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August 6, 2012

Broadband network nears completion

Superb summer weather in Maine has done more than make a drought-weary nation envious of the Pine Tree State. It is pushing the completion of a 1,100-mile fiber optic network ahead of schedule by two to three months.

Maine Fiber Co., the firm created three years ago to oversee construction of the Three Ring Binder project, has completed construction of the historic network, with the economic intent of linking small businesses and large rural regions to their potential.

"We are currently finishing up with splicing and testing," says Jeff McCarthy, vice president of business development at Maine Fiber. "We expect to make a formal announcement of the completion in September when we have all the acceptance testing completed." The original timetable pegged construction completion at the end of 2012, says McCarthy, noting that excellent outdoor working conditions helped move the project along at a quick pace.

September is shaping up as a season of optimism for Maine's telecommunications industry. Construction of "last mile" high-speed broadband Internet connections begins that month in the Hartland, St. Albans, Somerset and Penobscot regions, impacting more than 2,500 households and small businesses, according to TDS Telecommunications Corp. representatives.

TDS, based in Madison, Wisc., is prepared to award three contracts worth a total of $12.5 million to two firms in New Hampshire and North Carolina to build last-mile connections in northern, Down East and western Maine. One company will handle two projects for customers serviced in areas surrounding Hartland, St. Albans and Stetson. The other will tackle a single project servicing customers in the Kingfield and Oakland areas. Consumers should be hooked up by July or August of 2013. Construction begins in September, weather permitting.

TDS spokeswoman Cindy Tomlinson says a conservative estimate of current businesses that will be impacted by the three projects falls somewhere between 20 and 100. Beyond that, TDS says, dream and think big because there is no way to measure how many business startups or finger-tapping entrepreneurs are waiting for connections to high-speed Internet.

"When you have the capability to work from home, a lot of new businesses start to happen," says TDS project implementation manager Joe Kirk. TDS is one of 22 incumbent/primary telephone companies authorized by the Maine Public Utilities Commission to provide Internet access to specific regions throughout Maine.

"This is good news for farmers monitoring prices to buy and sell their products," Kirk says. "It directly impacts their livelihood," says Tomlinson.

In addition to new access for current businesses and speculation about new opportunities, Kirk foresees tangible signs of broadband-based projects pumping energy into the economy. TDS, he notes, has wanted to bring high-speed Internet services to homes and businesses in rural Maine for many years. But it was only when the American Reinvestment and Recovery Act triggered $31 million in financing did such an undertaking make business sense, he says.

"We just couldn't figure out a way to get to certain areas that made economic sense," Kirk says. "Our only other option was to wait for the price of electronics (equipment) to fall. Those places were way out there."

Furthermore, Kirk says, the stimulus money opened up logjams between vendors and manufacturers in the fiber optic industry. Some manufacturers were at production capacity and giving delivery estimates of 24 to 36 weeks, while some vendors "won't even quote delivery data," he says.

Paving the information highway

While the federal stimulus money did extend the timeline for building and connecting broadband networks for the folks in the northern, Down East and western corners of the state, the analogies between this kind of public investment and the interstate highway system that began in 1956 get constant mention from the players involved.

The last mile of fiber optic construction is also known as the driveway to a house or business. It is overseen by the state ConnectME Authority, created in 2006 to provide funding and information for that purpose. "It's a vital pathway for commerce," says ConnectME Executive Director Phillip Lindley. "Economic development, distance learning, telemedicine, government services — the easier you make it for businesses to access these things, the higher the revenue."

The Three Ring Binder project network connects communities, not individual houses or businesses. Maine Fiber Co., the product of a public-private partnership that represents $24.5 million in public funding and more than $7 million in private financing, alternates between the big picture landscape and microcosms, says McCarthy.

On the one hand, McCarthy says, The Three Ring Binder project "is not an island … we are completing border crossings in New Brunswick and Houlton. We are interconnecting dark [installed, but unused cable] fiber to New Hampshire and Boston to add value to customers, international customers from Canada through Maine." Hospitals, health care clinics, community colleges, University of Maine campuses, libraries, government offices and public safety agencies are among the potential beneficiaries, he says.

On the other hand, calculating the direct impact on small businesses and households is a matter of faith, the same kind of faith Scottish economist Adam Smith first described in 1759, more than 100 years before the invention of the telephone. The invisible hand of the market is a function of competition, not planning or stimulus packages.

"The availability of routes from Maine to Boston should reduce the cost of bandwidth for (household and business) customers," says McCarthy. "Of course, that may take awhile."

The company maintains a list of 259 Maine businesses with estimated bandwidths of 3 Mb within 150 feet of its fiber targeted for service providers. It is also considering ways to aggregate customer demand in the most rural parts of the state to drive connections.

"The goal is universal access" to high-speed Internet services, says Lindley, of ConnectME. "Right now we're at 91%, which means that 50,000 people don't have it."

As for dreams of 100% access to high-speed Internet, Lindley recalls the state Legislature mandate that accounted for Mainers who choose to live off the grid. "One hundred percent is probably not feasible," he says. "There's always a few who don't want it. The Legislature's directive was access for everyone who wants it." n

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