Fast, affordable Internet access for all.
Innovative Services and Trailblazing Low-Income Programs in Chattanooga - Episode 539 of the Community Broadband Bits Podcast
This week on the podcast and on the most Valentines-iest of days, Christopher is joined by Katie Espeseth, Vice President of New Products EPB Fiber, at the municipal network in Chattanooga, Tennessee. After catching up on the release of the network's 25 gigabit service and the latest progress of the HCS EdConnect initiative (which has connected almost 10,000 homes), Katie shares with Christopher how its SmartNet Plus program expands the managed Wi-Fi framework to take advantage of the many devices we all have in our homes that connect to the Internet. The show ends with Katie and Christopher reflecting on how - thanks not only to Chattanooga, but the other cities as well as telephone and electric cooperatives in the state - Tennessee is among the best-connected across the country, with some of the fastest speeds and most affordable rates available.
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Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license.
Katie Espeseth (00:07):
Our first 25 gig customer that we announced in August of last year is the Chattanooga Convention Center. We're not unlike any other community. We have a large regional hospital here. We have university here, all of which have very high bandwidth needs. Because we have a fiber infrastructure in place already, we can upgrade electronics that are able to serve those type of needs Very quickly.
Christopher Mitchell (00:31):
Welcome to another episode of the Community Broadband Bits podcast. I'm Christopher Mitchell at the Institute for Local Self-Reliance in St. Paul, Minnesota, where I don't know if we're gonna hit positive digits today. Katie I'm, well, let me introduce you and then I'll, I'll talk about the weather more cuz people love that on a tech podcast. I'm here with with a repeat guest, Katie Esbe, who is the Vice President for new products at E P B in Chattanooga. Welcome.
Katie Espeseth (01:02):
Thank you. Appreciate the opportunity to join you today.
Christopher Mitchell (01:05):
It is wonderful to have you back. And I just thought I would start off by saying that I'm sure most people would rather be where you are than where I am <laugh>.
Katie Espeseth (01:13):
I don't know. Yeah, I will say we are, I'm not even gonna try to match the your weather. but it's 33 here and, and we're suffering with 33
Christopher Mitchell (01:22):
<laugh>. Yeah. So you're probably in that situation where I mean, just to kick it off, one of the benefits of your fiber optic system in being tied in with the electric system is that when people's heating goes on the fritz, you can let 'em know before they get a horrendously high bill because they've been heating with a backup system that is much less energy efficient.
Katie Espeseth (01:40):
That's true. You know, with, with fiber as the backbone you're, you're really capable of adding literally thousands, thousands of sensors that detect all sorts of anomalies on the system all the way down to your meter. and so with that, you know, we can, we can detect when you're headed for an extremely high bill when there's something not quite right going on. We don't know what it is inside your house, but we do know that something from getting to your meter doesn't look right and we can reach out and we have in fact notified folks that something's not right and their auxiliary heat may be on. And instead of headed for a a $2,000 bill, we can intercept that a little bit earlier. so the more you know the, the more you can manage your energy bills. And that's, that's really, that's the basis of our fiber optic network, was really to build a smart grid, not only for more reliable power, but to help folks manage their energy usage, give them the data they need to be able to manage it more effectively.
Christopher Mitchell (02:40):
I was thinking that maybe we would talk a little bit about, as though someone listening isn't familiar with Chattanooga, but I just, I don't know who wouldn't be familiar with Chattanooga, one of the, the brightest success stories in the field now operating since 2009 really leading the nation in announcing higher speed plans, never raising your prices, from what I can tell, only increasing your speeds dramatically. just all kinds of benefits. But let me, let me just ask you about that cuz I feel like, you know, you're obviously, I mean, your title is, is VP of new products, you're a tech kind of person. But I also think it's important that people have a sense of just that E P B is not about the technology so much as it is about the incentives being aligned with the community. And and that's where I'll often say, you know, the E P B network uses a lot of the same components that Verizon Fios does, that other at and t does that small private companies do. I mean, this isn't, this isn't like you guys developed your own, your own boards or anything like that, right? and just not at all if you can let people know, like what is it what that separates you that and, and that it's not the technology.
Katie Espeseth (03:48):
You're exactly right. I I, I, I couldn't agree with you more. we're an municipally owned electric power utility, and I'll just start from there. So we're owned by the city of Chattanooga, but we certainly operate as an independent, independent board. but because we're public power our mission really was rooted when we were founded in the late 1930s. And it's about improving quality of life for people who live in our area. All of our efforts are pointed in that direction to achieve that mission. So when it meant bringing electrification to the valley, heck that was that, that path was completely clear. We knew that, that by bringing electricity to everyone who lives in our footprint, we were certainly improving their quality of life. in the two thousands, we realized everybody has electricity. What are we lacking? What can we do to really improve the lives of folks in Chattanooga?
and we think that improving quality of life is tied to economic development. We think it's tied to bringing good jobs here offering a great quality of life, whether it's recreational or professional. and when we started to look around, we realized a couple of keys to that that we could impact was about being able to offer more reliable electric service. You know, certainly our electric service was on par with others in the nation. I'm not insinuating that we were providing subpar services, but we knew we could do better. And when you look at how much electric outages cost communities, not necessarily utilities, but communities as a whole, we realized if we could take a bite out of that, we could really impact productivity in the region. We could bring more companies in to locate here. Companies could, could grow and prosper here.
And oh, by the way, if you choose a technology that can accommodate access to high speed broadband and internet services, you accomplish two things with one type of technology. And looking around, we realized that in, in the early two thousands, Chattanooga was underserved by our incumbent providers here. so we said, okay, we wanna improve our electric performance and be able to offer high speed internet services because that those two things are key to companies locating here and growing here. And that means new jobs and better jobs for our folks. So that's what we said about doing. We launched our first customer, commercial customer, residential customer in, in 2009. Offered the first ubiquitous gig service in, in 20 10, 20 15. We began offering 10 gig services and then just last year announced 25 gig services. So all of those things, to your original point, certainly we did those with technology that many, many commercial carriers use.
We use fiber optic technology as the base, but we've we started out with G pon, we went to nng pon, now we're at XGS 25 Gig G pon. So we are constantly updating and improving our network for quality of life reasons. it, it's, it's same technology that others in the country deploy. Our, our reason for doing it may be a little bit different, but still at the end of the day, we don't have stockholders and we don't necessarily are not held to issuing dividends. Trust me. We are held to the same standards of we need to not lose money, but everything that we do make, we roll back into our community here. And we pride ourselves on being able to share what we do with our community by constantly keeping 'em on the technological edge of things. And if that's, that's one thing that we try to do is that we try to continually update the technology and it's all about keeping the community on the forefront of what's going on to get people to move here, to get people to build their companies here. Cuz we think that benefits everyone.
Christopher Mitchell (07:47):
And that is something that we've seen from most municipalities that have built citywide fiber networks that focus on, on economic development, on bringing in jobs, on making sure that existing businesses have a great environment. But what I think E P B has done in raising the bar is, is then using the proceeds of that. When you've succeeded at that and, and there's multiple studies about the like 10 x return on investment that you've had on your investment. you have moved forward in a great partnership that is known as h c s Connect for the Hamilton County schools where in the pandemic and other people were futzing around with with hotspots that didn't really work and things like that. You all started rolling out a fiber optic service to all the free and reduced lunch families. And how has that been going?
Katie Espeseth (08:37):
You know, we're seeing that a grow year in e every year. and so, you know, we futzed around in the beginning too with some hotspots <laugh>. we immediately went to the streets and put up over a hundred hotspots to try to solve the problem immediately. We knew that wasn't the long-term, but we did, we did wanna at least make that happen quickly.
Christopher Mitchell (08:59):
And you're right, I should say I was actually the English language being so imprecise I was actually thinking of the mobile cellular hotspots that oh, were deployed. And in some cases they worked well, but in many cases they found that local cell sites were overloaded or didn't have the service and, and the mobile connectivity wasn't there when it was needed. So that's something that I found I found frustrating and a reminder of why we can't just expect that in an emergency we can just have wireless save us all.
Katie Espeseth (09:26):
You, you know, that, that's interesting because just like everyone else in the country, as soon as we got the news that we were all going home, that the schools were closing and kids were gonna be learning from home, we started collapsing around that problem. We were, Chattanooga was in a good position in that we had fiber outside of that passes every home in business already. we have about a 70% market share. So 70% of our 185,000 homes in businesses have our services already, but there's that 30% that didn't. And we knew we had to do something quickly to be able for those kids to still learn if they were in that situation for businesses to still operate those that needed to move home, that sort of thing. So we did in fact look at mobile services just as you, you suggested. And we realized that might plug a small hole, but it wouldn't really help the community for the long term.
And we didn't have any earth earthly idea how long this was gonna last. But even more importantly, it shined a bright light on the fact that 30% of folks did not have access to the, or had, could not subscribe or had not subscribed to our services. So we have some great local partners. We partnered with the Hamilton County folks, with the city of Chattanooga, some private businesses here, some of our foundations. All we all came to the table to say, what can we do quickly and what can we do long-term to make a lie a difference in the lives of these children who don't necessarily, whose families can't afford or have not subscribed to our services. So to your point, we have about 16,000 households today on the H C S Connect program that touches the, the lives of about 28,000 folks.
And what that means is that we if you didn't have our services or if you did have our services, we con converted you to h c s products. So for, we have funded the program for 10 years and that will continue. We just initially funded it for 10 years. so if you have a child in the Hamilton County School that's on free or reduced lunch, the school certifies you. We don't, we don't ask a lot of probing questions. There's not a lot of hoops you have to jump through from us. The school just lets us know. And if you wanna order the services, you have 300 meg symmetrical with a router installed in your home at no cost to you. We're mandated by the state that we can't provide services below our cost. We make no profit of course on this. but with our great partners, they really picked up our cost for that. So to our customers, there is no cost. And we were able to still adhere to what the state law is.
Christopher Mitchell (12:13):
And there's a couple of points I would like to raise. One is that I love that you credit your partners because I do feel like when people ask me, how is E P b so amazing, I'll often start by noting that, that you are a very well operated organization and for people that are interested, I spoke with Harold De Priest in an extended interview many years ago about some of the, you were there, you, I think, came in after that culture change that they went through in the late nineties, early two thousands.
Katie Espeseth (12:39):
I was working for a large national carrier. And so I didn't join E P B till 2004 when we started seriously doing business planning. Right. So I did miss a lot of the culture change, but Harold's a great source of information and he he truly lived through that from day one.
Christopher Mitchell (12:59):
And, and so I I, I don't wanna take anything away from E P b fiber, but you have a great ecosystem there of, you know, the Enterprise Center I think does wonderful work. I'm a big fan of them and, and so many businesses and others are really committed to this success of the region. And so I think people can't miss that, that you really need a, an ecosystem that pulls together to have a success this big.
Katie Espeseth (13:21):
And, you know, we, the, the enterprise center, we have CoLab located with them. certainly chattanooga's fortunate that we have a number of very successful foundations mm-hmm. <affirmative> here in Chattanooga that stem from the Coca-Cola story. but, but at any rate, they really have dedicated their, their missions center on education and improving thing quality of life in Chattanooga. So we dovetail well with our mission in their operations, and there's just a, a great sense of cooperation within the community. We've also had great political support and legislative support in Chattanooga all the way beginning with the riverfront renovation beginning back in the, in the 1980s and nineties all the way through to today. we may have our differences, certainly just like every community, but when it comes to the betterment of how our folks live, and we certainly all do come to the table and, and throw our full support around projects like Ed Connect. We were, we didn't do that by any stretch. We were a facilitator and it's our technology, or it's our network. But by no means were we the only reason that that program has been successful.
Christopher Mitchell (14:34):
The thing that blows me away is I hadn't gotten the latest numbers, but 16,000, my understanding is, is that the total number of potentially eligible homes is in the around 17,000. And I've not, we're getting close, I've not heard of anyone getting that close. I mean, that's, it's very difficult. People don't how difficult it is often to get even 50% of people in this situation because they're often people who are changing homes rapidly. They're people who are suspicious because they've been targeted in the past by offers that look too good to be true. you know, and so I think there's a, a remarkable story to be told there about getting so close to a hundred percent of the, of the available audience. Well,
Katie Espeseth (15:13):
We have 16,000 students. That doesn't necessarily mean 16,000 homes. Okay. But we, but we are getting, we are in that 10,000 and above range of homes. So we, we do have some room to go, but we're working hard and it improves and increases every year along the way. and that's what we want. We want continual improvement. We want try to get the word out. Hamilton County Schools does a great job of making our making their students aware and their families aware of the availability. and we, we work really hard for there to be no barriers. Mm-hmm. <affirmative> when people do want our services. and, and you know, we we're very careful about their experience in dealing with our folks as they place the order, and then certainly as we, as we do the installation. So we try to be very, very sensitive and we're always, you know, we're in conversations right now about how do we expand this program?
Christopher Mitchell (16:07):
Katie Espeseth (16:07):
Well, and, and what does that look like for us?
Christopher Mitchell (16:10):
I would, I would love to keep talking about it. There's so many different things that, that you have going on. I was gonna jump next to the SMARTnet Plus and that's a, a program that I thought people might want to hear a bit about. What is SMARTnet Plus?
Katie Espeseth (16:23):
Well you know, we recognize that the speed that we deliver to the side of your home means nothing if you don't get those speeds inside of your home. and so we, we've been offering wire a router service for years. and we, we wanted to update that and make sure that our customers have access to the same great speeds inside their home that they do, that we're delivering to them. And you mentioned c e s and oh my gosh, if I was not a believer and you need horrific wireless connectivity before I went, I certainly did come back with that, with that understanding of just thousands of options, thousands of wireless devices. So
Christopher Mitchell (17:06):
A month ago you were at the Consumer Electronics Show for people who aren't in the, in the business. Sorry. Yep. No, it's fine. <laugh>.
Katie Espeseth (17:12):
It's, it's one of those that I hadn't been to in a couple of years because of covid and some other things. So it was exciting to be able to go back and I urge anybody that is interested in technology and looking towards the future it's a great show in Las Vegas every year, that first week in January, the number of devices that are in, in folks homes today. I, I, I sit in on several of the sessions and I think the average now is 16 smart wire devices that need wireless connectivity in your home today. And, you know, we've done some surveys here and some focus groups, some informal Facebook surveys and that sort of thing. and Chattanooga is about that same norm. I, it's shocking, but when you really step back and think of everything in your home that requires wireless that you really may not have thought of, you need a strong partner to be sure that every device is covered.
We wanted our customers to have insight into the health of their network. We wanted to give them the tools to manage their network if they wanted to do that, or to at least understand what was going on. Certainly we pride ourselves on 24 7 technical support. That's all here located in Chattanooga. and if they can't solve your problem quickly, we'll have a truck at your door at your convenience to be able to solve that problem. So our smart net plus is just an enhanced version of that wireless connectivity inside your home. We want every square inch of your home to be able to operate wirelessly. and so you, you do get, you can take advantage of the speeds that we're delivering to you. We just think now it's about what you can do with it inside your home. We all lived through the pandemic. We all learned at home. We had kids at home, we had folks who were working at home. In some cases you had people gaming at home at the same time. and so not only is it about you, but it's about your whole family being able to enjoy and learn and work at home all at the same time.
Christopher Mitchell (19:12):
One of the things that I heard about c e s was we're getting more and more products that are finally gonna be able to take advantage of more than one gigabit. I think we've had 20 years now of the one gigabit port on a lot of our devices. And we're, we're going beyond that more rapidly now, it seems like.
Katie Espeseth (19:27):
Yes, yes. I mean we are rolling out some devices now, some routers now in pods that have one gig, but we, but that's not at all where we're gonna stop. I mean, we're, we offer five gig, 10 gig, 25 gig today. And so we're continually updating our devices especially in the commercial for our, our, our commercial customers. Our first 25 gig customer that we rolled out in, we announced in August of last year is the Chattanooga Convention Center. And as you well know, they host a number of conventions every year with all sorts of folks using their cell phones, running different devices. And we just thought that it was very appropriate that the first 25 gig service that we installed would be at the convention center. It's kind of a, a showcase for them and a showcase for us. But I think it demonstrates the need for high bandwidth opportunities with multiple devices.
Christopher Mitchell (20:26):
Well, and especially one that has hosted multiple e-gaming summits and championships and things like that.
Katie Espeseth (20:31):
That's right. That's, that's a great point. So we were happy to partner with them as our first customer. And, and you know, we're not unlike any other community. We have a large regional hospital here. We have university here all of which have very high bandwidth needs. and so unlike in some locations where you're having to build specifically to serve them, because we have a fiber infrastructure in place already, we can upgrade electronics and are able to serve those type of needs very quickly.
Christopher Mitchell (21:03):
The last four trips I've made into my office, cause I do most of my work from home now, have been to get to a gigabit upload and download where there was no bandwidth cap, because I've hit my bandwidth cap several times in the past few months. And that's not a problem on your network as I understand it.
Katie Espeseth (21:19):
<laugh> No, that's, that's one of the luxuries that that's, those are some of the things that drove us to Bill Fiber was really that we knew it had un unlimited possibilities. We've upgraded and changed electronics. This is our third iteration of our network in 12 years. It will not be the last.
Christopher Mitchell (21:38):
Right. Well, I have to ask then as we're winding down the interview about Knoxville, because Knoxville is is building their own fiber network now, I have to assume there's a bit of a rivalry at some level between Chattanooga and Knoxville, and it looks to me like y'all are helping them rather than trying to get some sugar in their gas tank. So I'm, I'm curious how that's going
Katie Espeseth (21:58):
<laugh>. No, we we are absolutely delighted to work with other communities. In fact, we have a group within the company, BroadB in solutions, and we partner with right now we're partnering with 20 other communities in their deployment. So we offer consulting services for them. we do a lot of their market research and, and survey work and that sort of thing. We, we handle some of their call center services for them. We do some of their smart grid work. So you know, we're, we are believers in what building this type of infrastructure can do for a community. So when another community is interested in it we're happy to work with them. And we do work some with K U B and we're cheering 'em on from the sideline. I mean, they're, they, they're larger than we are. and so we look forward to the day when they pass us in, in their sub counts, in their customer counts.
Christopher Mitchell (22:55):
I think it'll take a little bit of time, but yes, they're, it'll,
Katie Espeseth (22:58):
It'll, it took us lot. I like they're doing a great job. It took us some time too, but they have great leadership in Knoxville and they're doing it for the same reasons that, that a lot that Munis and co-ops move into this business. And so any way we can help them in other communities, we're delighted to do it. as we were building our network and writing our business plan, we travel all over to anyone that would talk to us. We were so lucky that other communities were, would open their doors and sit down and talk to us and share what they had done well and what they had not done well. We learned from them so much during that process that we kind of think it's our way to pay it forward. We need to do the same thing for other communities cuz we do believe this is the right to happen across the country country. Whether it's a muni or a co-op, a a a different type of, there's all sorts of different business models. I don't think there's one that works that I'd say is the best. It's really what works best for you. So no, we, we think rising tide will, ra will raise all boats and we're happy to be part of that.
Christopher Mitchell (24:05):
Well, I've been surprised to see that the Tennessee legislature has been not I'm trying to think of how to say this properly cuz the Tennessee legislature is acting in some interesting ways. I think in that you and in other, the many other municipal fiber networks that have been so successful across Tennessee are prohibited from offering advanced services outside of your electric territory. At the same time, the broadband office has been giving grants to some munis where they have low density areas that are not covered within their electric territory lines. And so I feel like the state is both encouraging and discouraging <laugh> municipal investment at the same time. so I'm just curious if you see any of that dynamic. Is that, is that what I'm correctly perceiving?
Katie Espeseth (24:52):
The interesting thing is that you're exactly correct. We are not allowed to own customers or provide services outside of our footprint. There's many different ways we can work together to enable others to provide these services. So where there is connectivity between neighboring municipalities or operating systems, we certainly take advantage of that. You know, we, we lease fiber from other carriers or from even in some cases t v a leases their fiber to us and to anyone else really who wants to take advantage of that. But by having that kind of connectivity, whether it's, it's an informal middle mile right now, we'd like to make it a formal middle mile. We can really share services we can reduce the cost to enter the market by being able to enjoy the economies of scale that some of us who are already in the business have been afforded. We can lower their financial risk to get into the business. We can share applications, share experiences. So we may not own customers in each other's footprints, but it doesn't prohibit us from working together to help, to help all of us offer better services to each other.
Christopher Mitchell (26:00):
Well, that's good and, and I think, you know, for people who aren't familiar, whether it's you know, up in the the corner there with Irwin down to y'all, you got Morristown, you got Bristol, you got Johnson City with the, the Bright Ridge. East Tennessee has gotta be one of the best connected parts of the United States of America for, in terms of pricing, reliability, and high speed services. It's truly remarkable.
Katie Espeseth (26:21):
And and you've got Lenore City getting ready to launch here. That's right. which is right outside of Knoxville. And you know, they serve thousands, literally I think 60,000 they passed the homes and businesses. So you're right. It it's been, and you know, when we launched in 2009, we were not, we were by far not the first in Tennessee to get into the business. So I I think we were sixth or seventh, in fact, the munis to jump into the business. So we've had a long history of our munis and our co-ops as well serving their customers this way. So I think interestingly enough, that puts Tennessee kind of as a, as a market leader in, in, in building this type of infrastructure.
Christopher Mitchell (27:03):
I think so. And and I think, you know, with the kind of shared knowledge that we see from, from you and, and others in the area, I hope that will continue. so thank you so much, Katie, for your, your time once again. It's, it's wonderful seeing what you've done.
Katie Espeseth (27:18):
Well, thank you. And we're always, we're always excited to talk about Chattanooga and we applaud what you're doing to make, make sure that everyone in the country has access to this, these same advantages that we hear in we enjoy in Chatanooga. So thanks for your time.
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