August 11, 2014
Springfield Business Journal Online
Nixa Weighs in on Residential Fiber
Do Nixa residents have the need for speed? London-based fiber-to-the-premise network provider SiFi Networks is looking to find out.
The city contracted with SiFi Networks in July to conduct a six-week feasibility study and determine resident demand for a “gigabit” broadband infrastructure.
Municipalities such as Kansas City and Chattanooga, Tenn., have coveted the “Gigabit City” moniker, a title that comes with a hefty price tag. The phrase describes communities that offer broadband connectivity at roughly 1 gigabit per second, or 100 times faster than the average broadband service, according to Fiber.Google.com.
In Nixa, building an infrastructure capable of gigabit speeds is estimated to cost $28 million, or roughly $1,900 per resident.
In April 2013, Nixa city officials began considering moves toward developing a robust fiber infrastructure with a goal of economic development, according to Springfield Business Journal archives.
Nixa Mayor Brian Steele said if the feasibility study shows at least 35 percent of residents want to see this system in place, the city could move forward with system development, potentially from SiFi Networks.
“We would need at least one in three residents to be interested in this service at the prices we’re looking at putting it out at,” Steele said.
The survey asks residents if they would be willing to pay $99 per month for gigabit speeds, $60 per month for capacity of 100 megabits per second or $50 for 50 mbps.
Chris Huels, a senior service director for Springfield-based information technology support company JMark Business Solutions Inc., said residential gigabit speeds would be a coup for Nixa.
“I would kill for it. But at the same time, gigabit is a lot of speed. That is a ton,” Huels said. “In the Kansas City market, where (Google Fiber) has been delivering fiber at gigabit speeds, they’ve bundled it with streaming television, which would utilize a lot of that bandwidth.”
To put gigabit to the home in perspective, Dan Templin, senior vice president for Mediacom Business, a division of New York-based Mediacom Communications Corp., said streaming a movie on Netflix takes up about 3 megabits per second, or 0.3 percent of a 1 gigabit system’s capacity. In Springfield, Mediacom-serviced homes offer speeds of up to 150 mbps now – about one-eighth of the speed being proposed in Nixa.
That doesn’t mean, however, that businesses in Springfield and nearby communities don’t have access to gigabit capacity.
Templin said Mediacom has invested hundreds of millions of dollars in bringing gigabit speeds to businesses in largely rural communities across Missouri.
In Springfield and southwest Missouri communities including Ava, Billings, Cabool, Marshfield, Rogersville and Willard, Mediacom business customers can access up to 10 gigabit speeds.
“Much of the gigabit conversations are not so much about the technology, but they’re about the functionality and what it really means. They are almost more theoretical than technical,” Templin said.
Mediacom, the eighth largest telecommunications company in the U.S., traditionally has served secondary and tertiary markets, e.g. small to mid-size communities, largely centered in the Midwest. From Templin’s perspective, while business has seemingly unlimited potential for ultra-fast data speeds, there isn’t yet wide support for residential gigabit performance.
He said large health care systems, for example, can use loads of bandwidth to send large imaging files from clinic to clinic, allowing patients in rural communities to get the same services closer to home.
“It used to be that when one of the clinicians in one of the outlying areas needed to have an MRI done or some other type of diagnostics done, it required sending that patient into Springfield. Now, with the connectivity we have into these organizations, they can transfer those extraordinarily large files – including real-time MRIs and other imaging – so that you could get a diagnosis, in real time, from a specialist in a city that might be miles or hours away,” Templin said. “It is really improving telemedicine, and the technology is staggering.”
In Springfield, businesses also have access to 1 to 10 gigabit speeds via City Utilities’ SpringNet Broadband division.
“In my opinion, the business sector has demonstrated the need,” said Todd Murren, director of SpringNet Broadband. “Future opportunities, which are a little less tangible, are probably at the home.”
He said SpringNet serves roughly 250 business clients in Springfield, but the division of the public-owned utility does not serve residential customers.
Huels said what’s exciting about in-home gigabit service are the opportunities it unlocks.
“Ever since Google Fiber got its buzz going in the Kansas City market, we’ve had staff here that have jokingly mentioned moving to Kansas City just to have gigabit to the house,” he said. “With the younger crowd, there is a lot of appeal there with what you could do with that bandwidth. Even with older professionals, it might be an option to have a virtual office or a work-from-home opportunity.”
Nixa’s Mayor Steele said city leaders will begin weighing infrastructure development and management options after the survey is complete Aug. 13. If residents indicate interest and city officials decide to move forward, Steele said SiFi most likely would be the developer.
The city has the option of going with another developer, but in so doing, Steele said Nixa would have to pay the London company $25,000 for the feasibility study. The study is free if SiFi builds Nixa’s broadband system.
Steele said the move to build out broadband makes sense for municipalities because private companies typically want a quick return on their investment and cities such as Nixa can spread out infrastructure costs.
“From the discussions we’ve had with people in that field, most of them are looking … to get the return on their investment in less than three years. That’s almost impossible to do,” Steele said. “That’s why those companies have been cherry-picking where they’d build these kinds of systems. What we’re looking to do with SiFi is spread that cost out over 20 years.”