Broadband Communities

OCT 2012

BROADBAND COMMUNITIES is the leading source of information on digital and broadband technologies for buildings and communities. Our editorial aims to accelerate the deployment of Fiber-To-The-Home and Fiber-To-The-Premises.

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Early on, the Technology Commit- tee considered emulating Fredericton, New Brunswick, by forming a coopera- tive in which community stakeholders would collectively own the network. Fredericton's co-op initially comprised the city government and 12 of the larg- est businesses in the town. Douglas says that, after a careful review, "We didn't use the Fredericton model because, to generate the amount of money necessary, it would have taken five to 10 years for a co-op to grow to the point where it could fund a $14 million project. Nevertheless, we still wanted an organization that would prevent the community from losing control to an outside entity." Te ownership structure that Olds settled on keeps control within the community. OICRD, a nonprofit orga- nization, owns the for-profit OFL and provided it with a shareholder loan to build the dark fiber network – which the institute also owns. OFL licenses the network from the institute and is responsible for operating it. OFL sells broadband services and pays the in- stitute a per-subscriber fee based on a formula that enables OFL to generate enough money to cover operating ex- penses. Te institute uses the revenue from these fees to fund community eco- nomic development projects. Steuben County, Ind., offers a prec- edent for this type of business arrange- ment. Te Steuben County Commu- nity Foundation, a nonprofit, created an enabling organization called iMAN to raise money for, build and operate a dark fiber network. iMAN sells access to the fiber to businesses for $225 per month. Sixty-five percent of the revenue from subscribers goes to the foundation to fund local economic development projects. Business customers are respon- sible for finding ISPs to light the fiber and provide Internet services. However, Olds seems to be the first in Canada to use this arrangement. "In Canada, costs have prevented quite a few other rural communities from at- tempting what we're doing," says Doug- las. "Also, being the first scares some people." However, Alberta's increasingly O-NET's legal structure is designed to keep ownership and control local, return funds to the community for economic development and encourage new community broadband services. progressive stance on community-run initiatives may add an extra spark that encourages other communities to follow in Olds's steps. Olds presented a credible broadband plan to the province of Alberta that doc- umented a strong financial case for Olds's ability to run a profitable network opera- tion. Te town subsequently received a government loan that covered some of the initial capital expenditures. Douglas believes other communities might have an easier time negotiating similar deals today. He explains, "Te province is shifting toward a policy of letting com- munities take responsibility for their own economic and social development. Our community said, 'We'll take the risk.' And government basically said, 'Take your taxes back and build away.'" LICENSE TO INNOVATE Te stakeholders in Olds's broadband project have been through a long pro- cess with several restarts and changes of direction. Still, those leading the broad- band charge believe they are right where they need to be. "We can be as innovative as pos- sible going forward," says Douglas with conviction. "We're in a fortunate posi- tion because our renowned agricultural college, Olds College, has given us the creative mind power to understand how to use technology. Constituents are used to pushing the envelope." Olds had no control over the complexities involved in operating a network, or the associated costs, when it had a partner controlling much of the process. By taking control of the infrastructure, Olds can implement new ideas to contain operating costs. OFL uses open-ended technology that ensures that the network can stay ahead of future broadband develop- ments. Its design facilitates integrating all the services OFL offers under the brand name O-NET, including IPTV, voice and over-the-top video, as well as integrating Facebook, Twitter, Web- based applications and services, local content and more. OFL has open application interfaces in its platform to allow development of applications that meet community needs. For example, a doctor could make a virtual house call via a patient's TV, write and upload a prescription to the patient's FibreCloud account and then send the prescription to the phar- macy the patient chooses. Many of the communities surround- ing Olds have become interested in get- ting broadband for themselves as they watch Olds get ready for its network launch. However, they are concerned about the cost of building the network infrastructure and about the difficulty of getting providers to offer services. Olds is informing communities that want broadband that, if they build and man- age their own dark fiber infrastructures, OFL will light the network and provide services. Communities would still have capex costs but could avoid the cost and effort of enticing providers and manag- ing services. OFL would then facilitate a regional rather than a city network. As Olds's service takes off, OFL is set on trying not to be "just another pro- vider." Its mission is to make the com- munity better. Typical providers sell ser- vices. OFL wants to give citizens tools to integrate social services with television and create new forms of e-health. Doug- las states, "For constituents, faster speed by itself doesn't offer enough incentive for them to switch from what they have. We have to be the best community ser- vice. We have to offer services they can't get elsewhere." Y OCTOBER 2012 | www.broadbandcommunities.com | BROADBAND COMMUNITIES | 71

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