Utility Forum Shows Multiple Broadband Approaches

Doug MacMurray followed as the Forum Moderator, with a brief presentation to introduce the concept of utility broadband under the following categories:

Key Business Drivers for Utility Broadband
* Underserved or unserved communities
* High price of private provider broadband service
* Compelling need for economic development
* Desire for social improvement, especially youth retention and quality of life
* Need for utility applications, including Intelligent or Smart Grid

Utility Advantages of Broadband
* Infrastructure Management issues are similar
* Local brand awareness strong among utilities
* Utility organizations are trustworthy and stable
* Long-term investment focus
* Connections in the local community
* No legacy infrastructure to protect - open to new ideas and approaches

Utility Broadband Applications
* Automated Meter Infrastructure (AMI) and Smart Grid, including Outage Detection, Remote Connect/Disconnect, Time of Use Billing, On-Demand meter reading, Transformer loading analysis, and Demand Response/Demand Side Management
* Infrastructure to facilitate future growth
* Empower the consumer

Components of a Successful Broadband Deployment
* Projects are unique and custom - there is no One-Size-Fits-All approach or attitude
* Alignment of community goals among stakeholders
* Clear decision-making process, well-defined scope of mandate
* Ability/Willingness to exploit strengths and minimize risks
* Presence of an internal champion
* Public private partnership approach
* Definition of roles, including network owner, network operator, network builder, service provider, citizen participants, etc.

Lessons Learned from Utility Broadband Projects that Struggled
* Disconnect between technology and business plan
* Funding hurdles
* Attracting service providers or being your own network operator
* Public private partnership to minimize capital expense (Cap Ex)
* Underestimating operating expense (Op Ex)
* Importance of community partnerships and teaming

Resulting Benefits of Utility Broadband Projects
* Empowering consumer satisfaction
* Additional revenue stream
* Competition provides superior quality and lower costs
* Promote innovative services
* Improved economic development
* Utility operational efficiencies
* Foundation for future growth in the community

Lessons Learned In An FTTH Deployment

Next up was Joe King, Asst City Manager and Utility Director for the City of Danville, VA, whose presentation seemed to embody many of the points in the description laid out by Doug MacMurray in the introduction. (Be sure to check out the nDanville Case Study as well, download here.)

Joe's vision for nDanville was informed by his political philosophy, to have government play a minimum role as it promoted a private sector solution. He determined that the best approach would be to approach the project in the same manner as the city and county build streets and roads. He would pursue an Open Access Network. His project plans and guidelines included:
1. Build a Metropolitan Area Network (MAN) to serve the needs of government and the public school system
2. Generate operating revenue from providing service to schools under the federal eRate Program
3. Expand the system incrementally with a two-way meter communication system
4. Operate an Open Access network with multiple service providers
5. Provide no retail services directly

The nDanville network ultimately provided service to the city's 46,000 residents over a 44-square mile territory. The city's electric, gas, water, and wastewater utilities are able to benefit from the network. In addition, the electric utility provides services over a larger region, a 500 sq. mi. area. While AMI is under review, there is no AMI system in operation yet.

The system has a strong economic development rationale, as the local area has suffered from struggling foundation industries, tobacco and textiles, with resultant high unemployment. Education levels are not traditionally high in the area, given the reliance on blue-collar work opportunities. With the need for workforce transition, city leaders see a public-stimulated broadband network as a good solution. In addition, the state of Virginia has a large Rural/Urban Digital Divide, and Danville is a good case study, located in the rural southern portion of the state.

Project planners envisioned a need for 3-4,000 residential subscribers as a threshold to attract private service providers to the network. They made an initial investment of $2 M, which enabled 70 miles of fiber to be deployed.

Broadband: Key To A Community's Growth And Vitality

Jerry Brown from Bristol, VA, showed the audience how a utility-provided broadband infrastructure enhances economic development. (Virginia was well represented in the Forum). Bristol's project was all about economic development from the start.

In introducing Jerry, Andy Cohill, a consultant whose firm Design Nine is a pioneer in community broadband, gave some background on how his community of Blacksburg and VA Tech University came together to launch the first broadband network in the US, back in the early 1990s, ultimately labeled Blacksburg Electronic Village. Their ambitious goal was to provide broadband Internet access to everyone in the county, back before "broadband" was barely a defined term. Be sure to see the Blacksburg Case Study - click here.

Jerry Brown brought an interesting counterpoint to Danville's approach in his discussion about Bristol's network, as he is a career Economic Development professional. (See both Access Bristol, the economic development website and BVU OptiNet, the network services website.)

Jerry described a market focus, whereby the network was intended to spur economic development into a new arena of technology (they had already gone through job growth phases in industry and retail). In Bristol, the project benefited from a strong champion in the VP of Operations for BVU, the Bristol Utility. In contrast to Danville's Open Access approach, Bristol decided to proceed with a Closed FTTH Network, stressing the need for Quality of Life in the Bristol Region.

Working Lunch with Resource Panel

The Hon. Hilda Legg, former director of the federal Rural Utility Service (RUS) and current vice chair of Broadband Properties moderated this panel - her style of walking in front of the podium, microphone in hand, stimulated the discussion and made for a good interchange of ideas.

On the panel, which was quite interactive with the audience, were James Moskowitz, Fleischman and Harding, L.L.P. (a Washington DC telecom regulatory firm); Dr Jey K Jeyapalan, a civil engineer and consultant, with a specialty in pipe infrastructure; Andrew Cohill, president & CEO of Design Nine; and Jim Kelley, VP Operations, BVU OptiNet.

I was an active participant in the discussion, which had two or three themes.

One was the personal / human aspect of utility managers, who face a culture shift to adopt these broadband practices - broad adoption (pardon the pun) of utility broadband will require a paradigm shift and strong utility leadership - these panelists at the Forum are on the cutting edge, and are the exception to the rule.

Second, we had an interesting debate on whether broadband itself is a utility or a service (see my long post from yesterday).

Finally, the idea of using trenches and pipes as common ducts for multiple utilities received considerable discussion. Dr. Jepyapalan is a passionate promoter of full and efficient utilization of water/wastewater infrastructure, while Jim Kelley's practical experience in Bristol cautioned against putting broadband fiber down in water pipes, based on the human error element. It may be efficient in theory, but according to Jim, it's hard to do in practice.

Key Questions For Utility Managers

The next panel featured an in-depth look at the community of Gainesville, FL, home of 2006 National Champions, the University of Florida Gators. On the panel were Commission Member Ed Braddy and two representatives from the Gainesville Regional Utilities (GRU), Frank Latini, Technical Services Manager, and Dan Clark, Marketing Specialist for Gator.Net. They outlined a low-key strategy that has enabled the utility to bring new Internet opportunities to the citizens of Gainesville by incrementally extending the FTTH network on a project by project basis, without raising political objections or opposition from the incumbent cable and telecom broadband providers.

The website GRU.net provides more detailed information on the services offered. Commission Member Braddy described a communication strategy to compare the fiber network to "digital streets and roads," which he said has been an effective communication method. While the team holds a goal of engaging in an advanced deployment of a fiber optic loop for industrial purposes, their method is to engage in public private partnerships with MDUs and property developers, who share the costs of deployment. Their advice to any utilities, when asked how to manage perceived risk, is to "Go Slow."

So, in summary, we saw in great detail how three creative electric utilities worked within their communities to bring in compelling communication infrastructure to support economic development and enhance the standard of living for their communities, but in three distinct ways:

* Danville - planned Open Access Network with a focus on workforce devleopment
* Bristol - planned Closed Network with a focus on economic development
* Gainesville - incremental FTTH network, pay as your go, with private participation in construction costs

It was a productive session for me, and good to see this dialogue getting started.