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Municipalities Generally Prefer Not to Own Broadband Builds, Conference Hears

Broadband leaders note cities prefer to partner than to own networks.

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Kenrick Gordon speaking remotely, with Deb Socia, Joshua Williams and Christopher Mitchell in person at Broadband Communities Summit

HOUSTON, May 3, 2022 – During a panel discussion Monday, broadband implementation leaders said local governments are often much more willing to help a partner organization establish a broadband network than they are to oversee construction themselves.

Speaking at Broadband Communities Magazine’s 2022 summit in Houston, Kenrick Gordon, director of the Maryland Office of Statewide Broadband, said “most local governments don’t really want to own a broadband network” and prefer to partner up and support the build.

Gordon spoke alongside Deb Socia, the CEO of the Enterprise Center, a non-profit infrastructure partner based in Chattanooga, Tennessee, which is known as the “gig city” for its city-owned gigabit fiber network.

When asked about what makes a bad partner organization for local governments in infrastructure projects, Socia, who formerly led internet-expansion organization Next Century Cities, said those who are not trusted by members of the community will not make effective broadband providers.

Many organizations have the potential to overpromise to community members, for example giving earlier timelines for broadband builds than is required, Socia said. Gordon added it is common that the expectation among some community members is that broadband projects can be built faster than other infrastructure.

Screenshot of Kenrick Gordon, Catharine Rice, Will Aycock, Deb Socia, Joshua Williams and Christopher Mitchell

Socia said trust can be garnered from the public by using a consistent script between all involved organizations, such as utilities and city government offices, so that questions can be answered in the same manner with accurate information.

She also outlined how Chattanooga was able to promote its broadband network on trusted and popular local radio stations, increasing familiarity with it in the community through on-air discussions.

Both Socia and Gordon, as well Catharine Rice, project director for the Coalition for Local Internet Choice, stated the importance of maintaining relationships and partnerships, with Rice emphasizing the need to frequently speak to state broadband offices as they generally are quite interested in working to be helpful and improve how they do their job.

Fiber

New Whitepaper Shows Long Wait Times for Fiber Construction Materials

The Fiber Broadband Association has said there is up-to 60 weeks of wait for materials necessary for fiber deployment.

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Photo of Gary Bolton, president and CEO of the Fiber Broadband Association, via fiberbroadband.org

WASHINGTON, September 20, 2022 – Covid-19 and other supply chain stressors have contributed to lead times of up to 60 weeks for materials necessary for fiber deployment and operation, according to a recent white paper from the Fiber Broadband Association.

Speaking at a web event Thursday, FBA President and CEO Gary Bolton presented some of the report’s findings. The waiting period for fiber optic cabling is 52–60 weeks, the report says, and lead times for other necessary goods – e.g., 10–20 weeks for cabinets and splitters, 20–35 weeks for multiport terminals, and up to six months for home equipment – are also extended. The report also notes shortages or inflated prices of raw goods such as plastics, resins, steel, aluminum, copper, and wood.

Prices in the fiber broadband industry are also affected by the global semiconductor shortage. For instance, the price of neon – necessary for semiconductor production – has spiked in the wake of Russia’s invasion of Ukraine, which halted production from a major neon manufacturer in Mariupol and another in Odesa.

President Joe Biden last month signed the Chips and Science Act into law, which includes $52 billion to incentivize domestic manufacturing of semiconductor chips.

In addition, logistical bottlenecks still plague the supply chains, the report said: “COVID shutdowns continue in waves around the globe, with Chinese ports particularly hard hit this year. In April 2022, up to 20% of the 9,000 globally active container ships were stuck outside backed-up ports in various parts of the world. Almost a full 30% of that backlog was created by shutdowns in Chinese ports alone.”

Supply chain disruptions have contributed to the inflation currently disrupting the broadband industry. To avoid such disruptions, the FBA report recommends a series of strategies, including increased domestic sourcing of materials, supply chain diversification, and the utilization of AI technology.

“AI can help companies make short term, reactive decisions about how to source components, and it can also help them make longer-term planning decisions about where they will manufacture their goods,” the report says.

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North Carolina Officials Tout Recent Investments in Rural Fiber

North Carolina hopes to achieve 80 percent subscription to broadband services among its citizens.

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Screenshot of Nate Denny, deputy secretary of the North Carolina Department of Information Technology’s Broadband and Digital Equity Division

September 9, 2022 – With $260 million being awarded by North Carolina to several fiber deployments, a key state official highlighted his strategy toward broadband infrastructure, community engagement, mapping and digital literacy initiatives.

Speaking on Wednesday at the Fiber Broadband Association’s Fiber for Breakfast event, Nate Denny, deputy secretary of the North Carolina Department of Information Technology’s Broadband and Digital Equity Division, said that the Tar Heel State allocated more than $1 billion from its American Rescue Plan funding for different facets of broadband deployment.

Dubbed the Growing Rural Economies with Access to Technology, $260 million of an anticipated $380 million is to be awarded, including $206 on August 31, 2022.

According to Denny, the $260 million already allocated will span 92 counties and connect more than 115,000 new homes and businesses.

Additionally, the private sector has provided $120 million in matching funds to the $260 million in public funds already spent, Denny said.

GREAT is a reimbursement program, Denny explained, and grantees have two years to complete projects under state supervision. Grantees thus far include major national companies – including AT&T and Charter – as well as small regional providers and cooperatives.

Beneficiaries of GREAT funding are expected to participate in the Federal Communications Commission’s Affordable Connectivity Program, which provides discounts on monthly internet bills and eligible device purchases to low-income households.

Denny said that North Carolina hopes to achieve 80 percent subscription to broadband services among its citizens in the next few years. Besides GREAT, the state’s American Rescue Plan–funded broadband programming includes the Stop Gap Solutions program, which provides targeted solutions such as satellite coverage to hard-to-reach locations. It also includes a broadband mapping initiative and a $50 million digital literacy effort.

In addition to current funding programs, Denny expects North Carolina to be the recipient of more than $800 million in upcoming Broadband Equity, Access, and Deployment program grants. He said that the state plans to funnel BEAD moneys into existing programs that have proven themselves effective.

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Fiber

Fiber Providers Feeling the Heat of Inflation as Cost of Materials, Labor Rise

One fiber tools company says inflation is hitting broadband developers hard.

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Photo of Sam Pratt, CEO of Render Networks, from his Twitter account

September 8, 2022 – Inflation-driven high prices for materials and labor are putting significant economic pressure on builders of fiber networks, Render Networks CEO Sam Pratt told Broadband Breakfast Tuesday.

Inflation woes have gripped America for almost a year and a half. The latest consumer price index report has year-over-year inflation at 8.5 percent. According to the Federal Reserve Bank of Atlanta’s data for August 2022, the median hourly wage jumped 6.7 percent quarter-over-quarter.

The fiber industry is feeling the effects of inflation like all others. Pratt, who runs the software company that assists fiber construction companies, said that fiber developers that already submitted cost estimates in their government funding applications but haven’t yet ordered supplies or contracted for labor will likely run over budget due to inflation.

Consulting firm Dgtl Infra estimates that fiber optic cables cost $60,000–$80,000 per miles buried, up to sixty percent of which pays for labor. Taking the average of Dgtl Infra’s estimate – $70,000 per mile – as current, and if quarter-over-quarter wage growth remains at 6.7 percent – as it has since June 2022 – each new mile of fiber laid will cost an additional $4,814 in labor costs come November.

For a fiber deployment of 7,000 miles – the length of Google Fi’s project in Kansas City – the next three months would bring a labor-cost increase of $33,698,000.

Government officials warned last summer that the inflation problem could make closing the digital divide more challenging. One official from Minnesota said the increased cost of deployments could even be pushed onto consumers, raising their monthly bills.

Streamlining production

Inflationary pressures make efficiency in the construction process incredibly important, Pratt said he believes, adding construction costs make up the vast majority of broadband funding. He said his company offers tools to allow users to digitally map all progress and to streamline workflows. Pratt said that extensive geospatial data allows builders to better identify and eliminate inefficiencies in the construction process.

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