Network Sustainability. Sustainable Broadband Adoption. Two Sides of the Same Coin.

I delivered a presentation and facilitated a workshop on broadband adoption in northern California yesterday. Far away from the Bay Area – and reliable broadband. Imagine the irony of giving a presentation on broadband in a location where you don’t have access to it. Or is that empathy? I feel your pain. 

Lots of folks were grappling with making sense of the ARRA applications. They’ve created an infrastructure application that, among many things, requires you prove how you plan to sustain the network. But there’s a separate application for Sustainable Broadband Adoption (SBA).

That’s kinda silly, separating them out like that. Presents communities with what appears to be two separate hurdles. Inspires some entities to pursue broadband adoption on their own in areas that may or may not be planning to build a network. A few may not even build networks at all.

Other than being a relatively tiny bone ($1.5 million) for urban areas that have painfully realized Round 1 funding isn’t going to help them much, it would have made more sense to wrap everything together. However, what we have is what we got, so let’s talk sustainability. This is a valuable  discussion also for those who are planning to make a run at Round 2 funding.

Sustainability is government speak for “having enough customers paying you enough money every year for network services so you earn sufficient revenue to cover the expense of running the network.”

SBA is mainly the methods you use to to close them. SBA is also digital inclusion, but I address that in another blog.

You need smart marketing to close the right customers. Though it may seem counterintuitive, if at this date your project team still believes that selling subscriptions to individuals and residences is the primary road to sustainability, your plan’s in trouble.

In rural areas there aren’t enough individuals out of your total population who you can reasonably expect to subscribe to the network to offset your 20% match and annual OpEx. What you really want to do is find and close those customers who can generate 80% of your revenue though they make up only 20% of your customer base.

Your SBA plan needs to focus on are institutional customers, the equivalent of anchor tenants in a mall. Get a Macy’s, the Gap and a Home Depot, you pay for most of the land while the ebb and flow of mom & pop shops doesn’t damage your bottom line so much. It’s the same way with broadband networks.

Town, city and county governments should be your lead anchor tenants. They have identifiable communication needs, such as overhauling old, expensive T1 lines and mobile workforce automation that can justify their investment in broadband services. 

The business community, as a block, is probably your second best source of institutional customers. Many communities typically have a handful of companies that need super highspeed fiber access. Since the grant needs 20% in matching funds, these key businesses can provide much of that. 

The medical community offers you the opportunity to drive adoption by being institutional customers, and through hospitals and medical centers using the network to engage constituents, thus driving residential adoption.

Educational institutions drive adoption throughout the community to the extent that the school systems – K-12, colleges or adult education institutions – want to create programs that extend classroom learning.   

These points I presented yesterday are just the tip of the iceberg in the strategy guide I just finished. It gives you 16 pages of pointers and insights for getting your proposal out the door with a minimum intake of Pepto Bismol tablets. 

Check it out.

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We Should Demand a 30-day Extension on NOFA Deadline

I wrote a sanity-check blog post over at Muniwireless.com with some tips on dealing with this insanely tight window for submitting grant proposals.

One voice of sanity, Bill Price, left this simple question: “Why has no one filed for a ‘stay of execution’ and requested an extension of the August 14th deadline?”

Hmmm. 

Update!

It less than 48 hours before applications are due in DC, and the Twitter world is starting to buzz with rumors that NTIS/RUS might extend this deadline. How long, or even how true, rumored extension will be is unknown. But this points to yet another reason people should have pushed harder for a 30-day reprieve – someone needs to figure out how to get the computer system beefed up so it doesn’t implode under the weight of hundreds of filings.  

Think about it for a second. The main deadline for getting all that stimulus money out is September of 2010. Aug. 14 appears to be a date set more by political pressure than by what’s best for those footing the bill, and definitely those trying to make the deadline. There’s probably a run on Pepto Bismol and liquor stores all across the U.S. as people try to decipher rules, regs and applications, get their documentation in order, etc. Why not demand an extra 30 days?

There are several reasons to lobby heavily for either 1) an option to request a 30-day extension, or 2) having NTIA/RUS move the application deadline to Sept. 18 for everyone. Those wanting to submit their paperwork by mid-August can still do so.   

You won’t adversely effect job creation in most states

The broadband stimulus bill is creating practically zero jobs in 2009 (though great job security for lawyers and grant writers). Once the Feds announced the December lotto, I mean grant, payout date, that pretty much slammed the door on starting any networks until March or April 2010 in most of the country due to weather conditions. So a delay in announcing grant awards won’t short-circuit the economic impact. 

You’ll get better applications

To call the NOFA long and confusing is gross understatement. Even veterans of many grants past are struggling to sort it out and get their plans to conform to the demands of the application. It’s a classic case where a great proposal can get tossed out because of technicalities or misinterpretations, or never even get considered because some people are too overwhelmed by the time crunch to apply. For an initiative as vital to our future as broadband development, we need to maximize the chances for good projects to get funding based on their merit, not just the wherewithal to survive the application maze.  

Quick poll #1

The volunteer grant-review process becomes manageable

I touched a nerve with my commentary questioning this idea of having volunteers review the grants. But if you ignore the harsh irony of not paying people to work to implement a jobs creation grant program, the other big problem is that 30 days is a ridiculously short time to set up a national process to recruit, hire, train and manage volunteer or paid staff scattered across the U.S.

In some respects, the logistics of transforming volunteers into an effective and productive workforce is more difficult than with paid employees. If you mismanage volunteers who have the skill levels this fairly complex job requires (it isn’t like sending people to canvass neighborhoods for a political campaign), then they’re not going to execute well or stick around very long. An extra 30 days to set up the volunteer infrastructure right pays dividends when those proposals come pouring in. 

We have a chance to do some mapping before the final proposal

Many applicants face a serious challenge to assemble the kind of credible broadband mapping data required to strengthen their case justifying broadband need, and the NOFA’s guidelines with its focus on census blocks makes this even more of a nightmare. An extra 30 days won’t resolve all of the challenges, but it still gives applicants time to make more headway gathering useful information.

You get time to put some clarity into this process

Confusion and contradiction are two good words to describe the challenge many people face with the NOFA, which is made all too clear when you hear NTIA/RUS folks respond to even basic questions from people seeking clarity. We all know these staffers are trying to work magic while dealing with intense political pressure and timelines, so an extra month to sort through the many valid questions that applicants everywhere have is highly recommended. 

We’re about to give out $4 billion, give or take, to put infrastructure in place we claim is as vital as water and electricity. But in our haste to create jobs and stimulate the economy, we stand to reap unintended consequences that hinder both objectives.

Maybe an extra 30 days for applicants to get their act together seems politically unpalatable to bureaucrats driven by the White House’s need for speed. Therefore it’s up to everyone working in the trenches on these proposals to drive home the point to D.C. – a 30-day extension on the front end is going to make them all look better on the back end of this process.

Quick poll #2

What? Volunteers to Approve $4.7 Billion in Broadband Grants?

Now there’s a headline that’ll give a broadband applicant pause – and the rest of the network project team terminal heartburn.

NTIA unveiled in Boston yesterday they intend to recruit an army of volunteers to make up the panels that do the first round of the review process. This legion of un-paid but patriotic souls will influence whose grant applications make the cut by meeting the basic requirements according to the NOFA rules.

As NTIA let that little one-slide tidbit hit the screen, I gather there was a collective gasp from a majority of the people attending this workshop. The reaction was swift, and it was not positive. RUS, by the way, quickly pointed out that they’re handling the impending application onslaught the old fashioned way by hiring more staff and contractors.

I try not to be overly critical of NTIA because they have an impossible job and most of us wouldn’t want it. On the other hand, this is a pretty surprising revelation that has potential to produce some bad consequences for broadband.  

Get on the horn (e-mail, the phone line they rarely answer, your newspaper) and make your voices heard if you feel this is definitely NOT the way to go. Harold Feld, a fellow broadband activist, said it well – “you want good policy? Then you roll up your sleeves and get ready to fight for it.” I believe we definitely need to ask probing questions about this policy because it raises some doubts for quite a few people.

What were they thinking

Congress authorized a sizeable chunk of money (in the many millions) for NTIA to pay for administrative/logistical tasks. If there is a greater need for quality logistics support, you won’t find it this side of the North Pole.

When last I checked, this is a stimulus bill for creating paying jobs. How the heck can you justify asking people in a crappy economy to work for nothing on a jobs-creation project that has money budgeted to pay for the work these volunteers are being asked to do? But set aside the perverse irony for a minute.

You’re about to enter a competitive bidding process with millions of dollars at stake for your community. I think you’d want the best people stimulus money can acquire influencing who the winners are. Did you read the job qualifications required? Jiminy Cricket! NTIA wants people with some serious brain power, which is a good thing. But I feel it’s a reach to expect the best people are going to volunteer for this gig.  

If you have these skills, you’re already working fulltime or you’re looking fulltime for a job that pays you to be this good. In either scenario, you’re likely hoping to cash in on one of these broadband projects that eventually gets funded. The confidentiality and conflict of interest clauses can work against you all around.

Where does this leave the grant-proposing world? Probably with gatekeepers who sorta meet the requirements, were selected on a first come, first served basis and maybe without a lot of serious screening, and are working mostly from home with (according to the impression some workshop attendees got) moderate supervision .

Another thing…

Backtracking to conflict of interest, another concern you want to express to the powers that be is that there appears to be a lack of clarity from NTIA on how they intend to police this. As a practical matter, can you really police this?

I’m at home (hypothetically) reviewing proposals from my state and I don’t particularly like Los Angeles. I could zap every L.A. proposal in random ways and you’d never know. If I gave favorable point awards to a proposal from a vendor or county my best friend works for, would I be in conflict? You betcha! Would NTIA find out, or if they did what are they going to do, withhold my last Attaboy? I’d like to think that paid contractors give you stronger legal recourse to respond to such a scenario.

With this volunteer admin army, are there enough incentives, training time, management skills and oversight capability within NTIA to make these troops sufficiently competent, efficient and reliable to recommend the “A Team” of grant proposals? Would you trust the integrity of the grant process with such an army in place if the answers to all of the above is “no”?

We Got the NOFA. Now Let’s Move Broadband Forward!

It’s time to move this broadband ball forward!

 In my analyst role, I could ponder the winners and losers of the NOFA (broadband stimulus grant rules), or summarize 121 (+ 45 pages on broadband mapping grants) in 900 words. But I’ll let others do that.

In my role (and day job) as a consultant to those who want to put a true broadband network in place post haste, my main thoughts over the weekend focused on how you can get it done. The depth of broadband needs, the insanely short NOFA deadline and weather factors demand some quick, thoughtful decision making. There are two main paths you can take.

For communities that want to build and maintain reasonable control of a blazing fast network that delivers maximum economic and societal benefits for constituents, stakeholders and partners, and start this effort before the winter winds, forget the stimulus. Look no further than Wilson and Salisbury, NC for two communities building networks to deliver 10 mbps [up and down], plus faster speeds for businesses, yet bypassed the stimulus. 

Doug Bergren, an Alderman in Mt. Carroll, IL, said over the weekend “my small town is attempting to go it alone. There is some thought here in Mt. Carroll, IL that it can actually cost LESS to do it ourselves than become part of a big scheme. It’s our objective to get at least the downtown portion serviced by broadband by the end of the year.”

 Chasing the stimulus effectively

 The other path is to do the stimulus dance. Here’s a highlight the practical issues and action steps to give you a strong chance at winning (actually, some of the points here are good for everyone).

First, if you have been planning your network competently since before 2009 and yours is a county or regional effort, you’re practically the only ones with a good shot at first-round stimulus funding. Your biggest task is probably to find the mandated professional engineering firm to sign off on your technology plan, and tweak your proposal to conform to the many NOFA requirements. Though not mandated, still consider getting a similar professional to sign off on your business case and your financials.

Cities and towns pursuing projects solo may want to sit this dance out and wait for Round 2 stimulus funding. Ditto anyone who started planning in March, hasn’t done much partnership development, and doesn’t have a sound business/financial plan completed that’s certifiable by a credible professional services firm.

For this latter group, you have effectively five weeks to fund and secure an engineering firm’s sign off, financial verifications, legal certifications, and other similar tasks, which likely means re-writing or speedwriting chunks of your proposal. That assumes you have a plan capable of meeting the 101 other NOFA tick points. For the soloists, the cards in this first funding round are truly stacked against you. A lot. 

Become the Tom Brown of backtrackers

Second, you better get to backtracking some key elements of your proposal ASAP. If, for example, you heeded hints to create relationships with other Federal agencies to complement funding with their grants for activities such as using transportation projects to lay fiber conduits, you win extra points. But only if you prove these deals are real.

Likewise, if your financial sustainability case rides on community stakeholder support, you have to provide letters or other proof of said support. The NOFA references anchor institutions (anchor tenants for us muni wireless veterans), nonprofits and public safety. You can claim these partnerships, but the devil’s in documenting the details.

Your backtracking had better include verifying who owns what and the rights to what, particularly if your project involves multiple town and county jurisdictions. In many muni wireless projects, network contractors sat with city officials who swore they owned this or that vertical asset. But once projects started, the real owners would be pop up to derail or delay them. You don’t want NTIS/RUS or the governor’s office to discover these things post-submission because your proposal’s chances could sink like a stone.

The catch-22’s 

Third, you have 45 days to solve the following digital inclusion (DI) conundrum. One component of most DI plans is the use of community centers, libraries, churches, etc. as what NOFA calls Public Computer Centers. If you plan to pursue stimulus funding for these, are you ready to dash through the hoops such as providing data on the demographics of people who’ll use the centers, how the centers will market their services, the equipment to be used, etc?

If you find the time limit too overwhelming to write what in essence is a somewhat meaty business plan for each center or the centers collectively, are you ready to show how you plan to fund these resources otherwise? The people creating the NOFA, by virtue of making computer centers a distinct funding area, must believe centers are important. You can’t ignore the centers and how you plan to create, fund and sustain them as well as other DI efforts.

A similar conundrum concerns demand generation (DG). Simply stated, DG is the marketing campaign you need to run to have enough people and organizations use the network to affect economic development, DI and network sustainability. The NOFA asks for innovation, market size, sales projections, cost projections, how the project will create sustainable adoption and how will the program sustain itself.

If your project team finds it to be too daunting – and even too foreign a concept – to complete a full-scale marketing strategy plan as a separate proposal within five weeks so you can get it grant funded, how will your proposal address the execution and financing of DG so your entire network proposal gets funded? Few, if any, proposals without a strong DG plan will fly because DG is the crux of sustainability. Having done plenty marketing plans, I know this is a steep hill to climb. 

I haven’t given you an inclusive list of action items for those wanting to move on their broadband efforts ASAP and worry about the failings of NOFA later. But it’s enough work to keep you busy for the next few days.

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