In the 70′s manufacturing started shifting away from big population centers. While a significant amount of it has gone offshore, the rest has landed in more rural digs right here in America. Basic infrastructure that didn’t exist in these areas during the industrial age is now commonplace. Lower costs and a more literate workforce are typical in smaller towns as well.
Rudimentary knowledge work also found its way into fly over country with a great many call centers and similar operations finding a home in Rural America. More recently, data centers have also begun taking the rural path. A recent example, Prinveville, Oregon landed a big Facebook data center with the potential to add two more major facilities.
Fiber loops follow most major interstates, rail lines, and pipelines. Most new power generation facilities are in rural areas. While a great many rural population centers are not located directly adjacent to one of these fiber thoroughfares, a significant number are close to one. Adding a spur from that existing infrastructure is easily justified with an anchor customer like a server farm. When backbone access becomes local, consumers are easily connected at a fair price. The rural population center gets new employment, and a growing tax base in additional to broadband.
While this could be one solution, it won’t solve the larger goal of universal access. A broadband duopoly will only build out in rural areas if it is heavily subsidized to do so. Even with that subsidy, chances are the service level will be bare bones at best. The problem will never be properly solved by pols, bureaucrats and regulations. Server farms are just one example of how big pipes came come to the other farms without them. There are limitless others. Private capital will be available to make this happen, but only when the market is open.
The federal government’s initiatives to expand the reach of broadband has yielded studies, maps, abundant calls to do more, tax more, and regulate more. What it has not created are actual new connections to those who are live in areas without service. Even where funding could help, the process of applying far grants is much too cumbersome for the entrepreneur who can provide can provide service quickly and economically.
In spite the fed’s failure to deliver on promises, service is reaching some rural citizens without the fed’s help.
Conlin delivers broadband to Fauquier County homes bypassed by Comcast and Verizon, bouncing wireless signals from antennas on barns, silos, water towers and cellphone poles.
By some measures, he is a local hero.
“I don’t know how Paul does it,” said John Chierichella, a District lawyer, who struggled for years without reliable broadband. “I don’t really care. All I know is I get service now.”
County officials estimate that 60 percent of Fauquier’s residents have been bypassed by big telecoms because they don’t live in populous clusters that make building broadband infrastructure cost-effective. Though the Obama administration has plans to close the digital divide for the 10 percent of the U.S. population without broadband access, many living within that gap in Fauquier think the problem will be theirs to solve. (Washington Post)
This example could be applied to cover every citizen much more quickly than any government run system possible could. We need a small army of Bill Conlins. We’ll get better coverage faster at a affordable price instead of waiting endlessly for promises to be kept.
Moving bits via the bird has been with us just about as long as networks themselves. Satellite currently exists as the broadband provider of last choice, providing the slowest speeds at the highest prices. Some new hardware in orbit will give sat service parity with most wired services, but it’s almost certain that it will continue to be priced in a high multiple over wired.
Hughes Network Systems, one of the largest satellite broadband service providers in the world, will launch the Jupiter satellite, which will offer more than 100 gigabits per second of capacity. This is more than 10 times the capacity the company currently offers on its existing satellite, launched in 2008.
The new satellite means that Hughes and its wholesale customers, which will resell the service in Canada and the U.S., will now be able to address between 1.5 million and 2 million consumer broadband customers offering average download speeds of 5Mbps. High-end services could go up to as much as 20Mbps, according to Arunas Slekys, vice president of corporate marketing for Hughes. (Cnet)
Not to down play this significant advance, but there’s skulduggery in the background. Look for the FCC and the Obama administration to take credit and declare mission accomplished in reaching it’s 4MBPS everywhere goal ahead of schedule. This project was well underway when these folks took over. With little or no results to show from $7 billion in broadband “stimulus”, taking credit will be irresistible. Lessen learned: tasking the federal government with improving broadband is expensive and ineffective.
While the big carriers continue to scale back fiber deployment, the smaller independent telcos are pushing speeds higher over new fiber networks. How can this be done without the massive economies of scale? It’s never been cheaper, and costs continue to decline. Consider the case of a rural telco with 9000 subscribers delivering 60/30 MBPS connections. That’s something we can only dream about here in AT&T’s Dallas-Fort Worth DSL ghetto.
At the end of 2009, Canby had brought Fiber to the Home-based services to about 1,000 homes-a major milestone given the fact that the ILEC has only 11, 000 access lines and 9,000 customers.
I believe the small telco is the model for a better broadband future. With large protected territories, and laws written to squash competition, the large telcos and cable operators have no incentive to offer more bandwidth at a fair price. It’s not from lack of capital. It’s how the capital is used. The smaller independents tend to stay focused on their home markets instead of investing in acquisitions, wireless and pay TV. They also tend to employ locals and are more responsive to local market needs. I’m not suggesting that we divide cities into a patchwork of small monopolies, but rather open the infrastructure to allow for small providers to enter urban markets as competitors.
While 105MBPS won’t get headlines in much of western Europe, Japan or Korea, it’s a glimmer of hope in bandwidth starved America. Waterloo Iowa now leads the US, shaming the major cites that continue to languish with DSL and old DOCSIS speeds that are pretty much the same as they were a decade ago.
The Courier article quotes a Mediacom exec on the reason for picking Waterloo. “First of all, the physical network in place is very robust,” he said. “It is in great shape, and we know that the product will perform well from a technical side… We also wanted to select Waterloo as indicative of a typical Midwest community. We had heard that the business community was questioning whether Waterloo was keeping pace. …We think this says Waterloo is keeping pace.”
It was certainly sporting of a company like Mediacom to care about the feelings of Waterloo’s business community, but the city might also have been chosen for other reasons. Waterloo is contiguous with Cedar Falls, which houses the University of Northern Iowa and also features a city-owned cable and Internet operation. (ARS Technica)
Meanwhile back in Washington the feds are contracting out more broadband maps….and building nothing.
Venture capitalist Tim Draper recent told a group of entrepreneurs that the time is right for starting new ventures:
To illustrate the point, Draper pointed to over two dozen companies that were founded in recessions and depressions including giants like General Electric, Chevron, and Coca-Cola. Also included were more tech-oriented companies like Skype (of which Draper was an investor), Microsoft, Hewlett-Packard, Kodak, and Adobe Systems.
In his keynote address to attendees of WTIA’s Fast Pitch Forum & Technology Showcase, Draper made the case that each of these companies had done something to drastically change the way others in that industry were doing business, or that they had created completely new and different categories that solved real-world problems.(Cnet)
I totally agree with the premise. The best opportunity to gain market share is when the major players are pulling back. If you’re small, the time is right to bet the company and get aggressive. That is unless you’re considering rural broadband. In that case there’s a $7 billion federal money pot that is up for grabs. How to disperse this prize is the subject of endless studies with the FCC’s first analysis not due until 2010.
As part of a Congressional request buried in the 2008 Farm Bill, the FCC today released a report (pdf) on getting broadband services into rural America. According to the FCC, broadband “is the interstate highway of the 21st century for small towns and rural communities, the vital connection to the broader nation and, increasingly, the global economy.” The report notes that the $7.2 billion being used for under-served areas is the first salvo in a larger broadband policy, which is due by February of 2010.
According to interim FCC Commissioner Michael Copps, this latest report acts as a stepping stone to the next phase of improvement. Of course the first step in improving broadband is knowing who already has it and at what speed and price, something the FCC hasn’t been particularly good at. (DSL Reports)
Any responsible small business that could push broadband into the hinterlands quickly is sidelined. Those who haven’t already looked for better opportunities must play the waiting game to see what the feds do with the money. Why? If you invest on your own, you could end up without a shot at some federal help, or worse, competing against a heavily subsidized rival. So, the congress and our president get to say they’ve fixed rural broadband when all they’ve really done is stall it. My bet is that most of the subsidy money will eventually go to AT&T and Verizon to build their 4G networks at a snail’s pace while rural America waits for a change they can believe in.