So close and yet so far away to broadband just outside St Cloud MN – could grants to the business in need help

I recently heard from Eric, who lives just outside of St Cloud. He lives and works in no-man’s-land where the kids go to Kimball school, the mail address is South Haven but he actually lives outside Fair Haven. He’s just a little beyond reach of the kind of broadband he needs.

He lives on a farm, has a home-based business (Sproutary.com – online software for daycare proviers to help manage their business) and can get about 15 Mbps down and 1 Mbps up from Arvig. As he says,  it’s  just good enough that expansion is not going to come for many years. He’s talked to Arvig – the local provider – and they can run fiber to our house for $18k – which would mean 1 Gig down and 25 Mbps up.

I’m not here to disparage Arvig – it’s a tough call to make that kind of investment for one customer. But to use the story to start some discussions.

  • Eric gets 15/1 coverage and it’s not enough for him. CAF 2 funding requires 10/1 coverage. Areas getting a 10/1 upgrade may be in Eric’s position soon – too slow to conduct business, too fast to get attention.
  • Maybe a solution is not to disperse upgrade funds only to providers. The UK had a voucher fund that supported businesses in their effort to get better broadband. The fund has expired (they had £40 million) but here’s what they found…

Key Facts about Connection Vouchers

  • Around 55,000 vouchers for superfast broadband connections were issued to SMEs during the lifetime of the scheme – 37,000 since April 2015
  • More than 770 suppliers won voucher business out of 864 registered suppliers

Early Impacts & Data Analysis
SME Survey Results

  • Over 550 SMEs with connections live for between 3 and 9 months replied to BDUK surveys on the initial impacts of using a connection voucher
  • The results show that firms are using the internet more and using it for functions they were not using before. The biggest changes are to uploading/downloading large files, remote access/Virtual Private Networks and Cloud Computing
  • As a result, firms reported a wide range of impacts with many seeing improvements in efficiency and effectiveness of employees, as well as improvements in the speed and reliability of delivering goods/services
  • The results suggest that soon after the connection has been made businesses profits increased by £1,300 per year per SME and the equivalent of 0.27 extra full time employees per firm, or one new job for every four connections
  • This equates to a return on investment of over £5 for every £1 that the Government is investing through this scheme
  • Firms reported that faster broadband makes a huge difference to their business:
    • 86% of firms reported that their broadband upgrade had increased their employees’ effectiveness;
    • 83% reported improved efficiency of business administration;
    • almost 70% reported increased speed and reliability of delivering goods or services;
    • 45% reported that their upgrade had improved their ability to develop new goods or services; and
    • over 35% reported that their upgrade has generated new sales and provided access to new markets.

BDUK Data Analysis

Based on the 50,700 vouchers that were reported by cities as having been issued up to the end of September 15

  • Up to 1 million people are estimated to work for businesses that have had broadband connection voucher grants approved
  • SMEs took broadband services that are on average 11 times faster than their previous service
  • Nearly 30% of firms took uncontended services (not shared with other customers) with guaranteed up and download speeds
  • Over a fifth opted for ultrafast broadband with download speeds of 100 Mbps or more

Commercial Suppliers

  • The 3 largest national suppliers registered on the scheme – BT, Virgin Media and TalkTalk – accounted for 14% of the value of vouchers issued to the end of September.

  • Other suppliers, including smaller regional and local suppliers, took 86% of the total value of the vouchers.

  • Some suppliers have extended their existing networks and built in new areas, for instance Metronet extended its Birmingham and Leeds networks, and built new networks in Newcastle and Bradford.

This entry was posted in Digital Divide, Funding, MN, Rural by Ann Treacy. Bookmark the permalink.

About Ann Treacy

I have a Master’s Degree in Library and Information Science. I have been interested or involved in providing access to information through the Internet since 1994, when I worked for Minnesota’s first Internet service provider. I am pleased to be a part of the Blandin on Broadband Team. I also work with MN Coalition on Government Information, Minnesota Rural Partners, and the American Society for Information Science and Technology.

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