Minnesota's Ultra High Speed Broadband Task Force (created by the legislature last year and largely appointed by the Governor) is releasing its report today (the report will soon be available here). I've had a chance to skim it and found it disappointing in some ways but otherwise to be better than what I expected when I learned about the Task Force. Being in Minnesota, I guess we should just be thankful the Governor did not attempt to make the report a secret as he recently did with other public broadband information. The Task Force was remarkably open as it went about its process - something I think we can attribute to Chairman Rick King's seriousness in running the operation and trying to move Minnesota forward. Unfortunately, the political reality of such a task force is that many private interests have to be represented. So the irony of having a Task Force to study why the private sector has failed to invest in the broadband Minnesota needs is that those who have failed to invest get to make demands or refuse to sign off on the report. This is how Task Force's typically devolve into a colossal waste of time. My observation is that while this Task Force seemed headed in that direction, in did not get there. While the report sets decent targets for future levels of service, it is relatively silent about how to get there. There is some talk of local governments "partnering" with the private sector to aggregate demand (meaning, collect customers for the companies) but when the local governments partner in other ways (say, to build a modern network) they get sued as did Monticello. Thus the report is rather timid in its suggestions of what kind of public-private partnerships should be pursued - we are left to believe that the best partnerships are those where the public sector does the work and the private sector collects most of the benefits. The report is silent on the role of municipalities directly building their own networks although Chairman King is reported to have said that some on the committee had doubts about the abilities of local governments to run these in the long term. Surveying the landscape, I have to wonder about the ability of private companies to run these networks over any term!

A few local elections on Tuesday had questions relating to publicly owned broadband networks. In Seattle, candidate McGinn strongly supported a publicly owned fiber optic network for the city and he may yet get his way as the race is a dead heat and ballots are still being counted. We previously discussed Seattle's broadband deliberations. In Longmont, Colorado, voters voted against giving the municipality authority to expand the city owned fiber-assets into a network offering retail services. As usual, the proponents of the public network were significantly outspent by incumbents seeking to prevent competition.

A group called No Blank Check Longmont, backed with $150,000 from the Colorado Cable Telecommunications Association, spent more than $143,000 in cash and benefited from more than $46,000 in in-kind contributions in its campaign to defeat 2C.

Up on top of Minnesota's North Shore, the Cook County Broadband project got a mixed reception. Though they received the authority to raise a 1% sales tax that would have helped pay for the project, they failed to achieve the necessary 65% super majority required under ancient Minnesota law (1915) to operate a telephone service. A majority supported the idea - 56% - but without the ability to offer a triple-play, the county will have to reconsider its approach. Though such results are disappointing, every community with a locally owned community network has had to deal with such setbacks. The question is how organizers can respond to challengers and how badly the community wants fast and affordable broadband networks. In the near term, I hope that both the Minnesota Broadband Task Force Report (due Friday) and the FCC National Broadband Plan recommend abolishing such barriers to public ownership as a 65% referendum.

Monticello Minnesota, the small community located 40 miles northwest of the Twin Cities, recently returned to the news when its telephone incumbent, TDS, began offering a fast 50/20 Mbps residential broadband connection for $50/month. Nate Anderson, of Ars Technica, covered both the story and backstory (something he has extensively reported).

But the entire congratulatory press release glosses over a key fact: the reason that Monticello received a fiber network was the town's decision to install a municipal-owned fiber network to every home in town… spawning a set of TDS lawsuits that went all the way to the Minnesota Supreme Court, which ruled in favor of the town.

I might also note that the press release and much of the coverage also glosses over a one-year contract and early termination fee (though it isn't clear if this is applied in all circumstances). However, Nate nails the story by framing it with the title "Want 50Mbps Internet in your town? Threaten to roll out your own."

We spoke to TDS about the situation last year, and its director of legislative and public relations told us that TDS didn't act earlier because it didn't actually know that people really, really wanted fiber; once the referendum was a success, the company moved quickly to give people what it now knew they wanted.

Of course, TDS did not start rolling fiber after the referendum. They waited. It was only after the City successfully bonded for the project that TDS acted (first by filing a lawsuit to block competition and second by investing in their network to be competitive when the doomed lawsuit would inevitably be dismissed). TDS did not change course because they suddenly realized that people wanted better broadband, they did it because they knew that they would have to invest or perish when confronted with actual competition. Nate's article looks at other communities that have followed a similar trajectory.

The Minnesota Independent took Pawlenty's Administration to task last week for its decision to give more money to the telecom company front group Connected Nation. To be clear, this is not the money for infrastructure (yet - time will tell how the state encourages the feds to allocate the grants). This was the mapping money. Peter Fleck, of PF Hyper blog, put it well:

“My understanding is that we have allowed the companies that have not provided the needed broadband coverage in our state to steer the broadband mapping process itself because of a stated need for confidentiality. That need is questionable,” said Fleck. “And it puts the state in a position where if the maps show there is no problem with broadband coverage, then we won’t need legislation, regulation, or any other policies and it creates the risk that the telecom industry can continue to provide inadequate coverage to underserved areas — usually areas of low-density and low-income. And because of the inadequacy of these maps, eventually we will have to undertake broadband mapping again at taxpayer expense. To me, this is an irresponsible use of public money.”

The story also quotes me and links back to our story on Connected Nation in Minnesota. I want to note that states and federal agencies can demand more in terms of better maps and data transparency. It is somewhat disingenuous to lay the blame solely at the doorstep of this telecom-front organization when elected officials refuse to demand more from an industry that has long retained legions of lobbyists. Make no mistake, Connected Nation's conflict of interest is a serious problem, but we need our elected officials to stand up to the telecommunications companies and demand better mapping data. We had higher hopes from the NTIA, but clearly that was misplaced. More recently, Sharon Schmickle of MinnPost wrote about plans for a publicly owned network in Cook County, Minnesota. It touches on the major issues that many communities face when deciding whether to build their own network.

Our focus on the broadband stimulus is almost entirely on last-mile infrastructure because it is the most challenging and expensive problem to solve before all Americans will have affordable access to the broadband networks they need in the modern era. As we are most familiar with Minnesota, we decided to take an in-depth look on who is proposing what projects in our state. Total Infrastructure Grants Requested for Last Mile solely in MN: at least $240 million Total Infrastructure Loans Requested for Last Mile solely in MN: at least $85 million Groups seeking stimulus funds to deliver last-mile broadband access in Minnesota have asked for hundreds of millions of dollars. By my tally, some 17 applicants are seeking to serve Minnesota with last-mile access (I threw out applications pertaining to middle mile infrastructure, digital divide, and those last-mile projects that combine Wisconsin and North Dakota areas) have requested some $240 million in grants and $85 million in loans. If one assumes that the total amount of money is divided evenly among the states, this is somewhere around 3x as much stimulus money that will be awarded to Minnesota applicants over the course of the multiple rounds of funding. At some point, this list will have to be winnowed and prioritized, so let's delve into it. All applications still must survive the peer review process (ensuring they met NTIA/RUS requirements), the incumbent challenges (incumbents can veto applications by showing that targeted areas already have broadband advertised to them), and the prioritization of surviving projects by each state (no one seems sure of how this will happen in Minnesota, our Governor is too busy not running for President in 2012). There are two applications that should be jettisoned immediately, Arvig Telephone Company and Mid-State Telephone Company, both of which are owned by TDS Telecom.

Minnesota is now in poor company, along with several other states that have chosen to use telecom industry-backed Connected Nation (if unfamiliar with CN, read this report) to supply data from Minnesota to the federal government as part of the national broadband map that is being constructed. Just how this came about explains why a group like Connected Nation thrives in the current telecommunications arena. Mike O'Connor, the urban users' representative on the Minnesota Governor's Broadband Task Force, explains that the Minnesota Department of Commerce and Department of Employment and Economic Development (DEED) chose Connected Nation absent any public discussion or even consultation of the broadband task force. Mike is not one to mince words about the deal (which got him picked up by MinnPost):

I'm pretty cranky about this process.  Nice n'cozy.  Nice n'closed.  Nice bypass of the Task Force.  No public input at all as far as I can see.  Looks like there was lots of opportunity for providers to provide input about their confidentiality needs, not too much input about what consumers need.  Look forward to more sub-par optimistic maps, and impossible to use/verify data, peepul.

He references the ample opportunity for providers to express their preferences, this comes from the letter from the two commissioners to the governor:

The other primary reason that we are recommending Connected Nation is that in conversations with and letters from the broadband provider community (including the Minnesota Telecom Association, the Minnesota Cable COmmunications Association, Qwest and Comcast), they have noted their satisfaction with the work Connected Nation as done, the professionalism displayed. Most important, the providers have confidence in Connected Nation's ability to protect their sensitive, nonpublic infrastructure information.

The letter goes on to discuss the other possible mapping entity - the University of Minnesota:

First, the University indicates that it has entered into confidentiality agreements on other projects.

The July/August issue of Broadband Properties features a number of stories relating to community broadband. Editor Masha Zager explains how the stimulus rules hurt communities:

The NOFA explicitly calls 768/200 Kbps broadband “sufficient access to broadband service to facilitate rural economic development,” but how many jobs will this kind of broadband really attract to a depressed area? How many new services can service providers sell over such networks? Will the networks support public needs for distance education or health care? And how long will it be before the equipment has to be replaced? In the words of a rural telco manager I spoke with recently, “You want to put money into something long-term if you’re going to start building networks. Don’t build something you’ll have to throw away in two or three years.”

Steve Ross takes a look at two networks in Minnesota - the much discussed Monticello FiberNet and a proposed network in Lake County (see Lake County Fiber Network Project FAQ):

Lake County is a rural area in northeastern Minnesota. Its planned network requires 800 miles of fiber to more than 7,300 homes and 500 businesses – every premises in the area that has electricity or telephone service now. It’s the first project of National Public Broadband (www.nationalpublicbroadband.org), a nonprofit helping communities develop and operate municipal fiber networks. NPB’s CEO is Tim Nulty, director of the ECFiber project awaiting funding in Vermont.

Steve discusses the crap that TDS is pulling to again prevent competition in Monticello. Despite being laughed (albeit slowly) out of court in their attempt to stop the city from building a fiber network, they are now attempting to incite a bondholder lawsuit by spreading more FUD (fear, uncertainty, and doubt). Interestingly, Steve suggests that TDS' numbers do not add up and that they are advertising fiber services while offering advanced DSL (not that any other private companies have similarly lied).

Opponents of publicly owned broadband networks often hold up examples of wireless networks that did not turn out as planned -- more often than not, they ignorantly use examples of privately owned networks like Earthlink networks in Philly, Houston, or proposed privately owned networks in San Fran and Chicago. It is true that many wireless networks (especially those using Wi-Fi) came in above projected costs and late. It is also true that this happened across all manner of network ownership types. GoMoorhead, a publicly owned Wi-Fi network in Minnesota, was recently sold to a private company - and I am working on a report about that. However, there was also a recent announcement that the privately owned wireless network being built in Burnsville, Minnesota, is behind schedule.

Frontier Communications expects to extend its Wi-Fi hot spot service to Burnsville's performing arts center this fall, but a company official admitted Friday that knitting together complete citywide coverage has gone more slowly than expected. The phone provider for the southern part of Burnsville as well as Apple Valley, Farmington and Lakeville, Frontier had expected to have 90 percent of the city covered with a network of broadband Internet Wi-Fi hot spots by now. But Frontier is still moving its wireless service from the south, where it kicked off service in October 2007, into the northern parts of the city.

Additionally, the public-private partnership in Minneapolis remains behind schedule (privately owned but built with substantial amounts of public money). The problem is the technology - not the ownership. We continue to believe that the future should feature wireless as a complement to the more reliable and faster wired connections that should be available to everyone. But the more we talk to communities, the more we learn that wireless is more difficult to work with and often more expensive than expected.

Many people in rural areas get their phone services from a cooperative telephone company. When it comes to fiber in rural areas, some of these cooperatives are on the cutting edge. The July Issue of FTTH Prism [pdf] from Chaffee Fiber Optics has a feature on Paul Bunyan Telephone in Minnesota. They are an aggressive broadband network deployer in rural areas, often saving residents from Qwest or another company unable (sometimes just unwilling) to build these necessary networks. Cooperative telephone companies fall into our understanding of publicly owned because they focus on their communities first and do not seek to maximize profits at the expense of social benefits. Paul Bunyan Telephone is nearly 60 years old and now covers over 4,500 square miles. They have used RUS loans to finance significant portions of the network.

Currently, over 4,000 locations are served with our fiber-to-the-home network, which represents about 30 percent of our entire network. For these customers, thanks to the benefits of fiber optics, we can deliver high-speed Internet services up to 40 Mb (both upload and download) and a host of advanced television services including multiple streams of high-definition television, digital video recording, and on-demand services.

For those who claim that people in rural areas just don't understand broadband or don't want it, this company has an answer:

One specific example the fiber optic network capacity can have on a business is Northwood DNA, Inc. This is a business operating in a very rural area, Becida, MN, that provides DNA sequencing and genotyping services globally. The services they provide require receiving and sending large data files electronically. Prior to the deployment of the fiber optic network, their business was only able to report two to three test results per day. Today, with the benefits of the all fiber optic network, they report over 50 test results per day.

The full story starts on page 9 of the 2009 July FTTH Prism.

In a recent article, the Star Tribune asks if Minnesota cities are shut out by broadband rules. Of course, this applies to all cities, not just those located in Minnesota. I'll soon put up an overdue piece with our reaction to the broadband stimulus rules - in particular, the decision of NTIA to ignore the public-interest requirement for private companies. In the meantime, this article has gotten some attention - thanks to Eldo Telecom for touching on it. Many Minnesota cities are giving up hope due to rules that privilege private companies who already have the necessary data and the means to jump through the red-tape hoops required by NTIA.

The problem, as city and county broadband planners see it, has less to do with technology than with the sheer legwork required to create an acceptable proposal. Applicants must prove that all the areas they propose to serve would meet a narrow federal definition of being underserved -- that 50 percent or more households in the area lack broadband access, or that fewer than 40 percent of the households already subscribe to broadband. That puts the burden on cities and counties to undertake expensive and time-consuming door-to-door surveys, because telephone and cable companies don't reveal which areas they serve.

In the meantime, private companies like Qwest are not even sure they will participate as they do not like the requirements that grantees operate the network without discriminating against some kinds of content (meaning they want to charge more to visit some sites than others). Though Qwest has not been as bullish on this money-making idea as AT&T, one assumes it is not too far off. Telephony's Ed Gubbins also comments on the many municipalities that have little hope of grants under NTIA's rules:

One group of broadband stimulus hopefuls that has been in large part swept out of the running by the specifics of the plan is individual municipalities of any size.