New Times / Cover Story
The following articles were printed from New Times [newtimesslo.com] - Volume 29, Issue 4
Ready, willing, and cable: Is SLO County on the verge of a fiber-optic revolution?
BY RHYS HEYDEN
Grover Beach is a city of roughly 13,000 people, 2.3 square miles, limited means, and exceptional ambition.
“By the year 2030, the City of Grover Beach has successfully developed a municipal fiber network that extends throughout the City,” reads the vision statement in Grover’s 2010 Technology Master Plan. “As a result, the City has developed into a major telecommunications hub in the State with direct fiber access to Asian markets.
“Through an innovative approach to municipal broadband and public-private partnerships, the City has attracted new and existing high tech businesses that have become the foundation of its economic base,” the vision statement continues to project. “Residents of Grover Beach also enjoy one of the fastest broadband connections in the region.”
As gloriously spelled out in the master plan, this is Grover Beach’s most fervent hope and dream for the future. Though the city may be best known these days for its crumbling roads and fiscal difficulties, city leaders aren’t letting that stop them from dreaming big.
“Once we can walk, then we can start to run,” Grover Beach Mayor Debbie Peterson told New Times. “Once we start a fiber-optic network, I truly believe the possibilities will be phenomenal.”
Peterson is referencing what she’s dubbed the “Virtual Port” initiative: an ambitious plan to transform the sleepy city into a thriving telecommunications hub with lightning-fast fiber-optic Internet and abundant tech businesses.
Though the plan is still largely hypothetical—and has been in place for more than four years—Peterson and other local leaders say the time is now to seize on the newly burgeoning economy by investing in overhauling lackluster telecom infrastructure both in Grover Beach and countywide.
Why all the fuss over fibers?
So, you’re probably wondering just what exactly the existing telecommunication infrastructure looks like in SLO County, what supporters of this overhaul are proposing, and how it all might work.
Strangely enough, the technological engine that would power Grover Beach’s desired high-tech utopia is made up of tiny extruded glass strands, or fibers, that are only slightly thicker than a human hair.
Fiber-optic technology—wherein light (and data) are beamed through a fiber strand—has been around for decades. However, recent advances in the electronics at either end of the fiber have allowed fiber-optic cables to transmit increasingly large amounts of data at blistering speeds.
Even though fiber-optic cables are the way of the future and put other cables to shame in terms of performance and reliability, much of the telecommunication infrastructure in America was built with poorer-performing copper wires, before fiber-optics became widely available.
Although the United States has been making progress in revamping that infrastructure, studies have ranked our average nationwide Internet connection speed anywhere from 14th to 31st among all the world’s nations, according to a 2013 New York Times article—hardly elite.
“Many cities, towns, and Internet service providers have these old-school copper wire networks that they still use, because it’s cheaper to do that than build something new,” said Tim Williams, founder and CEO of Digital West, a San Luis Obispo-based data storage and web hosting company. “Every second they can squeeze out of the old network is pure profit.”
Williams and Digital West have been leading the charge for increased fiber-optic infrastructure in SLO County ever since they started providing fiber-optic connections to their local business clients in 2008.
“We got a great response from providing that service, and we’ve continued to expand our network bit by bit ever since,” Williams told New Times. “The big providers in the area—basically Charter and AT&T—have had decades to improve their networks and their service, and they really haven’t done either.”
Whether the cause of our backwardness is stubborn and atavistic Internet service providers, lack of capital investments, or just the sheer enormity of revamping our infrastructure, SLO County has lagged behind other more connected areas of the country.
According to the National Broadband Map—an online tool for assessing broadband availability developed by the National Telecommunications & Information Administration and the Federal Communications Commission—SLO County ranks 1,852nd out of 3,234 U.S. counties when ranked by average Internet speed.
“In the larger scheme of things, I think the big companies see us as a little blip,” Williams said. “We’re only about 300,000 people spread out over a large area, so it’s easy to justify ‘business as usual.’”
For their part, big telecom providers disagreed with Williams’ assessment that they are retrogressive and stubbornly reliant on outmoded networks.
“That view is completely false. AT&T has invested more than $50 million in its best-in-class wireless and wired networks in the San Luis Obispo area during the last three years,” Meredith Red, a Los Angeles-based spokesperson for AT&T, wrote in an email to New Times. “We’ve made upgrades to enhance speed, reliability, coverage, and performance for residents and businesses.”
“Since 2012, Charter Communications has made more than $271 million in capital investments to our Southern California network,” Charter spokesman Brian Anderson—based in Fort Worth, Texas—wrote in an email to New Times. “We believe our move to all-digital services and $2 billion investment in a fiber-rich, national network demonstrates Charter’s continued focus on improving the customer experience.”
In response, Williams noted that the “investments” made by big telecom are often just tweaks to existing networks, and added that “fiber-rich” can be used as a popular—if somewhat misleading—buzzword for telecom providers.
“They may use a central fiber-optic backbone, but then they just connect to the traditional copper network far away from the end user,” he said.
Ultimately, what Williams and his local partners are aiming to accomplish in the long term is to subvert and ignore the big providers almost entirely, no longer having to rely on big corporate whim to determine the state of local telecom infrastructure.
By encouraging public-private partnerships, maximizing efficiency, and constructing a fiber-optic network step by step, Williams believes SLO County can drastically improve its telecom infrastructure—with enormous economic benefits to follow.
The grand plan
Thus far, Digital West has been playing it pretty conservative with its fiber-optic business. Though Digital West hosts a diverse array of companies and interests in its data center, it’s kept its active fiber-optic network limited to just SLO County government offices and business in and around San Luis Obispo thus far.
However, Williams said he’s used these years of slow expansion to acquire bandwidth and digital rights-of-way, build relationships, and devise plans for how fiber-optic infrastructure can grow at a faster clip in the future.
“In order to make this fiber-optic expansion financially viable, we have to work with municipalities—building these public-private partnerships,” Williams said. “As a county, I think we’re poised to expand right now. The climate with the elected officials, staff, and the business community is right where we need it to be.”
In Grover Beach, a partnership between Digital West, county government, and city government is shaping up to test Williams’ faith that “the time is now” while also assessing the viability of expensive fiber-optic investments.
According to Grover Beach Mayor Peterson, the city is slated to spend roughly $500,000 to install fiber-optic conduit (a special tube for protecting the cables) under city streets. SLO County will chip in about $268,000 to cover design costs, conduit, and fiber; and Digital West will invest approximately $194,000 for fiber.
At the end of the project, Grover Beach will have a fully operational fiber-optic network (run by Digital West) in its industrial area (down by Farroll Road, between 4th and 13th streets) as well the entire Grand Avenue corridor. The network will primarily be available to businesses at first, with the potential to expand to residences down the road.
Peterson said the three parties are still agreeing to final contracts right now but expects to have those agreements signed within a month or two. At that point, Peterson will bring it to the Grover Beach City Council for approval.
“The Internet connection speed on this network will be exceptionally fast, and the huge positive for Grover Beach will be attracting businesses to town because of this network,” Peterson said.
On the county level, Assistant County Administrative Officer (and former county IT director) Guy Savage said the county wants to expand fiber-optic infrastructure as much as possible and “is fully committed to supporting what Grover Beach and Digital West want to do.”
“As far as grading Internet connection quality goes, as a county, we’re not at the bottom of the list, but we’re certainly not at the top,” Savage added. “There are some citizens in our community that can’t even watch Netflix because of their bad connections, and it’s frustrating.”
Both Peterson and former mayor John Shoals—who are running against each other for the Grover Beach mayoral seat in the 2014 election—said they support the “Virtual Port” plan and don’t want to politicize the issue beyond each believing she/he is the best candidate to realize the plan.
“We’re going to improve Internet access and efficiency for existing businesses, and we’re going to create the opportunity for companies to potentially move here in the future,” Shoals told New Times. “What’s not to like?”
SLO County District 3 Supervisor Adam Hill, whose district includes Grover Beach, said it would be great and “a big deal” if Grover can succeed in creating a municipal fiber-optic network.
“At this point in 2014, it’s kind of a necessity to have a fiber-optic connection if you’re a modern business,” Hill said. “In Grover and in the county, though, we need to make sure these fiber-optic plans don’t end up as more marketing than meat.”
Past caution, future hope
As with all plans of the “build it and they will come” variety, there’s some concern over exactly how these dreams of a high-tech Grover Beach (and SLO County) will come to fruition, especially given the steep upfront costs.
“Fiber-optics are a supply/demand thing here locally,” Savage said. “A lot of people have to demand it, and it has to make economic sense.”
“Economic sense” is the key factor for county leaders who have no doubts about the quality of fiber-optics or Digital West’s ability to install them, but are dubious about exactly how many tech businesses would be willing to move to SLO County.
“Our quality of life is higher, but we are too distant from the bigger cities, there’s no good air or rail service, and there’s just a better talent base in the bigger cities,” Hill said. “We have certain limitations here—we’re not going to be the next Silicon Valley.”
Hill said that, in his opinion, the old model of wooing and attracting companies to an area with incentives “just doesn’t work anymore” because there’s no guarantee the companies will stay in the long run.
“Obviously, with operations like Mindbody, Shopatron, and Rosetta, we have great little pockets of tech businesses, but I’m not sure how much more we can grow,” Hill said. “I don’t know what would make us more competitive than San Jose or Redwood City.”
Ambitious fiber-optic projects also have a somewhat inauspicious history here in SLO County. A New Times cover story from 2010 documented efforts around the county to jump-start fiber-optic development by applying for the “Google Fiber” competition and various multimillion-dollar federal government grants.
All of those efforts were unsuccessful.
The county and Digital West have been installing fiber-optic cables at a much slower clip in the four years since, and some locals wonder why now is the right time to ramp up those expensive efforts in Grover Beach and elsewhere, given the failed push in 2010.
“We are doing this in a cost-effective way, and we are building the actual infrastructure,” Peterson said. “We’re not asking for a grant or just saying we want economic development like a platitude or a flash in the pan—our infrastructure will be a hard reality.”
“For a small city with limited resources, if we can bring in even just a few more small businesses, that would be huge,” Shoals added.
Peterson said that her telecom infrastructure plans for the future include making fiber-optic connections available to more residents and not just businesses, as well as tapping into the incredible speed of the “Pacific Crossing” cable—an important trans-Pacific fiber-optic cable from Shima, Japan, that comes ashore and has a landing station in Grover Beach.
“Our Internet speed will already be really fast when we first start our fiber-optic network with Digital West, but if we can tap into the Pacific Crossing cable, then that’s a whole different ballgame,” Peterson said.
Pacific Crossing CFO Kurt Johnson—based in Danville—told New Times that his company’s business model is wholesaling telecom capacity exclusively between Japan and the United States, so he’s not sure that his organization matches up with Grover Beach’s aims.
“We are open to doing what we can to grow the economy in Grover Beach, but nothing has been done yet,” Johnson said.
Peterson admitted that the city would have to have some business development and become a wholesale-type customer in order to make a worthwhile pitch to Pacific Crossing, but she’s hopeful it will be a “viable proposition” in the future.
Williams also has aspirations to tap into Pacific Crossing and other large fiber-optic cables that come ashore in SLO County (including cable landing stations in Morro Bay and SLO), as that could offer Digital West a competitive advantage.
Ultimately, when asked why fiber-optic development is worth the investment and why SLO County residents should care—given that countywide Internet speeds are already adequate, if imperfect—Williams cited technology thought leader Susan Crawford.
“Crawford gives this example of the ‘Light Bill’—which is what electricity bills were called back in the day,” Williams said. “People couldn’t conceive of electrical power being used for anything but light bulbs, and look where we are now.
“We don’t have any idea how we might use fiber-optic high-speed Internet 20 or even 10 years from now in business or in the home,” he added. “History tells us to think big.”
Staff Writer Rhys Heyden can be reached at email@example.com.
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