A lack of an initial return on investment (ROI) is the hurdle that deters municipalities and private businesses from investing in the establishment of a fiber optic internet network. But as demand multiplies, one broadband industry expert says ROI should no longer be a deciding factor.
An online article published on Government Technology (GT) this week recalls what Industry analyst Craig Settles told the online publication. Settles conducts what’s known as “needs assessments” for communities interested in broadband. Settles says a lack of a guaranteed ROI shouldn’t be the brick wall that blocks broadband expansion from happening.
“There has to be an understanding that after I have built the network … then comes all of the other pushes for equity,” Settles told GT. “And that concept, whether it is a statewide policy or it’s in pockets within a particular state, there has to be a push for the full digital equity package.
Settles listed several examples of equity issues: children who don’t have adequate technology at home for educational purposes; digital training for teachers for preparing students for the future; and an aging baby boomer population that does not have the equipment or knowledge to understand or take advantage of telehealth.
“We love to talk about our technology and ‘God, we’re doing all this great stuff in the world’ and so forth, but the underlying digital core beyond the network has to be addressed,” he said.
Settles indicated that ROI is looked at as a pressing issue for private companies that invest in broadband infrastructure.
Fiber Broadband Association President and CEO Lisa Youngers believes ROI should be based on the specific goals of a community.
Historically speaking, Wireless Internet Service Provider Association President and CEO Claude Aiken says the discussion about ROI and broadband used to be clear: Nothing will happen in more remote areas due to a lack of clear profit in sight. However, he says today’s situation is different.
“There are certain areas of the country that without government intervention you wouldn’t see broadband deployment,” Aiken said. “That assumption has been kind of turned on its head by folks who are our members — folks who have been deploying broadband using fixed wireless technology.”
U.S. Telecom Association President and CEO Jonathan Spalter told GT that public-private partnering are “sacred” relationships that have evolved between internet service providers and government agencies.
“Ensuring return on investment is critical to any business,” Spalter said. “The opportunity for broadband providers to work hand in glove with government in closing the digital divide helps defray some of the economic challenges that are associated with this important mission.”
Locally, Grant PUD is already on pace to expand the fiber broadband network countywide within the next four years. Grant PUD’s decision to do a full expansion was based more on "need" than "profit" echoing what Settles was alluding to earlier.
“If we’re going to compete in the high-tech world, we’ve got to have fiber. If we don’t do that, we get left behind and we don’t want that in Grant County. The expansion of fiber in our community is more of a social benefit than it is a money-making benefit,” Grant PUD Commissioner Tom Flint told iFIBER ONE News. Flint says the need for broadband doubles every three years.
Adams County Development Council Executive Director Stephen McFadden echoed Flint’s sentiment. When asked if Adams County's current probe into the feasibility of fiber was based on whether there would be a monetary return on investment, McFadden said, “expanding fiber to the rural community of Adams County is the right thing to do.”
McFadden went onto say that the driving factors for fiber in Adams County is lack of connectivity at home for kids learning and to meet the requirement of most businesses looking to build in the area.