Gigabit service in Jackson and Owsley counties is creating tech job options ahead of statewide KentuckyWired
By Chris Clair
How fast is your Internet download speed? Twenty megabytes per second? Thirty? A hundred? If your download speed exceeds 100 mbps, you’re zooming past most of the rest of the nation. The national average Internet speed as measured by cloud service provider Akami in its 2015 State of the Internet report was 11.9 mbps. Worldwide, the average speed was 5 mbps. In rural areas, speeds are generally considerably slower, if there is service at all.
Cruising the Internet at those speeds in Jackson County or Owsley County, however, will get you run off the information superhighway. Those two counties – two of the poorest and most rural counties in the United States – have some of the fastest Internet speeds in the world: up to 1 gigabit per second.
And it’s not just in a handful of places in Jackson and Owsley counties. Thanks to a six-year, $50 million effort to run fiber optic cable throughout its service area, the People’s Rural Telephone Cooperative (PRTC), based in McKee in Jackson County, can deliver that 1 gigabit or 1,000 megabytes per second Internet speed to every home, business and school in the two counties.
Keith Gabbard, chief executive at PRTC, told a crowd gathered Oct. 22 for a “Gig launch ceremony” that PRTC had been in the fiber business for some time before deciding in 2009 to go with an all-fiber network.
“As of now, 100 percent of our customers have fiber available,” Gabbard said. “Every home and business has a fiber connection, or can have one. What we’ve done here is pretty impressive because we have it to every single home and business, not just in this town (McKee), but to every place to the farthest holler out. Everyone has the same capability.”
Fiber optic cables transmit data via pulses of light sent through glass or plastic strands slightly larger than the diameter of human hair. Traditionally data has been carried via copper wires that conduct electricity. In the early days, of course, the only “data” carried was voice data. With the growth of the Internet, phone lines and dial-up modems gave way to coaxial cable and high-speed routers. Coaxial cable is a thicker copper wire surrounded by insulation, like the one that probably runs to your modem or cable box. Ethernet cables like the one connecting your computer to your network contain copper strands that carry the data.
From copper to fiber, step by step
Copper tends to experience electrical leakage and is subject to electromagnetic interference, however, and its bandwidth – a measure of how much data it can carry – is less than fiber optic cable. Copper also needs a more extensive network of junction boxes to boost the signal as it travels over long distances.
On the downside for fiber, most computers are built to handle copper connections. Since any connection is only as fast as its slowest point, having fiber optic cable run up to your home or business only helps to the extent that the equipment inside the walls is maximized for speed. That said, the higher bandwidth of fiber optic cable means you can have a lot more going on inside your walls – a business, for example, could have multiple simultaneous videoconferences, multiple large data downloads, an entire phone system – and the outside wires can handle the traffic.
It wasn’t that long ago, relatively, that Jackson and Owsley counties had no phone service at all. The PRTC was formed in 1950 and used money available in the form of low-interest loans through the federal Rural Electrification Administration to construct a telephone network. Customers were owners of the business, and profits went to pay off the loans.
In an interview, the PRTC’s Gabbard said over the years the cooperative replaced and expanded the copper network repeatedly as the population grew and spread. The updating and maintenance were constant, he said, and as Internet use grew the PRTC heard from customers that they wanted better service.
In the 1990s, PRTC partnered with four other small Eastern Kentucky companies to form Appalachian Wireless. As part of the effort to build that cellular network, a 375-mile ring of fiber optic cable was installed. Fast forward to the mid-2000s. As PRTC considered ways to upgrade its Internet service, that fiber optic cable looked like a pretty good starting point.
The PRTC funded construction of its fiber optic network through a combination of timely grants from the Rural Utilities Service arm of the U.S. Department of Agriculture, loans, stimulus money from the American Recovery and Investment Act of 2009 and the PRTC’s own capital. After spending $50 million to complete the project, PRTC has about $19 million in debt outstanding. Money to pay that back will come from user fees, as well as the successful Appalachian Wireless business, Gabbard said.
Appalachian Wireless serves its own customers and collects fees from Verizon, which also uses the wireless network. With few other wireless providers willing to build their own networks in the mountainous terrain, the wireless business model is strong enough to help support PRTC’s broadband initiative, as well. That’s helped keep the PRTC from having to raise rates to cover loan servicing costs.
Gabbard said the availability of the loans and grants, plus stimulus money, presented a “once-in-a-lifetime opportunity.”
Mule power helps close digital divide
Fully 70 percent of the fiber optic network in Jackson and Owsley counties runs above ground. As it turned out, even the highest of high-tech networks had to rely on the lowest of low-tech methods for installation. At points in the tougher terrain, a mule named Old Bub pulled the cable from pole to pole. Some photos of the operation made the rounds via e-mail earlier this year.
The image of a mule pulling fiber optic cable through the mountains probably seems like a fitting juxtaposition to those not aware of Kentucky’s efforts to close the digital divide. The PRTC’s gigabit network stands out as an example of a fully local initiative, but the state has announced its own plans to improve and expand broadband access.
The KentuckyWired I-Way broadband initiative aims to provide reliable, high-speed Internet service to every county in Kentucky. The estimated $324 million project will build what’s known as a “middle mile” fiber optic network. State officials likened it to building a highway through the state. That highway will have some 1,100 “nodes” at government user sites, including five Kentucky Community and Technical College System sites in Eastern Kentucky.
The I-Way will provide tiered access to speeds up to 400 gigabits – yes, that’s 400,000 megabits – per second. Adequate end-user equipment will be essential to using such capacity, and it will be up to local communities to build the “last mile” – to connect individual homes and businesses to the nodes.
The recommendation to build such a statewide open-access network was one of many that came out of the Shaping Our Appalachian Region (SOAR) initiative co-chaired by former Gov. Steve Beshear, a Democrat, and Republican U.S. Rep. Hal Rogers, whose district encompasses most of Eastern Kentucky. Partly as a nod to that impetus and partly in response to the severe economic downturn in Eastern Kentucky due to the dramatic decline in coal jobs, KentuckyWired construction will start at the eastern end of the state and over the next three years extend 3,400 miles across the state to all 120 counties. Work in the 54-county SOAR region is expected to be finished in summer 2016, with the rest of the state completed by late 2018.
High speed for … jobs in the hollers
The kick-off celebration for KentuckyWired was held Aug. 31 at Hazard Community and Technical College. Beshear said the project would bring much-needed Internet access to all communities.
“The potential for every Kentuckian to tap into the global economy, compete for higher paying jobs, collaborate with researchers around the globe, take classes online, or access increased medical care make KentuckyWired one of the most important infrastructure projects in our state’s history,” Beshear said.
Rogers added that with the capacity and connectivity “the only limit is our creativity. It’s up to us to put this resource to work for economic diversity, job creation and improved opportunities for the people of Eastern Kentucky.”
Jared Arnett, executive director of SOAR, called the extension of broadband service “a literal economic lifeline” in today’s increasingly digital economy and said it can’t reach communities fast enough.
KentuckyWired is the state’s largest public-private partnership. A consortium led by Macquarie Capital of Australia will provide the bulk of the funding via the issuance of debt and equity. The General Assembly approved $30 million in direct state funding in 2014, and the federal government is kicking in another $23.5 million. In August, the Kentucky Economic Development Finance Authority approved the issuance of $232 million in revenue bonds to finance a loan to the consortium, KentuckyWired Infrastructure Co.
Payments on the debt will be made via the state transferring its current lease payments for Internet service to KentuckyWired. In essence, the state and local governments – anyone with a node – will be paying KentuckyWired to use the Internet.
This setup actually has PRTC’s Gabbard slightly concerned. The way things are worded now, local governments and school districts in the PRTC’s service area would end up being among those 1,100 KentuckyWired nodes, and could be told to use the KentuckyWired fiber network instead of the PRTC’s. That would cost PRTC money. Gabbard said he hopes the PRTC can work with KentuckyWired to avoid building a parallel fiber optic network in Jackson and Owsley counties.
Jackson, Owsley jobs only ‘a starting point’
The potential for high-speed fiber network duplication in one of the poorest parts of Eastern Kentucky carries a hint of irony given the overall lack of investment in the region historically. Nevertheless, from an economic development perspective it might not be possible to have too much of a good thing. The emergence of fracked shale gas in the past decade means significantly fewer coal jobs, but plentiful broadband brings better chances to create a diverse patchwork of technology jobs that can help fill the void – and create an entirely new economy centered around technology.
Jeff Whitehead, executive director of Eastern Kentucky Concentrated Employment Program, said the PRTC broadband project and KentuckyWired “takes the lid off of the potential for both economic development and for what people can do from their homes.”
EKCEP, based in Hazard, provides job training, employment assistance, career counseling and tuition assistance for half a million people in 23 Eastern Kentucky counties, including many hit hard by the loss of coal jobs. In 2015, Whitehead said, the PRTC gigabit network has led directly to some 110 new jobs in Jackson and Owsley counties. Almost all of them are for companies based out of state – one employer is based outside the United States – and involve customer service work done remotely, often out of one’s home. The average salaries for these jobs are around $20,000 a year, but most have benefits.
“That’s not knocking it out of the park at this point (in salary), but they are still jobs you can do from home and not have to spend gas money,” Whitehead said. “We’re not satisfied with that; it’s a starting point.”
Down the road, he said, fast broadband service could lead to more and better-paying technology jobs, the ability to do remote job training, and ultimately lay the groundwork for a new generation of locally grown technology entrepreneurs who will be job creators of the future. Eastern Kentuckians prefer not to have to leave their families and their connections to the land to find work. Being connected to the rest of the world via the Internet could mean fewer locals will have to leave, and it could draw in new people who need that connectivity but don’t want to live in a big city.
Isolation ends; school’s never cancelled?!
Local schools are already benefitting from better connectivity. Owsley County Schools Superintendent Tim Bobrowski said the gigabit network has allowed the district to expand the use of “virtual schools,” or instruction over the Internet. As a result, a district that formerly had to make up in the summer an average of 20 snow days per year now can engage students at home, via online programs like Blackboard and Edgenuity that allow students to complete coursework for up to 10 snow days. Additionally, students who get suspended can continue classwork from home as opposed to just sitting at home not learning.
Owsley County Schools officials are working on a plan to get laptops like Chromebooks into the hands of some classes next year – as many as two grades per school, Bobrowski said.
As limited as Eastern Kentucky’s economy has seemed in recent years, the possibility broadband brings has people excited. Change won’t come overnight, but already the region’s eagerness to embrace the economic opportunities technology has to offer is changing perceptions.
Some locals are still buzzing about a story that appeared in mid-November on medium.com’s tech-focused section Backchannel. The author profiled Bitsource, a Pikeville company that aims to turn former coal miners into code writers and make a profitable business out of it. The story by Lauren Smiley – “that lady from California” – showcased local entrepreneurship and, perhaps as importantly, local pride.
Hilda Legg, a former administrator of the USDA’s Rural Utilities Service and a past co-chair of the Appalachian Regional Commission, said the gigabit service in Jackson and Owsley counties could also serve as a point of pride as well as a practical way to connect a historically isolated area to the rest of the world. She praised the PRTC not only for having the foresight and willingness to take on the risk of building the fiber optic network but also for promoting it and showing customers how it can help them.
Legg has been called a “broadband evangelist” and she isn’t shy about describing the PRTC’s gigabit network as a blessing. Appalachia has a history of relying on help from outside – be it from mining companies to provide jobs or government programs to fight poverty. Broadband, Legg said, has the potential to change the way locals see themselves.
“We can’t have generation after generation looking to the outside for help,” Legg said. “We’ve got to work at changing the way we look at ourselves and this beautiful, abundant region. I hope it will embolden residents to broaden their opportunities. Quit looking at yourselves in terms of what you don’t have, but rather look at yourselves for what you do have.”
Most of the rest of America – even larger cities – don’t have gigabit Internet service, she said.
Fast Internet service isn’t an elixir for curing the unemployment, drug abuse and attendant health issues that persist in Appalachia, Legg said, but it can be an important tool.
“If you remain isolated, you don’t tend to be able to raise yourself up. It will take time and there are no simple solutions,” she said. “But you have to start with pride in what you have.”