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.

Minnesota Farmers Union finds rural frustrations with broadband an healthcare

The Minneapolis Star Tribune reports…

Many rural Minnesotans feel left behind or ignored when it comes to challenges in everyday living.

Excessive health care costs, limited high-speed internet service and long-delayed road and bridge projects are some of the top problems that frustrate those who live in smaller communities, and many do not believe that their voices are being heard by policymakers.

The concerns are identified in a new report by the Minnesota Farmers Union, a grass-roots family farm organization that held 14 discussion sessions across the state in 2017 and another seven this year that drew more than 800 farmers and other members of the public.

And what they found in terms of broadband…

Also on people’s minds was access to internet service.

“Lots of rural areas don’t have broadband,” said Wertish. “It should be viewed as a public utility because it’s important for farmers or public schools or small businesses if they’re going to compete.”

University of Minnesota Extension Dean Bev Durgan said that the problems presented in the report are valid for most rural residents, not just farmers — and in some cases for urban Minnesotans as well.

Broadband Communities in Austin Texas – talking up Minnesota’s successes

Bernadine Joselyn, Bill Coleman and I are in Austin talking about Minnesota at the Broadband Communities in Austin Texas. Specifically, we are talking about the Case Studies Measuring the Impact of Broadband in Five Minnesota Communities.

First – people are pretty impressed with Minnesota. We have broadband grants, we have an awesome Office of Broadband Development, we have smart economic developers and everyone seems well above average.

Second – people have had good questions – like how can they bring the info in the study to their own communities. The answer is that it’s helpful to know that when public funds are spent on broadband, the public benefits. Specifically households with access to broadband see an increased economic benefit of $1850 per year and the value of the house goes up three percent. Those numbers are average estimates but given the stories we’ve collected, they seem conservative. And knowing that benefit per household has got to make it easier to quantify the benefits of investment.

Third – we are also able to make the point that to really drive economic growth, a community needs broadband (and we’re talking MN state goal of 100 Mbps down and 20 Mbps up by 2026) and needs help using it with economic developers, educators, healthcare providers – people who help train, promote and support smarter use of broadband. And that’s what we were proud to show off in Texas this week.

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.

Murray County Broadband Feasibility Study: fiber in stages may be possible over years, fixed wireless already available

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

Here’s the executive summary of the Murray 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 that meets the state broadband goals of 100 Mbps download speeds for those parts of the county without fast broadband today. The county is typical of many rural counties where a substantial part of the county has or will soon have fiber to residents, while other parts of the county will be served by slower broadband technologies.

Our study looked at the feasibility of bringing fiber broadband to the parts of the county that are not expected to have fast broadband to homes and businesses over the next few years. The areas served today by Woodstock Communications already have fiber. Redwood County Telephone Company will be building fiber to customers in the Walnut Grove area and thus that area was excluded from the study. There is fast broadband provided by cable companies in the towns of Slayton, Lake Wilson, Currie, Fulda, Avoca, and Hadley and those towns were also excluded from the study. That leaves a study area consisting of the rural areas served today by CenturyLink and Frontier Communications including the towns of Iona, Chandler, Dovray, and the Lakes area.

The studies looked at the business plan for bringing fiber to the service area. The vast majority of the study area has (or will soon have) fixed wireless broadband. This technology can deliver broadband connections in the range of 25 Mbps download, and sometimes faster.

However, we know the county’s goal is to eventually have fiber everywhere and the current wireless broadband is not a permanent bandwidth solution. Broadband trends show that the amount of bandwidth needed by a typical home will keep growing, and at some time in the future these wireless networks will seem too slow and become obsolete in the same manner that has happened in the past with dial-up and DSL broadband.

Our analysis shows that it is not economically feasible to build fiber everywhere in the rural parts of the county using the existing Border-to-Border grant program—the 50% grant matching in that program is not high enough to create a sustainable network. However, it would be possible to fund fiber using these grants if the percent of the grant matching is increased above the 50% level used in awarding these grants today. It might also be feasible to build the fiber in stages over multiple years to get the needed grant funding.

It is likely to be a challenge for a service provider to building fiber today since almost all of the rural area is served with newly-built fixed wireless technology that is capable of delivering speeds of at least 25 Mbps download. Any potential fiber provider is going to worry that many households will be satisfied with that level of broadband speed.

Chippewa County Broadband Feasibility Study: hybrid fiber and wireless solutions seem viable

With funding from the Blandin Foundation, Chippewa 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 Chippewa 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 is already harming 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.

The base study area looked at the feasibility of bringing broadband to the parts of the county that are not expected to have fast broadband to homes and businesses over the next few years. This includes the rural parts of the county that are served for telephone service today by Frontier Communications, CenturyLink, and Mid-State Telephone, including the town of Watson. We looked at an additional scenario that brought fiber to Montevideo.

The studies looked at two network design scenarios—building fiber to the study area and building a hybrid combination of wireless technology and fiber. 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 without good broadband today. Some customers will be able to get even faster speeds on the wireless network. We also looked at a scenario that brings fiber to Montevideo.

However, we know the county’s goal is to eventually have fiber everywhere and so 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 time in the future a wireless network would become obsolete in the same manner that has happened in the past with dial-up and DSL broadband.

We view the hybrid fiber and wireless solution as a great first step towards improving broadband. This option would bring fiber immediately to about a third of the rural homes in the county, including the town of Watson. The fiber constructed for this scenario is a first step in getting fiber closer to everybody in the county. We think a reasonable business plan is to start with the hybrid option and extend fiber to everybody over time.

Our analysis shows that it is not economically feasible to build fiber everywhere in the county using the existing Border-to-Border grant program—the 50% grant matching in that program is not enough to create a sustainable network. However, the hybrid fiber and wireless solutions all look to be economically viable.

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 be ready for future state grant funds.