The connection to Truckee’s future
In the world of high-speed telecommunications, 2004 may soon be remembered as the best of times or the worst of times depending on who you ask.Locally, representatives of the Truckee Donner Public Utility District await regulatory approval on their ambitious plan to build a fiber-optic broadband network in Truckee. Meanwhile, Cebridge Connections and SBC, both established players in the local telecommunications market, argue that another service provider isn’t needed.A national phenomenonAcross the nation similar scenarios are playing out in communities that feel underserved by the incumbent cable, telephone and Internet service providers, leading many public agencies to take matters into their own hands.As demand for high-speed Internet service and more robust cable television and phone service increases, many of those involved in the “municipal broadband” movement have been turning to fiber optic networks to meet the needs of their potential customers.That was the case in Bristol, Va., a city of around 20,000 people located on the Tennessee border, which went online with a fiber-to-the-home network in July 2003.”The inspiration for building the network was for economic development and to improve the quality of life here,” said Wes Rosenbalm, president and CEO of the publicly-owned Bristol Virginia Utilities. “If you don’t have broadband capabilities, it is a detriment to your economic development portfolio. So it’s just something else to check off on the list as entities look at you as a potential location. “Quality of life ties in to the fact that the type of entities we want to attract have employees who expect these kinds of services at home.”According to Rosenbalm, since installing the broadband network the utility is at 50 percent penetration for homes and businesses – after only 15 months.”We did not anticipate that rapid of a success in our business plan, so we’re ahead of the plan,” Rosenbalm said.For Bristol Virginia Utilities, that 50 percent penetration rate equates to just over 5,000 subscribers out of about 10,000 homes and businesses that have access to the service.Rosenbalm was not able to give precise figures on how many of those customers had other high-speed Internet options available to them, but he did note that Sprint (a telephone and DSL provider), and cable TV and high-speed Internet providers Charter Communications and Comcast were competing for customers in the same market.”Personally, I do not consider those two services equivalent to what we offer on the broadband side,” Rosenbalm said. “We offer a 1-megabit-per-second service and there’s no bandwidth sharing or any of the other things that you can have problems with using the cable modems.”Online in TennesseeOfficials in Jackson, Tenn., which has a population of just over 60,000 people and is located about 30 miles northeast of Memphis, had a similar story to tell. Jackson’s fiber-to-the-home system was built due to customer demand, according to Kim Kersey, senior vice president for telecommunications at the Jackson Energy Authority.”It’s customer driven; just the general public saying we want another provider, we want competition for these services,” Kersey said.Online since April of this year, Kersey said that demand for the high-speed Internet, cable and telephone services being offered by Jackson Energy Authority has been high, even with similar offerings by Charter Communications and Bell South’s telephone and DSL services already available.”Typically when we go into an area we’ll sell to about 50 percent of the people we talk to,” he said, adding that JEA often signs up additional customers after their initial installations through word-of-mouth recommendations.
And while Kyle Spurgeon, vice president for business development at the Jackson Energy Authority, admits that it’s too early to tell if the authority’s fiber-optic network has led to new businesses coming to Jackson, he is confident that in five years he will be able to make that claim.”Right now, when we’re recruiting new industry, it’s something we talk about,” he said. “We haven’t been in the business long enough to point to company A and say ‘OK, they located here because of our fiber optic network.’ But five years from now we’ll be able to say that. “It is certainly something that creates a much stronger perception of Jackson as a good place to do business.”Spurgeon compared the effect of Jackson’s new fiber network with that of Interstate 40 coming through town 30-plus years ago. At that time, Jackson experienced new growth due to the freeway. Likewise, he said, Jackson’s fiber network is the I-40 of the new millennium.Like the Truckee Donner Public Utility District and Bristol Virginia Utility, the Jackson Energy Authority is a publicly owned utility company. Similarly, they also experienced resistance to their proposed telecommunications service from the incumbent cable provider.”They actively fought our entry into the business and opposed us as we went to get our Certificate for Convenience of Need with the Tennessee Regulatory Authority,” Kersey said of Charter Communications. “They have tried to do things politically and in the marketplace to dampen enthusiasm for the project.”Really they’re just trying to lock it up for themselves,” he added.Representatives for Cebridge Connections, which recently bought out USA Media’s cable television and Internet business in Truckee, argue that they aren’t concerned by the competition posed by the Truckee Donner Public Utility District’s proposed broadband service. Rather, they just don’t want to see unfair competition enter the marketplace.”As a competitor, we are required to ensure that our other competitors compete with us according to the same laws and principles that are applicable,” said Pete Abel, vice president of community relations for Cebridge Connections. “As long as everybody competes legally, by the laws that govern them collectively or individually, I think that’s fair.”Demand for services in TruckeeWhile Cebridge and the Truckee Donner Public Utility District have been trading arguments before the Nevada County Local Agency Formation Commission’s Telecommunications Subcommittee over the past three weeks, Truckee residents are divided – and often confused – over the issue of whether the Truckee Donner Public Utility District should get into the telecommunications business.Tracy Okamura, an Internet business consultant with Truckee-based WSI Internet Consulting & Education, stressed the need for some kind of broadband service within the Truckee community:”I think [broadband] is absolutely mandatory,” she said. “Primarily because we are a tourist-based economy… So when we market our services, it’s to a much larger audience.”Traditional marketing practices make reaching that larger audience difficult, she argued, but the Internet takes away those barriers.Studies have shown that 99 percent of small-business owners who have invested in a website believe it has drastically improved their business and would recommend it to other businesses, Okamura said. That kind of a success rate means that more and more Truckee businesses will be doing business on the Internet, she said, and dial-up connections will no longer be feasible as new applications are developed with high-speed connections in mind.”For those people who are still on dial-up connections, dial-up isn’t going to be viable in the near future,” she said.Tahoe Donner resident Joel Erickson says that he has already run up against bandwidth limitations, even with the broadband offerings that are currently available in Truckee.Erickson telecommutes from his home, doing software development and engineering projects for two clients in Hawaii. He used to develop software for a number of companies in Silicon Valley as well, but according to Erickson, he didn’t have the bandwidth capabilities that he needed for the job, specifically the ability to video conference with colleagues in the Bay Area.”When you’re dealing with clients remotely, it’s important to get the details straight. And talking on the telephone it’s too easy to make mistakes and miscommunicate, so I ended up having to drive down to San Jose a lot,” he said. The six-hour round-trip to the Bay Area and costs of a hotel room add to the costs of his service’s Erickson said.
“It doesn’t really work out all that well,” he said. “It would be nice to have video conferencing so you could show graphs and charts of what you’re working on.”It’s basically about being able to communicate efficiently and being able to communicate nuance when you’re making those business decisions.”Erickson argues that nothing short of the Truckee Donner Public Utility District’s proposed fiber optic network will be able to provide the kind of advanced services that Truckee residents will need in order to live and work here.”There’s no way that Cebridge or SBC can provide that bandwidth over wire; they’re going to have to bring fiber optics to the home in order to do that. And you ask them when they’re going to do that and they can’t tell you,” he said. “It’s really a question of whether the community is going to be begging Cebridge for bandwidth… and not really getting enough to really become a leader.”Erickson and other proponents of the Truckee Donner Public Utility District’s proposed fiber optic network see the project as a key to Truckee’s future.”What I’m really worried about is the quality of life up here. When you take the fact that 50 percent of Truckee’s economy is based on new construction, what are we going to do in 20 years when we’re built out?” Erickson asked. “There are a lot of examples all over the country where fiber optics came into a community and brought businesses, brought alternative business, brought clean business, helped the economy, and in some cases even saved the community. So I see that as part of the answer to that economic problem of what do we do in 20 years.””I think that fiber optics should be treated like roads. It’s going to be part of the economic infrastructure of our community.”Those arguments, however, don’t hold water for Glenshire resident Marti Reedy, who currently subscribes to Cebridge’s high-speed Internet service and is content with the speed at which she can access the Internet.”High-speed Internet access is more of a luxury that a necessity,” she said, arguing that the Truckee Donner Public Utility District’s plan to bring ubiquitous high-speed access to every Truckee resident sounds like overkill.”I think for a small town, we’ve bitten off a huge chunk and maybe we need more information,” she said.Reedy said she worries that the Truckee Donner Public Utility District has rushed into its plan to offer broadband service when other technologies – such as wireless or WiMax services – might make more sense.What good will it do us, she asked, if the Truckee Donner Public Utility District spends $24 million dollars for a system that’s obsolete by the time it’s built? Reedy might have her doubts, but proponents of fiber-to-the-home networks across the country argue that fiber optics provide the only “future proof” option that service providers can install today.A crowded marketplaceIn the end, if the Truckee Donner Public Utility District does get the go ahead to build its fiber-to-the-user network, it will be joining a marketplace that is seeing increasing competition from both local and national service providers.Two local companies, Exwire and Lake Tahoe On Line, haven’t figured into much of the recent debate over the Truckee Donner Public Utility District’s broadband plan. However, both offer high-speed Internet service that currently compete with Cebridge and SBC for broadband customers.Lake Tahoe On Line has offered traditional dial-up and ISDN lines to Truckee/Tahoe area customers for 11 years, and recently became a reseller of DSL services to customers in those areas.According to LTOL owner Veronica Cannon, her customers appreciate dealing with a local company for their high-speed Internet needs, and are even willing to pay a little extra for the kind of customer service that they provide.”Basically, instead of dealing with the hassle of calling SBC [for DSL] and getting the kit delivered and trying to figure out if your computer has got an ethernet card and everything that goes along with that, you can call us up and talk to us once and we take care of the whole thing,” she said.
Exwire founder and CEO Devin Koch, whose company offers high-speed wireless access to many areas in Truckee and Lake Tahoe, sees the fight over whether or not the Truckee Donner Public Utility District should be allowed to build its fiber optic network from a different perspective altogether.”Everybody is focused on whether we need another provider and whether we have enough capacity coming into each home when the real question is what are going to be the needs of the people of Truckee in three, five, 10 years?”Koch is betting his money on Truckee citizens needing what he calls “personal, portable broadband,” Internet access that you can get at your home, your office, the ski resort, and the coffee shop.”That’s what wireless brings,” he said. “So I think the whole argument is wrong for the future needs of Truckee. It’s not how big the pipe is; it’s what services and what features and applications can I provide.”As everyone involved in the debate over the Truckee Donner Public Utility District’s broadband plan and the high-speed Internet marketplace will admit, the issue ultimately comes down to what’s right for Truckee’s future.Does the addition of another competitor in the telecommunications industry mean we will get better, more reliable service at lower rates? Can the private companies already providing these services meet the current and future needs of Truckee’s residents and businesses? And last, but not least, will Sierra Sun reporters soon be able to send in assignments from the tram at Squaw Valley?For Truckee and communities across the nation that are struggling with these same questions, the answers could make the difference between economic development or stagnation in the new millennium.The bandwidth bandwagonBandwidth refers to the amount of data a connection to the Internet can provide in a given amount of time, usually measured in megabits per second Mbps or kilobits per second Kbps with one megabit equivalent to 1,000 kilobits. “Broadband” is a term loosely defined as Internet connections delivering between 200 Kbps and 100-plus Mbps in at least one direction, and offering services like high-speed Internet access, voice-over-IP (Internet Protocol), cable TV and Web-based video on demand.Sidebar info:For more information:www.ftthcouncil.org Fiber To The Home Councilwww.broadbandreports.com links to current stories of interestwww.communitiesinfocus.org Fiber Optic Communities of the United Stateswww.tdpud.org Truckee Donner Public Utility District Web sitewww.truckeetruth.com Web site sponsored by Cebridge Connections outlining their complaints about the TDPUD broadband planwww.jaxenergy.com – Jackson Energy Authority Web site with information on their fiber optic networkwww.bvu-optinet.com – Web site for the Bristol Virginia Utilities’ fiber networkwww.sierrasun.com search the archives for more on “broadband” in Truckee
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