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NEEDS ASSESSMENTS AND TELECOM PLANNING Funding PEG and I-Nets Post State Franchising

NEEDS ASSESSMENTS AND TELECOM PLANNING Funding PEG and I-Nets Post State Franchising Presentation on September 20, 2008 by Rita R. Stull to National Association of Telecommunications Officers and Advisors Annual Conference: Promoting Community Interests in Communications

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NEEDS ASSESSMENTS AND TELECOM PLANNING Funding PEG and I-Nets Post State Franchising

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  1. NEEDS ASSESSMENTS AND TELECOM PLANNING Funding PEG and I-Nets Post State Franchising Presentation on September 20, 2008 by Rita R. Stull to National Association of Telecommunications Officers and Advisors Annual Conference: Promoting Community Interests in Communications Community Needs Ascertainments: Not Just for Cable Anymore www.teledimensionspublicsector.com

  2. BACKGROUND • PEG/I-Net funding established in 70’s in national cable franchising model • 1980’s-2008: Digital & Internet Convergence, intensive bandwidth applications • Fiber-to-the-Premises (FTTP) networks needed to carry 100 Mbps bandwidth • Copper twisted-pair & coaxial cable carry 10 Mbps Internet after upgrades. • Pro-industry federal/state laws stifle next generation fiber deployment. • Loss of PEG access and I-Nets constrains local economy: • Blocks economic development initiatives, education, job creation, e-innovations • How can we fund PEG access and I-Nets in the 21st Century? Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  3. IMPACT ON LOCAL GOVERNMENTS AND COMMUNITIES NOW HISTORY • No new funding for loss of PEG Access and Institutional Networks • Erosion of local control of right-of-way: ’84, 92, & 96 legislation, court cases & myriad FCC rulings TECHNOLOGY INNOVATION & WORLD COMPETITION • Digital Convergence for Voice, Video and Internet Services • Affordable & Bendable Fiber • Europe & Asia subsidize deployment of FTTP Networks & 100 Mbps Internet LEGISLATIVE & REGULATORY BARRIERS • U.S. phone & cable monopolists balk at upgrading to FTTP • Incumbents refuse to allow competitors to use any upgraded fiber networks • at&t state video franchising initiatives void cable franchises & prop up inferior U-verse technology PAYMENT FOR USE OF PUBLIC-RIGHT-OF-WAY IN STATE VIDEO FRANCHISING ARENA • State video laws abandon PEG channels, I-Nets, technical and customer service standards • Eliminate mechanisms for protecting community quality of life & public interests Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  4. LOCAL ECONOMIC DEVELOPMENT ISSUES LOCAL ECONOMIES • Losing thousands of jobs and businesses overseas • Diminished tax base creates domino economic effect, less dollars for schools, road maintenance, police, fire and other essential elements that collectively create a community’s quality of life • Franchise fees used In general fund due to economic downturn instead of for technology upgrades & PEG Access • Loss of manufacturing jobs not being replaced by technology driven innovation businesses • 21st Century fiber-to-the-premises infrastructure not being built by the private sector EXORBITANT LOCAL TELECOM COSTS • CA community charged $45,000/month for 30 drop I-Net that used to be part of franchise payment • Public sector pays more for less telecom services as they cut back due to budget shortfalls. • Implementing E-Government services impossible with spiraling costs for telecom connectivity. • Guaranteed bidirectional high speed Internet unaffordable or unavailable to small businesses. Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  5. LOCAL DEVELOPMENT ISSUES COSTS • Communities of 40,000 purchase $1.1 million in telecom I-Net services. * • Loss of PEG access channels & capital eliminates “local communications.” • Loss of I-Nets & PEG access stifles workforce retraining, economic development and community communications in an information dependent global economy. • Emergency Management & public safety upgrades deferred due to decreasing local revenues for government operations. ___________ * Public sector telecom expenditures in this conservative estimate include schools, colleges, universities, libraries, social service and government agencies . Adding hospital telecom operating costs would increase this estimate. Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  6. COMPETING GLOBALLY U.S. BROADBAND FIBER OPTIC WORLD POSITION • Europeans and Asians pay $40 a month for home bidirectional 100 Mbps bandwidth • Americans pay $40/ month for 1-3 Mbps downstream & 250 Kbps upstream bandwidth • Most rural areas cannot purchase any high-speed Internet for home or business. • U.S. businesses pay $550 a month for a guaranteed 1.5 Mbps bidirectional T-1 line. • The U.S. telecom industry calls 1-3 Mbps downstream Internet high-speed. • Global standard is 100 Mbps bi-directional Internet—upgrading to 1 Gigabit • Incredible as it seems, the FCC’s definition of high speed Internet is 200 Kbps.

  7. U.S. POLICY FAVORS PHONE & CABLE MONOPOLIES • U.S. free market competition policy has not produced universal upgrades in a phone and cable company duopoly environment. • Most phone and cable companies have fiber ‘backbone’ infrastructure. What’s missing is the last mile of fiber capacity needed to transport 100 Mbps bandwidth to the premises. • Phone & cable companies current upgrade strategy is to pass state and federal laws that eliminate cable franchising at the local level. • at&t’s video technology carries only 5-10 Mbps downstream high speed Internet service and poorly transmits PEG channels. Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  8. U.S. STYLE TELECOM INDUSTRY SUBSIDY Individually, each of us subsidizes the telecom industry. “By 2006, according to telecommunication companies’ own documents, 86 million [U.S.] customers should have received 45 Mbps [bidirectional] Internet fiber optic service, replacing the [phone company’s] copper wiring. . . [From 1996-2006,] America paid over $200 billion in excess fees as well as tax and other financial incentives to improve subscriber lines, and there is nothing to show for it.” * Note: $200 billion in 10 years amounts to 86 million customers paying $19.38 per month. • "Where's that broadband fiber-optic access?"Bruce Kushnick, Harvard's Nieman Watchdog Project, 3-14-06. http://www.niemanwatchdog.org/index.cfm?fuseaction=ask_this.view&askthisid=186 Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  9. PUBLIC INTEREST & TELECOM ASSET ISSUES IN 21ST CENTURY • Compensation for use of Public Rights of Way • Access to your marketplace, your community’s subscribers • Availability of PEG channels, facilities, equipment & training • Bridging the digital divide: creating media literacy and competency • Transition to information, innovation dependent 21st Century economy Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  10. DEVELOP LOCAL TELECOM PLAN • What’s your community’s telecom worth? • Needs Assessments & Future Requirements Analysis • Document current public sector expenditures • Develop telecom projections to meet future demand • What’s quality of life in your community? • Jobs and businesses: are they growing or declining • Schools, colleges & universities and use of next generation information technologies • E-applications use in government, social service, health and educational delivery systems • Availability of local communications networks • Local news, emergency notification, special events, facilities and equipment for training • What’s private sector investment in your community • Capacity of existing phone, cable, wireless networks • Are there any long distance carriers passing through the community • Point of presence or switch and cost of connection Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  11. LOCAL TELECOM PLANNING MODEL • Conceptual design of phased public telecom network includes • Fiber backbone • Number of drops & types of voice, video and Internet service per premises • Projected phases or expansion of network • Business Plan • Projected costs for implementing phase 1 • Current public sector telecom expenditures • Future requirements for infrastructure and applications • Financial model for owning/operating/sharing assets in any partnership • Seek Private Partner(s) • Issue Request for Qualifications • Evaluate Responses • Negotiations • Draft agreement and execute Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  12. ASSETS / GOVERNANCE FOR LOCAL FIBER NETWORK • What does local government bring to public/private partnership? • Public right of way access—smaller communities that own electric systems have added benefit of granting pole attachment agreements. • Historical note: In Cincinnati, Warner built 850 mile cable network in three years, and paid phone & electric company to attach to poles and to move phone plant to lowest position on pole to accommodate new cable plant • Planning note: Some jurisdictions require installation of extra underground conduits whenever road work is undertaken—publicly owned conduit available for local partner. Leasing conduit creates new revenue stream for local government. • Public sector agencies are anchor tenants on the public network. • Value in Needs Assessment & Conceptual Design Business Plan • Estimate a community spends $1 million dollars annually / 40,000 population Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  13. GOVERNMENT ACCESS INFORMATION NETWORK (GAIN) ADVISORY COMMITTEES AND BOARD

  14. GAIN PROJECT OBJECTIVES From the Government Perspective • Provides enhanced & affordable digital telecom infrastructure for crime prevention functions, emergency management, homeland security operations & public information programs • Provides enhanced & affordable digital telecom infrastructure needed to deliver more services with less resources • Eliminates duplication of effort & increases responsiveness to community needs Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  15. GAIN PROJECT OBJECTIVES From the Education Perspective • Creates 21st Century ‘new journalism’ model, integrating new media content creation & distribution networks for schools, colleges, universities • Supports ‘information anytime anywhere’ programs to connect community and schools • Interconnects on-demand, high-tech training for digital telecom dependent information jobs & employers seeking skilled workers • Connects network of locations offering ‘New Journalism’ content origination learning programs with schools, colleges & universities Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  16. GAIN PROJECT OBJECTIVES From the Community & Economic Development Perspective • Makes enhanced digital telecom infrastructure available & affordable to elderly & low income residents • Supports deployment & accessibility of broadband intensive community service applications such as E-Medicine, E-Government, E-Education, E-Workforce Training & E-Economic Development • Interconnects innovations for businesses & workforce development initiatives into a comprehensive economic development incentive package—designed to link potential employers & employees Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  17. GAIN FEE STRUCTURES SUPPORT PEG / I-NET • Use cable franchising national precedent as base for GAIN fee structure for use of public rights of way and access to the community marketplace • 5% of gross revenues from all business streams—public and private services • 3% gross revenues for PEG, digital channels, programming, facilities & equipment • 2% of gross revenues for economic development, innovation and entrepreneurial new business development grants (replaces funding I-Nets) • Operating model • Private partner builds, maintains, upgrades the network • Partial ROW payments equal capacity for use in economic development packages • GAIN Board manages public sector assets including PEG/I-Net programs • Private partner leases wholesale capacity to phone, cable, wireless carriers • Private partner can offer cable & phone services & compete with incumbents Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  18. WHAT’S NEXT—WHAT CAN YOU DO? • Educate elected officials, administrators & community stakeholders • Telecom cost savings • For every dollar spent, community receives another dollar in value in increased services & reduction of current expenditures—or‘gained opportunity dollars’. • Impact on economic development initiatives • Losses result from unavailable or inadequate Internet capacity offered by your phone & cable operators--$40/month for 100 Mbps bidirectional Internet in Europe & Asia versus $550/month for 1.5 Mbps bidirectional T-1 line from U.S. phone company. Asia now upgrading to 200 Mbps Internet with 1 gigabit backbone. • Constraint on educational institutions & digital media training • resulting from unavailable, unaffordable, universal 100 Mbps Internet service • Start Today: Complicated, phased implementation process • Delay equals continued overpayments for inadequate service, lost opportunity dollars. • Losses are exponential given speed of technologic changes & overseas growth. Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  19. VALUING PUBLIC ASSETS In San Francisco’s Fiber-to-the-Premise Feasibility Study, consultants discussed valuing public assets: “. . . the business case for FTTP is not limited to such easily-quantified matters as cash flow and capital investment—rather, . . . it includes the less quantifiable financial factors, . . . economic development, small business empowerment, job creation, livability, environment protection, education, increased sales and real estate tax revenues, increased property values and other factors that measure the overall benefit of a next generation communications infrastructure such as FTTP.” * * Fiber Optics for Government and Public Broadband: A Feasibility Study , prepared for City & and County of San Francisco, January 2007, Columbia Telecommunications Corporation, http://www.internetctc.com/ Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  20. TECHNOLOGY ENHANCED PUBLIC ASSETS • Emergency Management & Notification • Public Information Programs • Local News, Culture, Building Community • Free Speech—Program Creation & Generation • Media Literacy & Competency Training Programs • Stay-at-Home Business Development Opportunities • Teleconferencing / Telecommuting • Tele-Medicine • Tele-Courses • New Applications Development—from your garage or home office • Global Business Operation from Home Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  21. CONCLUSION • CHANGE THE PARADIGM • Communities must become self reliant in the telecom arena • Incumbent carriers can’t be expected to abandon stock holders • Local government can’t win the ‘anti-public interest’ telecom industry battle • CONTROL YOUR DESTINY • Educate your community • Create community wide awareness of telecom infrastructure needs • Manage your collective assets • Fund PEG Access & I-Nets for your community’s 21st Century future • ENTER THE 21ST CENTURY ON YOUR TERMS • Create and sustain your community’s quality of life • Develop your local economy & public information network Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

  22. ABOUT US • A specialist in designing telecom plans for local governments, Ms. Stull’s twenty-seven years of public sector experience includes enforcing cable franchises, conducting needs assessments, implementing public, educational and government access systems and institutional networks, integrating telecom within municipal operating and economic development departments, training staff and restructuring delivery of public service. In the eighties, Ms. Stull acquired a telecom planning grant from the John and Mary Markle Foundation to develop the first Local Area Network Plan for a major city. As a result of her work in the regulatory arena, Ms. Stull testified on behalf of NATOA at the U.S. Senate Public Hearings opposing legislation leading up to passage of the 1984 Cable Act. Ms. Stull presents educational seminars and helps communities identify initiatives needed to compete in a 21st Century, Internet dependent, global economy. • Rita R. Stull, President • TeleDimensions, Inc. • Phone: (513) 381-3393 • Cell: (513) 236-8635 • ritastull@fuse.net • www.teledimensionspublicsector.com Rita R. Stull, President (513) 381-3393 ritastull@fuse.net www.teledimensionspublicsector.com

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