The middle mile
The publicly funded EAGLE-Net broadband project still is mired in controversy, and it remains to be seen if the project comes through on its promise to reach rural Colorado. With or without EAGLE-Net, the Yampa Valley has to prepare for increasing future broadband demands.
Steamboat Springs The news came on the morning of May 16: The South Routt School District would not be connected to the EAGLE-Net statewide broadband project.
“We don’t have the money; we can’t do it,” Steamboat Springs School District Technology Director Tim Miles said an EAGLE-Net representative told him.
The Oak Creek-based school district of about 400 students is only 20 miles south of the Routt County seat, but that’s far enough to be left out.
The South Routt School District is exactly the type of rural, underserved school system that was supposed to be at the heart of EAGLE-Net’s mission to build a high-speed network for educational and public institutions.
The $100.6 million federal grant-funded initiative was supposed to connect every school district in the state, but EAGLE-Net has fallen far behind its original schedule, and doubts loom about its ability to fulfill its promises.
The stumbles pose a challenge for rural school districts that were hoping for more affordable bandwidth at better speeds, but initiatives like EAGLE-Net also have impacts on the private sector and the overall broadband outlook for Northwest Colorado.
Currently, the only broadband paths connecting Steamboat Springs to larger outside networks are owned by CenturyLink. Its monopoly on what’s termed the “middle mile” — the infrastructure connection between core networks and the “last mile” to individual customers — means it has significant control over broadband services in the area.
Any local Internet service provider that wants to provide service to area homes and businesses has to lease connectivity from CenturyLink to reach the outside world. Without competitors in the market, CenturyLink can charge higher prices for middle mile services here than on the Front Range, and it can leave fiber dark, meaning it’s not lit for use, if it chooses, limiting the potential bandwidth available.
EAGLE-Net was supposed to change that. It would offer an open-access network that would allow any carrier to lease fiber and compete in the middle mile market.
The project still is slated to reach Steamboat and could have tremendous effects on broadband in Routt County. But for now, companies and organizations are exploring what can be done to improve connectivity in the area with or without EAGLE-Net.
Running out of money
EAGLE-Net has committed to reaching 29 additional school districts across Colorado — mostly on the Western Slope or in the San Luis Valley — with all of those projects except Silverton being completed by the end of the year.
But as its President Mark Ryan revealed earlier this month, the project has less than $8 million left in its coffers.
A recent call for a third-party network operator — criticized by some as privatizing the publicly funded network and an acknowledgement that the organization is not self-sustaining — stated that EAGLE-Net is seeking an $8 million initial capital investment.
The National Telecommunications and Information Association stated that some private in-kind financing for the project was jeopardized when the project was suspended for deviations from the original plan and that $10 million to $15 million likely would be needed to finish the project.
The Silverton project might cost $8 million by itself and would require a grant extension by the Telecommunications and Information Association to meet the 2014 completion date.
In addition to the financial woes comes a host of other complaints. EAGLE-Net’s plan to fan out from the core network around Denver ran into accusations of overbuilding in already served areas. Rural providers that used other federal programs to build their own middle mile connections complained that EAGLE-Net’s plan would compete directly with them and threaten the health of their projects.
Then accusations of graft and abuse bubbled up.
Even after the Telecommunications and Information Association lifted EAGLE-Net’s suspension for not following environmental plans, it’s still under review and its accounts are being monitored. A self-audit due to the state was not submitted May 15 after months of postponement, and a federal audit of the project is expected to start in December.
The 200 community institutions that originally were to be linked were trimmed to 170 school districts. The project still is less than half finished, and now South Routt knows it hasn’t made the cut, either.
“It’s just a very poor way of operating,” Miles said about the lack of Telecommunications and Information Association oversight for EAGLE-Net. “The grants said every school district, and now, we’re not going to get that.”
The project sits incomplete west of the Moffat County School District.
Moffat County School District Technology Director Marlene Knez said the original timeline she was given for the project to be online in her schools was July 2012.
Now, a local EAGLE-Net representative can tell her only that a schedule will be released soon.
The technology promised to the Moffat and Steamboat school districts would have supplied a gigabit per second downstream if they chose to contract with EAGLE-Net.
Steamboat has been paying $100 per megabit per second per month while prices for comparable service in the Denver area are $5 to $15.
“They said that we would be able to get Denver prices and the ability to connect schools together,” Miles said.
School districts would have access to a shared, statewide network, allowing far-flung or smaller districts like Steamboat and South Routt to consolidate services such as email hosting or even outsource them to districts like Jefferson County Public Schools, the largest district in the state with about 84,000 students.
“That’s where you really start to see the benefits of technology,” Miles said.
Knez said her district hopes to increase its bandwidth next school year and will go through the E-Rate bid process, which provides more affordable connectivity to certain educational institutions.
“Any vendor that has that service available in your area has the opportunity to respond,” she said.
CenturyLink has increased its offerings in the past year, and there might be other providers that would like to bid.
Meanwhile, EAGLE-Net has failed to produce any deliverables, Miles said. But the technology needs of Moffat and Steamboat remain, and both districts might have to plan for a future without EAGLE-Net.
Working to expand
EAGLE-Net is not the first high-speed Internet project to try to reach rural areas of Colorado.
The Beanpole Project provided grants through the Colorado Department of Local Affairs to guarantee contracts and encourage development. Routt County eventually saw some service expansion and upgrades, but the fiber route from Steamboat to Grand Junction never was owned by a single entity. NC Telecom went bankrupt, and the section of fiber between Rifle and Craig now is owned by a company called STRATA Networks. The section between Craig and Steamboat was owned by Qwest, and CenturyLink acquired Qwest in 2011.
CenturyLink representatives said the company has a path west of Steamboat to the peering site in Grand Junction. It leases fiber between Craig and Rifle and owns fiber between Rifle and Grand Junction. The company said it has provided fiber diversity over that route since 2003.
However, Zirkel Wireless President Alan Belvo said that when his company purchased a circuit in Craig with the intent of providing a diverse path for its services, it found its traffic still was being routed over Rabbit Ears.
The diverse path is important as a fail-over when one connection is interrupted.
Steamboat lost Verizon Wireless service on Halloween 2011 when a fiber carrying backhaul from towers was cut. The six-county San Luis Valley area went completely dark for 14 hours in 2010. That included wireless service, credit card authorization, long distance telephone service, Internet access and 911 service.
Outages are much more problematic for the San Luis Valley than Steamboat, but more paths and middle mile providers also supply competition in the market.
Belvo said CenturyLink has improved its middle mile offerings and made prices more competitive in the past year. In turn, Zirkel Wireless was able to purchase more capacity.
“It takes the rumblings of something like EAGLE-Net to get CenturyLink” to take action, he said.
There is more action upcoming in the broadband market, as well.
Northwest Colorado Broadband is a nonprofit co-op started last year to provide connectivity to large institutional users and allow last mile providers to access greater resources, according to Tom Kern, CEO of the Steamboat Springs Chamber Resort Association.
The goal is to aggregate the demand of the school district, the city of Steamboat Springs, Routt County, Colorado Mountain College’s Alpine Campus and Yampa Valley Medical Center, Miles said.
“Now, our voice is rather large when someone comes in and tries to separate us,” he said.
Earlier this year, Kern said, the group contracted with a firm on the Front Range to craft business and financial plans.
A part of those plans is to build a space to make it easier for additional middle mile providers to move into Steamboat.
The agreements EAGLE-Net secures with owners of existing fiber and the sections it builds have an open-access setup.
“EAGLE-Net can use it, but EAGLE-Net is required to let anyone else to use it,” Kern said.
The co-op wants to build a carrier-neutral location: a space owned by a disinterested third party where middle or last mile providers can house equipment and link their networks.
Northwest Colorado Broadband has acquired space in the school district’s administrative building downtown and will use a $150,000 anonymous gift to start construction.
The carrier-neutral location also could be used for any future infrastructure separate from EAGLE-Net.
STRATA’s fiber that ends in Craig could be continued to Steamboat if it makes financial sense, and the co-op is a step in that direction.
“We have to make it attractive to that middle mile provider,” Miles said about the move to aggregate the bandwidth needs of the five Steamboat and Routt County government, educational and health care institutions.
“The redundancy and some competition and infrastructure that allows other carriers to come in ... it’s very important.”
Northwest Colorado Broadband now is reviewing the business plan that was prepared for them, Kern said, and a request for proposal from companies interested in offering middle mile services is due back at the end of May.
The public focus on broadband resources also includes an initiative to figure out what already is built.
Right now, no document or database exists that can show what resources are underneath our feet or strung overhead, according to Kern.
The Northwest Colorado Council of Governments, a regional organization based in Summit County, is embarking on the Regional Broadband Strategic Plan Project. The project, which received a $65,000 matching grant from the Colorado Department of Local Affairs, will seek to map existing infrastructure, identify needs and coordinate improvements across the region.
There’s a lot of private fiber in the ground that’s not publicly known, Kern said, and a great deal of expense is going toward contacting individual providers and even walking rights of way to build a full picture of existing resources.
Pushing for progress
The ripples from EAGLE-Net are affecting middle mile and large institutional users first, but smaller business and residential customers won’t be left out.
“My goal is to take it out into the community,” Miles said about the benefits from Northwest Colorado Broadband’s efforts.
Pushing for more middle mile providers and infrastructure upgrades by CenturyLink should allow for prices closer to what Denver-area consumers pay for bandwidth, Miles said.
Local Internet service providers can take advantage of upgrades and more affordable middle mile, then turn around and invest in their own networks.
Resort Broadband already has invested in more fiber across its network. Zirkel Wireless has been increasing capacity to its towers and adding access points.
“That’s been our goal — to upgrade our towers so we can offer those faster speeds,” Belvo said.
If EAGLE-Net reaches Steamboat with open-access middle mile, the benefits of more connectivity for local ISPs could be mixed with competition for certain clients.
“Zirkel Wireless currently serves many government entities that EAGLE-Net will want as customers,” Belvo wrote in an email.
“Over the last five years, the demand for broadband has just skyrocketed,” said Jon Quinn, of Steamboat-based Northwest Data Services. “I’ll give our local ISPs a lot of credit.”
Overall, Quinn said, the community is served pretty well, but there’s room for improvement.
As more of our traffic goes to the cloud, he said, the limits of our infrastructure will become more important.
“We’re still a bit behind the Front Range communities,” Quinn said.
He said CenturyLink has been resistant to install fiber connections at certain businesses and prefers to use copper, for which it can charge a higher rate through phone tariffs.
Miles also said he has experienced resistance from CenturyLink to light up fiber or provide services at an acceptable rate.
He said he has received responses that indicate the company’s focus is on more competitive markets like Denver.
Winnie DelliQuadri, a city of Steamboat Springs employee, was the project manager of the Beanpole Project in the early 2000s and remembers the choice faced at the time: contract with Qwest and get no new infrastructure, or go with the young NC Telecom and get new builds.
“We knew going into it that there was a high likelihood NC Telecom would go bankrupt,” she said. “It had to do with the industry.
“As soon as NC Telecom got that contract, both Qwest and Comcast invested.”
For all the failings of EAGLE-Net, its rumblings already have had indirect effects on Steamboat and Routt County.
The increased offerings by CenturyLink to Moffat County School District, network upgrades and reported improvements in middle mile service speak to that fact. The company reported that it has invested nearly $6 million in its Steamboat Springs network in the past five years.
“I will say that CenturyLink appears that they’re starting to listen,” Miles said.
For now, Steamboat still is a CenturyLink town. The company is not participating in any indefeasible right of use agreements with EAGLE-Net, which would allow it access to fiber owned by CenturyLink.
“Globally, the concern was that it’s not the best use of tax dollars,” said Jim Campbell, regional vice president for regulatory and legislative affairs for CenturyLink.
“The idea is good policy, I don’t think that policy is put into actions,” he said. “The networks they’ve built is where there’s not just one but where multiple networks exist.”
Campbell said the grants were designed to reach communities where a carrier wasn’t already serving the area.
“I think we offer a wide array of services there already,” he said about CenturyLink’s approach toward Routt County. “I don’t think it’s really going to affect how we serve Steamboat.”
In the meantime, South Routt School District will look for other options for its bandwidth needs. Zirkel Wireless donated service to the district this past year, and Miles said he’ll work something out with them.
Whatever service they use, it’ll be better than what they had before EAGLE-Net didn’t come to town.
To reach Michael Schrantz, call 970-871-4206 or email mschrantz@SteamboatToday.com