Tennessee Telecom Association

Tennessee’s Broadband Survey Results: An Overview

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Thirteen percent of Tennesseans don’t have broadband access, and most of them live in rural areas, according to the state’s recently released broadband assessment.

And, Economic and Community Development Commissioner Randy Boyd says it’s probably going to take a mix of fiber and fixed wireless provided by telcos and electric providers to reach the residents who still lack access.

“I imagine that when we finally come up with a solution across the state, it will be some blend of those different solutions,” Boyd said in a phone interview.

In addition to access, the assessment also provides insight into customer demand. According to the assessment, more than half of Tennesseans (52 percent) don’t believe a 10 Mbps connection has enough capacity to meet their needs, and 29 percent say a 25 Mbps connection is still not adequate.

The full report is available by clicking here. Here are some of the key takeaways from the assessment and the interview with Boyd:

Tennessee looked at what’s worked in other states. 

One component of the assessment researched what other states had done to increase broadband access. “It turns out, Tennessee’s not the only state that has this issue,” Boyd said. “Every state has this issue.” According to the assessment, best practices in other states include:

  • Strong public leadership that champions broadband projects;
  • State broadband office or similar entity;
  • Effective partnerships;
  • Public seed funding and grant programs to encourage investment and build out;
  • Transparency;
  • Proper planning and due diligence.

The study carries heavy legislative implications, and the governor is taking the lead.

In the ECD press release, Governor Bill Haslam announced he was putting together a working group to come up with policy suggestions for the legislature.

“The information in this report is a starting point to advance the conversation about broadband access in our state,” Haslam said. “An internal working group will review the report and have discussions with stakeholders to develop potential solutions to close the gap on broadband access in Tennessee.”

Boyd sees the formation of this group as a “huge sign of something significant and positive to come in the future.” Boyd says he sees “a broad menu of options” going forward, and he’s looking for a win-win-win. He expects some “new solutions being proposed when the legislature comes back in” and expects electric providers will have “a huge role to play.” He said the legislature will decide the role of municipal providers in the future, and his office is only providing information.

Rural areas lag behind in access, and that’s bad news for rural economies.

As a whole, 13 percent of Tennesseeans, representing 834,000 individuals, do not have access to broadband under the 25/3 Mbps definition. But drilling deeper, only 2 percent of city dwellers are lacking connections while 34 percent of rural residents do not have access. “There’s a dramatic digital divide between the cities and the rural parts of our state,” Boyd said.

The urban/rural split, which Boyd described as “incredibly significant” and having “tremendous disparities,” has worrisome implications from education to entrepreneurship. While statewide unemployment, household income and GDP numbers are at all-time highs, according to Boyd, 21 of the state’s 95 counties are in the bottom 10 percent in the United States in poverty and income. “We’re leaving a lot of our neighbors behind, and one of the things that we wanted to focus on was to … find a way so everybody gets to participate in that success,” he said. “Many things depend on broadband access. I get the question from time to time, ‘Broadband? That’s got nothing to do with economic development,’ and I think it’s got everything to do with it.”

Connecting all of Tennessee will be expensive. 

The assessment also sought to determine to cost of connecting every Tennesseean. The study acknowledges that fiber-to-the-home is the best option, but the costs are significant. To deliver 25/3 Mbps service across the state over fiber would cost $1.1 billion to $1.7 billion. “It’s never implied that the state of Tennessee or any one particular person would have to pay this,” Boyd explained. “It will probably be a combination. Somehow, somebody is going to have to make that sort of investment.”

The cost for fixed wireless to provide the same speeds came in lower at $500 million to $1.3 billion. “I imagine that when we finally come up with a solution across the state, it will be some blend of those different solutions,” Boyd said.

Municipal electric providers and fixed wireless are probably part of the answer.

Some of the best practices from other states suggest getting electric providers involved. Boyd said municipal providers were “definitely one of the stronger options on the list,” and many people involved believe electric cooperatives have a “big role to play” if it’s done in a “not anticompetitive manner” that “seems fair.” He’s hopeful that TTA members will be “key players in providing the solution in the long term.”

The assessment also looks at competition among internet service providers, suggesting that areas with more service providers have higher speeds for both businesses and residents. The average download speed for businesses with access to only one provider was 22.5

Mbps while businesses with access to more than three providers averaged download speeds of

43.8 Mbps, the report states.

People care about their broadband and want faster speeds.

Boyd said he thought the consultants’ goal of 4,000 responses was too high, given that the survey took about 20 minutes to complete. He was shocked to see 23,000 responses, including 18,000 homeowners and 5,000 business owners.

“It was incredible,” Boyd says, “which I think tells us 1) that people feel like this is important and 2) that they care about it enough to take the time and fill out the survey.”

The assessment shares some enlightening numbers about residents’ need for speed:

Chart1HouseholdSatisfaction

Almost everyone thinks they need internet service.

Only about 5 percent of assessment respondents (821 individuals) reported no internet at their home. Over half of those cited a lack of availability as the cause, with affordability as the second most frequent barrier. Only 2 percent said they did not need internet service. Interestingly, the study showed no clear correlation between not having an internet connection and

income, education, age or employment status.

Broadband is good for business.

Participating businesses reported that broadband enabled 43 percent of all net new jobs and 66 percent of revenues. Additionally, 34 percent of businesses indicated broadband was “essential to selecting their location,” and 56 percent claimed a high-speed connection was essential to remain in their location. Unfortunately, 16 percent of economic development agencies reported that businesses frequently chose not to locate in an area due to insufficient broadband.

There’s more to come:

The report gives providers a lot of information. Boyd said county and census track-level data will also be available upon request in the future.

Other insights: 

  • Pricing within similar offerings and technologies is relatively consistent across the state.
  • Reliability rated as even more important to households and businesses than speed or price, and concerns over reliability impacts consumers’ willingness to purchase premium services.
  • According to business and household respondents, fiber connectivity is the most reliable, fastest and most highly rated of Internet services by a significant margin. Cable and fixed wireless are rated as the next best, with DSL and mobile wireless performing at lower speeds and with less reliability. Satellite and dial-up are by far the poorest rated internet services based on reliability and value for money.
  • Broadband internet enhances earning ability of households and provides employment and training opportunities. About 24 percent of participating households run a home-based business.
  • Telework has quickly become an important internet-enabled activity, with almost 26 percent of participating households teleworking at least one day per week.
  • The largest barriers to greater internet use for businesses are concerns over security and privacy. For households, the greatest barriers are the reliability and speed of the connection.
  • Tennessee is above the national average for percentage of the population with download speeds of 50 Mbps, 100 Mbps or 1 Gbps.
  • Only about 25 percent of Tennesseans have access to fiber.
  • About 41 percent of businesses connect to the internet via cable, compared to 22 percent on DSL, 11 percent on fiber and 6.6 percent on fixed wireless.
  • Nearly 60 percent of businesses are using cloud-based services, with an additional 13 percent considering it.

From The Executive Director – Summer 2016

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Levoy Knowles, TTA Executive Director

It’s always nice to get together with longtime friends, swapping stories and enjoying meals. This is part of what we look forward to each year at our annual meeting.

But there’s a bigger reason for coming together every June in Franklin. Our industry is going through an unprecedented era of change. Some rules that have applied for decades no longer do, and other rules that were seemingly just put in place are already obsolete.

The best way I know of to combat the shifts in our industry is to get what I believe are some of the best minds in our industry together to talk about those shifts. Through this year’s conference sessions, we gained insight from experts about how we can overcome some of the hurdles that lie before us. Through our networking time on the golf course or during the receptions, many of those longtime friends I mentioned shared with me their concerns, challenges and successes.

This year, I think we had even more idea sharing through our breakout sessions. Thank you to our discussion leaders and to all who participated. It was very valuable to sit down with our peers and discuss what’s working and what’s not. Based on the responses I’ve heard from those sessions, I believe you can count on seeing those again next year.

TTA has always been a group where we can come together and share our knowledge of whatever opportunities or challenges that are facing our industry. As we move forward, I firmly believe the TTA and our time together at these meetings will become increasingly more important in order for all of us to thrive in the new telecom landscape.

As your Executive Director, I sincerely appreciate your support and attendance at the conference. I look forward to seeing you this fall in Bowling Green at the joint KTA/TTA meeting and again next June in Franklin.

Strong Topics And Attendance Highlight 2016 TTA Annual Conference

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Great networking, strong sessions and a stunning golf course highlighted this year’s TTA Annual Meeting.

More than 180 TTA members gathered at the Cool Springs Marriott in Franklin June 6-8 for the yearly conference.

Attendees were treated to sessions from 11 speakers, including Tennessee Economic Development Chairman Randy Boyd and FBI Agent Scott Augenbaum.

New this year was a shuttle bus taking members to downtown Nashville and a series of roundtable sessions grouped by field: CEO/General Managers; Plant and Operations; IT, Networking and Technology; Marketing, Sales and Customer Service; and Accounting and HR. These proved to be popular additions, and TTA is working to continue and refine them for next year.

The conference closed with another strong vendor showcase. Fifty-three vendors were in attendance to inform members about the newest products and latest technologies in the industry.

The golf tournament was held at the Vanderbilt Legends Golf Course, a highlight for the 64 participants. The winner of the tournament was a threesome comprised of Mark Patterson, Pieter van Vuuren and Gentry Underhill.

In association business, the TTA elected the following officers: Jonathan West, President; William Bradford, Vice President; Nancy White, Secretary; and Mark Patterson, Treasurer. Marty Passarella is now Past President and John Dorris was re-elected to represent associate members on the TTA Board.

See if you are a part of our online photo gallery from the conference.

Some of the speakers and moderators from the annual meeting recorded podcasts on their topic, including:

Levoy Knowles: Conference Preview

Keith Jones: Making Money On Free Wi-Fi

Patrick Moreno: Home Solutions Powered By The Gig

Julie Gogel: TTA Marketing Roundtable Recap

Bruce Mottern: What Are The CEOs Thinking?

Commissioner Discusses Preliminary Broadband Assessment Results

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Tennesseans are making more money than ever before — and part of that is due to broadband, according to Tennessee Commissioner of Economic Development Randy Boyd.

While most of the results from the state’s recent Broadband Assessment are still being tabulated, Boyd shared a few encouraging numbers from the early results during his session at the TTA Annual Meeting in Franklin.

In the early results of the assessment, 66 percent of business respondents say their increasing revenue was due to broadband, and 36 percent of households say they made extra money due to high-speed internet access.

The biggest surprise so far, Boyd said, has been the number of surveys completed. Boyd’s office received more than 23,000 returned forms, which is four times more than he expected. Boyd said surveys were submitted from every single county in the state.

Boyd said internet speeds continue to be something that new and potential companies ask about when they look at building in the Volunteer State.

“Having broadband is essential,” Boyd told the attendees. “It’s one of those things that has to be there for us to be successful.”

According to Boyd’s figures from the assessment, 43 percent of jobs brought into Tennessee last year required broadband.

Boyd also said Tennessee had the “best balance sheet in the country,” adding that despite what some politicians state to the contrary, this is the most prosperous time in Tennessee’s history. He highlighted record-setting household income figures and a shrinking unemployment rate.

At the conference, Boyd said it would likely be six weeks before the full Broadband Assessment results were ready to be released.

TTA Member Profile: Bledsoe Telephone Cooperative

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CEO:

Charlie Boring

Number of Employees:

50

Number of Access Lines:

10,000

Exchanges Served:

Pikeville, Fall Creek Falls, College Station, Nine Mile, Dunlap

Recent News:

In the battle over municipal broadband, it might be tough to find a TTA member closer to the frontline than Bledsoe Telephone. Based in Pikeville, Bledsoe serves a small sliver of Hamilton County, which it would stand to lose if Chattanooga EPB is allowed to expand beyond its city limits.

“It’s an unfair disadvantage to us,” says General Manager Charlie Boring, who took over for Greg Anderson in 2015. “They don’t pay taxes, and they borrow at lower rates than we can. There’s really no way to know where EPB would go.”

Whatever comes next, Bledsoe Telephone can rely on a long legacy of service and a quickly improving network infrastructure to keep their customers happy.

The cooperative was founded in 1953, starting with one exchange in Bledsoe County. “We just went on and grew from there,” Boring says.

In 1958, Bledsoe Telephone bought an exchange in Sequatchie County, establishing a significant portion of its two-county footprint that remains today. Over the years, the cooperative has added 20 to 30 unserved customers across the line in Hamilton County for a total of about 10,000 access lines.

Bledsoe also holds the distinction of being one of the first telcos in the state to get into the television business by deploying their own coaxial network in the 1980s. “We were one of the very few that were in it,” Boring says. “You could make a little money on it then.”

Today, Bledsoe Telephone is deploying fiber in Dunlap and Pikeville, primarily to businesses and key institutions. Residential fiber will follow, Boring says, with plans to build out the entire service area in 5 to 10 years. As with many telcos around the Cumberland Plateau, the rugged landscape is a challenge. Even after the buildout, 90 to 95 percent of the cooperative’s lines are aerial, meaning there’s plenty of maintenance to be done. “Everything we’ve got is rural, and it’s not easy getting through it,” Boring says. “We’re in some very remote communities, and we’re trying to get the network built to help them out. Some of these businesses are begging for more bandwidth, and we’re able to meet those needs now.”

As for municipal broadband expansion, Boring says the TTA is spot on with its stance. He believes municipal networks would cherry pick the choice areas with the highest rate of return, leaving the rural residents without access. “I think everyone in the state deserves to get broadband — that’s what we want at TTA,” he explains. “But it’s not Cleveland or Dunlap that’s unserved. It’s these people living out on the backroads that are unserved.”

Boring has met with local city councils and county commissions to explain the investment the telco has made in the area and outline the challenges of building a network. “We’re showing them exactly what we do because a lot of them don’t realize what it takes to have and maintain a network,” Boring says.

In the meantime, Boring and the staff at Bledsoe Telephone are working hard to make their services and network as strong as possible.

“We’re going to be moving a lot faster than we have been and getting a lot of things done,” Boring says.