Map to Prosperity is built on broadband: Minnesota Model is praised

The Center for Rural Affairs just released a new Map to Prosperity

This paper begins by underscoring the ability of broadband technology to revitalize the rural economy. The farm and small business sectors are just two areas where this potential is already being realized. Manufacturing and ecommerce are others.

We then consider obstacles to broadband expansion. As expected, geography emerges as the most formidable barrier. However, improvements in both adoption rates and literacy can provide a needed boost at the household and community levels.

Finally, we explore solutions. Federal stimulus, including the American Recovery and Reinvestment Act of 2009, has expanded service and spurred innovation. This has also created momentum at the next level where states, such as Minnesota, have built upon and enhanced what federal support was initially able to achieve. When paired with leadership and commitment on the part of states, continued funding at the federal level is essential to closing the digital divide.

Also essential is an improved approach to gathering, analyzing, and employing broadband data. Today, the Federal Communications Commission (FCC) and its state-based counterparts are making critical decisions based on erroneous and incomplete information. This has resulted in an overstatement of broadband availability and continued misallocation of funds. Any serious policy effort to extend broadband to unserved areas must include a fix.

The paper is full of a lot of great numbers from reports I’ve posted here over the last few years – but nice to have them in one place. I was looking forward to exploring solutions. Then I was both proud and disappointed to see the Minnesota Model featured for highlight. Disappointed only because I wanted to get some good ideas – and proud to see we’re on track…

Perhaps the most successful policy can be found in Minnesota. The state’s Border- to-Border Broadband Development Grant Program was first authorized in 2014. Since then, state lawmakers have invested $85 million, resulting in broadband access for 3,852 households, 5,189 businesses, and 300 community institutions.40 See Figure 4 on the previous page for Minnesota’s 2017  Border-to-Border awards.

State-based funding is used to meet Minnesota’s goal of universal access to broadband by 2022. Border-to-Border operates by making grants available to internet providers willing to expand service to underserved or unserved areas of the state. Grant dollars are used to offset upfront costs of infrastructure for fiber optic, cable, fixed wireless, and DSL technologies.41

Each recipient must be able to provide matching funds. To qualify, each project must be financially and technically viable. Recipients must also prove the project is capable of being scaled to 100 Mbps, a speed that administrators expect all Minnesotans to have access to by 2026.42

The most recent round of grants was announced in late 2017. A total of $26 million was distributed to 39 projects, leveraging an additional $34 million in local and private funding. This is estimated to secure broadband access for 9,973 households, 2,169 businesses, and 60 community institutions across the state.43

Minnesota took advantage of momentum created by the federal stimulus and built framework to meet the unique needs of its population.

The result is a program that stands out as a model of success. Once enough data was compiled to determine underserved and unserved areas across the state, leaders developed clear and ambitious goals, identified a key source of funding, and leveraged partnerships to carry that investment forward. Leadership from the governor’s office was unwavering, and allies in both the Senate and House provided necessary support.

Other states would be wise to glean lessons from this experience. Chief among these is the value of developing a robust expansion program, including clear metrics and guidelines, and embracing public-private partnerships.

Capitalizing on federal investment was important, but a big part of Minnesota’s success came from an ability to utilize local actors and larger market forces to achieve state-based goals.

 

Schools are mostly connected in the US, but that deepens the divide

Telecompetitor reports some good news from the EducationSuperHighway…

Broadband advocacy group EducationSuperHighway found in its annual State of the States report that 98% of public school districts in the United States have high-speed broadband.

They also report some bad news…

But 2.3 million students don’t have high-speed connectivity in their school, the school broadband report found.

Here are other highlights from the report:

·         Only 1,356 schools still lack a fiber-optic connection or other scalable broadband infrastructure, down from 22,958 schools in 2013

·         The cost of K-12 Internet access has declined 85 percent in the last five years

·         Since 2015, the amount invested in Wi-Fi nearly doubled to $2.9 billion, but 7,823 school districts have over $1.4 billion in unused E-rate funds set to expire in 2019.

·         Today, 44.7 million students and 2.6 million teachers in more than 81,000 schools have access. Since 2013, an estimated 40.7 million students have been connected to broadband and 21,600 more schools to fiber, the press release says.

The real problem with this good news/bad news situation is that the schools and students that are being left behind are really left behind. The digital divide may be narrowing but it’s also deepening. And that’s going to leave a sector of students not learning digital skills that will be required for future jobs.

Governor’s Task Force on Broadband Releases Final Annual Report

The official, final MN Broadband Task Force Report is released…

The Governor’s Task Force on Broadband released its final Annual Report today, which includes recommendations for Governor Dayton, the legislature, and other policy makers to consider in the 2019 Legislative Session.
The report contains eight recommendations aimed at ensuring every Minnesotan has access to broadband:
 Fund the Office of Broadband Development through the base budget at levels sufficient for it to meet its statutory mandates and create an OBD operating fund to advance and promote programs and projects to improve broadband adoption and use, and the maintain existing partnership with the Minnesota Department of Commerce.
 Provide on-going biennial funding of the Border-to-Border Broadband Development Grant Program at $69.7 million per biennia until the state achieves its broadband speed goals.
 Provide direct funding to the Department of Employment and Economic Development for broadband mapping.
 Establish a legislative cybersecurity commission to enable information-sharing between policy-makers, state agencies, and private industry related to Minnesota’s cybersecurity infrastructure, cybersecurity workforce issues and emerging technology, whose scope of work includes: (a) developing legislation to support and strengthen Minnesota’s cybersecurity infrastructure, and (b) providing input or recommendations related to developing a multi-year strategic plan to secure Minnesota’s IT environments.

 Continue to understand the advances in technology that will drive both the demand for better broadband access and that will enable the delivery of broadband access to its
citizens.
 Take action to promote and communicate dig once policies, including development and dissemination of best practices and model policies to state agencies and other
stakeholders. Ensure that agencies with construction oversight, construction funding, and land stewardship responsibilities ensure that they lead by example in implementing “Dig Once” policies which encourage broadband competition and deployment, including
planning, joint use, construction and notification.
 Fully fund the Telecommunications Equity Aid (TEA) and Regional Library Telecommunications Aid (RLTA) to facilitate broadband in K-12 education and libraries.
 Continue a Minnesota Broadband Task Force as a resource to the Governor and the Legislature on broadband policy with a broad representation of perspectives and
experiences, including provider, community, business and labor interests.
“Over the last seven years Minnesota has made great progress on connecting more households and businesses with broadband,” said Margaret Anderson Kelliher, chair of the Task Force. “We hope to make additional progress, and need continued, ongoing investment in the Border-to-
Border Broadband Development Grant Program and reliable, consistent funding for the Office of Broadband Development. I hope these are priorities for our next governor.”
The Border-to-Border Broadband Development Grant Program, created by the Legislature in 2014, provides funding to build the state’s broadband infrastructure and promote broadband access in unserved and underserved areas of the state. The grants provide up to a dollar-for dollar match on funds, not to exceed $5 million for any one project, and are distributed to qualified entities. Since 2014, the program leveraged $110.6 million in matching local and/or private investments, making service available to more than 34,000 households and 5,200 businesses across Minnesota.
“The work of this Task Force has helped shape the debate about broadband policy in Minnesota,” said Don Niles, representing the City of Wadena on the Governor’s Task Force on Broadband. “As we release our final report and list of recommendations, we encourage the continuation of a Minnesota Broadband Task Force as a resource to the next Governor and Legislature on broadband policy.”
Minnesota’s universal broadband access and speed goals, originally established in 2010 and updated in 2016, specify that by “no later than 2022, all businesses and homes should have access to high-speed broadband services at a download speed of at least 25 megabits per second
and minimum upload speeds of at least 3 megabits per second,” and that by “no later than 2026, that all Minnesota businesses and homes have access to at least one provider of broadband with download speeds of at least 100 megabits per second and upload speeds of at least 20 megabits per second.”
The share of Minnesota households with access to wireline broadband at the state speed goal of 25 megabits per second (Mbps) download and 3 Mbps upload (25 Mbps/3 Mbps) has increased from 69.64 percent in 2011 to 90.77 percent in March 2018. Nearly 75 percent (73.66 percent) of
Minnesota households now have access to wireline at the 2026 speed goal of 100 Mbps/20 Mbps.
The full report can be found here.
About the Governor’s Task Force on Broadband
The Governor’s Task Force on Broadband, which is made up of 15 members representing a variety of backgrounds, is charged with developing, implementing and promoting state policy, planning and initiatives to achieve state broadband needs and goals.

Expanding Rural Electric Member Coop broadband coverage in Indiana could mean benefits of $12 billion

Purdue University just released a report that looks at the quantitative benefits of investing in broadband – they look specifically at extending/expanding networks deployed by Indiana’s Rural Electric Member Cooperatives (REMCs) – but expanding the network ubiquitously across the state. Here’s what they found…

We estimate the net benefits of broadband investment for the whole state of Indiana is about $12 billion, which is about $1 billion per year annuitized over 20 years at six percent interest rate. Year after year, added government revenues and cost savings would amount to about 27 percent of net benefits in the seven REMCs each year. If the rest of rural Indiana is like these seven Cooperative service areas, then 27 percent of the $1 billion per year would be government revenue and health care cost savings, or $270 million per year. In terms of total net present value of benefits, 27 percent of $12 billion is $3.24 billion in added government revenue and health care cost savings.

It’s interesting to see that 27 percent of the net benefits would be government revenue and health care cost savings. That’s a number taxpayers can use to determine the return of public investment in broadband. Last fall, I looked at community return on public investment in broadband – which came to about $1,850 per household. Taking it a step farther, figuring out how much benefit is there in government revenue and health care savings make it even easier to balance cost with benefit.

Minnesota Broadband County Ranking for speeds of 100/20 for 2018

I’m starting to work on County Broadband Profiles and in the process, I found a map that highlights percentage of households served by wireline service as defined by at least 100 Mbps down and 20 Mbps up by county. So I pulled out the numbers from each county to see how various counties rank. (I looked at rank for speeds of 25/3 earlier this year.)

Here are the top 10 ranking counties:

  1. Rock (99.93% covered)
  2. Ramsey (99.82 % covered)
  3. Hennepin (98.97% covered)
  4. Big Stone (98.91% covered)
  5. Anoka (97.86% covered)
  6. Lac qui Parle (97.35% covered)
  7. Stevens (96.747% covered)
  8. Beltrami (96.30% covered)
  9. Washington (96.10% covered)
  10. Cook (94.50% covered)

And the bottom 10 ranking counties:

  1. Otter Tail (2.36% covered)
  2. Kandiyohi (10.64% covered)
  3. Becker (12.95% covered)
  4. Mahnomen (13.53% covered)
  5. Blue Earth (14.13% covered)
  6. Aitkin (17.55% covered)
  7. Todd (17.58% covered)
  8. Norman (20.55% covered)
  9. Mower (23.31% covered)
  10. Pope (23.67% covered)

Given these lists – all things being equal – where are you going to move, start a business or invest?

Clearly some counties are in good shape and some need a good kick start. But what is interesting is the swing between top and bottom – from 99.93 percent covered to 2.36. I think it’s worth nothing that Rock County – the top county was a recent recipient of a Minnesota broadband grant. And congrats to them for edging out the metro counties.

Many people seem focused on the 2022 speeds goals (25/3) but I think these are the ones to look at if you want to be ready for the future. There’s only one county that is on the lowest ranking list for both speeds of 25/3 and 100/20 (Aitkin). Being prepared for 2022 may give some counties a false sense of security for the future.

I’m going to include a table with the full list – but that rarely transfers well to the website – you can download the Excel file too.

Continue reading

FCC Broadband maps shown unreliable

The Institute for Local Self Reliance recently looked at what the FCC reports for broadband coverage in Rochester MN and what’s actually there. They found…

Our results confirm what a bipartisan group of U.S. Senators has expressed concern over: federal broadband data is deeply flawed.

The FCC data comes from self-reporting via Form 477. What I’ve heard from providers over the years is that these forms are overwhelming to complete. The report recognizes the flaws of self-reporting…

The overwhelming failure of broadband mapping results from several factors. Large, de facto monopoly providers have incentives to overstate their coverage and territory to hide the unreliable and slow nature of their service in many communities. Small providers often have trouble completing the FCC Form 477. This form requires 39 pages of instructions on how to properly complete it. Providers are supposed to submit it every 6 months, but many small providers find it confusing and frustrating- taking too much time to produce data that has dubious value given the flaws. Larger providers have plenty of staff to handle the form and seem to benefit the most from its flaws, as this data is often used to determine whether government programs should invest additional funds into an area, often by a competitive grant program. Areas that appear to be well covered will not result in more investment, leaving the incumbent providers without fear of competition.

Here is the coverage (number of providers versus population) for speeds of 25 Mbps down and 3 up

Versus 100 Mbps (which is the state speed goal by 2026)…

There’s a ten-fold difference in number of unserved residents.

They also compare coverage of wired-only access:

Versus wired & wireless service…

What they found is that there is much greater competition, pricing and speeds in town as compared to the outskirts or outside of town…

The rural communities surrounding Rochester, Minnesota have few fast, affordable, and reliable Internet service options. The urban areas enjoy some limited broadband competition. Still, most residents can only access broadband with speeds greater than 100 Mbps through Charter. A majority of the rural communities around Rochester rely on fixed wireless connections. The broadband tiers from fixed wireless providers are often more expensive than wireline broadband. The two fixed wireless providers that advertise Internet access at broadband speeds around Rochester are Hiawatha Broadband Communications’ Air Internet division and RadioLink. Hiawatha Broadband Communications charges $64.99 per month for a 25 Mbps download and 10 Mbps upload connection.8 RadioLink charges $85 per month for a 30 Mbps download and 10 Mbps upload connection.

Within Rochester, broadband is more affordable and has faster speeds than outlying areas. As of July 2018, Charter Communications charges $30 for 100 Mbps download for one year if the service is bundled with a cable subscription in Rochester, but the service appears to cost $65 without promos or bundling and before the many fees that are tacked on.10 CenturyLink has an online offer for 40 Mbps download for $45 in Rochester, but that only applies to addresses located very close to the DSLAM and again does not include the added fees.11 Jaguar Communications offers a Fiber-to-the-Home network in select portions of the city. In a phone call, they confirmed that fiber services cost $69.95 per month for 125 Mbps download speeds, where available.

One of the main reasons we need to care about what can be seen as the minutia of technology is that policies are written and public funds spent based on these numbers. The ILSR presents one example…

In 2015, City Council member Ed Hruska claimed, “We have 19 local broadband providers and, of those, we have two cable providers, six DSL providers, four fiber providers, three fixed wireless providers and four mobile providers.”4 Our analysis shows that broadband competition in Rochester is actually far more limited.

As a whole, this may (or may not) be true about Rochester – but people need to understand that is is not ubiquitously true. If we can recognize the digital divide within and around the city, the digital divide more is likely to deepen.