FROM THE INDUSTRY
How did this work get underway? What were your intentions behind the study? Scott Neuman Three years ago, Matt and I collaborated on a study of the economic impact that high-speed, fibre- fed broadband can have in real-estate values in residential markets compared to unconnected and underserved homes. We looked at two states and were impressed to see about a 3% difference which can add up quickly. This was interesting, but then we thought, what are some of the broader implications that broadband can have on a community? If we could wave a magic wand, wouldn’t it be great if we could prove that fast, reliable and secure broadband in rural communities can increase local GDP, business startups, education attainment and population growth, all while lowering unemployment rates. All positive changes countering the current economic trends we’re seeing happening in rural communities all over the country. At Calix our mission is to transform society one community at a time. That’s why we exist. We knew we were making headway by working with amazing broadband service providers (BSPs) to deliver those kinds of services to their communities, but we wanted to prove it. Amanda Weinstein We knew that residents want reliable and safe broadband, and they value it. It improves their quality of life. However, we didn’t know whether it propels rural communities forward. Does it help them address these longstanding trends we see of a growing divide between rural and non-rural America? Well, it did. We see a completely different impact in communities when they leverage that broadband. One would expect these communities to be in a slow, continual decline. We would expect these communities to see a loss in local businesses, to see a loss in population, a loss in jobs. But we have uncovered an amazing story for communities with high broadband adoption that shows growth in the number of new businesses, so much so that they are seeing an average 213% increase in the number of businesses in their communities.
Can you point to any case studies to illustrate this? As an economist, what I want to see is entrepreneurship and small business growth driven by the local BSP, particularly from those that are having a disproportionate impact on their community. Bemidji, Minnesota stands out. We talked to the local BSP, Paul Bunyan Communications, and it turns out they’re heavily involved with chamber and economic development agencies. They’ve helped put in an industrial park. They act as an incubator for local businesses. This sort of activity has been replicated across the country; many local, small broadband service providers are heavily invested and integrated in their communities. They are not just concerned with a three-year boost in profits, they’re making the long term investments in broadband and value-added services that will last generations. Presumably the pandemic accelerated all this? Scott Neuman The pandemic brought the widening digital divide to the forefront. When lockdowns began, all of a sudden people needed a lot more bandwidth to their homes; overnight entire families were working and studying together under one roof. Many people chose to spend lockdown in rural locations, which was an interesting outcome too; many realised they didn’t necessarily need to live in the city to work. One of the primary concerns became the quality of broadband. Fast, safe and reliable broadband became an urgent requirement for every community, whether it was in Alabama, Alaska or even where you are in the UK. However, it’s important to note that this study is based on post-pandemic data. Our goal was to remove the initial migration spikes during the lockdowns and examine the data once we settled into the “new normal”. Broadband is the fourth utility. You can get by without heat for a while but not without internet access. We profiled a lot of stories demonstrating the value people place on their local broadband provider. For instance, when Hurricane Helene worked its way all up the Eastern seaboard, it left behind completely devastated communities – houses
destroyed, trees down, flooding, power knocked out, internet down. In many of these rural communities, there is no cellular coverage. Customers that we work with on a regular basis, including electric utility providers who are also broadband providers, sprung into action. They were running 24hr shifts putting up new poles and setting up outdoor Wi-Fi systems so the community could quickly get internet access, let their loved ones know they’re ok, start connecting with FEMA and get the process for disaster relief funds underway. We have uncovered an amazing story for communities with high broadband adoption that shows growth in the number of new businesses, so much so that they are seeing an average 213% increase in the number of businesses in their communities.
Amazing that everybody rallied together.
Scott Neuman They put up temporary networks to get everybody connected. And slowly, as everything started to get back to normal, they were able to re-splice the fibre to restore full service. We work with them on all of these outdoor units; it’s very easy to pop up a virtual, fibre-fed outdoor network. The goodwill out there as a result must be considerable. Scott Neuman I hear from our customers that when residents in their local community see them with their jackets on, they stop and express their gratitude. There’s a story of a BSP that was finally restoring fibre, and the neighbourhood threw a pizza party for the crew on the day they arrived. How often do you see that happen?
MARCH 2025 Volume 47 No.1
65
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