Recognizing this principle flips common arguments about connecting rural areas on their head. Ensuring that people in rural areas are connected benefits everyone -- it is not charity. Connecting people in rural areas increases the value of the connections in urban areas, creating more value for everyone. But the flip side may be too rarely considered. As these networks have grown in size (and therefore value), the cost of those who are excluded from them also increases significantly. This means that while the costs of not connecting rural areas are high today, those costs will be even greater in coming years. The argument is rather intuitive, but for those who want to learn more, Rahul Tongia and Ernest J Wilson III published an academic paper this year in the International Journal of Communications. The abstract for "The Flip Side of Metcalfe's Law: Multiple and Growing Costs of Network Exclusion" is here:

The study of networks has grown recently, but most existing models fail to capture the costs or loss of value of exclusion from the network. Intuitively, as a network grows in size and value, those outside the network face growing disparities. We present a new framework for modeling network exclusion, showing that costs of exclusion can be absolute, and might, at the extreme, eventually grow exponentially, regardless of underlying network structure. We find that costs of exclusion can also be spread to the “included” through several mechanisms such as parallel networks, and we also highlight how future research needs to capture the interaction of alternate or parallel networks to the network at hand.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Reedsburg Utilites, the owner and operator of a muni FTTH network north of Madison, Wisconsin, is finally moving forward on a project to connect rural areas of Sauk County. Last year, Reedsburg received a broadband stimulus award to expand its network but hit a series of stumbling blocks that called the project into question. The first problem is a common one when taking federal money -- Davis-Bacon wage rules. The bids from contractors were higher than expected because the appropriate wages according to the law are sometimes based on flawed data. In this case, contractors based the wages on highway construction rates, which increased the costs of the project by 50%. In other cases, we've heard of Davis-Bacon setting rates in rural areas based on urban wages, making projects harder to finance. Reedsburg apparently found a work-around (after first seeking a waiver from the provision):

Instead of accepting the bids, the utility decided to bid out rental contracts worth about $4 million to various companies, because the utility would not have to pay federal rates for temporary labor.

Then the prices for fiber-optic cable and duct rapidly increased due to the increase in demand from stimulus projects and the Japan earthquake. Finally, they were stuck waiting for final approval from RUS. Now they are moving forward with the $9.5 million project ($5.2 million grant, the rest in revenue bonds), which is good given the apparent demand they are seeing for the service:

Douglas [Reedsburg Utilities Marketing and Media Specialist] said the utility has seen a very high rate of interest in the new service. "I would say nine out of the 10 people I've talked to are on board, out of everyone we've met with so far," Douglas said.

Dunnellon, a small town in Marion County south of Gainesville, decided to invest in a community fiber network to spur growth and diversify its income stream. Though citizens did not want to cut government services, they have not been pleased at property tax increases. 364 days ago, we published a story discussing their financing. The town itself is quite small, with 1,733 residents but the network will be serving areas in the County as well. Though AT&T and Comcast offer services in the area, they have big gaps in coverage and apparently the cable television packages are antiquated (only 50 channels???). An article last year noted Dunnellon's Internet connections will range from 10Mbps to 125Mbps. They hope to sign up 1,647 subscribers within 6 months of launch -- the network is named Greenlight (not sure if they were aware that the city of Wilson, NC, already operates a triple-play FTTH network called Greenlight). They hoped to launch 6 months ago. Bill Thompson's "Dunnellon dreams of a connectied future," offers a comprehensive look at the promise and the challenges Dunnellon faces. Dunnellon's city manager comes from Valparaiso, which had a city-owned cable network that upgraded to FTTH. Unfortunately, Dunnellon is in the hard position of building a network from scratch. Building a new network requires a massive up-front capital investment - in this case the city will have spent $4.4 million to connect the first connection. Good thing they aren't all that expensive! The article identifies two main sources of the delays: difficulty in getting on the poles owned by Progress Energy and long delays in receiving the fiber-optic cable they ordered (stimulus projects have hogged the supply). Rather than taking 12 weeks, they had to wait 30. Delays cause problems:

The installation delay has put the city in a pinch with its lender, Regions Bank.

Dunnellon, a small town in Marion County south of Gainesville, decided to invest in a community fiber network to spur growth and diversify its income stream. Though citizens did not want to cut government services, they have not been pleased at property tax increases. 364 days ago, we published a story discussing their financing. The town itself is quite small, with 1,733 residents but the network will be serving areas in the County as well. Though AT&T and Comcast offer services in the area, they have big gaps in coverage and apparently the cable television packages are antiquated (only 50 channels???). An article last year noted Dunnellon's Internet connections will range from 10Mbps to 125Mbps. They hope to sign up 1,647 subscribers within 6 months of launch -- the network is named Greenlight (not sure if they were aware that the city of Wilson, NC, already operates a triple-play FTTH network called Greenlight). They hoped to launch 6 months ago. Bill Thompson's "Dunnellon dreams of a connectied future," offers a comprehensive look at the promise and the challenges Dunnellon faces. Dunnellon's city manager comes from Valparaiso, which had a city-owned cable network that upgraded to FTTH. Unfortunately, Dunnellon is in the hard position of building a network from scratch. Building a new network requires a massive up-front capital investment - in this case the city will have spent $4.4 million to connect the first connection. Good thing they aren't all that expensive! The article identifies two main sources of the delays: difficulty in getting on the poles owned by Progress Energy and long delays in receiving the fiber-optic cable they ordered (stimulus projects have hogged the supply). Rather than taking 12 weeks, they had to wait 30. Delays cause problems:

The installation delay has put the city in a pinch with its lender, Regions Bank.