Finding a Broadband Partner

Logo of the United States National Telecommuni...

Logo of the United States National Telecommunications and Information Administration, an agency in the Department of Commerce. (Photo credit: Wikipedia)

The NTIA issued a notice last week that asks if they should continue the BroadbandMatch website tool. This tool was created during the stimulus grant process and the original goal was to connect partners for applying or implementing the broadband grants. And the process worked. One of the components of the grants was the requirement for matching funds and there were many grant applicants with a great idea who had to find a partner to supply the matching funds. A significant percentage of the stimulus grants involved multiple parties and many of them found their partners using this tool.

On the NTIA tool a company would describe what they were trying to do and would describe the kind of partner they were looking for. And the main reason this worked was that the government was giving away billions of dollars for fiber construction, and so a lot of companies were looking for a way to get in on the action. Many of the companies involved in the grant process were new companies formed just go get the grants. The NTIA tool gave companies who were not historically in the telecom business a way to find potential partners

The NTIA asks if they should keep this service going, and if so how it ought to work. I will be the first to say that I was surprised that the tool was even still around since it was clearly designed to put together people to make stimulus grants work. The only way a tool like this can work now is if everybody in the industry knows about it and thinks to look there when they are interested in making an investment.

But I am going to guess that if I didn’t know that this tool was still active that hardly anybody else does as well. It was great for the purpose it was designed for, but one has to ask if this is going to be a place where companies look when they are seeking a partner. It has been my experience that outside that grant process, which was very public, that most people want to keep the process of forming new ventures as quiet as possible to avoid tipping the competition too early. And so, without the billions of public dollars that made the grants attractive I can’t see this tool being of much interest.

But this leads me to ask how a company can find a partner for a new telecom venture? The most normal type of partnership I see is one made between people with technical expertise looking for investors and people with cash looking for opportunities. So how do these kinds of partners find each other?

At CCG we have helped numerous carriers find partners and the following, in our experience, is what has worked and not worked:

  • Put out a formal request for a partner. This may mean issuing an RFP or an RFI or advertising somewhere to find interested parties. I have not found this process to be particularly fruitful, because it normally doesn’t uncover any potential partners that you didn’t already know.
  • Get to know your neighbors better. I have found that most partnerships end up being made by people in the same geographic area. It is not uncommon for the parties to not know each other well before the partnership, and sometimes they are even competitors. But there is a lot more chance that people in your region will best understand the potential for local opportunities.
  • Don’t be afraid to cross the line. Commercial CLECs and independent telephone companies are usually dismayed by municipalities that get into the telecom business. But generally those cities are just hungry for broadband and in almost every case they would prefer that a commercial provider come and build the infrastructure in their community. So crossing the line and talking to municipalities might uncover the best local partnership opportunities. If a town wants broadband badly enough (and many of them do) then they might be willing to provide concessions and cash to make it work.

Of course, this doesn’t even begin to answer the question of how to make a partnership work, which I will address in later blogs this week.

The National Broadband Map

Seal of the United States Federal Communicatio...

Seal of the United States Federal Communications Commission. (Photo credit: Wikipedia)

Last Thursday the FCC voted to take over the data collection for the National Broadband Map. The Map was created as part of the funding for broadband supplied a few years ago by the Stimulus package. The Map was created and administered by the NTIA (National Telecommunications and Information Administration) with input from the states, and that funding is now running out.

Back when the Map was suggested I thought the concept was a good one. But as soon I saw that the data gathered for the Map was to be self-reported by carriers I knew that there were going to be problems. And sure enough, when the first generation Map was produced it was full of errors – big errors.

I work with a lot of rural communities and I have reviewed the maps in many areas of the country and compared it to the actual deployment of broadband. Some communities have developed their own maps – and they did it the hard way. They sent people around to see where broadband was available. A lot of this can be done by somebody who knows how to look up at the cables. It’s easy to know where cable modems are available by the presence of coaxial cable on the poles. And rural DSL generally has repeaters that can be spotted by the eagle-eyed observer. And it’s not hard to look at your cell phone to see how many bars of data you can get. But the best test of where broadband is at is done by knocking on doors and asking people what they are able to buy.

As an example of what I found, let me talk about the issues found in just one county in Minnesota. The Map showed that most of the County had landline broadband availability. The County is very typical of rural areas and the County Seat is the largest town in the County. There are half a dozen much smaller towns and everything else is rural. A large chunk of the rural area is a national forest where very few people live. Most people live in close proximity of the roads in the rural areas.

The reality in this County is that even in the several of the smaller towns the DSL is so slow that it is hard to think of it as broadband. It’s more like dial-up plus. And there was no cable modem service from the cable company outside of the County Seat. And as is typical with DSL, as one goes outside of the towns the quality of the DSL quickly degrades with distance from the DSL hub. We’ve always called this the donut effect with large areas of no broadband surrounding rural towns that have DSL and/or cable modems.

The Map also showed that almost every populated area of this Minnesota County had 3G wireless data available. It’s a very hilly and rugged place and probably half of the county by area can’t even get cellular voice calls, let alone data. But even where voice is available there are many areas that can’t get cellular data. The Map was just wrong about this.

Everywhere that I have helped communities look at the Map we have seen the same thing. The Map shows broadband that isn’t there. It shows cellular data coverage that isn’t there. And it often shows providers that are supposedly serving the counties that nobody ever heard of.

And this is not true for just rural counties. I have helped two suburban counties near large cities look at the Map and they found the same situation. The Map showed areas that are supposed to have broadband where their citizens still have dial-up or satellite. And cellular coverage was exaggerated on the Map.

An obvious question is why this matters? The national Broadband Map has only been around for only a few years and anybody who has ever looked at it knows it us full of inaccuracies. The problem is that the federal government now relies on the Map for several purposes. For instance, if you want to get federal money by loan or grant to deploy rural broadband the assumption is that the Map is good. It is then your responsibility to show where the map is wrong.

And the FCC uses the Map when it talks about the availability of Broadband in rural America. The Map has been overlaid with Census data to count how many households can get broadband. This produces a very distorted picture of who has broadband. There are pockets of people without broadband in even some of the most populated counties in the country and the Map simply misses them. And in rural areas the Map can be very wrong.

The FCC just took over responsibility for the Map. From my perspective they either need to do it right or get out of the mapping business. It’s not easy to get it right, but it can be done. One of the easiest steps they could take would be to give counties the authority to clean up the maps for their areas. Many of them would be glad to do that. And broadband availability is not static. There are areas all of the time getting or losing broadband. If the FCC won’t take the time to get the Map right they should just let it die as another impractical idea.