(TNS) — Residents of 17 townships in Minnesota formed a cooperative — not so different from the old electric co-op model — and created RS Fiber to bring broadband to some 6,000 households.
Town voters agreed to fund RS Fiber’s $45 million network by bonding for seed money and borrowing from private investors, including local banks. Seven years later, they had fast, reliable broadband via, in some instances, towers built onto existing grain elevators and municipal water towers, Mark Erickson of Gaylord, Minn., told a gathering Dec. 2 in Fairbanks.
A “Building Better Broadband” workshop organized by Rep. David Guttenberg, D-Fairbanks, brought two experts north to talk about how their communities pursued alternatives after getting left behind in the internet age. Small markets often don’t pencil out for telecoms to invest in rural pockets of America.
As a result, “gigabit cooperatives” like RS Fiber have emerged to fill the gap.
“The point for me is that there are other things we can do if the providers won’t do what we need,” Guttenberg said.
He’s taken perhaps the most active role as critic of Alaska’s telecoms, which he says are not building out fast enough to help Fairbanks and rural areas keep economic and educational pace with urban Alaska. In June, he attached an order to the budget asking for the Regulatory Commission of Alaska to study broadband gaps. The workshop was Guttenberg’s latest effort to explore new options.
The central issue, as Guttenberg identifies it, is inconsistent coverage across the Fairbanks area.
“There are gaps all over Fairbanks between this service plan and that service plan and it’s creating inefficiencies,” he said. “If they don’t want to fix it, maybe we will.”
In a second example Guttenberg’s workshop brought to the Interior, a small Missouri electric cooperative decided to build and operate a fiber optic network to serve residential and commercial members of its co-op.
Ralls County Electric Cooperative, or RCEC, won an economic stimulus grant from the American Recovery and Reinvestment Act, the 2009 “stimulus” package from which GCI also received some funding for its TERRA broadband build-out in Alaska that was completed this summer and now serves about 45,000 residents in Western Alaska.
The $9.5 million grant, with a matching $9.5 million loan from the same program, paid for the electric cooperative to form a subsidiary known as Ralls Technology. It serves more than 1,000 households and is building out to serve neighboring communities, said Bob Winsel, a systems administrator at RCEC.
Why the gap?
Christine O’Connor, the executive director of the Alaska Telephone Association, said a five-year period during which Universal Services Funds, or USF, were cut to Alaska telecoms is a big part of the problem.
She attended the Fairbanks meeting, and has had several discussions with Guttenberg about the lagging broadband issue.
“We did have a slowdown in deployments during a five-year hiatus on support that was dramatically cut,” O’Connor said.
ATA is an advocacy organization that includes about 20 small and large telecom members that operate in Alaska, from GCI to Mukluk Telephone Association.
“Right when they were trying to deploy new broadband they sustained 20 percent in cuts,” O’Connor said.
More recently the telecoms shared in new funding streams, including the 10-year, $1.5 billion Alaska Plan. While some programs were cut this year, including Rural Health Care funding that subsidizes hospitals and clinics, others rebounded, O’Connor said.
“Plans they had started back before the funding cuts were all finalized late last year. Now there is a ton of deployment by different telecoms. But there was that window when projects weren’t moving forward,” O’Connor said.
During that time, those connected to internet were working on 1 or 4 megabit speeds, too slow for downloading a new Word program and certainly impossible for streaming Netflix or gaming.
Alaska Communications, one of the three companies providing broadband for Fairbanks, is planning a 2018-2025 build out to provide 32,000 homes in the Fairbanks North Star Borough and in the Kenai Peninsula Borough with new fiber optic services.
The funding stream that allows this for Alaska Communications comes from the Connect America Fund, one of the Universal Services Funds to help rural disadvantaged communities.
“The goal is to build out the network as quickly as possible,” said Alaska Communications Director Of External Affairs and Corporate Communications Heather Cavanaugh, who also attended the meeting to give information about the build-out.
The Anchorage telecom is promising at minimum a 10-megabit download speed and 1-megabit upload speed.
The Federal Communications Commission decided on a threshold of 25 megabit-per-second internet connection speed as sufficient to support a household.
To qualify for Connect America Funding, the minimum speed Alaska Communications must provide is 10 megabits; that’s enough that multiple people in a family can stream a video and be on the internet at the same time.
“We’ll be doing our best to reach even higher speeds in this initial build and to upgrade over time,” Cavanaugh said.
Customers in Fairbanks have worked with “4 and some have 1 megabits, which is why they are frustrated with slow service,” Cavanaugh said. “That’s why we worked hard to secure the USF-Connect America Funding so that we could install the broadband in the more rural communities and in the North Star Borough.
“We’ve wanted to upgrade and improve speeds for a long time.”
Faster speeds doesn’t just relate to Netflix. It improves education, health care, safety and the quality of life for many Alaskans, Cavanaugh said, in alignment with Guttenberg’s goals.
Another near-future deployment is OneWeb’s partnership with Alaska Communications to provide low earth orbit, or LEO, satellite connections. The 900 LEO satellites will begin to be deployed in 2018 and early 2019, with Alaska access set to be available in late 2019, according to the timetable estimate offered by Alaska Communications CEO Anand Vadapalli.
That will mean multiple options and different technology for different locations in areas that can be served with high speed internet, Cavanaugh said.
The Matanuska Telephone Association, which owns AlaskaConnect, also has offered its internet services in Fairbanks and CEO Michael Burke presented at the Fairbanks workshop.
“MTA is doing some fiber optics in Fairbanks. The challenge is more in the outlying areas. The message I wanted to portray (in Fairbanks) is that if the business model made sense, it would have already been built,” Burke said.
He saw a lot of difference between the Lower 48 gigabit cooperatives’ and Alaska’s situation.
“They can probably do construction year-round,” he said. “They don’t have these vast distances to get infrastructure.”
During the period from 2011-2016, the FCC pushed a broadband goal of better build-out in rural Alaska, but at the same time, “cut the funding to do it,” Burke said. “There was a disconnect on the policy and it was creating real problems.”
MTA has a similar problem to Alaska Communications in Fairbanks: customers waiting for faster-speed upgrades. The initial infrastructure was built but doing upgrades to create faster service and adding in new customers was slow coming.
“Now the funding is stabilized, but it didn’t actually happen until late 2016. Now we have the funding and we’re trying to build out as fast as we can,” Burke said. “We have invested in $25 million on new fiber infrastructure to get better broadband to MTA customers. There’s 20,000 to 25,000 customers, new or that we’re upgrading, as well. It’s been pent-up demand.”
Additional issues are about to make timing out infrastructure improvements more difficult and costly, Burke said, whether it would be for any future co-op or for telecoms.
The Department of Natural Resources is raising right-of-way studies by 600 percent, Burke said. The Alaska Railroad has also revised right-of-way annual fees, he said.
Currently, telecoms are using a fixed wireless solution with fiber optic combination.
“I could see a business model where you get business to the customer then plan down the road for fiber or better infrastructure,” Burke said. “That’s the challenge.”
A Fairbanks co-op?
Guttenberg has issued a challenge to telecoms to fix Fairbanks’ internet issues or the community will look at other options.
“We’re going to put the workshop presentation out there for web viewing and see what happens,” Guttenberg said, meaning he wanted others in Alaska to know more options. “No one model works everywhere. Every community is a different situation.”
At the end of Erickson’s presentation on RS Fiber, Guttenberg said he spent some time showing Erickson around Fairbanks.
“In his opinion, looking at us, he said ‘you have all the tools to look at a solution,’” Guttenberg said. “It is time to look at the options, see what has worked elsewhere, and get to work on solutions here in Alaska.”
©2017 the Alaska Journal of Commerce (Anchorage, Alaska) Distributed by Tribune Content Agency, LLC.