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July 29, 2014

Next-Generation Broadband Recommendations Released

Study: Public investment in fiber network would benefit business

MISSOULA— The City of Missoula and Missoula County can play a game-changing role in determining a better broadband future for the businesses and community anchors that need ultra-fast, reliable Internet by investing in a 60-mile self-financed open-access fiber optic network.

The proposed network would connect more than 50 public entities to each other including K-12 schools, the University of Montana, healthcare centers and city and county facilities.  Businesses could also take advantage of the network and what the study anticipates would be much more affordable pricing. The study recommends working in cooperation with Internet providers in a public-private partnership.

The study was released this week by Magellan Advisors, a firm contracted by the Bitterroot Economic Development District (BREDD) eight months ago to examine the feasibility of bringing “next generation” broadband to Missoula. Other recommendations include streamlining broadband repair and installation permitting, implementing broadband standards into the land use code, and using joint-trenching agreements to save on construction costs.

The Council’s Committee of the Whole will hear a presentation about the study on Wednesday, July 30, at 4 p.m. in Council Chambers, 140 W. Pine St.

“Broadband is essential and transformational infrastructure for the 21st century economy,” said Caitlin Copple, who has championed this issue for more than two years as chair of the economic development subcommittee of the City Council. “If Missoula is serious about educating entrepreneurial, tech-savvy students, supporting our local tech-startups, and becoming a Big Data hub, this is how to do it.”

Local business owners and community anchors lauded the recommendations as long overdue.

“As an owner of a company that relies heavily on real-time data analytics to provide our clients with our product, it is absolutely essential for us to have high speed, consistent, and reliable broadband,” said Lester Dye, CEO and Founder of Quantpost.

“In previous companies based here we have moved computing resources out-of-state because of the poor service.”

Dye said he frequently tests his Internet service and finds he’s not getting what he’s paying for.

“If you paid for 30 gallons of gasoline and sometimes received 27 gallons then sometimes 2 gallons you would cry fraud,” Dye said. “However, in our political system gasoline pumps are certified by the State but bandwidth, an equally important commodity, is not. Our company requires that employees be able to monitor our servers located around the world from our office and homes in Montana, 24/7 and not just in off demand hours.”

Magellan estimates building the network work require a $10 million city-county investment to leverage state, federal, and private investment. That amount would be debt-serviced and generated from user fees, meaning taxes would not go up, and paid out over five to ten years.

Community anchors that use the network would pay below-market-rate fees to help pay down the debt.  Magellan’s CEO John Honker said this business model has proved successful in hundreds of other communities and that the next step will be for the Missoula Broadband Task Force to conduct a detailed financial analysis and determine the operational model for running a community network. Most likely, day-to-day operations would be outsourced to a provider since local government does not have the expertise or staff capacity to run a fiber network, Copple added.

Similar fiber network projects are already underway in Butte and in the planning stages in Bozeman.

Magellan’s study, which was funded by a Big Sky Trust Fund grant matched by the city and county, included a comprehensive market analysis and documented services, pricing and providers in the local broadband market. It also surveyed local businesses about their needs.

Here’s what businesses and community anchors are saying in support of the study’s recommendations:


"When it comes to the forest products sector, next-generation broadband is very much needed. Our sector uses electronic devices throughout the entire supply chain from the forest to the consumer. You’ll find foresters with laptops and GPS in the woods locating property boundaries and conducting tree stand analysis. Modern day logging equipment has onboard computer systems and mills use computers for everything from log scaling to inventory control and equipment maintenance. Building product marketers and the forest sector's consumers alike use the internet and social media."
--Craig Rawlings, President and CEO of the Forest Business Network

“One of the most important things the Missoula City Council can do for the future of Missoula is continue to support the implementation of affordable, available, extreme broadband across the Missoula business sectors. At minimum, the City Council should remove any and all unnecessary and costly permitting red-tape in order to reduce the cost of fiber optic infrastructure installation.  At the maximum, the City Council should act as a leader and drive a proactive public-private investment partnership to help Missoula secure an international leadership role in the Big Data economy, leveraging local government, university and commercial resources in global information analysis.  Without affordable infrastructure, we will struggle to compete for the high-value, high-paying jobs of the global information economy.”

--Dr. Alex Philp, President and Founder, GCS Research


"Repeatedly, we hear from students, staff and parents that technology use is a top priority for our school district. Just as loudly, we hear that our existing technology infrastructure is not meeting our users' needs. Reliable, lower cost, faster access to our network and to the Internet is essential for MCPS to deliver on the promise of the 21st Century model of education envisioned by the community."

--Hatton Littman, Director of Technology & Communications for MCPS

“Competitively priced, quality broadband access that is widely available in Missoula would benefit UM and our increasing desire that Montana students be prepared technologically for a UM education. A well-connected Missoula adds to the attractiveness of our community as UM continues a tradition of bringing in the brightest faculty, staff and graduate researchers.  Ultimately, UM partnerships in businesses and economic development in Missoula will improve with better connectivity.  For example, technology startups fostered by UM partnerships and/or a UM education might choose to stay in Missoula if their opportunities are comparable to those in cities that currently enjoy the benefits of high-quality, competitively priced broadband."

--Matt Riley, Chief Information Officer, University of Montana

Local Government

“It’s not an accident that the two new urban renewal districts bump up against the fiber backbone along I-90.  The MRA is committed to continue to promote and assist expansion of broadband in the city’s urban renewal districts.  MRA plans to be an active partner in future efforts that implement the City’s broadband policies in the districts because we recognize the tremendous job-creating potential of fiber networks”

--Chris Behan, Assistant Director, Missoula Redevelopment Agency.

“As with any business, available, affordable, and reliable broadband access is critical to the operations of the City of Missoula. Thanks to the city’s access to State of Montana pricing and upfront costs being covered by the vendor, Missoula has constructed Metro, a fiber-optic loop that connects most City facilities on a closed network that meets all of our federal requirements. Unfortunately, the same pricing and infrastructure is not available to most businesses or consumers in Missoula. We are committed to supporting additional broadband infrastructure to make sure Missoula’s burgeoning technology and Big Data sectors have the ultra-fast and reliable service they need at an affordable price—just like we do at the City today.”

--Dale Bickell, Director of Central Services, City of Missoula