SNG was recently asked by a resident from a well-to-do neighborhood just outside Nashville, Tennessee, where to best put their efforts to get connected. They have lived in a location for 10 years and it is not serviced with high-speed internet even though they are near where it stops on either end of their rural community. Asking the incumbent providers in their words “has proven futile” to getting better service. However they have many neighbors who would be interested in better internet service because many have businesses and work from home and they don’t want to move.
At SNG, we understand this challenge, which too many residents and businesses face across North America because of perceived addressable market, expected revenues vs. cost to service, low density, etc. Approaching private sector providers can be futile if those providers do not see enough of a business case to invest in your area and when providers have better returns elsewhere.
Two Options Going Forward
There are generally two options going forward – either 1) entice a provider to deploy in your area by subsidizing their business case; or, 2) build your own digital infrastructure which multiple providers can then use to provide services (like municipal roads which are built, owned and maintained by the municipality, but anyone can use them).
Subsidizing a Service Provider’s Business Case
If you choose to subsidize a provider’s business case to bridge their gap between their costs and their expected returns on capital, then local dollars should be used to build infrastructure that the locality owns (like a tower, backhaul fiber, etc.). This retains local ownership and negotiation capability which may be needed if there is poor broadband service because the provider is exercising a market dominant position. Retain ownership and control of your digital future.
In working with providers, there is also the option of conducting a broadband demand assessment to identify people ready to sign-up to new service, as well as assess potential demand for online services. This is local market demand research. Private sector providers are often reluctant to spend their retained earnings on such research, especially if they are unsure there is a business case for them. By quantifying current and potential broadband demand up-front and sharing that with private sector providers, they can apply that data to their business models to see if there is a business case for them that previously ‘flew under their radar’. Having a list of contacts of people who are ready and committed to sign-up makes that business case for the provider even stronger.
In both these instances, local funds subsidize one service provider. This may be a tactical, less complicated, and a less involved way for a locality to move forward – who in their right mind would want to take on more work, especially a broadband initiative. However, performance agreements should be negotiated and periodically reviewed to ensure local residents and businesses are getting the broadband they need – and want.
Investing in Digital Infrastructure
The other approach is the locality investing in their own digital infrastructure which is more involved, more complicated, and longer term. But this approach addresses the issue of local ownership and control of essential infrastructure – as with other infrastructure like roads, or electrical where community benefits are significantly greater than a private sector business case. At SNG we call this the economic case for investing in broadband. The example of Ammon, Idaho, proves that it is possible for a locality to own their digital future while also allowing multiple providers to provide competitive, robust internet services that meet the needs of local residents, businesses, and organizations.
Deciding where and how to get started depends on the addressable market of the locality, the local champions available to drive the process, the local organizational capacity to support a broadband initiative, and whether local residents, businesses, and organizations (government, education, health) have an understanding and vision of how they can benefit from using online practices. The table below outlines SNG’s suite of services that have been designed to help you make the right decisions based on your needs and circumstances, no matter what stage you are at in the process.
Where and How to Get Started with a Broadband Initiative
If you are interested in assessing at what stage your locality is in the process of getting broadband – because it is a process – we have the Digital Needs and Readiness Assessment that your local broadband champion can take online. When they completed the 10 minute online survey, a report will be generated and automatically be emailed to them. We developed this tool specifically to help local leaders understand at what stage their locality is and to help them prioritize their community goals and priorities. SNG’s goal with this is to help local leaders make better informed decision on how they can and need to move forward in a way that is pragmatic, clear, and cost-effective.
Why you should launch a “planning” program as well as a “mapping” one
In the rush to apply for mapping grants, states should not forget the opportunity to leverage up to $500,000 of federal stimulus funds for broadband planning. So, if you are about to submit to the NTIA a broadband mapping proposal for your state, we urge you to take the parallel step of launching a planning program too.
That planning program should aim to organize the most efficient way to help your state’s businesses and communities overcome the barriers to adopting BEST practices – hence reaping their benefits of their broadband effort.
Because it’s worth remembering that the real value of broadband is not only measured by availability, speed or price — though all of these are important enabling factors. Rather, that value is most directly tied to the benefits of broadband connectivity combined with e-Solutions – an e-Solution being “a way to do what we’ve already doing, only better thanks to the Internet”. Thanks to over 10 years of hands-on experience, we know that the winning equation for the country must be: “broadband connectivity + e-Solutions = self-sustaining stimulus.”
And we also know that the key to maximizing broadband and e-Solutions benefits is to develop a “combined understanding” of both barriers to adoption and use and BEST (broadband e-Solutions transformative) practices, and an ongoing involvement of teams and people on the ground, in our communities, businesses and organizations. Achieving that requires solid planning!
As noted above, up to $500,000 is available to each state mapping project to support such planning activities.
But to take advantage of this federal support for broadband planning, states need to submit a planning proposal and budget along with their mapping proposal. And they need to do so by NTIA’s August 14 deadline. Because if they don’t, the $500,000 available for planning effectively disappears for their state. So, don’t miss it. In our view, decision makers in every state should take advantage of this opportunity to set a course toward “self-sustaining stimulus.”
Do you need help?
For states concerned about how to come up with the 20% matching funds, we suggest careful consideration of ways to cover some, or all, of this amount through in-kind contributions. According to the NOFA, these can include “employee or volunteer services; equipment; supplies; indirect costs; computer hardware and software; use of facilities; [and] expenditures for existing programs presented as part of the [planning] project proposal.” Based on our experience, there’s a lot of value that can be derived from these forms of in-kind contribution.
Also, to help communities understand and plan the move up the BEST practices learning curve, we’ve developed tools such as e-Solutions Benchmarking (to establish a baseline and direction for planning investments in broadband infrastructure and sustainable adoption programs) and Evaluation and Adoption Analytics (to help evaluate the impacts of these investments and adjust plans and strategies based on clear and measurable evidence).
By Michael Curri – Broadband networks can create a “platform for productivity, competitiveness and innovation” in your community – delivering the infrastructure to capture economic and social opportunities, some known, some yet to be invented. Many communities fail during the broadband strategy, build-out and adoption phases as they lack focus and/or sufficient investment of time, energy, and resources.
Too often communities develop strategies based on following recipes from other regions. Instead of uncovering what the needed resources are, or how to leverage current efforts to best serve the specific and unique needs of the community, civic leaders race to “do what they did.”
There is no ‘one size fits all’ solution for successful broadband strategies that bring economic and civic benefits to a region and its citizens. Each community not only has different needs, but different strengths to best leverage the broadband platform. Strategic Networks Group (SNG) has for years been helping governments, at municipal, regional and national levels, to best understand where investment will make the biggest impact – and each and every time the best approach involves following the Broadband Lifecycle, or path to owning your digital future.
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By Michael Curri
Much too often broadband initiatives that should be successful end up falling flat – for a myriad reasons. Perhaps they do not get off the ground because of a lack of vision, planning, or leadership. Many fail during the strategy and build-out process as they lack focus and/or sufficient investment of time, energy, and resources. Some initiatives may have been successful building the network but fail because they are simply taking a “we built it – you use it” approach and not driving applications and adoption. And even the most successful broadband projects, with ample utilization and economic and social impact can be perceived as a failure if the outcomes are not measured and reported.
It is for all of these reasons that SNG encourages its customers (and all broadband project managers for that matter!) to design and run their broadband initiative with “one eye on the Broadband Lifecycle.” In this issue of Bandwidth, and the next two, we will be taking a look at 2 of the 6 steps of the Broadband Lifecycle. In this issue: step 1 (identifying gaps, needs, and demand) and step 2 (pre-planning and assessment).
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By Doug Adams
Now that you have funding, how can you make sure that your project lives up to the promise that got it funded in the first place? Hundreds of broadband projects are being funded in 2010 – be it from Stimulus or some other funding source – but how many will truly become a community asset that drives economic and social benefits?
Key to making sure your project will have a return on investment with quantifiable outcomes starts with these four guidelines:
- Don’t focus on engineering: it’s all about awareness and adoption;
- Use data to drive decisions before, during, and after the project;
- Create a “platform for innovation”: investing in broadband is NOT just about the financials;
- Frame the benefits, measure them, and promote.
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