Five Community Benefits to Build the Case for Broadband Network Investment

Widespread access to broadband is changing the way we live, work and design our cities. But not every community is benefiting from this sweeping change. This is especially true across rural America, where the digital divide threatens to leave many smaller communities behind.

For these communities and the rural electric co-ops that serve them, access to high-speed broadband services can be a game-changer. All too often, what stands in their way is a question of stakeholder buy-in. To answer typical hesitancy around the price tag, the best starting point is clear information about the community benefits and economic impacts.  

In summer 2018, Purdue University’s Center for Regional Development released a study[i] indicating the state of Indiana could generate a $12 billion economic impact over 20 years with a meaningful investment in bringing broadband access to rural areas. The report, commissioned by Indiana Electric Cooperatives and Tipmont REMC, estimated that every dollar invested in broadband returns nearly four dollars to the economy. By any measure, a 400% ROI is impressive.

While electric co-ops and public power utilities are well aware of the potential benefits for their communities, the decision to invest in fast broadband requires consensus from multiple stakeholders. Depending on the organization, this can include obtaining buy-in from board members, local government and key community leaders. That means overcoming the fear, uncertainty and doubt (a.k.a. “FUD Factor”) inherent in any significant change.

The most crucial step in any rural or municipal broadband initiative is always the first one—building the case. The “go, no-go” decision typically comes down to a rigorous cost/benefit analysis. Stakeholders must understand why investment in broadband makes sense and realize that by not investing, they are doing a disservice to the communities and customers they serve. It is up to the utility to illustrate the power of the technology and the value of the investment in it.

Entire books have been devoted to the benefits of broadband access. Boosting broadband in rural and smaller communities can spark growth in diverse areas including education, economic and workforce development, innovation, consumer savings and farm income. Below are five broad areas where the effects are especially keenly felt.

Improved quality of life: Telecommuting, for example, allows individuals to choose where they live based on the quality of the community, not its proximity to their office. According to the 2017 Virtual Vocations Year-End Report, one in four US workers now telecommute thanks to accessible, affordable broadband. Broadband also enables a wide range of benefits such as telemedicine, distance learning and improved access to content and social media, all of which translate to better health and quality of life.

More responsive, efficient civic leadership: In cities large and small, local governments are using broadband to significantly improve how they respond to changing needs in their communities. This includes using broadband’s high-speed video capabilities to host virtual town halls. Affordable community-wide access also encourages convenient online self-service, so that residents can renew their driver’s license, pay property taxes and utility bills, and get updates on municipal construction, all without leaving their homes. By enabling mobile technologies such as geofencing, a broadband infrastructure allows public safety officials to share critical information regarding weather and potential emergencies. It also provides real-time data transmission that helps police track and respond to public safety threats.

Modernized electric system: A fiber-based infrastructure enables utilities to create a smarter, more resilient grid that can scale in size, scope and services as the community grows. One result is improved overall service reliability that reduces power disruptions and speeds outage restorations. Using remote technologies to monitor the smart grid, utilities are also able to reduce peak energy loads to save operational costs. Electric co-ops can also generate new revenue from additional fiber services to offset flat or declining electricity revenue.

Enhanced business services: Access to super-fast fiber infrastructure is vital for business productivity and growth. It enables businesses of all sizes to take advantage of the Internet of Things (IoT), automation, workforce mobility, and improved research. Perhaps more importantly, broadband opens doors for local businesses to access global markets and sell their goods and services to consumers and suppliers around the world. 

Long-term community growth: A digital infrastructure that is both utilized and evolving is a leading indicator of a vibrant and growing community. Connected schools and libraries, an educated workforce, virtual medical services and more efficient use of resources all make communities more attractive to new businesses and families, while enabling existing residents and businesses to keep flourishing.

This list represents a tiny sample of benefits that can bolster a strong case for rural and municipal broadband investment. Each utility must pick and choose the benefits that best apply to their communities. Once the benefits have been articulated, they are measured, and the results evaluated. The process of building the case has the added benefit of helping the utility or co-op clarify its vision, goals and strategies to ensure that the community-inspired project delivers the right results.

A successful broadband initiative is founded on community consensus and support. Building a broad and strong base begins by developing a business case that is both aspirational and impossible to ignore from a cost/benefit perspective. At Fujitsu, helping utilities and co-ops make the strongest possible case for broadband infrastructure and getting stakeholders to rally around a shared vision is a big part of what we do. Our vision?  Obliterate the digital divide, one community at a time. For more information, visit us at https://www.fujitsu.com/us/products/network/industries/utility/index.html


[i] Estimation of the Net Benefits of Indiana Statewide Adoption of Rural Broadband; Purdue University Center for Regional Development, research study; August 2018

How to Make Your Utility Smarter … And What You Stand to Gain

With the advent of 5G, the Internet of Things (IoT), and cloud technologies, smart infrastructure enabled by high-speed connectivity is now closer than ever to being truly ubiquitous. These trends are driving a variety of advancements across a wide range of industries — from cost-efficiency and better customer service, to enhanced safety and security. The utility industry, in particular, is in a prime position to put smart infrastructure technologies to good use.

Many of today’s utilities — whether they are public power, investor-owned, or rural electric cooperatives — are struggling with how to evolve their business model in response to several imperatives:

  • De-carbonization – Reducing current and future carbon footprints by leveraging renewable energy resources
  • De-centralization – Expanding energy solutions to include wind, solar, hydro, micro-grids and other distributed energy resources
  • Digital transformation – Increased data harvesting to inform key decision-making

By embracing smart technology, utilities stand to benefit from the potential positive impacts of trusted data on their business operations, including service offerings that were not previously possible. These benefits offer utilities opportunities to preserve capital, increase revenue, build stronger customer engagement, and strengthen future viability to meet new or unforeseen challenges head-on.

Yet for some utilities, the path forward remains uncertain. What are the requirements for building out smart infrastructure, and what is the best route forward?

Building Blocks of a Smarter Future

Alongside the recent evolution of power transmission technologies, many utilities have modernized their communications infrastructure, for example by deploying advanced 100G networks to replace the old standard of 40 Mbps transmission. Investments of this type have provided greater network speed and capacity, creating a bedrock on which power providers can deploy the essential building blocks of a smart utility.

In order to benefit from this bedrock communications infrastructure, a utility needs trustworthy and actionable operating data.  Trusted data is harvested, analyzed and contextualized only by putting in place all (five) smart infrastructure blocks, of which high-speed connectivity is one. Being a smart utility therefore is more than having a fast network, it is about having smart infrastructure. The essential infrastructure blocks of the smart utility include:

  • Sensing Block – Gathers data from IoT devices and sensors, such as cameras, drones, and microphones. Key metrics gathered using sensors might include the speed and direction of turbine blade rotation, system voltage or current, outage detection, suspicious persons, weather conditions, tower pitch, or network connectivity status.
  • Network Infrastructure Block – Fiber and wireless network infrastructure transmits data between IoT devices, cameras, microphones, data management systems and cloud services. Traditional interconnected networks include SCADA, AMI, fiber, core, FTTx, microwave and 4G/ LTE mobile networks. Newer technology options include 5G and Low Power Wide Area Network (LPWAN) technologies.
  • Data Infrastructure Block – Data from the sensing layer is aggregated, stored and processed in the data infrastructure block, making it available for use. Data management consumes significant compute power both in the cloud and on premises, and requires high-availability databases, often referred to as data lakes, that are both secure and scalable.
  • Cloud Services Block – The services block combines cybersecurity, managed network services, artificial intelligence (AI), and big data analytics to ensure data integrity; protect devices; secure and optimize the network; and extract insights. The cybersecurity layer is vital for compliance with NERC-CIP requirements designed to protect critical infrastructure, customer data, and community safety, especially in light of increased cyber and physical attacks aimed at utilities.
  • Smart Applications Block – Smart applications are the user interfaces through which utility executives and employees consume actionable insights, such as real-time dashboards for energy consumption, flow control, leakage detection, and load monitoring.

By deploying these essential building blocks, utilities can infuse their operations with real-time trusteddata. Trusted data can help them increase productivity; improve reliability and efficiency; streamline regulatory compliance; reduce costs and risks; deliver new services; and enhance the quality of customer experience. Consider, for example, how smart technologies could be used to leverage thermal imaging data and the power of AI to identify overheated equipment, or spot emerging fire threats at remote utility substations.

Creating a Smarter Future

At Fujitsu, we’ve seen firsthand how smart infrastructure technologies can make a substantial difference to a utility company’s business and operations models — and their bottom line. As a full-service integration company, we recognize every utility’s unique situation and we help them develop a sensible business plan to deploy the building blocks of a smart utility, making the digital transformation journey together.

To learn more about how to build a smarter utility with the right infrastructure in place to inform better, faster decision-making, contact us to discuss your business case.

How Utilities are Creating New Revenue with Legacy Assets

Changing market dynamics across the power industry are creating a shift in the way that utilities operate. As more people leave rural America in search of high-tech lifestyles in urban centers, electric cooperatives and public power companies alike are dealing with the realities of customer erosion and an ever-increasing demand from their members to provide broadband. This situation is compounded by flat revenues due to lack of growth, as well as adoption of renewable energy and energy-efficient appliances. As a result, utilities are striving to develop new, more lucrative revenue streams. Furthermore, utilities are facing increasing pressure from customers to offer high-speed Internet, since many incumbent carriers are not expected to update their networks anytime soon.

At Fujitsu, with our long information and communications technology industry heritage, we can easily see a parallel with the rise of the mobile phone roughly 25 years ago. As telecom subscribers began ‘cutting the cord’ in favor of wireless service, and reduced subsidies, established telcos were faced with the challenge of developing a revenue replacement strategy. Fortunately, established players in the telecom industry had existing capital and operational investments — in the form of infrastructure, unused capacity, systems and support and most importantly, people — that they could leverage to offer new broadband services to their existing customer base.

Likewise, utility companies also have significant assets at their disposal that can be monetized for new revenue opportunities. The key is knowing where to look and how to make the most efficient use of existing investments to improve profit margins.

Shifting Focus

Many utilities have existing fiber buildouts that they are upgrading to the latest technologies to take advantage of digital transformation to operate their electrical service. As a result, these utilities are realizing they will soon have surplus network capacity on their hands. For savvy public power utilities and rural electric cooperatives, the best way to monetize their fiber assets is to deploy a below-the-line, or unregulated, service over their own broadband network.

For example, many utilities have invested in advanced metering infrastructure (AMI) in parts of their service areas, with fiber networks capable of speeds up to 100 Gbps supporting electrical substations. A utility with this infrastructure could offer broadband service to customers in the vicinity of each substation.

Beyond fiber infrastructure, utilities have other assets that can be leveraged to offer fixed broadband services, Wi-Fi or fixed wireless access:

  • Knowledgeable workforce with service delivery expertise
  • Current fleet of vehicles
  • Vertical assets, such as light poles and towers
  • Data centers for electronics and colocation services
  • Back-office administrative and billing support systems.

Now more than ever, utilities have options available for using existing infrastructure to replace lost revenue sources with minimal additional capital investments. This strategy not only improves the bottom line, it also, more importantly, brings 21st century services to rural America at a much lower cost since they have existing assets/foundation to launch a new service. And as more consumers, businesses and cities embrace advanced broadband technologies, like smart applications and the Internet of Things (IoT), the opportunities will only grow stronger, particularly with the addition of data analytics, cybersecurity and artificial intelligence.

Where to Start?

While the promise of profitable broadband services is certainly enticing, some utility companies are reluctant to consider a new business model. How do they choose the right strategy? What can they do to minimize costs and alleviate risks? What assets can they combine and how do they put them together?

To ensure a successful transition to digital transformation, an important first step is choosing the right partner to make the journey with you. Becoming a broadband service provider is more than just building a network. The right partner will offer expertise in how to finance the network build-out, the best approach to implementing deployment, and what sort of services and “smart” applications you can offer to maximize monetization. In many cases, the right partner will even handle rollout and manage the network for you, until you are ready to take over.

As a full-service integration company, Fujitsu works closely with utilities to help them design, deploy and manage broadband networks, bringing all the pieces together in an end-to-end solution that fits their unique business case. We can analyze your existing assets to determine what capital investments and support systems can be leveraged, and develop a strategy to speed services to market so you can begin to realize below-the-line or unregulated revenue as quickly as possible. And with our years of experience and networking skills, we can manage network operations for you.

Lighting Up a Bright Future

A convergence of trends is creating new challenges for utilities, from the shifting demographics of rural America to increasing adoption of renewable energy. At the same time, the advancement of broadband technology, along with the IoT, smart applications and “always-on” connectivity, opens up vast potential for new revenue models and business opportunities across the utility market. To learn more about how you can put advanced technologies to work within your existing electrical utility, and grow “below-the-line” revenue, call Fujitsu to arrange for a complimentary assessment of your opportunity.

Get Smart: Why the Future of Your City Depends on Smart Infrastructure

The single biggest factor in determining the fate of your city’s digital future is its technological infrastructure. Because we live in an internet-based, digital age, if your city wants to be at the forefront of progress, economic development, growth, and relevance – it must invest wisely.

The right kind of infrastructure – high-speed fiber and wireless broadband – is essential. By comparison, the strength of a building lies in its foundation. A poorly constructed foundation can’t be counted on to support the load of the entire structure. Likewise, your city’s broadband infrastructure must be a rock-solid foundation so it, too, can provide the critical platform to deliver enhanced services, innovate and enable a smart city.

Those cities that have invested in a broadband infrastructure view it as an asset, just as valuable to their community as its other public infrastructure – water, streets, sewer lines, or gas/electric utilities.

Today, incumbent carriers aren’t upgrading networks or extending broadband services fast enough for unserved or underserved smaller and rural communities. As a result, many communities are left to lease aged, copper-based networks. Unfortunately, these communities’ economic fates become dependent, in part, upon the incumbent carriers’ network modernization timetables. By not being able to take control over their destinies, many cities adopt a wait-and-see approach which puts them at a big disadvantage to other, more proactive cities. It puts the city and its residents behind the technology curve and forces them to play the catch-up game.

Modern cities require modern infrastructure. In order for your city to solidify itself as economically viable, competitive, and a desirable place to live, you must undergo a digital transformation. Doing so is the catalyst for a fundamental reshaping of your city’s digital future. With a modern broadband foundation, you will have the primary building blocks for cloud infrastructure, sensors, smart services and applications. All of which give your municipality an edge as you evolve toward a smart city – a smart infrastructure with the connected connectivity, data, artificial intelligence (AI) and the enhanced capability to solve pressing civic issues.

The Drawbacks of an Outdated City Communications Infrastructure

Being deprived access to the most up-to-date technology can make your city feel old-fashioned and pose an inconvenience to your residents, anchor institutions, and businesses. A leased, copper-based network can be rife with challenges, including limited bandwidth capacity, a lack of intelligence to inform, and interoperability complexities when rolling out smart city technologies. Not to mention that copper can carry far less data at far slower speeds than fiber – which means many of the cloud- or Internet-based technologies associated with smart infrastructure cannot effectively be operated or hosted.

Bottom-line, an outdated infrastructure is a limiting factor. For example, it can be a deterrent for attracting outside business investments, tourism, people migration, and job growth.

How can a City Leverage Smart Applications?

Connected applications offer your city numerous possibilities to take advantage of a smart infrastructure. Your city personnel can use the data you’ve collected from connected infrastructure to make informed decisions about what makes your city run best – and this is what ultimately makes a city smart.

There is a wide range of smart city applications available today, including:

  • Active security: Increase your level of smart protection with technologies like facial and license plate recognition, gunshot detection, perimeter patrolling, and crowd counting. They give your security officers greater situational awareness on recognizing potential hazards, understanding when a situation is escalating, and knowing how to respond appropriately.
  • Parking and Transportation: Smart parking technology can detect parking space availability, automate metering, dynamically price spaces, issue tickets, and collect payments.Also, by leveraging connected cameras coupled with AI, traffic engineers can better manage traffic flows and synchronize signals. This capability provides the smarts necessary to lessen congestion, reduce air pollution, and ease commuting stress.

Co-creation Brings it all Together

When you’re ready to make the bold step forward on your digital transformation journey, you don’t have to go it alone. As your innovation partner, we’ll take a collaborative approach to plan, design, integrate, and implement your vision from concept to reality – whether that’s building a multivendor broadband network from scratch or upgrading it with smart infrastructure, including operating and maintaining it. Working together, we’ll co-create a unique solution that delivers real outcomes – real success to your community, including public safety, economic opportunity, operational efficiencies, and civic engagement.

WHAT IS A “SMART CITY?” PART 2

In Part 1 of this article, we talked about some of the characteristics of a smart city, including hyperconnectivity, people-centric technology, and increased efficiency of city-provided services. But although those things are critically important, they’re not the end of the smart cities story.

Economic development is an important driver for most cities considering an upgrade to “smart” status, with most cities looking to attract new businesses to their community. But how? In 1942, economist and social scientist Joseph Schumpeter coined the term, “innovation economics,” which, he argued, meant that innovation was a major factor in spurring economic growth and change as it created “temporary monopolies” when new products and technologies were invented, that then encouraged the development of competing products and processes, thereby creating beneficial economic conditions. He further believed that government’s most important role was in creating a fertile ground in which these innovations could occur. In this sense, the smart, connected, and efficient city is the technological soil in which the seeds of economic growth will be planted, yielding profits and benefits that will in turn enrich both individuals and society at large. Therefore, the cities that are at the forefront of smart cities transformation will reap the largest benefits from this explosive, and in many case much-needed, growth.

For example, an unique and innovative display of economic development using smart technology is taking place right now in South Korea. A major grocery retailer wanted to expand business, but without opening additional physical locations. The answer proved to be “virtual shelves” in the city’s subway stations. Wall-length billboards display goods for sale, complete with images and prices, allowing customers to order by scanning QR codes, paying, and arranging for delivery within a day. This optimizes commuter time in the stations, and expands business for the retailer without the expense of a building, rent, utilities, maintenance, staff, and all the other requirements of a physical location. The result is that this retailer has reached the number one position in the online market, and the number two position in terms of brick-and-mortar stores.

Besides these obvious advantages, an area in which smart cities can actually save lives, and one that is top of mind around the world right now, is by helping to deal with natural disasters, before, during, and after the event. Sensors can continually monitor air and water quality, weather and seismic events, and even increased radiation levels, for example, thus providing critical early warnings of disasters about to happen, and can disperse that information to residents via smart phone apps. Once an event occurs, smart data can be used to provide much-needed safety information. During Hurricane Harvey, for example, data collected via connected systems was able to provide residents with real-time information about increased water levels through information from county flood gauges, as well as identify passable evacuation routes and assistance, available shelters, food banks, and more. Drones can be – and are being – used to survey damage and to aid in recovery efforts, reducing the risk for human crews. And this is clearly the tip of the iceberg as regards ways in which “smart” technology will be able to aid in human response to natural disasters.

Of course, these are only a few of the ways in which smart technology can benefit communities. Every city and county has its own needs, especially in the early planning stages of digital transformation. What’s important to remember, however, is that smart cities aren’t coming, they’re already here, and the earliest adopters of this incredible technology will be the ones to reap the greatest benefits from it. Those that delay, or who reject the smart cities model altogether, will quickly find themselves woefully behind the curve, unable to compete with those communities that showed more foresight in these early days. Customers and residents are constantly increasing their demands for bandwidth as the fuel needed to drive their desire for connectivity, and the communities that can provide these services seamlessly and easily win the lion’s share of business and revenue. It’s never too early to start thinking about smart city transformation, so what are you waiting for?

WHAT IS A “SMART CITY?” PART 1

Unless you’ve been living in a bunker deep underground for the last ten years, you’ve no doubt heard talk about “smart cities.” Everyone’s talking about it, and a few truly forward thinking cities around the world are making it happen. But what exactly is a “smart city,” and what does it mean to you?

The short answer is that the smart city concept is the logical and foreseeable outcome of a world in which connectivity has become an integral part of our daily lives. In a smart city, things like utilities, transportation, education, housing, and more are all connected via sensors that provide data in order to improve the quality of life of the city’s residents. Civic leaders use this data to make better, “smarter” decisions for the way the city operates and interacts with its citizens. It’s a way to make infrastructure more efficient, to make government more transparent, and to make day-to-day interactions with technology smoother.

The best smart city improvements are based on a people-centric model, in which technology is merely a tool that improves the lives of those it touches by solving problems that might otherwise be insurmountable. Imagine a “smart” parking lot that can alert you to an available parking space via an app on your phone, reducing or eliminating your time driving around hopelessly looking for one. Or how about  a smart communications system for emergency personnel, able to assess a situation holistically, summon the appropriate personnel, identify and notify the nearest hospital with the appropriate treatment facilities, and even turn traffic lights green as needed for the ambulance en route, thereby decreasing response time significantly.

These aren’t simply concepts found in science-fiction novels, but initiatives actually put in place today in smart cities around the world. By making use of data collected from a variety of sources in an intelligently-connected infrastructure, and parsing that data in useful ways, these smart applications can be used to improve the quality, performance and efficiency of everything from major water utilities to individual home appliances. Europe and Asia have been making these steps forward for some time but America is catching up now in cities like New York, Boston, San Francisco, and even Wichita.

From a municipal perspective, smart technology is being used to streamline city-provided services, and to oversee and regulate services provided by outside organizations in order to minimize frustration and dissatisfaction and to maximize economic growth and development. In Amsterdam, for example, the city has installed “smart” garbage bins, so that trash is collected only when the bin is full, thus making garbage collection more efficient and less costly.

There’s even more to know about smart cities, and we’ll cover that in “What is a ‘Smart City?’” Part 2.