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Howard County Fiber Encourages New Jobs, Competition in Maryland - Community Broadband Bits Podcast 133
While at the Broadband Communities Economic Development conference in Springfield last year, I had the good fortune to catch a panel with Chris Merdon, the CIO of Howard County, Maryland. Howard County has become an Internet Service Provider, not just to itself, but to private firms as well.
To improve Internet access for businesses, it is both leasing dark fiber to existing providers and directly offering services to businesses and buildings. We are grateful that Chris could join us for a Chris2 interview! We discuss how and why Howard County chose this strategy and how it is benefiting the community.
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Thanks to Persson for the music, licensed using Creative Commons. The song is "Blues walk."
Chris Merdon: In this case, the landlord believes that it's a great attractor to companies, particularly high-tech companies, to want to look at these -- maybe some of these older buildings, that aren't as attractive as the newer buildings, because they have that gigabit speed.
Lisa Gonzalez: Hello. This is the Community Broadband Bits Podcast, from the Institute for Local Self-Reliance. And this is Lisa Gonzalez. In 2010, Howard County, Maryland, was chosen to receive stimulus funds in order to deploy the InterCounty Broadband Network, or ICBN. The network is now up and running, providing faster, more reliable, more cost-effective connections in the region. This week Chris talks with Chris Merdon, Howard County Chief Information Officer and Director, about the network. Merdon shares some of the innovative ways public and private entities are using the high-capacity network to improve the quality of life, education, and telehealth in Howard County. Merdon also describes how the ICBN has propelled economic development by providing affordable, fast, reliable connections to a broad range of local industries. Each week, we bring you the Community Broadband Bits Podcast to share information about publicly-owned broadband networks and related telecommunications issues. Our podcasts are advertisement-free, but they aren't free to produce. We hope you'll consider contributing by visiting ilsr.org and clicking on the orange "donate" button. Now, here's Chris, speaking with Chris Merdon from Howard County, Maryland.
Chris Mitchell: Welcome to another edition of the Community Broadband Bits Podcast. I'm Chris Mitchell. Today, I'm speaking with Howard County Chief Information Officer and Director, Chris Merdon, from Maryland. Welcome the show.
Chris Merdon: Thank you very much.
Chris Mitchell: I'm excited to have you on the show. We met briefly after a session that you gave in Massachusetts, I believe, as part of the economic development conference that was put on by Broadband Communities. I didn't actually know all the interesting things that Howard County was doing. So I'm really excited to take a dive into them. But I'd like to start by just asking you to describe a little bit, what is Howard County? Where is it located? For people who may not be familiar with it.
Chris Merdon: Yeah. Howard County's located right between Baltimore and Washington, DC. We're a population of about 350,000. Very well-educated population. We're the, I guess -- considered to be the second-wealthiest county in the country. So, you know, well-educated, well-funded county, and very technology-driven.
Chris Mitchell: Is that very dense throughout the entire county then?
Chris Merdon: I wouldn't say. I'd say more on the eastern side of the county is more the denser side. On the western side of the county, we still have a lot of farmland.
Chris Mitchell: OK. So you span the gamut.
Chriss Merdon: That's correct.
Chris Mitchell: So, you're -- as I sort of alluded to, you do have a county fiber network. But can you take us back to how that got started?
Chris Merdon: Howard County's fiber network is part of the ICBN, which is the InterCounty Broadband Network, which is also coupled with One Maryland, which is the state of Maryland's larger broadband network. The entire network -- the ICBN -- is about 1100 miles of fiber. It goes through ten political jurisdictions -- most of the central counties in Maryland, and the City of Baltimore, and the City of Annapolis. But it does tie directly into some of the more rural areas of Maryland -- western Maryland, and on the eastern shore.
Chris Mitchell: And so, before the ICBN, did you -- well, actually, I should say, I know you're -- you weren't as involved, I don't think. Do you want to tell us just briefly about your involvement, and when you came in?
Chris Merdon: Sure. Yeah. So, when I came in, the fiber had just -- the construction had just concluded. We had received a federal grant that required us to have all the construction done by August of 2013. I came in in September. So I had the easier part of lighting it up and getting it up and running, rather than the construction component. But we did have some legacy fiber prior to ICBN. Not much, but it connected a few facilities. But the ICBN really helped us connect many, many more facilities.
Chris Mitchell: And you have a history there. So you were familiar with everything that was going on, prior.
Chris Merdon: Yeah. I was an elected official in the county for eight years, prior to becoming the CIO.
Chris Mitchell: So, what were the motivations for Howard County to -- as I understand it, you played a pretty significant role in the ICBN.
Chris Merdon: Yeah. Howard County was the lead recipient -- took the lead in getting the funding from the federal government, on behalf of all the other counties, working very closely with the state of Maryland. But our County Executive at the time, Ken Ulman, really thought it was a great tool for us to not only be able to communicate within the county, with the different facilities within county government, but also the communication capability with other counties. As well as, obviously, the cost savings, and we believed that it would be a good economic development tool for us, to share with businesses, and to attract companies to come to Howard County.
Chris Mitchell: And so, one of the -- if I remember correctly, one of the things that really helped you sort of take this giant leap was the stimulus program -- the American Reinvestment and Revitalization Act, or the ARRA. But I think that was really what allowed you to invest in a lot of this. Is that right?
Chris Merdon: That's correct. We received $150 million grant from the federal government, that really was the catalyst to help us get where we are today.
Chris Mitchell: And so, now that you have this network, one of the things that I always like to ask is to get a sense of how the Howard County facilities that are being served -- well, actually, first let me ask what facilities are on the network already?
Chris Merdon: So, I'll speak to Howard County, and then sort of give you some numbers overall for all the counties. In Howard County, every single school is connected. All police departments, fire departments. Most county buildings. We do have a few county buildings, that are in the more rural areas, that are not connected today. There are plans to connect them in the future. But, you know, they've -- very few people -- you know, five or ten people in each facility. So, while we'd like to get it done, it was not a priority at the time. Our community college. We only have one community hospital in the county, so that is connected as well. As well as a number of nonprofit organizations.
Chris Mitchell: And what kind of benefits are these entities -- the schools, everyone -- what are they all seeing because you have this great fiber optic network now?
Chris Merdon: So, I think the most immediate benefit that people are seeing is, obviously, a reduction -- significant reduction -- in the cost. While we were providing -- buying our services from the private sector, county government alone is saving about -- probably about $750,000 a year by using the network rather than getting it from another provider. The school system alone is saving about a million dollars a year. Altogether, all the users, we're probably in between a two and three million dollar a year savings. Coupled with that, obviously, are significantly higher speeds. So, where our elementary schools used to be -- used to have a 75-meg line, each elementary school now has a gig. Our middle schools and high schools were about a 100- to 150-meg line. They're -- the middle schools are now at 3 gig; and the high schools are at 5 gig. So, obviously, significant benefit. To the faster speeds.
Chris Mitchell: And have the faster speeds resulted in any meaningful changes? I know you're not the CIO of the schools. But I'm just -- I'm always curious, when you see this jump ...
Chris Merdon: Yeah.
Chris Mitchell: ... in speeds, have you seen any new applications that entities can use?
Chris Merdon: We have. And we work -- while I'm not the CIO of the school system, we work very, very closely with them. We rolled out a very cool app. We're now doing telemedicine in our elementary schools -- in five Title I elementary schools. We have the -- students have the ability to go into the nurse's office and be seen by a physician, who is actually up at University of Maryland's medical center, in the City of Baltimore. We have a full-time physician there that serves these five elementary schools. Through Care Clicks, they're able to do a teleconference with a physician. The physician also have the ability to invite the parent. So the parent doesn't need to come in. They can invite the parent by clicking on a link. The parent can pull up their browser, see their son or daughter in the nurse's office, can see the physician, as well as see all the scopes that the doctor uses on the child. So if there's a scope that goes in the ear, or in the throat, the parent can see, from their desk at work, what their son or daughter's throat looks like, if they have a sore throat. Maryland does allow e-prescription as well. So the schools do have the ability to administer medicine, or to get a prescription for the parent to pick up, if their child is sick. So, that would not have been possible without broadband. Everybody's very excited about it. We've launched it for five schools. And it will be rolled out to all elementary schools as funding becomes available.
Chris Mitchell: Yeah. I can't help but be a little bit jealous. I sort of wonder if the kids in those schools can get better medical care than I can. [laughs]
Chris Merdon: It's possible. We have an excellent physician staff at University of Maryland.
Chris Mitchell: So, one of the things that I wanted to really get into was the -- Howard County's gone beyond just serving the schools and the public facilities, to actually making fiber, and, I believe, some services available to the private sector. So, can you tell me, if I was a business that was coming to Howard County, what sort of things might I be investigating -- that Howard County can do, that another county might not be able to do?
Chris Merdon: Sure. So, Howard County did become an ISP. So we are providing not only ISP services to ourselves and the school system, community college, but we are also making that service available to the private sector. We have probably about 20 different companies, at this point, that have connected to the ICBN and are receiving Internet services from us. It is a paid-for arrangement. So, we typically charge the customer directly for any lateral that needs to be constructed to connect them to the backbone. And then we charge a monthly fee.
Chris Mitchell: Is that typically an up-front fee? Or do you work it in over time?
Chris Merdon: We'll do it either way. I think almost every customer that we have has paid for it up-front. But we will finance it if that's what the customer prefers. But I believe everyone has been up-front. Then we connect them to backbone and provide ISP services.
Chris Mitchell: I'm curious. Do most of these -- are they mostly looking for faster than 100-Mbps speeds? Is there some sort of common thing that they're seeking?
Chris Merdon: I think, the common theme that we see is 1) we can provide it at a less expensive price. Secondly, better reliability. Some of our customers, at about three o'clock in the afternoon, see a significant decrease in performance. One company, n-tech, actually has to send their employees home in the afternoon to work from home, because performance is so bad from their existing provider. So they switched over to us, for more reliability -- and the potential to scale up. I mean, we could provide 10-gig speed to you if you needed it, with relatively no problem. So, that ability to scale up and down. We've also tried to get away from locking customers into multi-year contracts. Seeing that they're paying for the lateral up-front, we only require a month-to-month contract, which is very attractive, compared to some of the other providers out there, that will lock you into a contract that may -- you know, as prices continue to decline in the future, you may be paying a higher price because you have a longer-term contract.
Chris Mitchell: And so you're actually providing lit services. This isn't just a dark-fiber-type service.
Chris Merdon: We will do both. And we have both. So we work with some companies -- TW Telecom, for example, that needed a connection from one point on their fiber to another. So we did a dark fiber lease for them. But we certainly are providing lit services as well.
Chris Mitchell: So, one of the criticisms that public entities -- local governments sometimes get is that you're unfair competition. But it sounds like you're enabling the competition of TW Telecom, which aims for the kinds of businesses that you've also signed up.
Chris Merdon: That's exactly right. I mean, for TW Telecom to be able to construct eight miles of fiber to connect one of their customers would have been, obviously, very expensive to do. So we do believe that this is an enabler.
Chris Mitchell: So, have you seen any challenges, in terms of creating an ISP as a county government?
Chris Merdon: I didn't see many challenges. It was very -- it was difficult in the beginning to determine what the process was. We had some challenges with setting up our funding. Because we are a public entity, we are exempt from certain taxes that are -- that need to be paid. So we had to spend a lot of time with legal counsel to figure out how to set up our funding model, and segregate funds. So, we set up three enterprise funds. We set up a government enterprise fund, a government-related enterprise fund, and a private-sector enterprise fund. And the reason we did that was to segregate the funds, so we wouldn't be taxed on all revenue associated with each of the enterprise funds. We are taxed on the funds that are associated with just the private sector. But if just one dollar from the private sector or the government contaminates another pot, we would be responsible for taxes on all three pots. So, that was probably the most difficult part of setting up the business, if you will, not necessarily of setting up the ISP services itself.
Chris Mitchell: So, I guess one way of stating that might be that, in the instances in which you, as a county government, are acting like an ISP for the private sector, then you're paying all applicable taxes. But you don't want to have to pay taxes that you should not have to pay when you're connecting schools and things like that. Is that a fair assessment?
Chris Merdon: That's correct.
Chris Mitchell: And -- so what else are you doing to spur economic development in the area?
Chris Merdon: Well, we've come to an agreement with Corporate Office Properties Trust to connect five of their buildings that they're having some difficulty in leasing. They believe that by connecting to the ICBN, and marketing gigabit speed to that location, they'll be able to attract tenants. It's a little bit different model than we've been working with in the past. We generally work with the end user company, to make the connection and to provide the service. We typically aren't dealing with the landlord. In this case, the landlord believes that it's a great attractor to companies, particularly high-tech companies, to want to look at these -- maybe some of these older buildings, that aren't as attractive as the newer buildings, because they have that gigabit speed. So we're excited about that project. 15:40: Chris Mitchell: Yeah. That sounds like quite a project. Is there anything else that you want to tell us about the Howard County experience?
Chris Merdon: Yeah. I think the final thing may be working with the Columbia Association. Columbia Association is the largest community association in the country. It has about 90,000 residents that belong to it. They run pools, gymnasiums, several different types of sports facilities. We are in the process of connecting six of their 40+ buildings. We'll eventually get to all 40, but we're contracted right now to connect to six. Mostly, they're gym facilities. They're going to use it to roll out the next sort of generation of equipment in their gyms. And what will do is, as you go into their gym, and you touch a piece of equipment, that piece of equipment will know who you are, how long you've been on it, what your heart rate was on it, all the statistics that you'd want. And then send it to a website that you can check when you get home, or in a facility, and you can track your progress, day-to-day, week-over-week, month-over-month. Because it's very data-intense, Columbia Association did not have the ability to roll this out before getting the ICBN. So, we're excited about that project, as well, that enables our largest nonprofit organization to roll out excellent services to our citizens.
Chris Mitchell: Well, it sounds like you're making some great strides to being a very healthy community.
Chris Merdon: That's one of our main focuses of the county, yes.
Chris Mitchell: I mean, whether you're in school or whether your in the workout facilities, you've got access to all kinds of data.
Chris Merdon: Right. Right.
Chris Mitchell: Well, thank you for coming on this show. It's been really interesting to learn more about the approaches you've taken. And some of the successes.
Chris Merdon: Right. Well, thank you for having me.
Lisa Gonzalez: Send us your ideas for the show. E-mail us at email@example.com . Follow us on Twitter. Our handle is @communitynets . Don't forget to take a few moments to donate, in any amount, to ilsr.org, to help us continue this valuable service. We have new music this week. Thank you to Persson for the song, "Blues Walk," licensed through Creative Commons. Thanks for listening again, and have a great day.