The result: large swaths of rural America are stuck in dial-up limbo.

To remove this hurdle, the federal stimulus program is funding projects like the ones in Minnesota, to either add new infrastructure or find wireless alternatives to the lack of optical fiber in the ground.

This type of infrastructure projects involve the “middle mile” — telecommunications that link a network operator’s core network to the local network plant, typically situated in the incumbent operator’s central office. The Northeast Service Cooperative, itself an incumbent operator, will use the stimulus money to build that middle-mile infrastructure to serve areas in eight northeast Minnesota counties.

The two-year project will lay 915 miles of unused optical fiber in the ground, benefiting 613,000 residents, said Lyle MacVey, director of information technology at the Northeast Service Cooperative.

In addition to area residents, public sector entities such as schools, public libraries and hospitals will also benefit from broadband availability.

“Currently, almost all libraries are connected with a T1, which is 1.5 megabits per second,” MacVey said. “This will bring in gigabit to all facilities, so 1,000 megabits per second.”

He added that broadband availability in public libraries benefits unemployed people who need high speed internet to look for jobs but can’t afford to get it at home. Broadband speeds will also help health care entities, which will be able to share information more rapidly, a must in the era of health care data digitization.

“You have the ability for small, rural health care to be able to transmit and share information real time versus having to wait hours or days to have information exchanged,” MacVey said.

As a result of the project, the Northeast Service Cooperative will end up creating three permanent full-time positions to manage the network. Some of the engineering work is already under way and MacVey hopes to have RFPs out in the summer. Construction will likely begin next spring.

MacVey is already trying to leverage the benefits of the current project to expand broadband availability to even more residents of the region. He has meetings planned with service providers next week to see whether they want to either lease or buy parts of the new fiber that will be laid. That way, ISPs in turn can expand their network and services to more customers. One of the companies attending the event is CenturyLink (formed with the merger of CenturyTel and Embarq), which is based in Monroe, La.

“Currently, we are investigating middle-mile partnership opportunities with the Northeast Service Cooperative that will benefit the areas we serve,” said Carrie Amann, a spokeswoman with CenturyLink in charge of Minnesota and Northwest Wisconsin. “Middle-mile projects, such as this, may assist us by providing cost-effective transport capacity for our own networks.”

A wireless solution

In south-central and southwestern Minnesota, a local, member-owned cooperative has gotten around the problem of building a physical broadband network by going all wireless. Minnesota Valley Television Improvement Corporation (MVTV) began offering broadband in 1999. Currently it has wireless access points on 58 different locations, including city water towers and grain elevators and four communication towers that MVTV owns, said Dan Richter, president of MVTV.

The cooperative provides several residential and business packages at differing speeds and has roughly 2,700 subscribers, including farms, businesses and residences, Richter said. In fact, MVTV’s business has grown such that the cooperative is plowing back $281,388 of its own revenue into the project that is expected to begin in July.

Through it, 34 new access points will be installed and MVTV projects an additional 1,500 subscribers will become members of the cooperative, Richter said. The area covered will increase from around 12,000 square miles to about 20,000 square miles, when the project is complete. Four full-time equivalents will find work through the added coverage area, but Richter does not expect to hire people to install the access points. Most of that work is handled internally, he said.

“There are people that farm that need broadband for their market [information]; we have students who need broadband for education, for online classes and banking, consulting, all of the above,” Richter said. “This will help millions of Americans throughout America and we are happy to do our little piece of 20,000 square miles.”

Even before the stimulus money has found its way to MVTV, the cooperative added two new levels of service for residences and one for businesses in early April. That has taken the maximum speed available to residences to 2.5 megabits per second and for businesses to 3 megabits per second. The company has also installed a few more access points.

“I decided we could not wait [to get the stimulus funds],” Richter said. “We’ve done a couple of access points in the last 30 days because people needed it.”

Projects getting funded in Minnesota and elsewhere are doing so by overcoming massive competition. In late August, a press release from the National Telecommunications and Information Administration said that the agency and the Rural Utilities Service branch of the USDA received about 2,200 applications asking for $28 billion worth of funding. That was just the first round of funding application and only $4 billion was available. Both MVTV and the Northeast Service Cooperative obtained awards in the first round.

“I am not so sure anyone, anywhere on Earth, anticipated the amount of interest in getting broadband across America,” Richter said.

Source: Finance & Commerce