Axiom Technologies’ Public Ownership Model for Connecting Communities in Rural Maine - Episode 552 of the Community Broadband Bits Podcast

Mark Ouellette (00:07):
Come on into the pool. It's, it's not as bad as people think. You can manage it. And, and a lot of the smaller ISPs have the entrepreneurial sort of mindset around how they help their customers. And so, you know, you have to be available and open to all options.

Christopher Mitchell (00:21):
Welcome to another episode of the Community Broadband Bits podcast. Before we launch in today's show, I wanted to share a little bit about some interesting things that are coming up. One is a live stream on June 7th at three Eastern Time. Our next building for digital equity livestream. This will be the fourth one. We've had a lot of good feedback on our others. It's a interesting mix of presentations and trivia and, and q and a. And you can find more at building for digital equity.com, where you'll see information about that live stream on June 7th at three Eastern Time. Also, there you'll see information about the Building for Digital Equity Podcast, of which we have many episodes and more to come. These are shorter discussions about people doing that hard work. And then for those of you who haven't heard about the Connect This Show, we are gonna be continuing to do those about every two weeks, and you can find more@connectthisshow.com.

(01:28):
That is a hour long video show, usually a little bit longer than that, often featuring Travis Carter from u i Fiber in Minneapolis, Kim McKinley from Utopia Fiber, and Doug Dawson, the consultant extraordinaire. So if you haven't caught any of those they're best on video. You can watch 'em on YouTube. You can find that in additional shows from ilsr. The Institute for Local Self-Reliance, where I work at ilsr.org/podcasts. I'm Christopher Mitchell at the Institute for Local Self-Reliance, and I'm here at Broadband Communities in Houston, where we are once again doing some live interviews at this event where we always run into wonderful people. Yesterday on a panel that I got to hostOuellette, the CEO of Axiom Technologies in Maine which has been a, a partner that I've been watching from afar for some time great partner to local communities is with me. Welcome to the show, Mark. Thank

Mark Ouellette (02:28):
You for having me. I appreciate being here.

Christopher Mitchell (02:30):
It is exciting to talk with you. We we certainly hope that Peggy is doing well. We are hoping that Peggy will be with us as well, but

Mark Ouellette (02:38):
Peggy Schaffer? Yep. Yes, she's great. She's doing fine. And I have big shoes to fill with her. She's been a great partner at the, in Maine and now obviously has a national role. So excited for her.

Christopher Mitchell (02:49):
Yeah. When she was retiring, you know, I, I not so subtly was like, Peggy would love to find ways of working with you in your retirement. Yeah. And she was like, no, I'm really gonna be gardening. Yeah. <laugh>, I think she has three jobs now.

Mark Ouellette (02:59):
She does, she does. Absolutely.

Christopher Mitchell (03:01):
Not gonna take it personally. <Laugh> <laugh>. So let's talk about Axiom Technologies. What, what is Axiom?

Mark Ouellette (03:07):
So, we're an Internet service provider based in Machias, Maine, which is in the county of Washington, Maine, which is, that county is larger than the state of Rhode Island. So just giving you the space. So very, very rural on the eastern border not just with the Atlantic, but with Canada.

Christopher Mitchell (03:27):
I was gonna say, not right down there in the mid, mid mid coast. No. Or else you would've said that. No,

Mark Ouellette (03:33):
I would've said that. Not, not too far south. Pretty pretty middleland upper state area. All my people are there that work from there. And but we've been expanding quite greatly with a number of communities around the state, including down the mid coast and including off of the coast of Portland. So we, we've gotten a little reputation as an island se serving islands mm-hmm. <Affirmative> that are un bridged. That's the fancy way of saying you have to take a ferry to get there. Yeah. So yeah. So we've been expanding using our model, which is public ownership model that the town owns, the whole infrastructure all the way to the home, everything. And then we operate under a, an agreement, long-term agreement with them in which they can kick us out, in which they can control the pricing in which they have a number of levers to, to make sure that I'm doing what I'm supposed to be doing. So I'm pretty excited about it. We have about 12 communities now, right now, under that model. And we're building them out slow, but, sure.

Christopher Mitchell (04:33):
So, and this isn't something that is hypothetical. You are operating on these networks already?

Mark Ouellette (04:39):
Yes. It's not hypothetical. We're, we are on our third network now. We're almost done. Our third build out. We we're excited about it because in our, for example, in our third project, we we're not done building, but we're already paying fees back to the back to the community for those people that we serve. So that's exciting. It's a good, you know, there's nothing like money to to get people working together For sure. And it's been a good model for us in, in all of the communities we're in. And I think they're, if you had asked them, I wish they were here with me, they, they'd tell you, it's been a super exciting experience for them considering where they came from, which was extremely poor or no Internet whatsoever, and really no prospect for any of the larger providers to come and serve them.

Christopher Mitchell (05:24):
You say, the prospect of money. And yet I feel like the service provider community in Maine is different than what we see in many other areas. There's been a lot of interesting public-private partnerships. We've seen a lot of local for-profit companies working with cities also. Am I wrong in thinking that I think you are even providing maybe some like, engineering type services before you were partnering with cities or I, when I first came

Mark Ouellette (05:50):
Across you? Oh, yeah, for sure. I mean, we are we have tried to be, and, and have been a one stop shop so long before a community ultimately commits to us. We have done significant engineering on the cost. We have done significant five or 10 year modeling for them so that they know what to expect. And we're very transparent on our expense side. And I mean, I personally am the CEO of the company. I personally have written many state and federal grants on behalf of the towns with the towns meeting. They're their app. They, they are the applicant, but we are providing all of the technical assistance and, and a lot of the narrative to those grants. So we've been quite successful. Right now, we've been able to achieve for those 12 projects, about 25, about 25 million in build mm-hmm.

(06:46):
<Affirmative>, of which there's about 18 million in federal or state grants against those builds. So we've been quite successful both with NTIA/USDA, a couple of programs at U S A, including reconnect and at the state level through the connect main authority previously, which Peggy Schaffer ran and was a great partner mm-hmm. <Affirmative>, and now the main connectivity authority which we just received two projects in the, in the latest round. So, you know, these communities have had a lot of success. And I think you mentioned that there are a lot of different partners in Maine, a lot of different private ISPs in Maine that have interesting views on modeling and working with communities. And we are, it is true. We are just one of those. But we have had, and there are a nu a number of others.

(07:37):
And I think part of that is because we are a small rural state and a number, you know, as, as you know, across the United States in places where the big incumbents have find it very difficult to serve. The people like me, companies like mine have pro popped up across mm-hmm. <Affirmative>, you know, so they're, they're small. They, they work with the communities, they love the communities. They, I mean, oftentimes we, we know all of our customers. We know who they are. We know how to what, what's going on in their lives. So it's a really, really nice personal touch that we

Christopher Mitchell (08:07):
Could have. But at the same time, I mean, I am a hundred percent in favor of the model you're describing, but there are real frictions of dealing with local governments. I mean, there's challenges to go through the official processes. You can have changes in leadership. There's a variety of things that I think have led to those companies that you referenced that are popping up the local companies, I feel like many of them look at that and they say, I'd rather find, figure out how to get bank financing, which is much harder now as our friend Travis Carter reminds us in the new interest rate environment. Sure. But you were doing all this before that, and so what, what made you wanna work through the communities?

Mark Ouellette (08:43):
So, I, I'm a mainer through and through, and I, and I love the communities we work in, in which we live in. And

Christopher Mitchell (08:51):
I love my family too, but they're hard to deal with sometimes <laugh>. Yeah,

Mark Ouellette (08:53):
Fair enough. Fair enough. But, you know, I, I felt long before I, you know, I joined Axiom six years ago, so long before that, the founder of our company Susan Corbett, was working in the trenches working with communities long before. Yeah. Susan's been doing great work. She's doing great work. Yes. She now in the National Digital Equity Center and, and doing a lot of bridging the digital divide, not just in Maine, but you know, has a national profile. So she's, she was an exciting and, and important mentor to me about how you work with communities. But I came from the department of economic and community development at the state. I was the director of business development for the state. And I really latched on to how do you help rural communities? And I've just felt like the easy, the best way to do that was to let give people a connection that allows them to create their own economy.

(09:47):
Mm-Hmm. <affirmative> lets them to create whatever they want to do. And that, that, that, that our whole economy in Maine was lagging because of the lack of, of connectivity. And so from, that's where I started. And when I left the, that department, I was a consultant, and then I, I latched onto Susan, she hired me and then onward to, to working with these communities. It is hard work. It is a long game that you're playing mm-hmm. <Affirmative>. so, and there are challenges. There certainly are, but it is extremely rewarding. And I'll just give one quick example. I was in, there's a town it's called Vienna. You don't say vie, it's spelled like Vienna, but you don't say Vienna. Oh, yeah. You have to say Vienna in Maine, unless you, you know, you're from away if you say it correct. Incorrectly, there's a whole collection of those.

(10:32):
There is a whole collection room. Yeah. Yes. From the Maine. Yes, there are. And so that's a town of about, I don't know, 600 people or so. I was there on a Saturday. This is the last round in which we got we got an award for them for 2.3 million. They put in about 700,000 and 2.3 million. And we were, I was at a Saturday morning town meeting in which they were gonna vote to appropriate the money and go move forward with the grant. The grant hadn't been awarded yet. We were just applying mm-hmm. <Affirmative>. And I, they, they told me afterwards, it was about 90 people on a Saturday morning at 9:00 AM and it took about three minutes. They started the meeting, they said, all in favor, everybody raised their hand. I took a picture of it. Yeah.

(11:19):
you know, everybody raised their hand and everybody, and not in favor nobody, everybody down. And the, the the one of the select board members, an old crusty guy, seriously had tears in his eyes mm-hmm. <Affirmative>. And then when we got the grant he called me three times within an hour. He said, are you sure <laugh>, are you sure we got the grant dream come true. So, you know, when you, when you have that, I'm getting tingly just thinking about it now. I mean, when you have that experience, it, it really drives a company like ours to, to move forward with these communities. So I would just advise communities or, or ISPs to consider this because it is very rewarding. Very

Christopher Mitchell (11:59):
Rewarding. Yeah. I mean, for people to put that in context, I think my understanding from afar of the town meetings in Vermont and Maine is that if you put a proposition up that we think the sun is gonna rise somewhere over there in the east sometime tomorrow, there's dispute <laugh> always arguments about it.

Mark Ouellette (12:17):
Very much so. And we, you know, a lot of the ways we, we handle those disputes is up front. We tell the community that are, because there's always a group that's very enthusiastic. There's no way you get to community meeting without somebody being enthusiastic. And so having a champion in the community is essential. And you, you hear that over and over here, not just at this summit, but you know, anytime you're at any kind of national meeting around this, you, you have to have people who really care in the community that you can't get anywhere without that. But I always tell them, in a community this size, you're gonna have 10 people who are heck no. Doesn't matter what you propose, they gonna be, it's a good job. It's heck no. It's their job. It's what they do. And you just need to be prepared for that.

(13:01):
And you need to understand that that's just one voice in the community, or several voices in the community mm-hmm. <Affirmative>. And they have a tendency to be able to drown things out because of the way the communities work. You know, you can have a very small turnout. So one of the ways I, you know, I was mentioning it on the panel, I like pitchforks. You know, this is about an uprising from the, from, from the bottom saying, you know, we care about this, and we are coming to you select board. We are gonna over, you know, we're gonna get over all of the negativity and we're gonna move forward because we really want this for our, for our people. So it's, it's been a, you know, that kind of process is it can be hard. And it is true that I have a political background, so I, I get it and I understand how you do it. But, and not everybody's made for that kind of thing. But, you know, in Maine there's been a little bit of a disproportionate number of small ISPs who have worked with communities, not just with my model, but with other types of models to help those communities move forward. And that's, that's a wonderful thing. It it, you know, an ecosystem of, of small pro, you know, I, I walk the beach with and, and talk with these other small providers all the time mm-hmm. <Affirmative> all the time. So it makes it nice

Christopher Mitchell (14:14):
In every community, you're frequently gonna find a few people that are just immediately, their initial reaction is no, they generally don't have the resources to send people five glossy mailers a week. And to produce a website that has a bunch of misleading claims on it and and perhaps advertising on local media. And yet you, you're running into that, it's fairly significantly, it sounds like, very

Mark Ouellette (14:39):
Much so. In, in almost every community where there is a presence in, in this case, it's spectrum Charter Spectrum. As, as you're aware, they're in 40 something states. They're a $40 billion company. I know some, some ridiculously large corporation. And they've been coming into these small, small communities with a very strong negative advertising campaign. Very slick, very, you know, as you said, five mailers with all kind, you know, and if

Christopher Mitchell (15:11):
They were here, they would probably say, oh, no, no, no, no. That's that's an independent group. It's it's a, it is a alliance for quality broadband that we That's right. Have nothing to do with it. That's right. But it's pretty clear who is behind

Mark Ouellette (15:22):
It. That's right. And and that comes through the Main Heritage Policy Center also has been doing papers on this. And, you know, they've gotten a CRE they've created, and Spectrum specifically has, has funded these groups. And, and everybody's aware of that now, and they've been forced to, to, to say it out loud mm-hmm. <Affirmative>, which has been helpful, I think. And those kinds of processes, you know, those kinds of negative campaigns don't typically do well in Maine. And so we've had some success you know, overcoming them, but in some communities, they've had some success also in, in changing the community's mind. Bec they like to talk about risk, and they like to talk about how broadband is gonna siphon off scarce public dollars away from roads and education. Right. Which is like such a playbook, sort of typical sort of argument.

(16:22):
But it can be effective in communities who care about those things. And, and they, and we are asking communities, in the case of Diana they had never borrowed so much money, and they also had never gotten such a large grant by far mm-hmm. <Affirmative>. So, you know, you balance out the amount of money you're getting in a grant application with, with what you're borrowing. And then of course we have to, we have a little bit more of a complicated story to tell because we have to say, you know, the revenues from the from the subscribers are gonna come back, pay for the bond. There's not gonna be tax revenue involved at all. In fact, and, and the projects that I have going, we have that are now operational, we have 70 over almost approaching 80% take rates in those communities. It's just, they've been an enormous success. And I would

Christopher Mitchell (17:14):
Assume you need like 50, 60 to Yes. To business plan. Well,

Mark Ouellette (17:17):
I usually model 60%, and even then the, the towns are very skeptical. Mm-Hmm. <affirmative> extremely skeptical. They don't think you're gonna have that many, they don't think I'm gonna make that. So they always make me model at 50 and 40% to see if I can still make the numbers work, and I typically can. And so, and then there's just astounded, and it's every single community I go into, they, they have a, they, they don't think I'm gonna get there. And I'm on Ahoe right now is Ahoe is a small island community. There's 140 homes on it. He said, we, you will never get over 80 subscribers. We haven't even started building. We're at 110, 115. I mean, we're gonna have the whole

Christopher Mitchell (17:59):
Island approaching a hundred

Mark Ouellette (18:00):
Percent. Yeah. Yeah. Approaching a hundred percent. Yep. So, yeah. Yeah. Yeah. I'll give you one other quick story about how this sort of how these communities can work mm-hmm. <Affirmative>, because there's been, we, you know, I gave you the great story of vi but there's also been a challenge on on the island. Longdon. <laugh>. Yeah. Yeah, that's right. <Laugh>, right? Vi Oh my gosh. Right. in Shabi, Shahab Island is an island off in Casco Bay, off the coast of Portland. Mm-Hmm. <affirmative>. And they we've been through a three year process with 'em. We have dsl, we, we are a, we have DSL on the island to about half the island. We, we serve about half the island. We could serve the whole island. But that DSL is a resold product from FairPoint, from, from Consolidated communications.

Christopher Mitchell (18:48):
It's the incumbent telephone company,

Mark Ouellette (18:49):
The incumbent telephone company. It's really bad mm-hmm. <Affirmative>. And we have no control over it. So,

Christopher Mitchell (18:53):
Yeah. I mean, people don't always appreciate, but the copper in Maine is worse than the copper elsewhere. And the copper elsewhere is not good. That's

Mark Ouellette (19:00):
Right. It is very, very, very degraded and very old and, and just very, you know, to get a a three mag connection is, is not, is o often you can't even get that

Christopher Mitchell (19:12):
In the land of the blind, the one eye

Mark Ouellette (19:13):
Man. Yeah. Yes, exactly. So on that island, we thought we'd have a slam dunk. We were gonna bring fiber, we're gonna get a grant. And the, the, the, the council there was just dead set against, and I don't know if you've experienced this, Chris, but, or, or others listening. But I went into the first town meeting, and within the first five minutes I was like, I'm gonna be skewed and put, you know, there's no, it didn't matter what I was gonna say. Looking for

Christopher Mitchell (19:39):
Exit lines. Yeah, yeah.

Mark Ouellette (19:39):
I was like, oh boy, we are dead. We're dead. But it's amazing how local communities raise up when they really want something. And, and over the next year they went through a series of different o opportunities, and they finally came to the council and said, if you don't vote for this, we are gonna have a referendum, and we have the votes, and this is gonna be embarrassing to you, the town, and this may lead for to you to be, you know, un you know, unseated, you know, you don't understand how badly we want this. And so they've now been approved. They, they, they did get that approval from the council after, you know, the pitchfork idea. And we were able to get them a grant of, I think it's 1.2 million mm-hmm. <Affirmative>. and so, and then we had a little add-on to that, another 300,000 from the state after that. So we're gonna be building them this year. So it's exciting, but it's been two or three years to go through that process with them, about 500 homes

Christopher Mitchell (20:38):
There. So Maine is a place where not only is it hard to build aerially but and I mean, not just a case that the existing pole owners might be hostile that we see elsewhere. Also, just that you've got granite everywhere. And so I'm curious, like, do you have any fun stories about trying to deal with granite?

Mark Ouellette (20:59):
Oh, course, yes. Absolutely. In fact we are gonna be building on Monhegan Island the, within the next couple of months. It's a rock. It's an island, it's a rock, and they have no utilities on, on poles. So everything is on the ground. Wow. So we were putting fiber on the ground we will dig where we can mm-hmm. <Affirmative>. but, you know, fiber is extremely resilient. And most engineers and most people who are listening are cringing right now because they can't believe Oh, yeah. No, that we're gonna put it on the ground. Yeah. but you'd be amazed how, how well it's done. We are on, we're in several places where a significant portion of our build is on the ground mm-hmm. <Affirmative>. and, and it's amazing how it even self buries after a while. You know, we go through the woods and, and you know, we put, you don't even know it's there.

(21:50):
Mm-Hmm. <affirmative>. And yes, it is true that, that chainsaws are not you know, kind to, to fiber falling trees are not necessarily kind to fiber, but those are small problems in the, in the, you know relatively speaking. It's, it's just, is just as dangerous, frankly from a, from a fiber break standpoint to be on a pole as it is on the ground. In fact, there are a number of studies that show that being on the ground, it's actually quite safer mm-hmm. <Affirmative> than being on the poles. Very wind, you know, wind is not a, a fan. Trees falling and not a, you know, not, not, not very good for,

Christopher Mitchell (22:23):
For yeah. And this isn't the great Smokies. It's not on the Appalachian Trail

Mark Ouellette (22:27):
<Laugh>. No, no. These are, these are off the beaten trail, there's no doubt about that. You know, in more populated areas. And, and Shabi is a good example of that because they asked us and some of the communities on our, in, in our on land, we haven't even talked about those. But I have a number of communities on land you know, on the mainland that we're building out. And it's not really an application for those kinds of situations, but we do do where we have to we do do a little bit of underground in those areas, and you can get two feet down. The question is, can you get four feet down? Mm-Hmm. <affirmative> and typically not. So we get, we can get under and we had a situation with tds. TDS is another dsl provider in Maine, like consolidated. They have a few towns, and they, they told the town we had 60, 60 poles in a location that we needed to license from them. They told the town we needed they needed 10 million in liability insurance for those 60 poles. The town said, can't you do help us here? We just wanna just get on 60

Christopher Mitchell (23:28):
Poles. Yeah. That's not standard from what I

Mark Ouellette (23:30):
Understand, not standard. And and they said, no, I'm sorry. We can't, we're gonna hold, hold you to that. So we, we decided that that wasn't gonna work. And so we went on the ground in the right of way. And we sort of cut it in mm-hmm. <Affirmative>, and yeah. So it works, can work in, in various situations.

Christopher Mitchell (23:47):
It beats not having fiber.

Mark Ouellette (23:49):
It certainly beats not having fiber. And remember, we're talking low counts too. This is not, you know, so, so easily repairable mm-hmm. <Affirmative>, you know, within an hour, you're, you're repaired and going back if there's a problem,

Christopher Mitchell (24:00):
You're not splicing 288 strains

Mark Ouellette (24:02):
Is what you're saying. Yeah, it's exactly right. Exactly right. It's a pretty simple sort of process from that perspective. So come on into the pool. It's, it's not as bad as people think <laugh>, you can manage it. And, and a lot of the smaller ISPs have the entrepreneurial sort of mindset around how they help their customers. And so, you know, you have to be available and open to all options. I mean, it is critically important tho those, those fiber connections on in very remote places are, you know, allowing people to be educated. You know, we went through the pandemic. There were children who couldn't get do any schoolwork and such. I mean, they're people who are doing jobs now at, you know, important

Christopher Mitchell (24:39):
Maine's becoming a major destination for people that are, it is living cities. It is,

Mark Ouellette (24:43):
It is. It very much is. My wife's a real estate broker. She'll tell you what's going on. People are moving in for sure.

Christopher Mitchell (24:50):
Yeah. We had a conversation, a few, I don't know, maybe it was a month or two ago with someone. And the real estate agent that was in the room had said that they'd seen a real switch from people who are looking for second homes to people who are planning to move into a place that had been a second home you know, a vacation home or a cabin, and they're planning to make it their primary residence.

Mark Ouellette (25:09):
Most. so we have a, because we work on the coast we, we have a lot of seasonal, what we call seasonal customers second homes, and more and more and more, they're taking service year round. Mm-Hmm. <affirmative> e even if they're not there for the full 12 months, they're there for more than nine. Right. you know, and through it used to be, you know, this used to be a May one to, to Columbus Day, you know, you know, Memorial Day to Columbus Day kind of thing. Mm-Hmm. <affirmative>, and they come maybe in July mm-hmm. <Affirmative> now they are coming you know, or staying. And of course, it's allowing for them to also, the, the big driver for, for older folks is to make sure they can have their grandchildren with them. Sure. And, and the big driver for grandchildren is to make sure that they have connectivity to do what they need to do. Well, it's, so it's been an interesting process for

Christopher Mitchell (25:56):
Sure. And from what I know of Stephen King books, I have to say that it's a major driver for two key parts of living in New England. One bringing the economic activity in Yeah. For seasonally and two, giving people that are local, something to complain about.

Mark Ouellette (26:09):
That's right. <Laugh>. Exactly right. That's exactly right. I think in most communities, while there's a complaint, and it certainly is, it does make Megan a lot busier in the summer, I think people are more and more recognizing the importance of those folks from away, what they mean to the economy, but also what they mean to the fabric of the community. I, it has to be a synergy. So we, we are big supporters of the local community, the year rounders mm-hmm. <Affirmative>. And so our models favor year rounders. The, the, the, the people from away, the seasonal customers pay a little bit more in our model mm-hmm. <Affirmative>. And we say to them, but this is a community project, and you're supporting the community with your support. And you'd be amazed at how easy that conversation is. That is really the secret sauce at the end of the day. Yeah. Well, yeah. People love community. They will, even the s the, the people who are from away, they want that community to thrive. And people nowadays have a trouble understanding, how do I help my community? You know, what, what do I do? How do I inter interact with my community? Mm-Hmm. <affirmative>. And this is a nice way for the communities we're working in, for them to say, yeah, I'm sporting the community in this way. So it's fun. It's fun.

Christopher Mitchell (27:18):
Thank you. It's been wonderful talking to you. Mark Willette with Axiom Technology ceo. Thank you so

Mark Ouellette (27:23):
Much. Thanks for having me, Chris. Appreciate

Ry Marcattilio (27:24):
It. We have transcripts for this and other podcasts available at muni networks.org/broadbandbits. Email us@podcastmuninetworks.org with your ideas for the show. Follow Chris on Twitter, his handles at Community Nets, follow muni networks.org, stories on Twitter, the handles at muni networks. Subscribe to this another podcast from I L S R, including building Local Power, local Energy Rules, and the Composting for Community Podcast. You can access them anywhere you get your podcasts. You can catch the latest important research from all of our initiatives if you subscribe to our monthly newsletter@ilsr.org. While you're there, please take a moment to donate your support in any amount. Keeps us going. Thank you to Arne Husb for the song, warm Duck Shuffle, licensed through Creative Commons. This was the Community Broadband Bits podcast. Thanks for listening.