Business
6:55 pm
Wed March 5, 2014

Frustrated Cities Take High-Speed Internet Into Their Own Hands

Originally published on Wed March 5, 2014 7:56 am

College Station is right in the middle of Texas — a few hours by car from Austin, Dallas and Houston and home to Texas A&M, a major research university. But if you're in the market for high-speed Internet access, College Station can feel like the middle of nowhere.

"It's been pretty bleak. You get too far from the university, and it's nothing," says Andrew Duggleby, co-founder of Exosent Engineering, a company that designs and builds tanker trucks for the oil industry.

"We're doing three-dimensional computer-aided design, big 3-D models," he says. "So here we are, this super-advanced engineering company, with all these technologies — but then it can't get past the walls."

There is no high-speed Internet access in Exosent's part of College Station, Duggleby says. If he wants to show one of his 3-D models to a client for review, he has to copy the files onto a portable hard drive and put it in the mail.

James Benham, a city councilman in College Station, is worried that high-tech jobs are fleeing to Austin and other cities with faster and cheaper broadband. "We have lost countless companies to other towns because we cannot provide the level and cost of connectivity," Benham says.

Even in central Texas — not exactly a hotbed of activist government — cities are thinking seriously about how to upgrade their broadband infrastructure.

"We have to deliver consistent electricity and water. I think we have to lump [connectivity] in with the critical infrastructure that we at least have an obligation to think about and plan for," Benham says. "The worst thing, I think, a city could do is sit back and do nothing and wait."

The Private Approach

Right now, only a handful of American cities have superfast fiber-optic networks. Many others are looking on with "visceral jealousy," says Susan Crawford, a visiting professor of intellectual property at Harvard Law School. "And it's disrupting what has otherwise been a very smooth, unbroken, complacent approach to communications in America."

Crawford says cities need to take the lead on building fiber-optic networks because most private broadband providers don't think it's economically worthwhile.

But cable and telecom companies dispute that. Comcast recently said it would offer faster speeds — but only when consumers demand it.

So far, the demand simply doesn't justify the massive investment, says Fred Campbell, director of the nonprofit Center for Boundless Innovation in Technology.

"The rush to fiber may be foolhardy," Campbell says. "There's a notion that we should adopt a 'build it and they will come' strategy. But it can be more efficient in the long run to meet demand as it occurs."

There is one private company that's making a very big bet on very high speeds: Google. The company is offering to pay for the construction of fiber networks that can deliver speeds of up to 1 gigabit per second.

Google Fiber started in Kansas City and is expanding to Austin, Texas, and Provo, Utah, this year. Kevin Lo, manager of Google Fiber, says those cities were picked carefully, based partly on their willingness to streamline their regulations and make it easier for Google to build.

"Building these fiber networks is really hard. It requires hundreds, if not thousands of miles of brand new construction," Lo says. "It has the potential to be really disruptive to local communities who aren't ready for it."

Google Fiber recently said it may expand to nine more metropolitan areas, including Atlanta, Nashville, Tenn., Phoenix and Portland, Ore.

Cities Take The Helm

But even if Google Fiber built out to all of them, professor Susan Crawford says it would still only reach 3 percent of American homes.

"When it comes to the national picture for high-speed Internet access, Google is barely a ripple on the surface," she says. "They're choosing places where they know they'll do well. And they're hoping that other companies and other cities will take up this mantle."

Indeed, cities that have been left out of Google Fiber are thinking about how to do something similar on their own.

Ted Smith, chief of economic growth and innovation for Louisville, Ky., says when the new Google cities were announced, he got hundreds of emails asking why the city wasn't chosen. Louisville, he says, is actively looking for a broadband provider to build a fiber network.

"We've certainly sent the bat signal up to the sky to let people know that we will be easy to do business with," Smith says.

One thing Louisville will not do, Smith says, is pay for the network itself. But Chattanooga, Tenn., did: The city's publicly owned electric company recently spent upward of $300 million on a new fiber-optic network. Chattanooga's mayor, Andy Berke, says the high speeds are helping attract new businesses to his city.

"If, as a country, we're going to participate in this next round of innovation, we have to make sure the infrastructure exists," Berke says. "Someone's going to have to do this. And it makes sense that cities are going to lead the way."

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

MELISSA BLOCK, HOST:

This ALL THINGS CONSIDERED from NPR News. I'm Melissa Block.

AUDIE CORNISH, HOST:

And I'm Audie Cornish.

The speed and the cost of your Internet connection depends largely on where you live. In many places, high-speed access is still expensive and unreliable. That can be inconvenient if you're trying to stream a movie. It's a problem for many businesses. Well, some cities are playing a more aggressive role trying to bring in faster, cheaper online access.

NPR's Joel Rose reports.

JOEL ROSE, BYLINE: College Station is right in the middle of Texas, a few hours by car from Austin, Dallas and Houston. It's home to a major research university. But if you're in the market for high-speed Internet access, College Station can feel like the middle of nowhere.

ANDREW DUGGLEBY: It's been pretty bleak. You get too far from the university and it's nothing.

ROSE: That's Andrew Duggleby. A few years ago, Duggleby left his job as a professor at Texas A&M to start a company called Exosent. It designs and builds tanker trucks, mostly for the oil industry.

DUGGLEBY: We're doing three-dimensional computer aided design, these big three-dimensional models. You know, so here we are at this super-advanced engineering company with all these technologies but then it can't get past the walls.

ROSE: If Duggleby wants to show one of his 3D models to a client for review, he has to copy the files onto a portable hard drive and then put it in the mail. That's because in big parts of College Station there is no high-speed Internet access.

JAMES BENHAM: We have lost countless companies to other towns because we cannot provide the level and cost of connectivity.

ROSE: James Benham is a city councilman in College Station. He's worried that high-tech jobs are fleeing to Austin and other cities that have faster and cheaper broadband.

BENHAM: We have to deliver consistent electricity and water. And I think we have to lump this in with the critical infrastructure that we at least have an obligation to think about and plan for. The worst thing I think a city could do is sit back and do nothing and wait.

ROSE: Even in central Texas - not exactly a hotbed of Big government liberalism - cities are thinking seriously about how to upgrade their broadband infrastructure. Right now, only a handful of American cities have super fast fiber-optic networks. But many others are looking on with envy. That's according to Susan Crawford, a visiting professor at Harvard Law School.

SUSAN CRAWFORD: It's like jealousy, visceral jealousy of another city. And it's disrupting what has otherwise been a very smooth, unbroken, complacent approach to communications in America.

ROSE: Crawford argues that cities need to take the lead on building fiber-optic networks because most private broadband providers don't think it's economically worthwhile. Cable and telecom companies dispute that. They say they will offer faster speeds but only when consumers demand it. And so far, the demand simply doesn't justify the massive investment, says Fred Campbell at the non-profit Center for Boundless Innovation in Technology.

FRED CAMPBELL: The rush to fiber may be foolhardy. There's a notion that we should adopt a built-it-and-they-will-come strategy. But it can more efficient in the long run to meet demand as it occurs.

ROSE: There is one private company that's making a very big bet on very high speeds and that's Google. Kevin Lo is the manager of Google Fiber.

KEVIN LO: We see innovation today on the Web hitting a ceiling that's imposed by today's Web speeds.

ROSE: The company is offering to pay for the construction of fiber networks that can deliver speeds of up to one gigabit per second. But Google Fiber doesn't work with just any city. It started in Kansas City, then announced it's expanding into Austin and Provo, Utah this year. Lo says those cities were picked carefully, based in part on their willingness to streamline their normal rules and regulations and make it easier for Google to build.

LO: Building these fiber networks is really hard. It requires hundreds, if not thousands, of miles of brand new construction. And it has the potential to be really disruptive to local communities who aren't ready for it.

ROSE: Google Fiber recently said it may expand to nine more metropolitan areas, including Atlanta, Nashville, Phoenix and Portland, Oregon. But even if Google Fiber built out to all of them, Susan Crawford at Harvard says it would still reach just three percent of American homes.

CRAWFORD: When it comes to the national picture for high-speed Internet access, Google is barely a ripple on the surface. They're choosing places where they know they'll do well. And they're hoping that other companies, and other cities, will take up this mantle.

ROSE: Indeed, even cities that have been left out of Google Fiber are thinking about how to do something similar on their own. Ted Smith is the chief of Economic Growth and Innovation for Louisville, Kentucky.

TED SMITH: When the Google cities were announced, you know, it was my inbox that got 220 emails.

ROSE: Those emails all saying, hey, why aren't we a Google city?

SMITH: Exactly.

ROSE: Smith says Louisville is actively looking for a broadband provider to build a fiber network.

SMITH: We've certainly sent the Bat signal up to the sky to let people know that we will be easy to do business with if you'd like to come in and give us a look.

ROSE: One thing Smith says Louisville will not do is pay for the network itself. But Chattanooga, Tennessee did. The city's publicly-owned electric company recently spent upwards of $300 million on a new fiber-optic network. Mayor Andy Berke says it's helping attract new businesses to Chattanooga.

MAYOR ANDY BERKE: If you think about highways in the 1950s, about the sewer investments that cities have made, those have been precursors to economic development. If, as a country, we're going to participate in this next round of innovation, we have to make sure that the infrastructure exists and it makes sense that cities are going to lead the way.

ROSE: Of course, that may not be much help if your city isn't one of the leaders or if you don't live in a city at all.

Joel Rose, NPR News, New York. Transcript provided by NPR, Copyright NPR.