How do you get a business to rural Main Street? Broadband!

Minn Post recently ran an article on a new 3D printer business in Gibbon. It’s a great example of what happens in a rural area when they have broadband. (Gibbon is in Sibley County – one of the areas we featured in our report about the Community ROI of public investment in broadband.)…

“Our downtown is really struggling and has been for a while,” she [City Administrator Dana Lietzau] said. “The question is: ‘How do you find businesses to come here?’ ”

The answer that landed one entrepreneur is clear: high-speed internet access.

Like many rural towns in Minnesota, this village of 750 people in Sibley County has the standard fare of small businesses: a hardware store, a bank, an auto repair shop, an insurance agency, two bars. Also, like many small towns, it has few retail outlets. The grocery store closed years ago.

So when Adam Stegeman, an engineer with a background in 3D printing technology – a growing form of manufacturing – opened a 3D printing business in an old bank building here, residents took notice. “Any employment in this city is huge,” Lietzau said.

They talk about how they got broadband…

In 2015, Gibbon joined nine other cities and 17 townships in creating a cooperative that promised to bring broadband Internet access to 6,200 residents across both Renville and Sibley counties. RS Fiber Cooperative laid fiber optic cable through Gibbon in 2016 – about the time Stegeman began thinking seriously about striking out on his own. Each of the cities involved in the cooperative now has fiber optic cable, with speeds of up to 1 gigabyte; the second phase of the project – to bring broadband to the countryside – should begin in 2020, according to a spokesman for RS Fiber.

The cost to bring broadband to the cities involved in the project was about $15 million; Gibbon sold bonds to raise its share, which was $813,000. Lietzau, the city manager, said civic leaders pitched broadband access as at least one way to encourage businesses to locate in Gibbon. The Stegeman venture has helped to validate that hope.

And details the need for high speed broadband…

To fill orders, Stegeman must download large files of designs over his broadband connection. He can download 10 gigabytes in an afternoon, which he said was a major factor in his decision to locate in Gibbon.

“It really speeds things up,” he said. Without a connection that can transport huge digital files, he would need thumb drives sent through the mail – a much slower and more inefficient way to do business, he said.

Stegeman hopes his business will grow so that he can eventually employ some people who live in the area. He looks 10 years ahead and sees stability, three or four employees and profits. That is the plan, anyway.

Lack of rural broadband is hurting business – reprinted letter from Inter-County Leader

Thank you to the Inter-County Leader for permission to re-post a letter to the editor from someone who had experience with fiber in Minnesota and is talking about what life is like without broadband…

Rural Internet service

When I recently volunteered at Forts Folle Avoine during a fundraising event, their credit card machine stopped working. This was eventually fixed but staff said it happens quite often, especially when they have events where there are lots of people wanting to charge. The staff indicated that internet service in that area was poor.

The previous year, during Gandy Dancer Days, the credit card machine in the coffee shop in Webster did not work. They lost business as people didn’t have cash and most don’t use checks. On a recent visit to the coffee shop, the credit card machine was working but they had no internet. A customer said she was looking for a job and relies on using the internet at places like the coffee shop to apply for jobs. She stated that the school where she previously worked had iPads for students, but they often couldn’t connect due to slow internet speed. So she used her cell phone hot spot which cost her around $200 a month for unlimited data.She stated that this lack of access to the internet does not give local students an equal opportunity in education when compared with other locations in more populated areas.

About two years ago the school where I worked in rural Minnesota, a small town of 500, was getting up-to-date fiber optic cable for better internet access. I believe this was partly funded by the state of Minnesota.

With a population of 15,000 for the whole county of Burnett, the internet provider doesn’t seem to be concerned about the poor internet service. What the company doesn’t realize is that many “lakers,” some coming from the Twin Cities, want good internet service and they are at their cabins regularly. I would recommend that people interested in improving the internet connection in Northwest Wisconsin contact their legislators and their internet service providers asking for better up-to-date internet.

Pam Girtz

Frederic

Unfortunately the state funding she mentions above was not funded in the last legislative session – it was part of the Supplemental Budget that was vetoed.

 

Ely uses first fiber connection to connect a coworking space

The Minneapolis Star Tribune reports…

Just off the main drag in the North Woods town of Ely, often described as the “end of the road,” a side door to a brick building offers locals and visitors a little haven of modern technology.

The new Ten Below Coworking space — a basement office with desk seats for a dozen people — boasts the city’s first fiber-optic broadband-connection available to the public.

The city and the nonprofit group Incredible Ely used a $15,000 grant from the Blandin Foundation to create the open floor plan office as well as a couple of meeting rooms in the Klun Law Firm building. The money was used to furnish the space and should be enough to keep the lights on and the internet working for a year, officials said.

The coworking space is just a first step…

Ely Mayor Chuck Novak said he’s enthused about the energetic people who are working to make the space viable, including advertising it so people are aware of it. It’s part of a larger plan to bring internet fiber to the rest of downtown and get high-speed internet out to the entire school district, in some places using wireless access points, Novak said.

“We’re tired of legislators at the state and federal level always talking about broadband and not providing a sufficient amount of support for it. … It’s one of the most important things for economic development in greater Minnesota,” Novak said. “We’re going to have to take care of this ourselves. … We’re going to start getting creative here. We will find a way.”

The space in Ely will serve as a pilot project for getting local people exposed to working with truly high speed internet, officials said.

Broadband service spreading in rural Murray, Pipestone counties

The Globe reports on a process that Nobles, Murray and Pipestone Counties have used to move to better broadband in their areas…

The widespread utility of broadband has led several southwest Minnesota counties to invest their time and money into researching the topic, and make serious progress in the process.

In 2016, Nobles County conducted a broadband feasibility study with CCG and Slayton-based Finley Engineering. Shortly after, the state’s Border-to-Border grant program awarded Lismore Cooperative Telephone nearly $3 million to create a hybrid fiber and wireless network that will provide baseline broadband speeds to most of the county and ultra-fast fiber to hundreds of homes. The project is expected to be completed by mid-2018.

Last year, Murray County and Pipestone County partnered with four other southwest Minnesota counties and the Blandin Foundation to conduct feasibility studies — also done by Finley and CCG — in hopes of getting a similar outcome.

Pipestone County’s study was completed in February 2017, and later that year, Ruthton-based Woodstock Telephone received a $363,851 grant from the Minnesota Border-to-Border Broadband to provide fixed wireless broadband to rural Pipestone County.

Murray County is still working on access…

“The county does not plan to build a broadband network but is open to talking with providers who are interested in extending service to our citizens and may need financial assistance to do so,” Rucker said. “Murray County had the feasibility study completed so that any provider who wants to extend broadband service to our unserved and underserved areas could use the study as background to apply for state or federal grants to do so.”

The county has seen significant broadband investment from Woodstock since 2015, when it installed two wireless broadband towers around Lake Shetek. It continued over the last two years, installing eight internet coverage sites in the area, including towers in Lake Wilson, Slayton and Edgerton. The company plans to add another tower south of Chandler this year.

The towers, which are fed with fiber, provide 50Mbps download speeds at a range of six miles, according to Terry Nelson, Woodstock general manager. The speeds and service can vary, however, as wireless internet can be disrupted by geographical features such as hills, trees and windmills.

“We’ve done wireless in a lot of these areas, but there’s still little pockets that we can’t hit with some of our wireless,” Nelson said. “I would definitely never say the county is 100 percent covered, because it’s not.”

An October 2017 report from the state found 99.8 percent of Murray County households have access to 25/3 broadband — up from 50.47 percent in July 2016 — and more than 52.9 percent can access 100/20 — up from 41.56 percent. The numbers in Pipestone County are 97.87 and 79.73 percent — up from 79.36 and 44.54 percent, respectively — but Dawson said the numbers shouldn’t be relied on.

Counties recognize wireless as a means to meeting 2022 state goals, but at looking for fiber to reach 2026 goals…

Minnesota wants 25/3 speeds mandated statewide by 2022. By 2026, the required numbers will be raised to 100/20. Reaching those speeds consistently is nearly impossible with wireless internet, Dawson said.

“The wireless that we’re talking about is capable of that within a mile or so, but you would have to put a cell site at every farm — that’s not going to happen,” he said.

Instead, broadband experts agree the ultimate solution is delivering fiber-to-the-home, reliably delivering 1-gigabit (1000Mbps) speeds.

Lismore Telephone is installing fiber to every household in Leota and Wilmont and hundreds of homes along its 135-mile fiber ring, but it is expensive. In addition to $6 million between the state and Nobles County, the county had to throw in an addition $1 million in cash and $2.57 million in taxable general obligation tax abatement bonds to make it work.

That’s with fiber costing around $20,000 per mile, and the price won’t be coming down any time soon, Dawson said.

“You are already in a state where fiber is as cheap as it will possibly be,” Dawson said. “With 50-foot deep soil, they can get it in real easy. Minnesota can bury fiber for $20,000 a mile, where in a lot of parts of the country, that’s $50,000 a mile.”

For Woodstock, a successful fiber formula has been delivering directly to large businesses, where the return on investment makes it doable.

Pipestone County Broadband Feasibility Study: building broadband will require grants

With funding from the Blandin Foundation, Pipestone County worked with Finley Engineering and CCG Consulting on a study that would look at if and how the county might take on bringing better broadband to all corners of the county.

Here’s the executive summary of the Pipestone County Broadband Feasibility Study – check out the full study for greater details and next steps…

Finley Engineering and CCG Consulting submit this report of our findings and recommendations for the feasibility of finding a broadband solution for those parts of the county without broadband today. The county is typical of many rural counties where a substantial part of the county has or will soon have good broadband, including fiber, while other parts of the county have little or no broadband. The county is a textbook example of broadband haves and have-nots—with those without broadband living close to others that have it. This disparity will eventually harm those portions of the county without broadband and you can expect those areas to suffer lower housing prices and become places where families and business don’t want to be located.

Our study area looked at the feasibility of bringing broadband to the parts of the county that are not expected to have fiber construction over the next few years. We looked at three different business plan scenarios for getting broadband to everyone: 1) building fiber everywhere, 2) a hybrid plan that has a mix of fiber and fixed-wireless broadband and that covers the whole study area, and 3) a plan that just brings wireless broadband to the rural areas. Finley Engineering developed estimates of the cost of deploying each network option and CCG used these costs in the financial business plans to see if there is an economically viable model for providing broadband in the rural areas.

For each scenario we looked at a number of different options. For example, we looked at the difference of funding the project with municipal bonds or with commercial loans. We looked at different levels of customer penetration, including calculating the breakeven scenario, which determined the number of customers needed for the business to always be able to cover costs and remain cash positive. We also looked at the impact of the most import variables in the forecasts including customer pricing, interest rates on debt, and having the projects partially funded by grants.

Our analysis shows that it is not feasible to build broadband in the study area without some support from grants. That is not a surprising finding since the cost of building broadband to rural areas is high. This is particularly pronounced in Pipestone County since the areas we studied are entirely rural and don’t include small towns that might reduce the cost of building broadband. The analysis also shows that it will require more than the 50% grant offered currently by DEED if somebody wants to build fiber to the rural areas. We’ve seen this same result in other rural counties since the cost of building fiber to farms is so high.

It looks more feasible to provide wireless broadband to the study area. We know that is not the result the county was hoping for, but the Finley analysis provides for a fiber-fed wireless network that can provide speeds of at least 25 Mbps download to rural homes in the county. That would solve the immediate crisis for homes with no broadband. However, once built, the county will have to continue to push in the future to eventually get the network converted over to fiber.

The county has already taken the first steps of presenting these study results to potential service providers. Hopefully one or more of them will be able to seek grant funding from Minnesota DEED in the upcoming grant cycle this fall. But if that doesn’t happen then there are steps the county can take to be prepared to support a grant filing for next year.

Lincoln County Broadband Feasibility Study: wireless is more affordable but not permanent fix

With funding from the Blandin Foundation, Lincoln County worked with Finley Engineering and CCG Consulting on a study that would look at if and how the county might take on bringing better broadband to all corners of the county.

Here’s the executive summary of the Lincoln County Broadband Feasibility Study – check out the full study for greater details and next steps…

Finley Engineering and CCG Consulting submit this report of our findings and recommendations for the feasibility of finding a broadband solution for those parts of the county without broadband today. The county is typical of many rural counties where a substantial part of the county has or will soon have good broadband, including fiber, while other parts of the county have little or no broadband. This disparity in broadband coverage will eventually harm those portions of the county without broadband and you can expect those areas to suffer lower housing prices and become places where families and business don’t want to be located.

Our study area looked at the feasibility of bringing broadband to the parts of the county that are not expected to have fiber construction over the next few years. In Lincoln County that means the rural areas served Frontier Communications and CenturyLink. The western part of the county is served today by Interstate Telephone Cooperative, and those areas are expected to get fiber. The study area also excludes all of the towns in the county except Arco since the other towns are served by Mediacom.

We then looked at two different business plan scenarios for getting broadband to everyone: building fiber everywhere and building a hybrid network that is a mix of fiber and fixed wireless. Finley Engineering developed estimates of the cost of deploying each network option and CCG used these costs in the financial business plans to see if there is an economically viable model for providing broadband in the rural areas.

The primary purpose of the study was to determine the breakeven penetration level for the rural study area. This represents the number of customers necessary for the scenario to always remain cash positive throughout the life of the financing. This analysis told us the following:

  • It does not look to be economically feasible to build fiber to the study area without significant grant funding. This is not a surprising finding and is directly the result of the high cost of building fiber to farms.
  • The scenarios that mix fiber and wireless technology look feasible. The scenarios can work even without grant funding, but some level of grant funding make the scenarios safer for an investor.

The wireless network designed by Finley is intended to supply at least 25 Mbps download to rural homes in the county, which is a significant improvement for those homes with no broadband today. Some customers will be able to get speeds faster than that on the wireless network.

However, implementing a wireless network would not be a permanent solution. All of the broadband trends in the country show that the amount of bandwidth needed by a typical home will keep growing, and at some point in the future the wireless network will become obsolete in the same manner that happened in the past with dial-up and DSL broadband.

The report discusses the next steps the county needs to take after digesting the results of this study. These include such things as looking for a partner to bring broadband to those areas without it today. The goal would be to have a partner by next year to hopefully be ready for future state grant funding.

Yellow Medicine County Broadband Feasibility Study: wireless is a temporary solution, grants needed for fiber builds

With funding from the Blandin Foundation, Yellow Medicine County worked with Finley Engineering and CCG Consulting on a study that would look at if and how the county might take on bringing better broadband to all corners of the county.

Here’s the executive summary of the Yellow Medicine County Broadband Feasibility Study – check out the full study for greater details and next steps…

Finley Engineering and CCG Consulting submit this report of our findings and recommendations for the feasibility of finding a broadband solution for those parts of the county without broadband today. The county is typical of many rural counties where a substantial part of the county has or will soon have good broadband, including fiber, while other parts of the county have little or no broadband. This disparity in broadband coverage will eventually harm those portions of the county without broadband and you can expect those areas to suffer lower housing prices and become places where families and business don’t want to be located.

Our study area looked at the feasibility of bringing broadband to the parts of the county that are not expected to have fiber construction over the next few years. We considered three different study areas looking at different parts of the county. We then looked at two different business plan scenarios for getting broadband to everyone: building fiber everywhere and building a hybrid network that is a mix of fiber and fixed wireless. Finley Engineering developed estimates of the cost of deploying each network option and CCG used these costs in the financial business plans to see if there is an economically viable model for providing broadband in the rural areas.

The primary purpose of the study was to determine the breakeven penetration level for each scenario. This represents the number of customers necessary for the scenario to always remain cash positive throughout the life of the financing. This analysis told us the following:

  • It does not look to be economically feasible to immediately build fiber everywhere without significant grant funding. This is not a surprising finding and is directly the result of the high cost of building fiber to farms.
  • The scenarios that mix fiber and wireless technology look feasible. The scenarios can work even without grant funding, but some level of grant funding make the scenarios safer for an investor.

The wireless network designed by Finley is intended to supply at least 25 Mbps download to rural homes in the county, which is a significant improvement for those homes with no broadband. Some customers will be able to get speeds faster than that on the wireless network.

However, implementing a wireless network would not be a permanent solution. All of the broadband trends in the country show that the amount of bandwidth needed by a typical home will keep growing, and at some point in the future the wireless network will become obsolete in the same manner that happened in the past with dial-up and DSL broadband.

The report discusses the next steps the county needs to take after digesting the results of this study. These include such things as looking for a partner to bring broadband to those areas without it today. The goal would be to have a partner by next year to hopefully be ready for future state grant funds.

We note that as this report was being written that the county announced a tentative agreement with Farmers Mutual Cooperative to bring fiber to a significant portion of the county. The county has agreed to provide $4 million in funding subject to the Cooperative being able to find grants and other funding needed to build the project. If completed this project would cover a little less than half of the parts of the county that don’t have broadband today.