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Transcript: Community Broadband Bits Episode 40
Thanks to Jeff Hoel for providing the transcript for the episode 40 of the Community Broadband Bits podcast with Mayor Gary Fuller and others on the first citywide municipal fiber network in Opelika, Alabama. Listen to this episode here.
Lisa Gonzalez: Welcome to the Community Broadband Bits Podcast, from the Institute for Local Self-Reliance. This is Lisa Gonzalez.
This week, Christopher introduces us to Mayor Gary Fuller of Opelika, Alabama, and Jennifer McCain of the Motive Group. Chris' guests tell us a little bit about the history of the community and their decision to build a fiber network. The community has been held captive by horrible service offered by Charter Communications. But efforts to bring more private competition have failed. Community leaders want to bring reliable connectivity to Opelika, and improve existing municipal electric service. A fiber network is the natural choice. The network is in the testing phase now, with deployment scheduled for May. As Jennifer notes, while more communities offer fiber network for telecommunications, they also take advantage of the investment to improve electric delivery and manage other municipal utilities. Let's go to Christopher, Jennifer, and Mayor Fuller.
Christopher Mitchell: Today on the Community Broadband Bits, we're talking with Mayor Gary Fuller of Opelika, Alabama, and Jennifer McCain of the Motive Group. Mayor Fuller, will you please start by describing Opelika to us?
Mayor Gary Fuller: Sure. I'd be glad to. And it's a pleasure talking to you, Christopher. And thank you for allowing me and us to talk about my favorite community in the world, which is Opelika. Opelika we established back in 1854. So we've been around for about 159 years. And our claim to fame for many years -- we were a railroad town, in that we have an east-west railroad line and a north-south railroad line that interconnect in Opelika. And -- not very far from City Hall, where I'm speaking to you from. And then we had an economy that was based on agriculture and textiles. Then later on, we added a tire manufacturing plant, a magnetic tape manufacturing plant. All the textile plants are gone. And that's, for the most part, gone offshore, and will not ever come back. But Opelika's managed to, I guess, sort of reinvent ourselves, in that we've had a number of additional industries that have come to our community in the past several years. Primarily the automotive parts manufacturing business. Not only to serve the Kia plant in West Point, Georgia, which is about 20 miles from Opelika, but also the Honda plant in Montgomery, which is less than an hour from where we are. Then we've expanded, then, into a rental company that manufactures renal filters for dialysis -- a very high-tech company. And then, most recently, a company that manufactures vitamins, minerals, and supplements -- Nature Made. And that's a company called Pharmavite. So, we still have all of our automotive plants. But then we've added the medical device manufacturer and the vitamin manufacturer.
So, we're a community of about 27,000 people. We're part of the -- it's the Opelika-Auburn metropolitan area. We're a small MPO. And, I guess, something of a -- a little more than 100,000 people in the metropolitan area. And about -- almost 28,000 of those are in the corporate limits of Opelika.
Chris: Thank you. And, Jennifer, can you say a little bit about your background? You and I met at the Broadband Communities Conference last year in Dallas, which I just want to plug briefly, 'cause, for anyone who's listening, that will be coming up again in two weeks in Dallas. And the economic development program will almost certainly be broadcast online. So, definitely take a look into that. But, Jennifer, a little bit of background?
Jennifer McCain: I have actually been working with municipals who were looking to build their own infrastructure -- fiber infrastructure -- for about ten years. And I did that with a couple of different equipment manufacturers -- most recently Alcatel-Lucent -- and worked with communities like Opelika; Bristol, TN; Chattanooga, TN; Morristown; and multiple communities. And then with Opelika. And helping them try to figure out the best way to get into the business. What the business plan needed to look like. And then, in Opelika, we've been fortunate enough to have the opportunity to work with them on actual execution of their project. This is a, you know, big undertaking for any community. Mayor Fuller and his support staff had the vision for this network. But, like many others, they went and asked their incumbent providers to bring these services to their community; and they were not willing to make those investments. So, they had the vision and desire to do it for themselves. And we have -- we formed the Motive Group for the purpose of helping them execute on that. And, you know, we feel very passionate that this is the right thing to do, just like you do. And we're, you know, working on a day-to-day basis there with Opelika. And helping them execute, and bring services to their community as quickly as possible.
Chris: So, you got into it a little bit there. Opelika started by asking the incumbents to improve their services. Opelika has the benefit of having a municipal electric department. But, Mayor Fuller, maybe you can step us back a little bit and tell us how you came to be considering building your own network.
Mayor Fuller: Actually, it came about when we were trying to find a competitor for Charter, because all of our complaints on their poor customer service, on their predatory pricing, Charter, being the incumbent provider, their slow Internet speeds, just fell on deaf ears. And there was no one locally for Charter that could really make a decision. Those decisions were being made, I suppose, at corporate, or somewhere else. So, it was quite frustrating for me. And there was hardly a day that passed that I didn't get a call, here at my office in City Hall, with someone complaining about Charter. So, we tried to recruit a competitor for Charter. We were not successful with that. They said the numbers wouldn't work. So we started looking into it, on how we might be able to do it through Opelika Power Services. And then I became interested in improving our electrical distribution system that the citizens of Opelika have owned for over a hundred years. And it is public power. So we've -- so, how can we improve our efficiency? Well, you do that with smart grid. And you do it with fiber. And you do it with smart meters. And so, one thing leads to another. You know, that fiber has such capacity that we said, well, not only can we improve our power system, the local distribution, and the reliability, but we can add video; we can add ultra-high-speed Internet; we can provide telephone service. So, that's really how we got into it.
Chris: And what was the timeframe of when you were doing a lot of this investigation?
Mayor Fuller: Well, it was back in '07, '08. And, of course, everything we did was, you know, part of the public record, because the City Council had to approve my requests -- well, first of all, to do s feasibility study. And -- which, when that was done, then they brought the results to the Council meeting. So, you know, the media was reporting on what we were doing. That, of course, raised a few eyebrows with the incumbent provider, and perhaps other providers. And so there began to be a little more interest. And, of course, Charter wanted to tell us all the reasons why this wouldn't work, and why it was a bad decision for the city to get into something like this. So, that was really back in '07 and '08.
And then we had to have a referendum -- not for the fiber, not for the Internet or the telephone or smart grid or anything else, but we had to have a referendum on being able to provide cable television services. And that was because of an Alabama law that was passed back in 2000, really designed to keep municipals like Opelika out of the cable television business. So, we had a referendum, and the citizens of Opelika passed it, and approved us doing the cable television part of this. Which, of course, we didn't want to just build all that fiber. That's, as you know, can be quite expensive. And we wanted to be able to fully utilize it, which is to put everything that we could possibly put on there that will provide a service to our businesses and our citizens. And then, ultimately, we expect to get a return on this investment.
Chris: You had mentioned the referendum, which is when I first learned about Opelika. I think I saw some newspaper articles about it. And I was very interested. I saw that Charter was doing the same things they normally do, in terms of trying to discourage. And I remember, your referendum was focused very tightly around the smart grid, and the benefits of doing this to improve the smart grid. And seeing the cable television services as something that, you know, you would sort of have to do, in order to bring along all the broadband and other benefits you wanted to do. Is that -- am I remembering that correctly?
Mayor Fuller: Well, kinda, sorta. The referendum -- Charter and others tried to make the referendum all about smart grid. It was NOT about smart grid. We didn't need a referendum for us to build and fully deploy our smart grid. We already had a version of smart grid. We'd been doing automated meter reading for a long time, with a TWACS system. So that -- we had some of the smart grid in place. But that's what the opposition tried to make it out to be -- that the referendum was about smart grid. And if we had smart grid and smart meters, we were going to be able to tell what you were doing in your house, tell you what -- if your coffeemaker was on, and all that stuff. And, of course, none of that's true, but -- The referendum had one question: should the city of Opelika be able to provide cable television service to Opelika citizens? That was the question. So, the answer was yes.
Chris: And what was -- do you remember the proportion of the return?
Mayor Fuller: I think it was 63 or 64 percent that voted yes. So, 35, 36 percent voted no. And let me tell you what, the opposition -- the conspiracy folks, that had me in there with Al Gore and President Obama and global warming and being able to take control and tell them what electrical appliances they could use -- they put out a lot of what I would term misinformation. And I'm sure that that got them a few "no" votes. But at the end of the day, our citizens approved the cable TV part of it. So -- and I'm not sure we would have done the smart grid and smart meter and all of that if we were not able to offer all these telecommunications products that we're going to be able to offer.
Chris: Jennifer, you had mentioned that your experience is working with many communities in Tennessee. I'm curious, I -- Opelika is the first community in Alabama that I know of to do something like this, and I'm just -- I'm curious to what extent the Tennessee experience makes sense, and if you can, in terms of being a lesson -- offering lessons to Opelika. But I'm also curious, more broadly, if you can sort of explain the benefits, or the reason why one would tie so many different services -- the smart metering and the telecommunications services -- into one network.
Jennifer: Um, well, I guess, what's relevant with the experience that I've had -- and it's not only in Tennessee; actually, I've worked with customers across the country that have been looking to deploy fiber-to-the-home networks. You know, as you know, there's been a -- there's a pocket in Tennessee that, you know, went forward, between 2004 and beyond. And there were a lot of lessons learned. Dalton, GA, was actually another one of my customers I worked with. And Bristol, VA. So -- but, you know, as people got into the business in the early stages, they were deploying networks based upon the demand that they had in their community for these competitive services. And over time, what started to become more and more, you know, relevant was that there started to become more of an incentive -- and more of a need -- to upgrade the utility infrastructure as well. To make our electric infrastructure smarter, in order to just be able to provide better service to our customers. And what really kind of started to become evident was that you could utilize the same infrastructure to do both. You could, for instance, when you had a fiber-to-the-home infrastructure, if you -- you know, you can utilize an ONT to tell when -- you know, to isolate more accurately where a power outage has occurred.
Chris: And, just to -- for people who aren't familiar, an ONT is the device -- it's usually on the side of the house -- that communicates between the house and the network.
Jennifer: Yes. That's your telecommunications device that provides voice, video, and data interfaces to the home. But it can also be used for other things. It can be used to determine power outages, and isolate them down to a certain geographic area. And in a lot of cases, the electric utilities didn't have that intelligence built into their network before. And there's a long list of other things that, as these networks have evolved -- You know, municipal utilities are great about talking to each other, learning from each other, and helping each other, you know, from lessons learned, deploy networks and leverage them for other things. And I think that that's what's happened over time. There's been a, you know, influence, that we needed to start looking at how to smarten the electric systems, and how to, you know, get better information out of our electric systems, simply to better manage our power resources. And then, realizing you can also add telecommunications, you know, products over it, to meet the demands in your community for economic development, and meet those other needs as well, it's -- a business plan has evolved over time that has proven to be the most successful and profitable. And if you start to look at, really, the numbers, you know, utilities that invest in this type of infrastructure can utilize funds that they have to make these investments. And, really, the return on investment, when you look at structuring the plan that way, is significant, in comparison to just deciding we just want to deploy telecommunications infrastructure alone.
Chris: Right. It seems intuitively to make sense that if you're going to be making a large investment, you want to try and create as many benefits as you can across as many sectors of the economy as possible. And that would also include municipal departments, and that sort of thing. Now, if we jump forward to today, I'm curious how the network is benefitting the community and what exactly is happening this week in Opelika, as a result of the network.
Mayor Fuller: Well, this week, Christopher, we're signing up the first "friendlies" to be our test subjects for our system. And those are our employees, of Opelika Services. So they'll be installed this week, and they'll begin getting the video and the Internet. I don't believe the voice part of it is quite available yet. But it will be. So, we'll get these friendlies on. And then we'll add some more to it as we work out any bugs or any glitches we might have in the system. And then, hopefully, in May -- could be the middle or latter part of May -- we'll begin offering our services to customers. And I'm very anxious for that to happen, because all we've been doing for the past few years is spending money. So I'd like to have some revenue coming back this way. We don't know all the benefits yet. We're pretty confident what those benefits will be. And now it's just a matter of, you know, executing our plan, and getting customers online with us.
Chris: You made some very powerful enemies in pushing for this approach, and upsetting Charter. In a number of places, we've seen Charter or other providers respond by, you know, trying to make the Mayor's life more difficult when they've done that. And, as you've just stated, you've made a very large investment -- which you've had to pay all the bills long before the benefits start being achieved. I'm just curious if you have any advice for other elected officials, who may have to face an election before the benefits are rolling in from a needed investment?
Mayor Fuller: That's a great question. You know, I wouldn't know -- I'd pray a lot about it. And then I would -- you've got to make sure you've got the courage, and then the support. I was most fortunate in that I informed the City Council -- we have five City Council members -- and I informed them every step of the way of what we were doing, and tried to educate them -- as I was being educated -- and got the Council totally involved. So every vote that we have had in the past on this has been 5-0. So, I -- if someone else is going to do it, of course, make sure you've got, you know, some political support from your City Council, or your governing body. So, I -- we've been most fortunate in that. And we've been straight up with them on what to expect, and what kind of payback period we're looking at. So, you know, it's not going to be an overnight success. We -- I think our -- just with a very conservative take rate, we're looking at -- Jennifer, I believe it's about a four-year break-even? But, you know, the good thing about that is that, unlike some of these publicly traded companies, we don't have to have a quarterly earnings report, and we don't have to satisfy Wall Street. We do have to satisfy -- I have to satisfy Main Street. And that's the citizens that live here in Opelika. And we've been up-front with them about that, that it's going to take a while for us to get a return.
And we do have to pay for this. We cannot use any tax money to pay for it. And it will have to be paid for out of revenues from the Opelika Power services and from the telecommunication piece of this. So, that would be my advice for someone else looking at it.
Chris: And, Jennifer, do you have anything to add onto that?
Jennifer: Yeah. I think that -- Yeah, I totally agree. And, like I said earlier, Mayor Fuller and his Council had, you know, the vision. They went through a very diligent process of educating themselves on what it would take to do this. And made sure that it was the right thing for their community. And then, you know, moved forward with the project, with -- in implementing, you know, the smart grid piece as well as the telecommunications. And I think that they're -- you know, they have seen -- you know, I don't -- Mayor, you could speak more to the economic development piece, but I think that there's interest -- You know, in other systems I've built, the fiber system itself is typically of interest to businesses who are looking to move into communities and establishing themselves there, and think that it will provide a benefit. But, also, I think, as they move forward, they'll be able to do to things that -- you know, with their systems that are -- they're going to see great benefits from. And saving their community money. And managing -- you know, more efficiently managing their electric system. Their community will see a benefit, as we've all seen in the past, with competition enter the market. There will be better pricing. And there will be better service from everyone. So, you know, we see that as a benefit to the community. We expect completely that our competitors will -- we know they've been upgrading their networks, which they probably wouldn't have done without the -- without this project being built. They're -- we see them in the field was we're doing installation of, you know, the infrastructure itself, and know their intent is to come out with very competitive pricing when we launch. And we see that as, also, just an overall benefit to the community -- that it will have lasting, you know, and long-term effects for them.
Chris: And one of the other benefits we often see in the communities is much better services to local schools and municipal departments. Have you started to see any of those types of benefits yet?
Mayor Fuller: Well, there's a great deal of, certainly, interest from local Opelika schools, and from our community college. We have a regional hospital that -- I believe they would have signed up six months ago if we could have served them. And, of course, they're really interested in that speed -- or that ultra-high-speed on the Internet. Because what they're doing now is just, frankly, pretty slow. And you're sending those really big, big files. So, yes, we -- there's a lot of interest there, certainly, as we recruit business and manufacturers to come to Opelika, the fact that we're going to have a fiber network is very important to most of them. That's going to be a long-term benefit. And part of what we've tried to look at -- and I've encouraged all of us to look at -- is not what this is going to do for us the first year, or the fifth year, but what it's going to mean to Opelika ten years and twenty years from now. For us to have this kind of technology, what it's going to mean to our children and our grandchildren. You know, this is a long-term project that is going to be paying, I think, dividends and benefits for many years to come.
Chris: Is there anything else we should know about Opelika, as we sign off the podcast?
Mayor Fuller: Well, yeah. You ought to come down here and visit us, Chris. And I know that you're a sports photographer. And you can come down here and shoot -- You know, there's the Robert Trent Jones Golf Trail in the state of Alabama. And the crown jewel of all the Trail courses is located in Opelika. And it's called Grand National. A few years ago, Golf Digest Magazine rated all three hundred and -- I think it was 334 metropolitan areas, and the Opelika-Auburn metro was chosen number one for golf. We beat Myrtle Beach and all these other places primarily because of Grand National, part of that Robert Trent Jones Golf Trail. So, I would invite you to come down here and visit us. And maybe you could come for the ribbon-cutting, when we start serving customers and open our new facility -- administrative building. And -- come down here and stay three or four days, and spend some money with us.
Chris: I would like that very much. Although, I have to be honest, I might be more interested to play on your connections to get into an Auburn football game while I'm down there.
Mayor Fuller: We can do that. Even both Jennifer and I believe Crimson, we're very, very fond of Auburn. What a great university it is. And what a great partner they've been to the city of Opelika, especially in the area of economic development. So, Auburn's a great school. And, of course, didn't have a very successful basketball season this year. And, of course, you guys, at the University of Minnesota fired Tubby Smith. And, I guess, you haven't announced a new coach yet, have you?
Chris: No, we have not. And, you know, I've greatly appreciated Tubby. He was -- he had so much integrity. I just regret that we couldn't get more wins.
Mayor Fuller: Yup. Well, and, of course, football is the big, big deal down here in the state of Alabama, and especially at Auburn. And then at the University of Alabama. So, yeah, you come on down here. We'll -- we know some folks who'll get you in, and get you a sideline pass, and you can shoot all the pictures you want to.
Chris: I will definitely put that on my list. I want to do a trip, driving around the country, hitting as many networks as I can. And call it a vacation. I'm not sure I can talk my wife into it. But you're on the list now.
Chris: And, Jennifer, is there anything else that you'd like to throw in, in terms of your experiences with Opelika, that we should know?
Jennifer: Well, I will tell you that the project that Opelika has decided to undertake is as large as any, you know, I've seen. And they're a smaller community, but at the same time they've undertaken building the fiber infrastructure, they're building new facilities, they've undertaken becoming, really, the first CLEC in the state of Alabama. Through going to the FCC and actually having to validate some of the laws in the state of Alabama, and how you get through the process of becoming a CLEC. They've had a lot of firsts. They're continuing to move forward very aggressively. I'm very honored to be -- we're very honored to be a part of this project, because I think it will be instrumental in helping them to continue to be at the forefront of, you know, just communities and economic development. They're a very progressive community, and this is just another example of that.
Mayor Fuller: Let me add this, Christopher, to what Jennifer was saying. You know, when we started on this, the important thing for us was not to be some kind of pioneer or to get a lot of kudos for, you know, for being bold or brave. We knew what we wanted. And we were convinced of what the long-term benefits would be. Now, you know, some of these long-term battles we've had to fight have been a challenge, to say the least. But we're probably better people for it, after having gone through some of that. And we're excited about the future.
Chris: And I hope that you've helped to lead the way for other communities in Alabama that may have been in a -- that may BE in a similar situation to where you had been, before you moved forward. You know, one of the things that we've found with networks that are successful is, they can start reaching out into unincorporated areas around them, and other rural communities, to work together and find a solution. So, I'm just really thrilled that you found a way to make it work in Alabama. And I very much look forward to following your progress.
Mayor Fuller: Right. Thanks a lot, Christopher.
Lisa: That was Christopher, visiting with Jennifer McCain and Mayor Gary Fuller, from Opelika, Alabama. Learn more about the community at opelika.org , including a video tour that you can take of the city. You can also visit muninetworks.org and follow the Opelika tag, to see more on our coverage of the network. In addition to information in print, we have posted a few videos from local media about the network and about the community.
We want your questions and comments. E-mail us firstname.lastname@example.org . Follow us on Twitter to learn about all the most recent developments relating to community networks, broadband policy, and telecommunications. Our handle is @communitynets . This show was released on April 2nd, 2013. Thanks again to D. Charles Speer & the Helix for their song, "Freddie's Lapels," licensed using Creative Commons.
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