One quick high level stat – how important is it to you to have computer and Internet access at home?

Take that question and drill down by neighborhood and you can see how the details shine a light on areas that could possibly benefit from digital inclusion programs and/or public awareness campaign:

Now consider if you were looking to relocate to Minneapolis – and this was the one piece of information you had. Which neighborhood would you choose? Or from a more positive perspective, if you were looking to close the digital divide in Minneapolis, where would you start? If you drill down into the survey, you should be able to dissect interest and experience with technology by neighborhood, which would be of even more help when planning a digital literacy program. You would know what folks were using for computers (smartphones, library computers, tablets, nothing?), you’d know what they were already doing (email, text, web) and could build a program to meet those needs and more. It’s a very thorough report. Here’s the summary of findings…

Survey questions captured Minneapolis residents’ opinions and preferences related to technology, as well as their access to computers and the Internet. Overall, residents thought somewhat favorably of technology in Minneapolis, saw computers and the Internet as important, had a computer and Internet access and accessed the Internet regularly (most commonly via a high‐speed connection). Residents generally found help for any computer or Internet issues through a variety of means and participated frequently and comfortably in many basic digital activities, including emailing and using social media. However, meaningful differences were seen across the 11 communities that comprise Minneapolis as well as among different sociodemographic characteristics.

But again I think much of the value (to folks in the city) is in the detail.

• The focus is on consumer savings, jobs and economic development
• The FCC is aware that changing funding mechanisms presents issues for incumbents and other businesses. That’s why they are trying a gradual approach. But there are winners and losers (although who they are depends on who you ask).
• The last chapter of FCC has yet to be written and that’s making it difficult for businesses to plan
• There is still a focus on the US and comparing Minnesota to other states. Folks weren’t asking a lot about international perspective.
• Privacy was one issue where international perspective came up. The EU and other areas puts a premium on privacy; the US does not.
• Minnesota is unique in that broadband has become a county-level issue.

Full Notes…

Broadband Perspectives from the Dayton Administration

Members of Governor Dayton’s Sub-Cabinet on Telecommunications will discuss the creation of the Sub-Cabinet, the goals of the Sub-Cabinet and the goals of their respective Departments.

Commissioner Rothman – Dep of Commerce

Top goals for Governor

• Job creation
• Border to border broadband

We have regulatory job at Dep:

• Wireless
• Cable
• Telecommunications

We think this is critical:

• Monitor broadband development across MN
• Issues in Aug
  • Task Force – charged with doing analysis and comprehensive action plan by end of this year.
  • Establish a subcabinet: Rothman, Phillips & Parnell
  • Created a BB development office in Commerce

We have high goals for Minnesota. We need everyone to work together.

Commissioner Phillips – DEED

Lots of studies that indicate that communities with broadband have an economic development advantage. We work with site selectors. Broadband is now lumped in with common infrastructure such as sewer.

• California did a study saw 6 percent advantage for areas with broadband.
• Dep of Commerce found that broadband was an advantage to businesses especially for IT
• Online sales is $6.2 billion industry
• Broadband is a great equalizer especially for rural areas.

ARRA Investments

• 18 programs received $229 million in MN
• We’re going to need to see more programs like this
• We’re going to need to get creative.
• We’ll have to consider options – maybe FTTH doesn’t make sense.

QUESTIONS – none

Practice Perspectives from the Federal Communications Commission
Hear an insider’s perspective on the practice before the FCC.
– Joseph Cavender

Practice Perspectives from the FCC – Joseph Cavender

USF supports 4 areas:

1. High Cost
2. Low Income (Lifeline/Link Up)
3. Schools & Libraries (E-Rate)
4. Rural Health Care

Why reform?

System was designed to support PSTN – not broadband networks. Led to waste and inefficiency. Caused disputes and left hidden costs to consumers.

Objectives:

• Advance universal service
• Fiscal responsibility
• Business realities

Policy Innovations:

• No subsidy for areas served by unsubsidized competitor
• Dedicated support for high cost areas
• Dedicated support for mobile service
• Competitive bidding (reverse auctions) for the first time to award universal service support
• Explicit accountable public interest obligations
• Budget for CAF support

Connect American Fun $4.5 billion annual budget

1. Remote Areas Fund
2. Fixed Locations
   1. CAF Phone I in Price Cap areas
   2. CAF Phase II in Price Cap areas
   3. Rate of Return carriers
   4. Mobility Fund
      1. Phase I (including tribal areas
      2. Phase II (exclusively tribal)
      3. ICC Recovery

CAF I

• Existing legacy high-cost support to price cap carriers is frozen
• Additional $300 million in CAF funding in 2012
• Carriers have 90 days to accept funding; carriers electing to receive Phase I incremental support will be required to deploy broadband to 1 unserved location for each $775 in support accepted

CAF II

• No support for
  • Areas with unsubsidized competitor
  • Low cost areas
  • Extremely high cost areas
  • Incumbent price cap carriers may receive support if they commit to serve support locations within their service territories

Rate of Return Carriers

• Support continued broadband investment, while increasing accountability and incentives for efficient use of public resources
• Think 500 carriers will see increased support
• Reducing support artificially low consumer rates – may have an impact on rural areas that charge low costs

For Mobile Carriers

• For first time Commission recognizes mobile voice and broadband service as an independent goal of universal service
• Phase I; $300 to upgrade areas with no 3G
• Phase I (tribal) Additional $50 million
• Phase II: Ongoing annual support for areas that depend on USF for service up to $500M/year & $100M/year for tribal

What was wrong with ICC?

• Quite complex
• Carriers faced declining revenues
• Uncertainty related to VoIP traffic
• Arbitrage led to phantom traffic
• Consumers were ultimately bearing the burden

ICC Reforms

• Adoptions rules to deter access stimulation
• Adopts bill-and-keep methodology
• Adopts prospective default for VoIP-PATN traffic
• Created a recovery mechanism for incumbent LECs Access Recovery Charge (ARC)

Further Rule Making

• Bringing remaining rate elements to Bill-and-Keep
• Bill-and-Keep implementation
• Reform end user charges and CAF
• IP-to-IP interconnection

Connect America Fund Panel
The new Transformation Order fundamentally changed the allocation of high cost support and intercarrier compensation. This panel will discuss the impact of the Order on ILECs, CLECs and wireless carriers. It will also review the pending appeals.
– Joseph Cavender
– Philip Schenkenberg
– Jim Campbell
– Dan Lipschultz
– Shannon Heim, moderator

CONNECT AMERICAN FUND PANEL

CLEC need the following:

• Pricing of network elements (unbundled or special access) is still open issue
• CLEC are denied access to fiber networks (old FCC issue)
• No compensatory measure for CLEC
• CLECs pay into CAF, but cannot get money out

What do CLECs get? Lower revenue, no compensation, required to pay into a fund, can’t get fiber.Are we funding our own demise?

Silver lining? There are pending issues that may change this situation. They are taking graduated approach.

CenturyLink

• Maybe a winner, maybe we loser with CAF. (Depends on decisions moving forward)
  • Hope to get some funds.
  • We do lose a lot of access revenue
  • We are debating CAF Phase I funding mechanism
  • Entitled to $89.9M – must decide by July 24
    • But includes significant obligations (need to get to unserved customers for every $775 et al)
    • Need to decide where to spend money
      • CAF shoots for low hanging fruit
      • 83% of unserved are in Price Cap carrier territory so it made sense to go to the source
      • CAF II – need to serve remainder of eligible unserved areas (4/1Mbps) – by state
        • Cost model is important – too low will slow down process

 WIRELESS

• By USF – yes we were winners
• Large wireless providers have already seen shrinking USF (via merger permissions)
• Can anyone put together a business plan to take CAF?
• In 1996, FCC recognized wireless as emerging business
  • Policies were friendly to all technologies, esp wireless
  • There were 44 million wireless connections (in 1996) – now we have more connections than people
  • We are coming closer to 100% coverage)
  • ICC – we’re happy with bill-and-keep, we’ve always worked that way
  • ICC – we’ve had agreements with incumbents – but is there still a need?

 RURAL CARRIERS

• We have high cost areas
• We have pushed out phone service, via USF
• Now we’re transitioning to broadband
• Esp rate-or-return are getting cut
  • It will hurt some help others – but dice are still rolling
  • Hoping to maintain budget
  • Stranded investment is a very big deal
    • Investments have been made based on old rules
    • How do we continue to serve these loans

 QUESTIONS

Are CLECs funding their own demise?

FCC answers – it’s true everyone contributes. Some people get more out of it than others. Wireless providers might say the same. Interconnected VoIP have been paying too –without hopes of recovery.

CLECs are in line for possible support in Phase II. (Without taking full state commitment.)

The Commission is no longer supporting duplicative service in any one area (Mobile being different.) If there isn’t support for one provider, tax payers should not have to support a second provider.

 If you win funding in Phase I – are you ineligible for Phase II? If you get money to build – can you still get money for operating funds?

Phase II is not set in stone yet – but that is not the plan.

It’s tough to accept Phase I when we don’t know the rules for Phase II. Tough to create a budget plan with so many unknowns. DO how can one bid on the reverse auction?

The FCC understands the issue. Phase I is no designed to bring Phase I everywhere. It’s meant for areas that really just need one short of support. Most areas see that it’s an OPEX issue, not a CAPEX. But the folks who need CAPEX are the best case scenario for Phase I.

The wireless bureau did an analysis of 2G areas that would be ready for 3G. There were enough areas that would benefit from one-time investment to move this forward.

How are Mobility Phase I areas being identified?

Done on a census block area – there’s a map on FCC of qualifying areas.

Reverse auction for high cost areas is new (planned for Sept 27). What are the thoughts?

Know about it from Spectrum. Haven’t been very involved but seemed effective with Spectrum. Like it in terms of land lines.

What did FCC not allow common (aggregate) bidders?

To prohibit collusion.

Unfortunately it does make it more difficult for small providers to participate.

Who does reverse auction favor?

Favors whoever can most efficiently provide service.

Carrier of last resort. Will our notion change?

CenturyLink – we tried to get the FCC to lose the idea of carrier of last resort. That obligation has largely been addressed. If you’re going to focus on broadband – getting rid of carrier of last resort will help folks move forward. Funding is required for broadband carrier of last resort.

If you maintain carrier of last resort –the regulators should support those networks. However if there is no carrier of last resort, do we leave it to end user?

The rural folks are more supportive of carrier of last resort. We maintain the last resort connections, and we get support for it.

Sometimes our problem (in rural area) is the middle mile.

Generally people will build where they can make money – and that’s an issue for building out to areas of last resort. So carrier of last resort forces regulators to look at how to build out to those last resort areas.

IP-to-IP will be another issue.

What’s the process that FCC provides guidance to USAC? Any efforts to make current process more transparent to public?

We’ve talked about it. We’ve been trying to formalize the process and make it more transparent. We’ve issued guidance documents to USAC.

We do work near each other and there is less formal communication as well.

They are the repositories of info – and we occasionally ask them for info.

There’s a sense that there’s a lot of chatting that we don’t know about. There’s speculation on how much happens.

Artificially low rates – how do you factor in calling scope? IN rural areas I might only be able to call 900 people, in urban areas phone users can call thousands of people.

FCC looked at rates and they varied greatly. We thought that folks should be paying comparable rates. We ask about rates; we don’t ask about calling areas. Traditionally we’ve looked at areas where rates have been “too high”, looking at rates that are too low.

Other issues

Transition to Bill-and-keep

Two legal issues:

• Does FCC have authority to step into state areas
• Does FCC have authority to do bill-and-keep

Broadband in Minnesota
Update on broadband enrollment and deployment progress in Minnesota and a review of the impact of BTOP and BIP grants in the state of Minnesota.
– William Hoffman
– Lyle MacVey
– Christopher Sandberg, moderator

BROADBAND IN MINNESOTA

Bill Hoffman on Connect Minnesota

Primary Program Components

• Data Collection & Mapping
• Survey & Research
• Planning
• Program Development

Statewide Availability – Percentage of households reaching MN Broadband Goals:

• In Oct 2011 57.4
• In April 2012 59.92 (not yet confirmed or published, will be released within the week)

 Lyle MacVey – NESC

• Working on ARRA-funded Middle Mile – Regional Network serving Community Anchor Institutions in Northeast Minnesota.
• Working with Cook County and Lake County for last mile services

ARRA Funded Projects

• Anoka
• Carver
• LqP
• SMBS (Southwest Minnesota)
• Lake County
• Arrowhead Electric
• NESC

Other projects in Development

• Sibley County
• Todd County
• Cloquet Valley
• Redwood County
• Kanabec County
• City of Prior Lakes

We are looking at possible impacts of CAF and ILEC/CLEC response

In rural areas – you can build FTTH if you have the density. It’s the long haul (to TCs, to Chicago) that is expensive.

Trends in Projects

• Movement to Countywide projects
• Movement to public-private partnership
• Majority of projects fiber based
• Projects are rural in nature
• Looking for ways to bypass referendum requirements
• Biggest challenge is lack of funding sources other than bonding

Rate Trends

Consumer and Small Business (DSL/FTTH)

• Baseline holding steady – rates not falling
• Multiyear contract incentives

Carrier & Large Enterprise (Middle Mile)

• Greater Competition
• Prices in rural markets state to fall
  • 100 Mbps @ $675/month
  • Price matching and network leveraging

Challenges

• NTIA/USDA funding releases slower than expected
• Construction costs higher due to David_Bacon impacts
• Changes in Design or Scope
  • Result in lengthy reviews and project delays
  • Transparency difficult to assess both in terms of access to and release of; MN Data Practices Act (have had 5 intentional fiber creaks)
    • Business plan, rate structures

Result

• Projects falling short of original milestones and scope

Opportunities

• Technical Assistance Survey Results
• Leveraging Community Assets
  • Tower leases and public lands
  • Equal Opportunity and Access
    • Establishing Ground Rules
    • Public Common Carrier VS ISP
    • Education
      • Understanding FCC rules.

 QUESTIONS

How are people answering question about computer ownership? They aren’t counting smartphones and tablets.

Connect MN will change the question.

You mention engineering as project issue and 20% over cost. Can you say more?

It’s primarily in underground topology in NE Minnesota. Part of engineering is also inspection – and that can take longer.

How does Minnesota compare to other states?

Mid pack. Working on adoption would help.

Keynote Address: Assessing Broadband in Minnesota
The former Speaker of the House of Representatives and current Chair of the new Minnesota Broadband Task Force will provide her perspective of the state of broadband in Minnesota
– Margaret Anderson Kelliher

NextGen 911
The shift to broadband and IP is changing the way 911 services are used and delivered. With the explosion of mobile devices and data services, calls for emergency response are not just coming from telephones anymore. In this panel we’ll hear about what is happening at the national and state level regarding how emergency response networks must change to become next generation emergency response networks.
– Trey Forgety
– Anthony Mendoza, Moderator

NextGen 911

Tony Mendoza

• Need to access and locate different types of media – VoIP & Text
• Legislation was raised (didn’t pass) concerning all IP 911 network

Trey Fogarty at the 911 Association

• Primary standards development organization for 9-1-1 systems and service processes.
• 7000+ public safety and 9-1-1 industry  members
• The only professional organization solely focused on 9-1-1 policy, technology…

How we communicate

• By 2014, most Internet traffic will be mobile
• Voice communications account for only 1/3 of mobile usage; 2/3 are apps, test & video
• Approximately 32% of adults and 36% of children live in wireless-only households
  • Exception – folks will get the phone if it gets bundled with broadband
  • More than 8 trillion texts were send last year
  • Teens text 5,500 times per month
  • 35 million Americans who are deaf or hard of hearing rely on texting
  • IP-based messaging services such as iMessage are beginning to displace SMS

What’s driving NG9-1-1?

• The need to mainstream 911 technology
• Needed improvements in survivability
• The critical need to improve interoperability and information sharing
• A desire to increase competition and innovation in public safety technology

Built-In Interoperability

NG911 is:

• An open standards-based platform
• Using modern, flat IP Architecture
• With robust security and resilience features
• Based on Commercial Off the Shelf (COST) technology
• Designed to be originating-service agnostic

NG911 Responder Benefits

• Allows seamless flow of data from consumer to call-taker to dispatcher to responder
• Leverages existing national standards for interfaces and data structures
• Provides an adaptable platform to meet future responder needs

Recent Legislation – http://www.nena.org/?page=Standards

• Now is the time to start thinking about NG9-1-1

QUESTIONS

What kind of consumer education do you see happening?

The FCC asked in the rulemaking – should we do something now to deal with Americans communicating via text? The answer was yes – especially for folks with disabilities.

Text to 911 mandate may appear this summer – with a 3-5 year expectation.

If you’re a carrier a best practice – text back to people who text 911 to tell them to call 911. In the long term, start planning. Verizon is doing a text to 911 rollout.

Municipal Broadband
A review of municipal broadband projects in the state of Minnesota.
– Milda Hedblom
– Christopher Mitchell

Municipal Broadband: Milda Hedblom & Chris Mitchell

How did National Broadband Plan support municipal network?

States had the right to tell communities that they couldn’t build a networks and/or put stipulations on building the network. But the NBP gave a clearer sense that it wasn’t’ the case.

How does MN fit in compared to other states?

Minnesota is unique in that there’s a focus on counties.

You have looked at exemplar projects (such as Bristol, Chattanooga). Are there lessons to learn?

Chris just released a paper on the topic. They all of Gig to anywhere in the city. Here are some characteristics they share:

• Municipal electric department (only 2000 cities have this)
• They were prepared to act as a business (get, take customers)

Comment on counties…

Minnesota wants to be one of top 5 states by 2015. Counties have found that it’s hard to run a modern business without broadband. Folks with good access are often getting it from coops. Groups of people in the county are realizing that if they don’t act, they will be left behind.

Minnesota’s counties are looking at public-private partnership, community networks, working with private providers.

USF reforms will be interesting but so far seems insufficient.

There is no one-size-fits all solution. Different counties have different assets. Almost all counties are looking for partners of one form or another.

Ramsey County has aspirational plans. Sibley County has now made a commitment via Joint Power with ambitious goal of bringing fiber to farms.

JoAnne Johnson – U-reka update

1. Did feasibility for Todd County. We’re meeting with community and updating them. There was about 1 year between first meeting and completion of report. They are working with Arvig to match Blandin support.
2. We’re finding more enthusiasm from private partners. And more trust from public partner to work with private partners.
3. Working with Kanabec County – approved last night. It will be a marketing survey, 10 year financial study…
4. We’ve seen success with Middle Mile project – and now we’re investigating access to the home.

There are obstacles for public participation…

• There are 19 states with some form of barrier for private sector getting into providing/building broadband service.
• Municipal network has barrier of super majority referendum  for providing phone services – maybe it makes sense to make that 50%

Monticello – it went into operation with an overhang of debt (due to lawsuits). It’s been a huge obstacle. Perhaps we need to judge them not based on economics alone.

Serving the Underserved
A review of the legal requirements and programs designed to serve low-income families with broadband services. The programs of Comcast and CenturyLink will be featured.
– Karly Baraga Werner
– Jim Campbell

SERVING THE UNDERSERVED

Comcast

• The digital divide is a real problem and it is growing. 92% have access only 65% have adopted broadband
• Half of non-adopters are low-income families
• So we need to focus on low income families
• Big barriers – Internet Essentials was developed with FCC to address all issues
  • Cost (36%) – connectivity and equipment
  • Digital Literacy (22%)
  • Relevance (19%)

What has the FCC done?

• Supporting Connect to Compete (piloted in California right now)
• Feb 2012 – FCC released the Lifeline Reform Order
  • Permit eligle customers to apply Lifeline discounts to bundles that include voice and broadband
  • Creates a Pilot Program to study application to the adoption challenge of a subsidy for the price of BB service.

Details on Internet Essentials – http://www.internetessentials.com/default.aspx

• $9.95/month – XFINITY Internet Economy Service (currently 3 Mbps down)
• Option sot purchase computer for $149
• Free Internet training
• Can remain on program as long as kids are in school and qualify for free lunch

We’re trying to get the word out.

CenturyLink

Internet Basics – http://www.centurylink.com/home/internetbasics/?rid=internetbasics

• Service discount $9.95
• Equipment discount ($150 notebook)
• Training – and 24/7 tech support
• Committed to spend $2 million on the project over next 2 years
• We focus on families and seniors

QUESTIONS

How is enrollment?

It was slow to start. But we’re seeing an uptick and we (CenturyLink) will be working with school next year.

Comcast is at 5% of eligible students.

Is childcare assistance a qualification for CenturyLink?

Not sure.

What issues were there in Minneapolis (for Comcast)?

We found that when we can get a brochure in a backpack, we have success. But there are some reservations with some schools to have an appearance of supporting one business. And principals are busy.

Making the parallel between reduced lunch programs and reduced broadband rates helps.

Comcast has brochures in 13 languages. And we have a partnership with Hmong American Partnership.

Are there avenues to reach seniors that have been successful?

Going to where the seniors are has been helpful. Also we can direct mail to phone customers. And we’ve gone back to paper – we bring paper applications to meetings.

Privacy/E-Commerce
Our speakers will provide an update on developments in privacy law, including a discussion of the new FTC Privacy Report, the EU Privacy Directive, Google’s new privacy policy, the Obama Consumer Privacy Report and the impact of recent developments on mobile applications.
– Jamie Nafziger
– Professor William McGeveran
– Brad Bolin

PRIVACY / E-COMMERCE

Dorsey Whitney – Ways that our data is getting collected

• Fear of privacy may be holding back adoption

This is the info an App Developer can access

• Unique Device Identifier
• Contacts in your address book
• Current GPS coordinates
• Photos in your photo gallery
• Email account info
• Phone info
• Videos watched and searched.
• Web search history
• Keyboard cache

Facebook OpenGraph Apps (Frictionless Sharing)

• What you read
• Songs you listen to
• TV shows you watch
• Movies your watch (outside US)
• Your exercise results
• What you cooked
• What you are wearing
• What you want
• Where you are traveling

Ad Network/Data Broker

• Age
• Gender
• Income
• Ethnicity
• Sexual Orientation
• Political Views
• Parental status

Best Buy –

Think about the power that a business has in terms of having all of your info – but also understanding relationships based on info and that the business has the ability to feed you info when they choose it.

UMN Law School Professor –

We have a class to give our students an edge.

A lot of this is driven by what info can be gathered but also the algorithms that give even more info.

There aren’t a lot of laws out there now. But the Future Privacy forum are active.

• Slow movement towards increased federal role in regulation (FTC report and Obama/Commerce report)
  • Both reports pretty much say – there’s a lot to think about
  • They are looking for best practices
  • They are inclined to ask for privacy by design
    • Set defaults
    • They don’t want to kill the goose that lays the golden egg
• The rest of the world is proceeding in a different direction – data protection (not privacy)
  • Looking into right to be forgotten
  • Providing end users with access to info
  • Changing from guidelines to regulation
• Emerging US privacy strategy

QUESTIONS

Differences between EU & US have been ongoing. EU have made information a right. If agreements are 20 years long – is that part of US companies’ strategy to avoid stricter rules for a while?

The gulf between EU and US is growing.

One key concern is that less certainty is not good. The agreements led to more certainty.

There is drive in US policymakers to try to increase harmony between US and other places.

The powerful companies will hold out for US rules are long as possible.

On right to be forgotten – is it like right of withdrawal?

Loosely, yes. The US has longstanding rule on freedom of speech. And we prioritize that. We’re kind of libertarian on it.

EU countries see rights differently. They also have identity rights, rights of attribution, right of withdrawal.

Is common law developing on shrink wrap agreements?

Yes in FTC – mostly Section 5 deception trade practices.

This paper will explain the economic and societal gains enabled by broadband, and describe how different rural service providers and the communities they serve have embraced the challenges and opportunities of new technology.

They take a look at Education, Health Care, Agriculture, Electronic Government, Public Safety, Utilities and the Consumer’s Home. Each chapter includes a statement of need (generally backed up with statistics and citations), some specifics on what communities and providers ought to be thinking about moving forward and a couple of case studies taken from real rural communities.

I think this report can be used to compel a community to take a closer look at broadband. It could offer some advice on goals. And, as it’s been developed by the NTCA and therefore uses examples from local telecommunications providers, I think this could be used to engage local provider through examples of success approaches by counterparts in similar areas.

I would like to pull out two Minnesota examples used in the report – both highlight best practices in Education…

Halstad MN – Discovery Education Drives Use

Based in Halstad, Minn., independent telecommunications cooperative Halstad Telephone Co. (HTC) maintains an Ethernet, fiber‐based network that provides broadband service to each of the four K–12 schools in its territory. HTC is part of the Northwest Minnesota Special Access, a consortium of 18 rural telephone companies that connects 126 schools and 43 libraries in the state. Students often use a remote video connection to take advanced placement, foreign language and other specialty courses from a teacher located in another facility. The network is linked to the University of Minnesota, Crookston, enabling high school students to enroll in college courses via a video conferencing application.

Although the network has been in place for many years, HTC recently observed an exponential increase in online activity. In 2010, HTC arranged provision of Discovery Education service to its four local K–12 schools at the company’s expense for one year. Under the terms of the arrangement, instructors and students have access to Discovery Education’s multimedia and interactive content within the school building. Content includes audio files, images and videos, as well as interactive elements such as online quizzes, educational games, and math and science lab simulations. The rural communications provider reports that the various school systems engaged in this endeavor each have a 6 Mbps to 30 Mbps symmetrical connection, and due to the popularity of multimedia content, the various capacities are maxed out at least once per day. HTC also stated that combined with the increasing use of tablets, it expects many schools to double their broadband speed requirements within the next two years.

Spring Grove MN – Devices Drive Use

Headquartered in Spring Grove, Minn., rural provider Spring Grove Communications (SGC) enables its citizens to learn on cutting‐edge technology devices. SGC partnered with its local school district to outfit students with the latest laptops and tablets. Apple iPads are used in all of the elementary classrooms, and every seventh through 12th grader has an Apple MacBook Air available to him during the school day. If a student wishes to take home a MacBook Air, he has the option of renting one for $15 a month. Many of the families renting laptops have never had a computer in their home. The program engages students on a dynamic, digital online platform, providing for learning anytime and anywhere. It also is educating students and teachers alike about how to use this technology and the importance of broadband in today’s economy.

In addition to the student aspect of education innovation, virtual learning is a driver of economic development for small, rural towns. Under the traditional education system, a teacher is limited to open positions within driving distance of her home. With virtual education, a teacher residing in a rural area is able to teach from home and reach students across the state, district lines or the globe.

Here’s the situation as stated in the Subcommittee memorandum…

More than three years after the American Recovery and Reinvestment Act of 2009 (ARRA) allocated $7.2 billion for broadband grants and loans, the jury is still out whether taxpayers are getting their money’s worth. Despite claims of ARRA projects being “shovel ready,” recipients of 233 National Telecommunications and Information Administration awards worth $4 billion have spent just $1.6 billion of it so far. Less than a dozen of the projects have been completed. Six of the awards worth $124.5 million have been returned or revoked. Recipients of 320 Rural Utility Service Awards worth $2.4 billion have spent $968 million. Five projects have been completed. As of July 2011, $124 million in grants and $35 million in loans have been rescinded or revoked. Allegations also persist that NTIA and RUS funds are not bringing broadband to unserved areas but instead are subsidizing competitors to overbuild privately financed networks.

Here are the numbers:

NTIA
Budgeted $4 billion
Spent $1.6 billion
Revoked $124.5 million
11 projects completed

RUS
Had $2.4 billion
Spent $968 million
Revoked $159 million
5 projects completed

Congress is convening a panel of experts to talk about what’s happening, the panel includes:

• The Honorable Larry Strickling, Assistant Secretary for Communications and Information and Administrator, NTIA
• The Honorable Jonathan Adelstein, Administrator, RUS
• The Honorable Todd Zinser , Inspector General, U.S. Department of Commerce
• Mr. David Gray, Deputy Inspector General, U.S. Department of Agriculture

Causes of Current Problems

Telecompetitor notes that there are some extenuating circumstances that have made finishing projects more difficult…

The telecom industry has cited several factors (not mentioned in the memo) to explain the apparent spending slowness such as an often long approval process for environment impact studies or a shortage of fiber cabling that resulted when the April 2011 tsunami took a key vendor offline. No doubt Strickling and Adelstein will review some of these factors at the hearing.

I’ve heard from folks that both are real issues – but I’ve heard that from projects that are otherwise on track and seemingly making progress. I don’t know that the main concerns here are the projects that are running somewhat behind – but rather the projects that seem to still be hovering around the starting blocks.

Causes of Future Problems

The memo itself outlines another issue that I think may be even bigger moving forward; the FCC has made substantial changes to USF, thereby requiring changes in business plans of many ARRA grant/loan recipients…

More problems may lie ahead. The FCC has recognized the need to reform the USF’s high-cost program for a decade, with proposals in 2008 and a reiteration of that view in the 2010 National Broadband Plan. The RUS nonetheless apparently guaranteed loans under the BIP and its Telecommunications Infrastructure Loan Program on the assumption that applicants would continue to receive the same level of high-cost USF funding for the life of each loan. Now that the Commission is reforming the high-cost program, the RUS has asked loan recipients to revise and resubmit their financial projections to demonstrate sustainability.

It will be interesting to see how the Subcommittee and panel of experts addresses those issues. It’s a byproduct of the funding coming out before the National Broadband Plan – perhaps an unintended consequence but not unforeseeable.

Minnesota Projects Mentioned

Finally, two Minnesota projects were mentioned specifically in the memo. First the Leech Lake Reservation Business Committee in Minnesota declined its $1.7 million grant on the grounds that it would not be able to meet its grant requirements. And the Lake County project…

Nevertheless, industry observers have suggested that the BTOP’s and the BIP’s infrastructure loans and grants have been used to overbuild existing systems rather than extend service to unserved areas. The Government Accountability Office confirmed these suggestions at the Feb. 10, 2011, subcommittee hearing, noting that the NTIA and the RUS had performed “due diligence” with respect to overbuilding but “made a decision to go forward nonetheless” with projects that would overbuild existing facilities. Indeed, the Energy and Commerce Committee’s Subcommittee on Oversight and Investigations is already investigating recently publicized allegations by cable company Mediacom that the Lake County government in Minnesota is not only using $66 million in BIP funding to overbuild Mediacom, but committed fraud by misleading the RUS in its application.

The Lake County project has had its share of ups and downs. (Some might note that disruptions from incumbents may be one reason some projects are running behind.) Last we heard Lake County celebrating new location in Two Harbors. I did notice that their last couple of meetings had been cancelled.

The Subcommittee meeting will be held tomorrow, May 16, 2012, at 10:00 a.m. in room 2123 of the Rayburn House Office Building. I haven’t seen any notice of online broadcast.

I know that many people were impressed with Dakota County’s presentation at the April Minnesota Broadband Task Force meeting, especially their one-stop-shop for right-of-way permission. It’s a glimpse at the kind of seemingly common sense approach they take to streamlining processes in Dakota County. I say seemingly because I know a ton of work must have gone into assessing the policy and procedure for each type of application and finding a way to make them work on a common online form.

It was interesting to talk with David about other projects happening in Dakota County and beyond – from the physical layer up through applications.

Here’s a sample of what’s happening:

Metro County Fiber Interconnect

Dakota County met with several other counties (Anoka, Carver, Hennepin, Olmsted, Ramsey, Scott and Washington) and Hiawatha Broadband (HBC) to discuss Metro County Fiber Interconnect. They are working on an MPLS network between all 8 counties, which will be completed by the end of June. MN.IT (formerly OET) is driving the work and will provide private network space that was allocated to each county.

The counties are working together with HBC to find ways to cost-effectively expand their fiber networks. The goal is to make the best use of existing conduit and connections, rather than building from scratch. The counties and local government agencies get to improve infrastructure. It makes the most sense to map out existing infrastructure, map out plans for future development and pool the pockets of funding to build only when necessary and pull extra strands of fiber (or post equipment on towers) whenever possible.

Homeland security, disaster recovery and transportation have been a few of the possible pockets for funding. While the infrastructure clearly supports those goals- the investment is helping in other areas as well.

This underlying layer of physical connectivity has allowed the counties to streamline processes and build new applications that save money for tax payers. Looking at the infrastructure alone, building up this mesh network among counties has allowed different entities to terminate T1 connections – those connections were costing up to $1500/month. Also each expansion is bringing increasing rural area closer to high speed broadband.

Reducing Government Operations Costs

One of the ways Dakota County has been able to use ubiquitous broadband is their SIP phone system. SIP phones use voice over IP. There are several advantages – first they are like super-sonic phones and work well for videoconferencing. David mentioned that staff in Dakota County is just as likely to meet video videoconference, even while in the same building, because of lack of conference room and convenience of videoconferencing.

Second, the phones work anywhere they can get online. So if you have relocated or have a meeting in another building, your phone still works. In case of a disaster, whole offices can be moved pretty seamlessly to new locations – the phones and computers will work. Dakota County recently moved  3,800 phones to the new SIP system.

The County is looking at virtual desktop options, where much of the interworking and content would live in the cloud, while the desktop is really just a portal to the information. There are some similar advantages to SIP phones, in that the content becomes decentralized and can be accessed remotely – but also virtual desktops should not require the same sort of upgrades as regular desktops (and laptops) require today.

Applications in the Field

Dakota County just doled out 3500 IP addresses to traffic signals across the county. They are used to track stoplights and pedestrian crossings. Good – but I must admit I didn’t really understand all of the implications until talking to David. The stoplights are tracked. The buses are tracked. So the stoplights can speed up or slow down a bus when necessary – ensuring that buses aren’t falling off schedule and grouping together. Also the lights can be tracked and through artificial intelligence will learn to direct traffic as necessary – reducing red lights for the bulk of travelers, saving both time and money. And of course smart appliances like this could be helpful in an emergency or disaster recovery situation.

Next Steps for Dakota County

The next step for Dakota County is sharing infrastructure and technology with area businesses. That is where working with folks such as HBC helps.

The County doesn’t necessarily want to get involved with providing broadband services to the end customer – but they are willing to invest and collaborate so that broadband is available. Again is feeds into supporting the tax bases and providing the services that area business and residents want and need.

Connecting with businesses and nonprofits is the next step for Dakota County. Some counties/communities may not be at the same stage – and for those folks David was also kind enough to share a series of documents that he has used coordinating various parties in public-private partnerships. The hope is that these might become templates or fodder for other counties looking at fiber options.

Agreements Between Partners – Templates

• Joint Powers Agreement for the Development of Optical Fiber Network (between state, county and cities)
• Joint Powers Agreement for the Development of Optical Fiber Network (between state, county and MNSCU)

Board Documents

• Authorization To Execute Joint Powers Agreements For Development, Use, and Management Of An Optical Fiber Network
• JPA with State for Development of Fiber Network
• JPA with State, County and School District

Working with Vendors

• Request for Bids to Build Fiber Network
• Contract for Fiber Network (includes labor and materials)

Rights of Way

• Proposed Fiber Connectivity – Buck Hill Radio Site Tower Shelter (description of how/why fiber to tower will improve communication)

The FirstNet plan is to build a broadband network for police, firefighters, emergency medical service professionals, and other public safety officials. FirstNet is really just getting going – but there are some plans. First plan is for FirstNet to work with state, local and tribal governments. A goal is to create an interoperable, cohesive, countrywide network. That being said, states can opt-out of FirstNet. Apparently the plan (and I’m gleaning this from the webcast) is for FirstNet to come to the states with an assessment of what the state has and what they need. And RFP will be created from these assessments.

A Minnesota Public Safety Broadband Wireless Data Network Requirements Study has recently been released…

This comprehensive study was conducted through 2010-2012 to assess the needs of public safety wireless broadband in Minnesota. It is available in five sections, which each focus on a different interest area in public safety broadband. This study will form the foundation of Minnesota public safety broadband planning efforts and our interaction with national entities such as Firstnet.

I thought it might be helpful to share the recommendations from the report…

1. Establish a body under the Statewide Radio Board to officially sanction public safety broadband planning activities and to represent the State before the FCC, NTIA, Firstnet, and standards bodies including 3GPP.
2. Develop a Minnesota Public Safety Wireless Broadband Plan based upon its existing planning activities and current research.
3. Develop applications and data interoperability standards, including standardized SDKs, APIs, and network interfaces as well as media codecs, signaling formats, and container formats.
4. Execute formal MOUs with potential partners for the public safety broadband network to clearly identify all feasible avenues for alternative financial models for both construction and maintenance of the network.
5. Expand public safety broadband planning on a regional basis to ensure interoperability with adjacent states and the provinces of Manitoba and Ontario.
6. Work actively in larger planning and standards-setting with organizations including the FCC Technical Advisory Board, PSCR, NPSTC, 3GPP, and Firstnet to support development of national standards and a national network model that fully support the needs of the state of Minnesota.
7. Continue requirements research and planning efforts including expansion of its existing financial models, network design, network requirements, and user needs.
8. In the near term, construct a small public safety wireless broadband pilot network to identify transition and implementation issues specific to Minnesota, collect live user data, and serve as test-bed for innovative end-user applications.
9. In the long term, facilitate, through whichever means best meet the needs of our public safety community, integration into the national safety broadband network that introduces operational and technological efficiencies and enhances the performance of public safety services in the state of Minnesota to maximize the protection of human health, property, and safety.

As Cisco reports…

Dr Michael Johnson believes that one should “never waste a good crisis.” In recent years the provost of Itasca Community College (ICC) has faced more than his share: beginning in 2005, declining enrolments in northeastern Minnesota dealt a serious blow to institutions of higher learning, as well as local elementary and secondary schools. As a result, colleges and schools funded by the state based on student population found their budgets stretched beyond the breaking point.

But Johnson and his colleagues in administration have turned obstacles into triumph: as part of the Itasca Area Schools Collaborative (IASC), the college now works in close partnership with a consortium of seven rural Minnesota K-12 school districts to share resources and provide the highest quality education possible for their students. Supported by a robust networking infrastructure, standardized systems and innovative technology tools, IASC members are ensuring that geography and distance no longer limit academic opportunity.

Blandin is pleased to have played a supporting role in the transformation. We invested $50,000 in MIRC funds through the Lightspeed grant program and $750,000 in regular grant funding to build two “immersive telepresence classrooms” in the IASC districts and related training.  (Subsequent funding includes $1.76 million in federal dollars, $1.76 investment from vendor partners and district investments of approximately $1.5 million.)

While Cisco gets into some of the details of how it happened, Minnesota Public Radio details the fruits of IASC’s labor…

Teachers are using telepresence classrooms for Spanish and Ojibwe, but next year, the district will offer 17 courses in them, ranging from literature and writing, to business, mass marketing and calculus.

School officials say the uses go beyond academic courses. The technology also will allow students to talk to people anywhere in the world, and take virtual field trips to places like NASA and the Smithsonian Museums.

[School Superintendent Matt] Grose said modern distance learning technology levels the playing field for school districts that are remote and sparsely populated. It allows them to hire specialized teachers and share the costs.

“Our kids in Deer River are going to have opportunities to take higher level courses that we can’t offer here, or at least that we don’t have the enrollment to justify a teacher for,” he said. “All of the sudden you can justify running that course and you have kids that are getting access to things that are rigorous and relevant. And we think that’s important.”

It appears that only a very small handful of K-12 schools and college campuses in Minnesota are using the newest generation of interactive technology.

We are pleased to see hard work and investment reap such benefits. We wanted to share an added perspective from IASC Technology Services Director Lora Mathison…

“This golden thread of connectivity allows classroom students to take trigonometry, dislocated workers to be retooled, agencies to offer state-of-the-art trainings for staff and business meetings to be scheduled without drive time.  The expansion to the community is only in infant stages… the expanded opportunities  for students, families, staff, community, businesses, medical institutions, non-profits and others will only be limited by creativity.  The future promises to bring new ways to utilize the telepresence classrooms that have not even been thought of yet.”

“As exciting and successful as this project has been for IASC and the region, it is just a glimpse of what may follow.  Fundamental changes in public education are on the horizon and innovative technology solutions such as telepresence will be able to offer transitional support.”

And while we’re celebrating Grand Rapids Area’s efforts around education, I’d be remiss if I didn’t mention today’s Minneapolis Star Tribune on the Strive Partnership…

Known as the Strive Partnership, the program follows this strategy: Identify specific goals, come up with a common way to measure those goals, and do so by using a rigorous set of data that can be shared with everyone. Each community sets its own priorities for improving education for students “from cradle to career.”

The Deer River School District is using the approach for an effort called Itasca Area Student Success Initiative.

I am a long-time E-Democracy volunteer. The traditional way to grow a list is through existing social networks. In other words, I ask two friends to join, they ask two friends and so on. It grows a list – but it also means you get folks who run in the same circles. In the last couple of years, E-Democracy has made concerted effort to encourage greater diversity in forum participation. This report explains what they have done successfully.

I think this work will be valuable for community leaders who are also struggling with how to make their programs more inclusive.

Here’s a quick description from the report itself…

Through this work, E-Democracy hopes to debunk assumptions that people in poverty, of color, new immigrants, and others historically disenfranchised are digitally disconnected or less interested in connecting with their neighbors online than those in homogeneous, wealthy neighborhoods – and instead demonstrate that they in fact bring assets, capacities, information, and agenda-setting value to online civic participation.

And here’s an abbreviated/paraphrased list of what has worked…

In Outreach:

• Face-to-face connections, paper signup sheets, and a personal approach are by far the most successful recruiting methods.
• Building trust is essential. Knowing that “someone like me” is on the forum makes a difference. Personal invitations and direct support help people get started.
• Understanding people’s needs and then helping them find ways for those needs to be addressed through the forum smooths the path for their participation and continued involvement.
• Partnering with respected neighbors and event organizers creates opportunities to participate in community activities and offer people the chance to sign up for our forums

Content Management

• Seeding stories that are of interest to diverse populations
• Maintaining cultural awareness and proficiency in posts and outreach

The report is full of stories and practical advice – and again suggested reading for leaders in any community effort that would benefit from increasing diversity. (I have to think that’s just about any effort.) You can also learn more about the project on a special online event with the authors and others involved with the project will speak.

PCs for People chose Austin as one of 10 greater-Minnesota communities to get 75 to 100 free computers since February 2012. But that isn’t the beginning. PCs for People has donated more than 14,000 computers since it started in 1998. With the help of local businesses such as Hormel, the Mayo Clinic and local electric co-op, PCs for People was able to convert used or damaged computers into, practical, usable gifts for those who need them.

“This is a win-win for businesses need to manage their end-of-lifecycle digital assets in a cost-effective way, and for the community,” said Casey Sorenson, executive director of PCs for People.”

Todd County FIBERBAND 40 people in attendance Nate Burkett, county coordinator goal of meeting -
Inform, gather information from users, find partners, not make decisions

Timeline on project:

• April 2011 – County board approves resolution seeking broadband
• May 2011 – Countywide meeting
• August Blandin grant
• January 2012 – feasibility study completed and presented to county board.
• March 2012 – interest survey through tax statements – 400 responses.
• April – meeting with Arvig to discuss partnership possibilities

What’s next?
Community decision making.

Mark Birkholz – ACS

No current business model works for FTTP now PP partnership might work – evaluate… Breakeven – 25, 36 to 43 years Be ready if BB stimulus funds become available.
Be positioned for USF changes – proposed changes will not help project.
Fiber is the end all – be all for broadband deployment.

John Schultz U-reka Broadband Ventures

Cites the county for moving relatively quickly. John recognizes Blandin, Toni Merdan and Alex Weego.

Starting does lead to action.. Todd County has started!
Marketing study, Build options, Capital requirements, Business modeling, possible next steps.

Residential
96 % of people still have a land line telephone.
53% Internet penetration

• Rural customers less satisfied
• Customers want faster speeds, more bandwidth 74% cable and satellite penetration
• Charter in town
• Dish in rural areas
• Where ACS has capacity, they also offer video

65% “likely” to change providers
same percentage in rural and urban

Expected bundle pricing
39% – $85-100 per month
20% – $101 – 110
18% – more than 110 dollars

Business survey

• 86% of businesses use a broadband connection Only 37% have a web site those not using cannot get broadband 62% would like higher speeds at work
• 100 % want faster service at home

A few Todd County customers have FTTH through ACS or Consolidated Telephone or WCTA.

Rural outside ACS
Town/city outside ACS
ACS Service Areas

Total build cost with 100% penetration – $65 million 65% penetration used. ACS competitive pricing model – Staples and Wadena
30 year model – $42 million capital cost and operational costs based on 65% penetration. Includes electronics refresh.

Cash flow positive in year 3.

Intangible benefits

• Savings due to competitive environment – 30%?
• Economic development surrounding the network development
• Significant jobs impact
• Improved governmental and educational services

Jobs – construction and operations and permanent new business and jobs and telework.

Now

• further discussions with ACS
• Sales/education and marketing program to demonstrate 65% penetration Discussions with funding sources – bonding, etc.
• Meet with RUS
• Follow USF discussion and exploit opportunities

Questions -

Recruiting market/education team.

Issues around multiple devices and the use of bandwidth.
Cannot take online classes due to poor broadband.
K12 districts need students with broadband; new online training enabling college courses. Schools need the bandwidth too!
Bundling would be a big saver for residential and business.
Rural people may be/would be willing to pay more.
Move forward as a county .
Wireless did not work when it rains, snows, etc.
Timelines on decision-making.
County goal 20/10 Mb by 2014 in towns, in rural areas by 2016.
Hoping for federal action.
3 year build out to spend $65 million.

Wireless as the solution. Many limitations to wireless; it is significantly cheaper. Fiber is future proof. Copper is definitely limited.

Need to work to get the discussion going across the county, with lots of people participating. Make it easy for the county board to say yes.

So many people want and need broadband. We need a local partner, one with local customer service. People in rural MN understand the needs and value of both rural and city livers.

Discussion about enhanced competition. and the effect on pricing and take rates. Schultz indicated that they need 65% take rate and around $100 ARPU.

Community questions about making things happen. How do we get the word out? How does this work get done?

geography differences – what are they?

New worker in Todd County – tech consultant. Able to get high speed in town. This is critical for business and education. Colleges and high schools are becoming increasingly intertwined. Bandwidth is the link to connect students and educational institutional . Lives in Clarissa. Ready to help get things going using social media and local contacts!