Minnesota Busts the ‘Broadband Is Too Expensive’ Myth
1. Minnesota Busts the
‘Broadband Is Too
Expensive’ Myth
2017 CASE STUDIES OF 5 RURAL MINNESOTA
COMMUNITIES
ANN TREACY & BERNADINE JOSELYN
2. Lay of the Land
Blandin Foundation for community
capacity building and engagement
Office of Broadband Development
for coordination of public
investments
State broadband goals and task
force – in Legislation
Cooperatives growing interest in
broadband
3. Research questions
1. What does a connected rural community look like?
2. What are the providers and communities doing
right?
3. What is the community ROI on public
investments?
4. Methodology
• Collect and analyze existing data from 5 communities
• Look at ROI formulas
• Hold community meetings/interviews with key
interlocutors
5. Beltrami/Bemidji –
Hip and Happening
Provider – Paul Bunyan
Fiber (Gig)
DSL (50/40)
Community Partners
Bemidji Leads and
Greater Bemidji
6. Crow Wing/Brainerd –
Work Hard, Play Hard
Provider – CTC
Fiber (Gig)
DSL (50/1.5)
Community Partners
Brainerd Lakes Chamber
of Commerce, Brainerd
Lakes Area EDC (BLAEDC),
Schools
7. Goodhue/Red Wing –
Hotbed of Entrepreneurs
Provider – HBC
Fiber (Gig)
Fixed Wireless (40/40)
Community Partners
Red Wing Ignite
8. Lake – Remote but Global
Provider – Lake
Connections
Fiber (Gig)
Community Partners
County Commissioners,
Lake County
10. “I get two questions: do you have the people we
need to succeed here; the second do we have the
broadband.” - Economic Developer
11. “Business involvement is key in any successful
economic development program.” – Economic
Developer
12. “…that [new location in same town] coupled with
online marketing, we’ve grown 400% over my
dad’s record year.” – Business owner
13. “As we work with commercial real estate agents,
they tell us that’s a leading question – is fiber
available at that location?” – Broadband provider
14. “Having good internet makes everything move
more smoothly… bill pay…accounting … camera
feeds in our hog sites…” - Farmer
15. “We use drones to do investigating … into the
jungle [Puerto Rico] instead of sending
employees.” – Xcel Energy
16. “Broadband helps efficiency by allowing us to do
things at such a rapid pace. Before …you’d sit and
wait for things.” – Winthrop News
17. “Patients can easily be 200 miles from the
nearest health facility… the patient portal … is
tremendously convenient.” – Healthcare
20. Beltrami – Census Stats
2016 Population is up 3.7 percent from
2010
◦ The statewide average was 4.1
◦ Town/Rural counties as a group have
seen a decline
2015 Median Income is $44,757
◦ Compared $40,700 for similar counties
Beltrami’s Digital Divide Index Score is
the second best out of the counties we
are tracking
22. ROI Details
County Public Investment Annual
Econ Benefit*
Real Estate
Increase*
Beltrami $1,432,000 $38,631700 $102,593,266
Crow Wing $15,123,450 $67,412,150 $214,662,149
Goodhue $542,262 $32,774,600 $104,825,572
Lake $83,418,170 $13,695,550 $38,547,421
Sibley $9,850,011 $8,604,350 $20,162,085
• Annual economic benefit - $1850/household x HH served
• Community real estate increase – 3% increase of market
(median value x HH served)
23. Just to compare
Public costs?
Minnesota Super Bowl Host
Committee (nonprofit) $60M
Stadium (taxpayer) $500M
Tax savings, free parking, closed
public transport…
ROI?
Rockport Analytics estimated
$338M
Sports economist Victor Matheson
suspects $30M to $130M
24. Conclusions
• Two keys to economic benefit – access and
adoption
• The community benefits from broadband quickly;
the provider’s ROI may not be as “timely”
• Public funding shortens ROI for the provider
• Adoption efforts increases ROI for community
25. Thank you!
Bernadine Joselyn
Blandin Foundation
brjoselyn@blandinfoundation.org
http://blandinfoundation.org
Ann Treacy
Treacy Information Services
atreacy@treacyinfo.com
http://treacyinfo.com
Editor's Notes
Area of extremes
Provider - Paul Bunyan Communication (Cooperative)
Voted Bemidji their Best City by Minnesota Monthly
Recently wooed Delta Dental (150 jobs!)
Beltrami Stats
Youngest population of the cohort
Highest level of education
Highest population of Indigenous
Smallest population of White (73%)
Greatest percentage in poverty
Greatest growth percentage since 2012
Highest number of housing building permits, despite being third largest county
What’s happening
Bemidji State University
Gaming Championship
GigaZone
Minnesota Innovation Institute
Launchpad
Growing Art Scene
County partner role - Been meeting for 15 years to plan from the Future. Broadband was key. They still meet regularly.
Lots of tourism, but big enough to need other industries
Crow Wing Stats
Largest population
Greatest population density
Second highest median home value
Tourism location but big enough to have other industries
What’s happening?
Concerted focus on shifting to tech industry after closure of Potlatch
Community Tech Recruiter position created
Schools offering tech training
Seasonal homes are becoming year-round residents
Attracting people who can work anywhere
Hackfest to convene techies
County partner role - Held a conference of leaders in 1999. In 2001, the school took the lead to getting broadband. Joined BBC.
Goodhue Stats
Highest median income
Highest median home value
Closest to Twin Cities
What’s happening?
Red Wing Ignite
Bringing “cool” events to Red Wing such as hackfest and the MN Ignite Cup
Promoting innovation and entrepreneurs in schools
Programs to support existing entrepreneurs
County partner role - Founded in 2013 through local foundations and the City to support better broadband use. Joined BBC.
Lake Stats
Lowest population (and pop density)
Largest percentage of population over 65
Smallest percentage of population under 18
Second largest land area
Most remote, although proximity to Duluth
What’s happening?
Attracting people who can work anywhere
Extending vacations
Making area away from the lake attractive
Creating intergenerational interaction
Dealing with haves/have-nots in the school
County partner role - Stimulated with ARRA funds in 2010. Founded to bring better broadband. Joined BBC to spur adoption.
Sibley Stats
Second highest median income
Second lowest population
Highest population of foreign born (4.6%)
Lowest percentage of college degrees
Smallest number of building permits
What’s happening?
Broadband is still new – but receiving a lot of attention for the approach
Saved the newspaper and found a way to reach millennials
Attracted a medical school (to open in 2018)
County partner role - Started in 2015 – after 10 years of striving for broadband. Joined BBC to spur adoption.
Our challenge was to try to quantify some of the success that we’re seeing. Like website stats – we have to balance quantitative and qualitative. AND unlike website site we need to recognize that the stat lag behind reality.
First – it’s helpful to look at progress over time to help determine where these counties are in the process.
One problem with broadband mapping is changing definitions
Another problem with broadband mapping is reliability
The problem with census data is that it lags behind broadband updates
2016 Population (46,101) is up 3.7 percent from 2010.
The statewide average was 4.1
Town/Rural counties as a group have seen a decline
2015 Median Income is $44,757
Compares favorably to similar communities where median is $40,700.
Beltrami’s Digital Divide Index Score is the second best out of the counties we are tracking