August 02, 2012
Craig Settles, Industry Analyst
Connecting Communities: My Old Kentucky Home Page Delivers Economic Benefits
When was it started?
How many miles, what technologies, what speeds?
11 square miles covered by WiFi network offering 3.5 Mbps speed
What do services costs to businesses? Individuals?
Service to users is free. System was paid for by the Prestonsburg municipal government.
Who owns the network?
The City of Prestonsburg
Who (what organization) was the primary driver of the project?
The Prestonsburg Economic Development Director
Summarize the economic benefits of the network has brought
This network’s primary initial benefit was improving and revitalizing the downtown business district. The network also facilitated distance learning and workforce training.
A lot of the articles you read on broadband and economic development give the impression that fiber is the only broadband technology that matters. While it is true that a lot of the highspeed horsepower for online computing tasks such as videoconferencing, moving huge data files and voice calls over the Internet (VoIP) comes from fiber, wireless still has a vital role to play.
In tiny rural communities such as Prestonsburg, KY with 4,800 people, the sparse populations and rugged terrain make wireless the only practical option. Typically this wireless in small rural communities is not the cellular service available from the big carriers since they won’t make service available to such small populations, but from small local or regional wireless ISPs. Or the community builds its own wireless network.
Prestonsburg is about 11 square miles and definitely not the apple of the eye of any incumbent’s accountant. So the city decided to kick off 2008 by rolling out a $8,000 WiFi mesh network.
From the beginning the network proved its value by producing several economic outcomes as part of a program targeted to the downtown area. Brent Graden, the city’s former Director of Economic Development, states, “we made wireless the central part of an integrated package of activities to revitalize business in this area. The network, combined with 3% loans and development efforts for buildings that weren’t being used, made downtown friendly for businesses. This also created incentives for people to come downtown.”
Within three months of launching the network, 22 businesses moved in with 40–45 new jobs. This created a cyclical effect with more people coming into downtown, which in turn attracts more businesses. Resulting tax revenue in the first year of the program went up $111,000, mostly through new business growth. This in turn allowed the city to buy an aerial fire truck, which has kept property owners and government insurance rates from rising.
The city found that making it easy for retailers to do business downtown led to a lot of the network’s usage going up in residential areas as shoppers stayed in touch electronically with merchants. The network was particularly connecting businesses with tourists since they could push information out to network users about sales and available products, and conversely shoppers can browse information for shops while eating lunch.
Though it may not be immediately obvious, using broadband to address healthcare can have an economic impact with wireless if the speed is fast enough. This is true especially with preventative healthcare since it is much less expensive to support people on government assistance by providing treatment early on when illness hits rather than wait until people are having a medical crisis.
“We have folks in our county who live in pretty remote areas we call hallows,” says Graden. “There are people out there without running water, living on disability, and haven’t seen a doctor in years, particularly specialists, because it’s so much trouble and expense to get to an office or hospital. When the weather’s bad they’re completely cut off.”
Graden felt it was valuable expanding wireless coverage out to the hollows so people can use videoconferencing to talk to a doctor or medical specialist, and have at least a cursory visual examination. It’s not ideal, but it’s much more helpful than no care. A well-engineered wireless network also can enable medical personnel to visit rural areas and use laptops to search hospitals’ databases, consult with other physicians and introduce patients to helpful online resources.
Partnerships are critical to whatever economic goals you set, such as with colleges that promote distance learning. Big Sandy Community and Technical College near Prestonsburg has 1600 students. Eighty percent of tests for their courses are online. Students can get Masters degrees online. You may want to open library services up to far-flung neighbors or have educators promote online after-school programs.
If the community is going to form partnerships, you have to get the word out so people know you’re looking. Vendors and service providers should be enlisted as partners, not just a company that sells the community a product or service and just disappears. Public/private partnerships are increasing in popularity, and Prestonsburg formed a rather creative one with a local vendor. “Dataseam is a software and data solutions company in Louisville, KY. We told them we had $30,000 for a network services project and they decided to match this. They’re local, so they gave us equipment that the community uses during day and the company uses at night.”
Prestonsburg found that partnerships not only help you execute economic development programs more effectively, they are also critical for securing grants that allow you to continue and expand your programs as well as your network infrastructure. Partnerships can make your grant proposal more compelling. As with most economic development projects that are integrated with broadband, grant proposals that demonstrate and quantify the resulting creation of quality jobs that form an industry are treated favorably.
Many broadband-driven economic programs create benefits that are intangible but valuable to the community. It often pays to determine how the network can generate straight up revenue to offset some of the buildout costs. Graden sold ads on a Web site that the city’s network drives people to when they log on. Every entity that pays for a city business license has a page on the site. At one point city staff would create interactive Web pages for businesses for an extra $100. In this type of arrangement, the city, businesses, shoppers and the local economy all win.
Craig Settles is a broadband industry strategist, marketing expert, author and speaker. He helps municipalities and organizations use broadband technologies to improve operating efficiencies and boost local economic development. In addition, he is frequently called upon as source of broadband expertise by leading media outlets.