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Broadband Deployment: The Fifth Utility

In today’s connected world of smart devices and the internet of things, intellectual knowledge and everyday conveniences have become more available than ever…to some at least. There is still a large divide between those communities where internet connectivity is available at affordable prices and those where it is not available or too costly for the average household. Internet connectivity affects all aspects of the community such as local government, education, business and economic development, as well as making our communities attractive places to live for upcoming generations.

For this reason, it has become known as the Fifth Utility – think electricity, water/sewer, gas, and telephones, and communities around the state are struggling to ensure they don’t fall behind. Plain and simple, internet is no longer a luxury had by a few to a necessity to learn and communicate with the rest of the world.

For example, educators are building curriculums tailored to the 21st Century learning environment, posting content, and seeking to directly interact with parents and students before and after school hours; thus, putting students beyond their digital reach at a measurable disadvantage. The shortfalls aren’t limited to public schools.

Private businesses in these underserved areas find it difficult to provide services that customers expect -- for example, free Wi-Fi and credit card transactions that elsewhere are considered commonplace. These disadvantages limit businesses’ ability to compete and expand, and also serve as a disincentive to even opening in the first place. Moreover, an increasing number of businesses and social service providers are requiring clients to do their business only on-line. Again, either adding costly complexity to the have-nots or inadvertently knocking them out of the system.

As this demand increased, both state and federal entities have recognized this as an issue of the upmost importance and dedicated subsidies to service providers. In an effort similar to the Rural Electrification Act of 1936, they have provided grants and loans to service providers to deliver bandwidth to unserved households. Today, most unserved areas are primarily in rural areas due to the financial restrictions of private, for-profit service providers, who have a hard time “justifying” a distribution plan to an area with so few customers. To further complicate the funding model, areas described as “served” are determined using census blocks as a whole -- wherein even just one household served within that block classifies the census block to be served and thus ineligible for funding. This information is provided by the incumbent providers along with an assigned speed that is the theoretical maximum of the installed technology. Actual metered bandwidth information is often not available, and the actual speeds are often a fraction of the claimed speeds.

These funding models can quickly lead a town, village, or municipality to discover that they either qualify for funding but are at the mercy of a willing service provider, or do not qualify for funding because a small corner of a census block is claimed to be served.

Identifying Physical and Funding Solutions

This leaves communities seeking solutions that provide their residents with the same advantages as the urban communities. Consequently, like with other utilities – water/sewers, electricity, gas, and telephone, some municipalities have taken control into their own hands leveraging assets and utilizing different models to provide broadband to residents.

The answer could be a municipal, town, or village-operated Internet Service Provider (ISP).The three most common models are municipally owned and operated model, municipally owned and outsourced service model, and a subsidization model.

The municipally owned and operated ISP model relies on the municipal entity installing, managing, and performing all technical aspects of serving internet to its residents. This model is best suited to a municipality with an electrical authority that can provide the field resources and technical know-how to maintain a large fiber cable plant. Another option is the municipality-owned/business-serviced network wherein the municipality owns the system and sources out all other aspects of the business. Lastly, communities themselves have funded private internet service providers to build into rural areas of known need. This is a good option if the goal is limited in scope but is inefficient and not a good investment for the town as the service provider now owns the asset.

The counter point to municipal networks is that they have been difficult to make them financially viable on a large scale. This can be attributed to lack of data to match the correct model to the community. This, in turn, leads to underestimating costs and under planning. Prudent financial planning, good funding research, and embedding yourself in the community to gain long-term business clients, municipal networks can provide a community with a much-desired asset.

With an “open access fiber optic network’ as their vehicle, municipal leaders believe that they can reach the previously unreachable, .... drive economic development, .....strengthen emergency services communications, and .... push the expansion of cellular coverage by installing additional towers in remote locations.

2019-2020....NYS and PA Snapshots....What’s Next? ... Will it be sufficient?

Propelled by this increasingly dramatic disparity between digital have and have-nots and bolstered by new and compelling funding models, the installation of fiber-optic cable – both “dark and lit” -- has surged in the second half of the decade. According to New York State, by the end of 2018-early 2019 its NYBroadband Program will have reached 100% of the 2.42 million New Yorkers (or 35%) previously lacking access to broadband internet access. NYS program’s goal was to “achieve statewide access to internet download speeds of at least 100 Megabits per second and 25 Megabits per second in the most rural and remote areas.” These are admirable broadband-through-put achievements, and a dramatically positive advance in those communities previously without any services at all.

Under pressure from constituents complaining of insufficient service and hamstrung by laws restricting government entities from providing telecommunication services, in 2017 county commissioners in Bradford County, Pennsylvania, a rural community in the state’s northeast corner, decided to build the “middle mile” that private providers were unwilling to build. Using ACT 13 Funds available to them through a Natural Gas Impact Fee, they funded a feasibility study aimed at the determining the viability of such a network. Their partners included the local development agency/IDA Progress Authority and HUNT Engineers & Architects, a local consultant. Buoyed by their findings, in 2018 Bradford committed $5.2 of matching funds for a grant application to develop their network, with a goal of providing dark fiber leases for public safety, ISPs, cellular, etc.

Looking at 2019 and 2020, PA Project Authority Executive Director Tony Ventello asserted that “Public safety remains the primary component of our efforts. Rural citizens have no less need for good connectivity than anyone else.”

“Efforts like this require the foresight and energy that our Bradford Commissioners have displayed. We’ve organized a team that includes the best possible cross-section of individuals that understand and have developed a truly redundant self-healing, fiber-optic middle-mile...”

” Moreover,” Ventello continued, “led by HUNT and supported with communications-savvy legal advice, last-mile service expertise, and financial analysis, we believe we can attack and solve the rural broadband dilemma. We will construct the first segment of our system the second quarter of 2019.”

Their efforts have been followed by similar planning efforts by neighboring Susquehanna and Madison counties, and the Pennsylvania Turnpike Commission has also begun its own public-private effort to create fiber-optic broadband networks to expand its cashless toll collections and tie together its widespread maintenance, tolling, and camera systems.

Meanwhile, in 2019-2020 industry experts expect the following advances and pipeline-pressures to be at play: 1) rapid adoption of 5G technology; 2) an exponential spike in government-deployment programs; 3) a continued proliferation of devices and voluminous software programs (think Virtual Reality and Artificial Intelligence software programs); 4) expanded cloud-based capacity and accessibility; and, unfortunately, 5) an increase in security concerns for all user groups.

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