The Economic Development Corp. is working its way through more than 150 applications, giving out fiber connections on a first come, first serve basis.
Nearly a month ago, on March 12, a contest to connect New York City businesses with high-speed Internet came to a close. Held by the New York City Economic Development Corp. (EDC), the ConnectNYC Fiber Challenge will award city businesses with dedicated fiber to their locations -- each of which is worth about $50,000.
Now the EDC is working its way through more than 150 applications, giving out fiber connections on a first come, first serve basis.
And according to Ian Fried, marketing and publicity director for EDC, none of the applicants has been turned away thus far. "And we hope that as many contracts as possible can be negotiated," he said.
This is the second round of the ConnectNYC program, which is funded by a franchise agreement with the city. In the first round, 29 businesses were selected, and included a Holiday Inn in Long Island and a Kickstarter project. The EDC expanded the program this year by partnering with more ISPs, offering more applications and providing $14 million worth of fiber construction cost coverage for the winning businesses.
"This program doesn't just benefit tech companies," said Eric Gertler, executive vice president of the EDC. "We're living in an age where broadband is essential for all types of businesses."
The program's expansion has paid off, as it had more applications that in 2013, Fried said. "The numbers were increased a little, which shows that the program is growing and that there is demand for something like this," he said. "As far as the types of companies, it is relatively similar -- smaller businesses that are looking to get connected to grow."
And businesses heard of the challenge through a variety of sources, Fried said, including the EDC's outreach, through companies that have received connections, and many other ways. "Some interesting companies to receive construction or signed fiber service are DonorsChoose, Fullstack Academy, Amicus, Pencils of Promise and Bark Box," he added.
In New York City, a majority of people receive their Internet service through legacy copper wires -- which is incapable of supporting high-performance services, so fiber is the next step. Although Verizon FiOS is one product in the area that utilizes fiber-optic cables, the service has a load factor that causes it to perform more like a DSL connection. And businesses that need guaranteed, consistent service need dedicated fiber lines.
The Internet service providers (ISPs) like Manhattan's Stealth Communications, which has been installing these fiber-optic cable connections to businesses since the city granted it a franchise agreement in early 2013, allocate colors of light, also known as wavelengths, to each firm. Once a business has its own wavelength, it can run at any data rate that it wants, whether that is 1 gigabyte or 100 gigabytes per second, and it will still receive the same high consistency of service. Stealth uses a special material to split and combine the light running through the cables, which makes it possible for the Internet connection to run without power.
"We're addressing the problem of digital deserts," Gertler said. "Digital deserts are pockets within New York City where there isn't the type of connectivity that businesses need. The ConnectNYC program is focused on providing the installation of dedicated fiber-optic cables to these office spaces."
To apply for the program, companies must meet a few qualifications: They must be located in one of the city's five boroughs, employ fewer than 500 employees and commit to signing a one-year contract with one of the participating ISPs. A minimum of one-fourth of the funding targets helping the small companies that are located in Industrial Business Zones. These areas tend to lag behind other parts of the city when it comes to building out the infrastructure for high-speed broadband connections.
"Manhattan has an underground conduit system that was created back in 1891," said Shrihari Pandit, CEO of Stealth Communications. Pandit said he uses those pathways to run the fiber up and down the street. Once he reaches the building that needs connection, he pulls the fiber-optic cables through that building's point-of-entry, which is basically a little conduit that connects with the city's manhole system in the building's basement.
The biggest challenge the ISPs face in trying to connect fiber-optic cables to the city's businesses? New York City's underground congestion. The majority of the time, Pandit said, is spent figuring out how to get the fiber where it needs to go. The ducts beneath the city are very old; many are completely full or have been virtually collapsed from numerous street re-pavings. This means that Pandit and his team sometimes have to zigzag around many different blocks just to connect a business across the street.
And older buildings, like those found in Chinatown, also pose problems for fiber connection. Many lack the points-of-entry needed for the installation. This means that Pandit and his team must find the nearest building with a point-of-entry -- sometimes there is only one on a block -- and figure out how to string the fiber from building to building.
Despite the difficulties that arise in deploying fiber, Pandit said he believes that the ConnectNYC program is very important for New York City businesses trying to compete in today's market. "Internet is the lifeblood of all these startups now," said Pandit. "If they don't get anything more reliable than DSL or cable, it's very tough for them to operate."
And the city’s gain? "That we are nurturing small businesses," Fried said. "This provides a service, which is typically fairly expensive, for free. Companies will get connected, which helps them grow and thrive in New York City. We are now in the process of working with the ISPs to get these companies connected."