Broadband Communities

JAN-FEB 2013

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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Wilson Gives Greenlight To Fast Internet Following the collapse of key sectors of the local economy, and after years of deliberation, a midsize town in eastern North Carolina made the tough choice to build its own fber optic network. By Christopher Mitchell ■ Institute for Local Self-Reliance and Todd O'Boyle ■ Common Cause Editor's Note: Tis article was excerpted from Carolina's Connected Community: Wilson Gives Greenlight to Fast Internet, a publication by the Institute for Local Self‐Reliance created in partnership with Common Cause. Te complete text is available at www.ilsr.org/wilson-fber -greenlight/. A follow-up report details the state politics surrounding the network. W ilson, N.C., is a city of 49,000 approximately an hour east of the state capital in Raleigh. Historically, Wilson's chief industry was agriculture, with tobacco and cotton forming a crucial part of the local economy. Global competition undermined the traditional cash crops, and, like many communities, Wilson watched many young people move away to search for opportunity elsewhere. As a result, Wilson has an older population and a higher rate of poverty than North Carolina as a whole. Wilson's seniors make up 14.1 percent of the population versus 12.9 percent statewide; 25.4 percent of the population lives below the poverty line, versus 15.5 percent for the state. By 2008, the three largest employers in the city were Bridgestone/Firestone, the hospital WilMed and the Wilson County Schools. Agriculture now accounts for just 1.4 percent of employment. In light of these trends, the city sought alternatives to promote prosperity, including improving its telecommunications infrastructure. Despite past frustrations, the city frst sought to partner with its existing providers to improve telecommunications services. Te city's 50 Christopher Mitchell will be speaking at the BroadBand Communities Summit in Dallas about using broadband networks to drive economic development. consultant originally suggested a public‐ private partnership to provide telephone services, and in 2007, the city entered negotiations with the incumbent cable and telephone providers. As a backup plan, the city simultaneously prepared to build a network on which it would provide telephone, television, and access to the Internet. Wilson Utilities began reaching out to local elected officials and business leaders about a possible FTTH network, emphasizing the importance of fiber optics and its unlimited potential capacity. Te city's priority was to build essential infrastructure, not just a cable television network. Cable TV service would be offered to make sure the network would attract enough subscribers to pay the debt. Te City Council (with one member absent) voted unanimously on November 16, 2006, to fnance the construction of an FTTH network using Certifcates of Participation (COPs), fnancial instruments akin to revenue bonds. Under COPs, the network itself is the collateral, and taxpayers are not obligated to cover potential losses. After negotiations with the incumbents failed, Wilson issued $15.7 million in COPs in 2007 and $13.5 million in 2008. Both rounds were for a term of 15 years; interest rates varied from 3.25 to 5.2 percent. GettinG SeriouS About Fiber Before embarking on a citywide system, Wilson Utilities built a 1 Gbps backbone network connecting its own institutions and the locations of BB&T, a national bank that was founded in Wilson and remains a prominent local employer. Te network was designed with the capacity for later expansion to handle thousands of connections to residents and businesses, if deemed necessary. City leaders – in and out of government – provided important support for creating a municipal fber optic network. An executive at BB&T lent the bank's support to the initiative in a let- About the Authors Christopher Mitchell is the director of the Telecommunications as Commons Initiative at the Institute for Local Self‐Reliance. He can be reached at christopher@newrules. org. Todd O'Boyle is the program director for the Media and Democracy Reform Initiative at Common Cause. He can be reached at toboyle@commoncause.org. | BROADBAND COMMUNITIES | www.broadbandcommunities.com | January/February 2013

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