After Going to Washington, Now What?

Well, that was an experience. Presenting on a panel before the FCC (click on “Recorded Panels”). Commissioner Clyburn showed up, a few media folks, DC insiders and other heavyweights on the panel. I was particularly happy not to have had a brain-to-tongue  malfunction. 

Heady stuff, this mixing and mingling in the corridors of power. But after the mics go dead, the Internet video feeds end, and the media files their stories, it’s good to assess the real value that come, or should come, from these exercises. This broadband stuff is deadly serious, and these folks at the FCC have an incredibly complex task before them.

Let’s talk about the upside of this workshop series. Our national broadband policy could put us on track to transform millions of lives and businesses in hundreds of communities. Or it could be great mental gymnastics that many look back on one day and wistfully ponder what could have been. I lean toward the former with a couple of cautions.

As Washington matters go with regard to setting telecom policy, this series of workshops appears to be a rather different beast. In the past, the Armani Suits Brigade (lobbyists) descend upon Congressional and agency’s policy makers to conduct backroom meetings and create directives that benefit the few more than the many. Though the workshops created some grumbling early on about being weighted heavily toward technologists, the panel I was on and the ones following have become more representative of the constituencies that broadband – and the lack thereof  – impacts the most.  

This is great because it’s an open forum, first off. Anyone can show up in person and on line to observe, ask questions and get answers. Granted, I’m a little biased, but the panelists were both knowledgeable about, and empathetic towards, those needing broadband, plus we offered good, practical and doable solutions to issues such as getting people to adopt broadband.

Here are two things that will elevate these workshops from being good public policy stepping stones to becoming great cornerstones of an effective national strategy that pulls the country from its sad broadband standing in the world.

First, The workshops need a big dose of participation by the people who actually own the problem, who feel the pain. One of my brothers, who’s a chaplain for athletes, says “unless you’re the one bleeding, you don’t really feel the pain.” If you’re going to do the type of needs analysis required to make the most effective technology plan, you have to bring the actual end users or potential end users who are feeling the lack-of-broadband pain into the process.

Those people sitting in the room listening to panelists probably weren’t low-income urban dwellers, rural mid-Westerners or small-town southerners fed up with the lack of broadband. The people dialing in to watch these workshops likely weren’t from un-served communities or those who we want to reach who have no interest in broadband.  

One of us panelists might have had what the audience felt were the most brilliant ideas for marketing campaigns to increase broadband adoption. Another panelist observed that smartphones are very popular in low-income communities. But a half dozen people sitting on a panel who live the life we want to improve might have told us we don’t know a good idea from a hole in the ground. They might also tell us why smartphones are popular so we don’t create some assumption-based strategy that hurts rather than helps this trend.   
The value of the workshops to date will be doubled or tripled if the FCC brings the people with the pain into the needs analysis process. But you have to go to them. As I said last week in my FierceBroadband column, go into formerly un- and underserved rural and urban areas that now have effective community-driven broadband networks. See firsthand what technologies they’re using, how these technologies were selected, what were the challenges to implementing the technology, what are the challenges to keeping everything operational and current.

Then go into the hood, the backwater, the outpost where broadband is not. Walk the streets and the country roads to truly understand what economic development agencies are talking about when they say broadband can improve businesses. Let community leaders tell you the struggles of dealing with recalcitrant incumbents and recalcitrant constituents.

Before I forget, let me get to the other caution I have. Whether these stepping stones (workshops) become cornerstones leading to meaningful and effective broadband strategy depends heavily on keeping them from being co-opted by the typical DC lobbyist machine. Unlike those who have the broadband pain, and the many groups working in the trenches to help remove that pain, those protecting big business interests roost in D.C. to tilt the rules in the favor of incumbents.

At some key points in the development of effective national broadband, the best interests of the those who need better broadband will not align with incumbents’ perceptions of their best interests. Compromise will be difficult without protecting our pitiful status quo. At those junctures, will the needs of the many carry more weight than the needs of the Armani Suits Brigade?

In the meantime, let’s keep moving this ball forward.

Monday Morning To-do List

I know, this is probably a really bad time to talk about the work that comes next in the broadband dash for dollars. But there are a bunch of folks sitting on the sidelines waiting for the Round 2 funding cycle, watching people’s submission trials this week with Round 1, and maybe contemplating just going to the beach instead.

Anyway, the fact remains, there’s still work to be done by everyone involved with this adventure in technology.

1. Everyone who applied, or at least initiated your application upload, be sure to re-read all the details on the next 2 steps of the NOFA journey. You can’t do much about the initial screening except wait to see if you make it. However, there are things you can do to get ready for the second step because the NOFA gives you an idea what to expect.    

2. I cannot emphasize enough that you do whatever you can to gather data about who doesn’t have coverage in your proposed service area. Somewhere along the line, I believe you’re going to need it. Besides, it can’t hurt to have more rather than less data about who needs what.

3. If you don’t already, have a plan B in case you don’t get funding this round. If you plan to go for Round 2 should you not win this round, pay careful attention from item # 5 on. By the time you find out if you have the grant or not, it may be too late to do many of these activities.  

4. Prepare to fight off any incumbent challenges to your proposal. Don’t forget there’s that pesky little NOFA rule that allows service providers who didn’t have the wherewithal to submit a solution of their own to challenge you after all the work you’ve done. I watched very carefully how Philly beat down Verizon’s challenge to that wireless network in 2004, and I created a media and citizen’s lobby campaign to give you a stronger hand in fighting off such a challenge. Get it here.

5. Those of you planning to pursue Round 2 funding, listen up. Go to this list (http://www.successful.com/news/articles.html), pull up and read my columns in Fierce Broadband, TMCnet, Daily Wireless and Public CIO. Many of these address steps you need to start taking months before the application due date. Some people ignored these steps until it was way too late for Round 1. Don’t miss the train this time.  

6. A lot of you need to decide if you’re going to fight back against rules that pretty much put communities’ interest far behind those of incumbents. I mean, letter-writing, e-mailing, foot-stomping, political pressure applying, in-you-face-but-respectful insistence on changes in the rules! Too many people sat back and bitched quietly rather than give full-throated voice to their concerns.

Don’t for a minute think that this doesn’t matter. As much as we were told the rules were set, the rules can’t be changed, they shouldn’t be changed until maybe the next funding round, here comes the incumbents’ $1000-Armani Suit Brigade. They stomped, wrote letters, got in NTIA’s face. And what happened? Concessions to the unchangeable rules that make it harder for meaningful broadband projects to succeed.

As we get past this week of uploading hell with your NOFA applications, ponder what rules you would change if President Obama tapped you on the shoulder and asked you to be in charge of this process.

7. In the spirit of helpful nudging, here’s a list for which there seems to be a consensus of disdain, dismay and disillusionment. Pick one or two items to make it your mission to address in whatever way you think will produce a change. I’ll be adding my own fuel to the effort over the next few weeks.

  • Either the incumbent challenge needs to go away, or NTIA/RUS provide applicants a valid ability to successfully defend their turf
  • Change the definition of broadband from it’s ridiculously low level to one that is based on the identified needs of the communities to be served.
  • Eliminate the “advertised speed” rule that defines an area as being un- or underserved based on who’s advertising what speed. Definitions have to rely on actual speeds received.   
  • Re-write the rules and reporting requirements that are heavily geared to telecom companies, adding requirements that take into account community-owned networks as well as networks built by public-private partnerships.
  • No more anonymous volunteers reviewing grants. Personally, I think using volunteers wasn’t such a great deal given the short time to adequately prep these folks, but at least the bugs may be worked out by Round 2 so the program runs as smoothly as other volunteer peer review panels. But this secret panel crap is for  the birds and no one should have sat quietly for that.

Feel free to add to the list. But let’s commit to spending part of September doing some amount of lobbying for better rules. NTIA has said it’s open to, and encourages, feedback on the rules and expressed a willingness to make changes. Are you going to take advantage of the moment?

The Smart Path to Broadband Mapping

I often address the serious need for a broadband mapping strategy that doesn’t involve Connected Nation. Today I lay out one strategy for getting better maps faster, and for a much more reasonable cost than the alternative. 

Here’s why mapping is critical to underserved communities’ ability to get broadband, and why poor mapping threatens to derail broadband’s promised benefits and waste hundreds of millions of dollars. If you know this already, you can skip to the next section.

A non-techie’s guide to understanding mapping’s importance 

Broadband maps are graphic manifestations of THE most important element in broadband deployment – the needs analysis. The more accurately you determine which individuals, businesses and other organization need broadband, where they need it and what type broadband they need, the more likely it is you spend money wisely and deliver the best possible solution to communities.

Web maps represent the data that your needs analysis gathers. They’re database apps. Like any database, they are vulnerable to the truism “garbage in, garbage out.” Do flawed data collection (e.g. allow incumbents to hide critical data behind NDAs), you get flawed maps. Conversely, do a bang-up job of data collection, your maps rock. What’s equally true is that, if you use bad mapping technology, you get fairly useless maps. 

Bottom line: You’re working long hours and spending tons of money developing proposals for tens of millions of dollars. All of these actual and potential dollars could be lost if maps that suck due to no fault of your own lead to your proposal’s rejection. Those relying on good maps have the odds stacked in your favor.

From the Fed’s side, they’re giving away $4 billion with “fund, no-fund” decisions based heavily on broadband maps. The ratio of good to sucky maps will determine how well this $4 bil gets spent – or not. 

Those of you whose states have not signed a deal with a purveyor of bad maps (or didn’t do a bad job on their own) have a fighting chance to get maps done right. This is important even if you can’t get the ideal mapping data before the Aug 14 deadline for first-round stimulus funding. You may need to defend your proposal from incumbent of NTIA/RUS challenges, and the more data you have on hand, the stronger your defense.

Key components for useful maps  

Drew Clark, president of Broadband Census (a broadband news and mapping services company) believes any broadband map that’s worth its pixels and the price tag has to sufficiently represent SPARC data – Speeds, Prices, Availability, Reliability and Competition.

Speed data is not only how fast is the access, but what technology is delivering those speeds (WiFi, WiMAX, T1, DSL, etc). Besides advertised speeds (a joke in many cases), what are people actually getting at off-peak AND peak community usage times?

Pricing should include who doesn’t use broadband because the price is too high, or too high relative to actual speed delivered. Availability relates to determining down to every individual household or office where people can or can’t get access, but also is all of this data easily available to everyone in the community.

Reliability speaks to the ability for everyone within a coverage area to be able to get and stay online during emergencies, during peak usage or when trees get their leaves back. Intermittent access or frequently dropped connections is not reliable access. What’s more, reliability relates to whether or not the data is updated as changes occur and do those maps change in real time. 

Competition speaks for itself.

What’s the difference between a map that wastes your money and produces near-useless results, and a good map with the right amount of SPARC? Go to this article and scroll down a little bit to see the Connected Nation map for Summit County, OH. It’s devoid of value because it represent so little useful information. The pink represents any kind of coverage from dial up to fiber, none of it verified by an independent source.

The state of Ohio paid $7 million for maps that look like what you see here. Right below this is another map. For a fraction of that cost, Ohio could have received maps that resemble this one created by Strategic Networks Group.

Getting it done – one tactical approach 

This is a simple approach because, well, so often the best solutions are simple ones.

You want to start with a good map of census blocks for your area.  This tool from the Feds should help – http://mappingtool.broadbandusa.gov/DefaultARRA.aspx

Gather data from and about carriers in your proposed service area, keeping in mind you want as much SPARC information as you can pull. This is tedious since the largest carriers such as AT&T, Verizon and Time Warner want to give you as little as possible, while the smaller ones are hard pressed to put enough people and time to the task. 

Center for Communications Management Information (CCMI) collects data on nearly 650 carriers from the giants to local telecom companies via their tariff filings. Starting at $250, you can get a list of the carriers, their middle mile pricing, last mile pricing, listing of individual and business subscriber service packages, carriers’ advertised speeds. Final price depends on how much work they have to do to get what you want. You still have to track down wireless and cable providers, but you save a lot of time and aggravation getting the other data.

You can attempt to bribe or browbeat wireless and fiber providers not included in CCMI’s list for this information, plus try to get more granular data. This takes a lot of time, but you’ll likely find the smaller carriers to be much more cooperative than the big one. The latest clarifications from NTIA are supposed to make it easier to get carrier data. 

This next step compensates for all the data you won’t get from carriers. Conduct surveys of your individual and business constituents. Your objective is simple: find out who doesn’t have broadband, or enough broadband to meet their needs.

Contact a reputable mailing list company with a good track record for providing reliable data, spend several hundred dollars to get a list of addresses and phone numbers for all the residents and businesses in your proposed service area, and survey them. Ask a couple of questions about what services they’re getting, but mainly find out 1) who’s getting intermittent or no service, 2) is the speed that people are getting adequate, 3) is it affordable. For people not getting access, is it the lack of availability, affordability and/or relevance holding them back?  

Put people in the streets, on telephones, online. Snail mail surveys, print them in newspapers, insert them in shopping bags. Either through volunteer broadband activists, paid teenagers, government and service provider staff or all of the above. This data doesn’t have to take months, it can be a couple of weeks if you coordinate a full-court press.

Show who’s dBoss

What makes this tactic practical is a service such as that from RidgeviewTel. Your workforce distributing and gathering surveys or your constituents can, either directly online or by phone, enter this data into the company’s software called dBoss. Ridgeview’s dBoss then immediately records, aggregates and displays this data on a Web-based map that’ viewable within seconds. You can see the entire state or zoom down to someone’s doorstep.

You can layer on top of the CCMI and survey data any additional information on communication assets such as location of dark fiber, vertical assets, WiFi access points, Internet cafes and just about anything else related to broadband. Changes are propagated in real time. The University of Calif., Chico’s Center for Economic Development is doing a major mapping project in N. Calif., and they’re using a similar data-gathering method with in-house software, so this approach has merit. 

When you strip away all the government-speak, the PR hype, the geekazoid terminology, what a process like this gets you is a reasonably straightforward, accurate maps showing where people need broadband. Yes, it is labor intensive in some parts. But for a community of 10,000, you may be looking at $6,000 or $7,000 for get the technology components doing what they need to do, and whatever it costs you to mobilize an army of data collectors.

What you get in the end are maps that truly represent an effective needs analysis exercise, and this data is quickly updated as broadband coverage and broadband need evolves. You get way more useful data to make much better broadband decisions, and spend way less than the millions states have been soaked for to produce marginally useful maps.

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.

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.

Making Sense of the NOFA Rules (pt 1)

Update

Finally, the NOFA’s out (click here). It’s 121 flippin’ pages! Be patient while I grab breakfast and try to sort this bad boy out. I’ll post Part 2 of this NOFA assessment as soon as I can.  

 This NOFA is more than a tick list of items that grant proposals must contain, or requirements to which applicants must adhere. It’s the big step off on the long march toward a [hopefully] successful national broadband strategy. It creates a framework for what U.S. broadband looks like as the next decade begins, who benefits from the technology and how strong a foundation is created for Mr. G’s eventual strategy.   

As you plow though the pages, here are a few things to pay attention to so we determine just how good this first step is going to be. 

Definitions

What’s in a word? A lot.

How the NOFA defines “un-served” and “underserved” determines not only where the lion’s share of these networks are built, but also the competitive landscape for telcos, WISPs, cable companies and other service providers.

If a very heavy emphasis is placed (via points, prioritization, etc) just on reaching “un-served” constituents, and un-served is defined as areas currently with no broadband at all, then most of the networks likely will be built in rural areas. Tier 1, 2 and 3 cities may want to send their grant writers home. Tier 4 cities could have better odds if they’re isolated enough. What’s more, incumbents get to relax because they likely won’t see competitors where they currently are the only game in town.

Should the NOFA, however, give balanced weight to building in un- and underserved areas, and the “underserved” definition includes areas where there is existing service with crappy coverage and/or unaffordable rates, then life is good. Urban, small-town and rural America all get a shot at the pot, and the gods of true competition are appeased.

How “broadband” is defined as it pertains to speed (and whether wired and wireless broadband get their own definitions) determines who’s popping the champagne corks. Anything less than 1.5 mbps symmetrical hands a bonus to incumbent telcos and cable companies, and depresses the heck out of broadband advocates. Defining the speed anywhere above 5 mbps symmetric is problematic for incumbents and maybe mesh wireless providers. WiMAX, fiber and consumers in general are going to be loving it.

Benefits for exceeding definitions represent the wild card 

If the NOFA gives bonus points to proposals that exceed NTIA/RUS’ minimum definitions of broadband, there’ll be happier hearts in the Heartland. Given how many communities have shown that they and public utilities can build faster networks at cheaper subscription rates than incumbents, bonus points give these types of networks a boost in the grant game.  

Open access

This is one NOFA element that’ll be either a boon to the drive to get broadband that matters, or a bona fide bust. Either NTIA/RUS go to the heart of why our broadband position in the world sucks and help rectify it through mandated open access, they show no heart by punting to the big guys or they try to have it both ways with some wishy-washy rule. Either of the latter two options is not good for communities.

Be sure to scan through the verbiage to see if, in deference to the new FCC Chairman, the NOFA also takes a shot at cranking up the heat with a little net neutrality support. We see that, it’s Katy bar the door! Communities and smaller providers should make out quite well, but there’ll be bitterness in other quarters. 

Where are local governments in the pecking order 

In the broadband bill that left Congress, the list of who gets priority for receiving grants starts with local and state governments on top and private sector companies last. Dig into the NOFA and see how much it adheres to this prioritization– or not. To me, this ultimately gets to the core of broadband’s ability to be transformative in its impact.

If local government (caveat to follow) is the main recipient, that makes them the major drivers in what broadband looks like in the respective communities that win grants. The networks are more likely to meet the unique needs of their communities, both economic and societal. Unless mandated or incentivized to form public-private partnerships with government as equal partners, rules that favor private sector companies over public entities will produce a mixed bag of networks, with many falling short of broadband’s potential.

The caveat pertains to state governments. I believe project teams for county-wide or even regional efforts within a state can build networks that produce great results when local governments are in the lead. However, the thought of some state governments getting block grants and thus controlling network development gives me the willies. I worry private companies would have too much influence, better projects without “insider pull” will have less, and/or the funding process will take longer to complete.

For example, one state allegedly plans to bring 40 local and regional project teams into a room to do 3-minute presentations each. Best presentations win state backing to participate in a block grant. If true, my only thought is, WTF! That said, reality dictates state involvement, which means it’s another river you should plan to navigate. 

Sustainability

Pay attention to how the NOFA mandates or otherwise influences applicants to come to the table with a plan to financially sustain networks once they’re built. With luck, these rules will instill a widespread understanding that you must treat these networks like a viable business if you want to advance the public good.

What We Can Learn From Canada’s Broadband Stimulus

Canada has a federal broadband stimulus program going on as well as the U.S. There are some elements of their broadband effort we in the U.S. should take note of as we get the long awaited rules this week. 

Last week I had the honor of chairing the Broadband Strategies for Cities conference in Toronto. Don’t let the title fool you. It was mainly about getting broadband to rural areas, though many of the presenters addressed a cross section of urban, small town and rural issues. I’ll pull out a few points that struck me as being items to note.

The first shocker was the dollar amount of Canada’s stimulus – $225 million. Not a lot compared to $7 billion, you say? True, but then look at how far they don’t have left to travel to get broadband adoption.

Canada vs US in BB adoption

Last week there were some shouts of joy about a PEW report that sites a significant increase in U.S. broadband adoption. In the general population we moved from 55% to 63% of households with broadband, while just looking at the rural US population, we’ve move from 38% adoption in 2008 to 46% in 2009.

In Canada, 93% of their total households have access to broadband, with virtually all of their urban households covered. Mainly it’s the rural areas that fall short with just 81% penetration in these households. So $225 mil isn’t a lot of money, but Canadians definitely a shorter row to hoe. We definitely want to applaud our progress in the U.S., but don’t lose sight of how far we still have to go.

Mapping before disbursement

Industry Canada, the agency handling the stimulus program, has determined that it doesn’t make much sense to hand out money without good maps, so they won’t. Gotta have maps before you get money. Provinces (similar to our states) are being tasked to take care of this as the main drivers with help from the feds.

If it weren’t for the fact that Connected Nation seems poised to do much of this in the U.S., I’d be more adamant that where appropriate we hold up grants until mapping is done where currently there is none. At least in the U.S. some states (e.g. Virginia, California, Arizona) are doing mapping on their own, and appear to be getting it done before their proposals go to D.C. As it is, I think money spent on C N is of limited value and we may as well throw the money out the door first.

The match game

Instead of paying for 80% of the broadband buildout projects, Industry Canada is doing a 50-50 split for funding. What’s more, the money’s only going to private sector companies. Since everyone admits $225 million is not enough stimulus money to get the whole job done, IC is leaning on provincial and local governments to both provide additional funds and advocating (heavily, I gather) for public private partnerships. IC is also setting zones based on size of geographic area and populations so as to induce competition.

An interesting way to tackle the fact that you believe in the private sector’s role, and you also believe local government has to have a strong hand in the process. Furthermore, the feds also believe that free market competition needs a helping hand since IC is basically saying “we’re going to make sure an area is large enough so there’s incentive for  more than one player. And to ensure this outcome…

Open access

Because there’s a lot of pressure from the public for open access and because, to quote the IC Director General giving the presentation, “this is the people’s money we’re giving away,” the IC is leaning toward an open access requirement for receiving grants. Supporting this are the provincial and local governments that set precedent by mandating open access for broadband projects already in motion.

Wow. Take all of these pro-competition rules, and if the net neutrality bill introduced last month in Canada actually becomes law on this its third introduction, Canadian consumers stand to get a pretty good shake from their broadband stimulus. Will we in the U.S. be as fortunate?

Broadband and un-served defined

IC defines broadband as technology neutral networks having a minimum speed of 1.5 mbps. The province of Nova Scotia came up with a solid definition of an un-served residential or business constituent: “an inhabited civic address with a reliable power source, accessible by road that unable to get broadband connections at prices, quality and level of service comparable to urban areas of Nova Scotia.

Hmmm, that’s good. The minimum speed requirement that IC set is, by itself, a debatable option for some folks who want a higher minimum. But coupled with mandated open access and zoning to ensure competition, 1.5 mbps allows you to raise people up way beyond where they are now, and also expect a competitive environment that forces speeds up and prices down. Then you add a definition of un-served that ties rural speeds to speeds of high-population, probably wealthier cities that you know will always get the best service, you further induce faster networks.

The role of local governments

Tim Scott, the speaker from open access network provider Axia NetMedia, stated that “local government is the primary customer of community networks. Without them there is no business case” Other speakers echoed his assessment.

I wonder how many proposals for U.S. stimulus grants will reflect this reality in their network sustainability models?

My next post looks at a pretty awesome analysis of the five most prominent business models for community broadband networks. Everyone, be sure to read this before you submit your proposals for stimulus money. Subscribe to my RSS feed.

Facing the Business Side of Community Broadband

It’s time for a discussion of a topic that gets hinted at, argued about and danced around. Do you run community broadband networks like a typical public service project or a business enterprise? And do advocates of the latter comprehend what a completely different mindset this requires? 

In my 2006 book on muni wireless, I argued that cities have to think like a business if they want to build a network that generates enough cost savings and revenues to sustain network operations. A conservative think tank critiqued my book with the counterargument that this is why governments shouldn’t build these networks; governments are incapable of thinking like a business.

Government administrators are quite capable of adopting a business mindset for broadband projects. But they do have to commit to assigning and hiring people to drive the project who can execute using business principles while achieving public policy and economic development objectives.

I interviewed Michael Johnston, VP of IT and Broadband at Jackson Energy Authority, a public utility in Tennessee, for my last Snapshot Report. The City of Jackson has a population of 75,000. Their fiber network is currently a success story with 16,000 subscribers, but it had a rocky start. Johnston gives a straightforward assessment of why “you need to do a gut check before you go after stimulus money. You can’t be a nice fluffy business person.”

Take this simple example. Your stimulus proposal (any proposal, for that matter) has to prove you can financially sustain the network after it’s built. But have you adequately planned for business success?

“Let’s say we just borrowed $10 million with the assumption we’ll get 100 new subscribers every month for a year. But what about the price of success? If you get 200 subscribers a month, what do you do? You need more customer service people, more technicians. Beating your ‘take plan’ is counterproductive if you can’t get any more ‘free’ government money and you have to go to the bank for real money.”

Recently I commented on the value of partnering, the staple of any business venture. With community stakeholders, these partners are likely on the same page as you in terms of what they want. But the public/private partnership that has become a community broadband orthodoxy also can be the source of great heartburn.

“Partnering with a telco does help because you have to be ready for the different world of telecom operations. The difficulty, however, is that regardless of which telco you partner with you can have completely different goals that are at cross-purposes. The city wants to deliver services in places where it’s currently not offered. The partner needs to make money. There’s a reason that partner isn’t already delivering service in your area.”

Though easier said than done, I suggest you spend a lot of time in frank conversation so both parties thoroughly understand how the other’s business works. Such a discussion opens your eyes to where potential troubles lie that could lead to irreconcilable differences.    

You have to think about your business model as relates to partners. UTOPIA, the municipal network in Utah, took on debt and didn’t provide anything but the Internet pipe. Providers deliver services directly to consumers. UTOPIA makes money on fees from providers based on how many of their customers use the network.

“This kind of arrangement should be a winner, but it doesn’t always work. ‘My plan says if I add 100 customers/month, I pay off the bond.’ But what if the partner doesn’t add that many customers. The city has no leverage because partners want the least number of customers for most profit. Acquiring more customers costs money that cuts into profits. If the city insist on getting their fee anyway, the partner leaves, so obviously the city can’t raise fees.”

As the broadband stimulus grant process appears to be unfolding, it’s going to be smaller local service providers stepping up to partner with municipalities to build networks, and these providers are limited on what costs they can carry. So you need additional revenue options than monthly subscriptions from individual consumers.

Business strategy includes how you’re going to price services. The school district wants to be a customer. The city wants to ensure all citizens get the best education. So you offer the district service 10 times faster and at a price 70% lower than the incumbent’s bid. Perhaps you can do this and still cover network operations costs. Should you? Heavens no! Don’t gouge them, but institutional customers expect – and budget – to pay more for premium service that delivers better value. Trust me, one day you’ll need the money.    

And speaking of competition, does your grant proposal reflect the future competitive landscape? What, you think that incumbents won’t jump in just because they initially refused to build the network?  Put your business hat back on!

“People are assuming their competitors are going to stand still. They think ‘we’re going to go in and take 60% of the market away.’ Take away 60%, the competition doesn’t sit there and say ‘oh well.’ They fight back. ‘I’ll give you free cable for a year, Mr/Ms Muni Customer, if you just come back.’ Municipalities have to match these kinds of offers or lose customers, and typically they don’t think about this.”

This leads to the battle of churn. You have a couple of options. One is to play this game, but that requires an aggressive marketing mindset and sizeable monetary resources. From years of marketing experience, I recommend *not* playing that battle. I suggest creating services that incumbents can’t easily match, or can’t match at all for several years, and sell them to institutional customers at premium prices.

I also suggest reading my column on sustainability.

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