Every day, we learn more about the reasons behind America’s growing digital divide. A major cause is that the needed investment to close the gap has not happened. As a result, a growing number of rural electric co-ops and municipal utilities are stepping in to provide the high-speed internet needed to spark community growth and bolster flat or declining electric revenues. As the Practice Leader of Fujitsu’s rural broadband team, I’m proud to be part of this effort.
I often come into the picture before a “go/no-go” decision has been made. Much of what I do involves answering the questions that help a utility’s leadership team decide if and how to proceed. Together with the other members of the rural broadband team, we’ve worked with communities to show them the path forward. The questions we field are as diverse as the individuals asking them, but a few topics crop up frequently.
How can I show that broadband is right for my community?
There are two parts to this question. The first part is knowing what your community needs, and the second is a general understanding of the expected benefits of a successful broadband network. One of the first steps in any local infrastructure project is to articulate what the community needs; no two communities have the same situation and available resources. That said, a “go/no-go” decision typically hinges on financial viability, the potential risks of such an investment, and having the right people at the table.
As for the benefits of broadband, there are a number of case studies that provide insight into what is possible and what is likely. Beyond the obvious benefits—economic development, additional non-electric revenues for your utility, and improved quality of life for residents—a broadband initiative is a long-term investment in infrastructure and the community. There is ample research to show that such investment affects the entire community just as a rising tide “raises all boats.” Everyone in the area benefits from better and more affordable services, greater innovation, and a future-ready foundation for growth.
What Are You Trying to Do?
Demonstrating broadband’s value requires a clear understanding of what is driving the project. Recently, a three-county regional collective in the Northeast engaged Fujitsu to help them build and implement their plan to reach the underserved community with an all-fiber broadband network. From the beginning, the planning board agreed that their job was to provide connectivity to the unserved and underserved in the region. They clearly articulated what that meant from a speed, price, and reliability standpoint. Remaining true to that vision is key to a successful project.
What technology is best for broadband network?
The simple answer: Selecting the right technology model depends entirely on your community’s characteristics, needs and priorities, as well as the resources of your utility. Each technology requires choices to be made regarding cost, reliability, support and lifespan.
Many, if not most, broadband projects involve a hybrid approach involving a combination of fiber and wireless networks, depending on the objectives of the utility. For sure, you can expect increasing bandwidth demands from Internet video consumption, IoT devices, and smart grid applications, among others. When selecting the best networking technology for your organization’s and community’s needs, consider which technology will support data traffic growth and the infrastructure over the long term.
Let the Vision Guide the Technology
A Southeastern public power utility decided that, while fiber would be their essential backbone, a fiber-only broadband network would impede some economically disadvantaged families (an important constituency for the project) from accessing the new internet services. Project planners therefore decided to add Wi-Fi services to the network’s scope.
Can I use my existing electric infrastructure to help lower costs?
Yes! Broadband infrastructure uses nearly the same things the electric infrastructure does, including rights of way, security, environmental protections, power and logical design. This is one of the reasons why electric co-ops and municipal utilities are well positioned to support a broadband initiative.
We’re currently working with a rural electric co-op in the mid-Atlantic region to devise a network build strategy. A core part of the project’s vision is to utilize as much of their existing electric infrastructure as possible, limiting the cost of the core backbone build. Any cost savings will be used for the building and operating the last-mile FTTH network. In the end, the existing design and infrastructure components— such as poles, conduit, and sub-stations—will lend themselves beautifully to a layered broadband network.
What sources of funding are available?
Funding is available on the local, state and federal levels. Federal initiatives like the FCC’s Rural Digital Opportunity Fund (RDOF) and the USDA’s Broadband ReConnect Loan and Grant Program provide funds for construction, improvement, or acquisition of the facilities and equipment needed to provide broadband service in eligible rural areas.
Some states also support broadband deployment, typically through grants, loans and tax incentives, with last-mile projects receiving the most state funding. At the state level, the requirements are more specific, and not every state has broadband funding programs. Finding what’s available in your state can be tricky. Fortunately, the Pew Charitable Trust has developed this handy on-line tool that lets you search available broadband funding opportunities by state.
Local or organizational funding is also available, depending on your community circumstances. Electric utilities can often use funds to expand fiber within the electric system to provide for smart grid technologies and capabilities. Cities and towns can also seek bonds to provide a source of funding, but these can require significant steps such as a public vote.
How can we minimize project risk?
To minimize risk, you must first spell out the specific areas of risk or uncertainty. Risk falls into four broad categories.
Project performance risk is tied to satisfactory execution and completion, on time and within budget. There are two main ways to implement a broadband network. On the one hand, you can take on the day-to-day responsibilities and risks yourself by internally managing the entire project and its vendor relationships. On the other hand, you can engage a third party to shoulder some or all of the burden. One third-party option is to hire an engineering firm, who would typically provide technical expertise and project management services for specific project phases.
If you have the resources, expertise and project management experience to oversee the entire process, this is a viable option. Otherwise you’ll want an established full-service prime integrator who can handle the integration and coordination of all workflows and provide complete project accountability.
Financial risk typically involves ensuring that your chosen funding sources are large enough to provide adequate funding of the project phases for which they are intended. You must also ensure that the terms are not overly burdensome and that the funding is easy enough to obtain with the resources you have. Mitigating financial risks begins with careful study, research and planning that enables you to establish a realistic budget that you can commit to if you’re managing the project internally. If an outside project partner is involved, ask them to contractually commit to meeting your budget requirements.
Technical risk refers to network design and performance. Is the network technically sound and operationally efficient? Is it secure from hackers and other bad actors? Will it operate reliably? Can the fiber infrastructure scale and evolve? Managing your technical risks involves having a solid understanding of the current and emerging technologies and how each would fit the long-term needs of your broadband network. This typically requires being in frequent contact with vendors to understand their technology roadmap.
Organizational risk refers not only to the electric co-op or public power utility, but to the key decision makers and leadership teams overseeing the project. Mitigating organizational risk is all about doing your homework upfront. Everyone at the table must understand his or her role, the utility and community’s needs and priorities, the project scope and vision, and the decision-making process. Choosing a single accountable partner to work with you all the way from the broadband, financial and engineering study to the execution phases—design, build, operate, and maintain the network. The single-partner approach reduces complexity and the potential for mistakes.
Technical Insight is a Game-Saver
An electric co-op in the Southeast engaged their prime integrator, Fujitsu, once the project had started and decisions regarding technology had been made. Fujitsu immediately realized that certain equipment essential to the technology was to be phased out by the vendor soon after completion of the project. Working together, the co-op’s project team and Fujitsu selected an alternate technology that was a core part of the vendor’s roadmap and used equipment which would be fully supported over the long term.
Now that you know the questions—find someone with the answers
These are challenging times for rural electric co-ops and municipal utilities. Electricity revenues are down in many areas as residents move to larger areas in search of more opportunities. Investing in a broadband network can go a long way toward boosting non-electric revenues and igniting local economic development. Yes, building your own broadband network is a big undertaking: perhaps the biggest project you’ll be involved with as part of your co-op or utility. But you don’t have to go it alone. By working with an experienced broadband partner from the beginning—a partner who understands all aspects of planning and implementation, and who can help you understand and anticipate those steps—you’ll have the resources, technical expertise and project management services needed to navigate the process, start to finish, with no surprises.