The Need for Speed: Broadband internet gets a boost in northern Michigan

From work to school to entertainment to social interactions, high-speed internet access is the cornerstone of many societal functions – except for a small percentage of rural Americans.

According to the U.S. Federal Communications Commission (FCC), 19 million Americans (or 6% of the population) still lack access to “fixed broadband service at threshold speeds.”

More than 14 million of those people live in rural areas, accounting for nearly a quarter of the country’s rural population. Another 100 million Americans have access to broadband internet service but do not currently subscribe.

Combined, those numbers mean that more than a third of the U.S. population is not online – causing the FCC to conclude that it is failing in the duty laid forth for it in the Telecommunications Act of 1996 to ensure that broadband “is being deployed to all Americans in a reasonable and timely fashion.”

The challenge is that rolling out broadband to the underserved parts of the country – most of which are sparsely populated rural areas – is both logistically difficult and extremely costly.

“It’s a tough subject area, because, (broadband service) is in the private realm, and the private realm is in it for profit,” said Matt McCauley, who serves as CEO for the Traverse City-based economic development entity Networks Northwest. “(The internet service providers) are looking to make money – and rightfully so and thankfully so, because that’s what our whole economy is based off of. But the problem is, for rural areas such as ours, the volume (of customers) isn’t always there for a profit to be made. There’s not that incentive to create the infrastructure in all geographies.”

Networks Northwest is in the process of launching a new economic development resource called Thrive North – a website designed to help businesses or remote workers from outside the region find answers to questions they might have about northern Michigan as a relocation destination.

One of the things the site will show, McCauley says, is which areas offer adequate broadband service, given that reliable internet access has become a prerequisite for most businesses. Filtering out northern Michigan towns and communities that lack broadband service or other key infrastructure shows why some areas achieve economic growth and prosperity while others don’t.

“In the 10-county geography we serve (at Networks Northwest), there are 190 units of government,” McCauley said. “So, one could say that there’s 190 potential places that you could invest in and create your business platform in. But if we apply the filters of water, sewer, broadband and master planning for growth, out of those 190 places, we now get to just 31.”

It’s not just business prospects and economic growth that are at stake. Especially during COVID-19, spotty internet access has been a problem for healthcare (which has pivoted to telehealth for many types of services) and education (which has gone in and out of in-person learning throughout the past year).

John VanWagoner, superintendent for Traverse City Area Public Schools (TCAPS) says he is cognizant of the issue and of how it’s made it more difficult for some students in northern Michigan to reliably access virtual learning.

While VanWagoner has said that TCAPS has seen 80-90% attendance during mandated virtual learning periods, he also knows that going to school online isn’t as simple for all students as hopping on the internet at home. Public libraries, coffee shops, fast food restaurants, houses of friends or relatives … these are the kinds of places where some students have had to go in order to do their school work during COVID-19.

“We’re pushing for better internet activity across northern Michigan with our legislators and the federal government,” VanWagoner said, noting that Traverse City is “better than a lot of places” in the region but “definitely still not to the point where kids have universal access.”

“The reality is that the (the government) has got to allocate money to the providers,” he continued, comparing the current broadband situation to post-World War II America, when the federal government passed the Rural Electrification Act and committed significant financial resources to providing electricity and telephone services to rural areas to make those systems mostly universal.

“It had to be financially enhanced for the companies to do that,” VanWagoner said. “It’s going to take that same effort from the federal government to make that happen across our nation (for internet service), especially here in northern Michigan.”

The good news is that those efforts are already underway. According to Tom Stephenson of Connected Nation Michigan, some of the biggest broadband news currently on the radar for Michigan (and for the nation as a whole) is the outcome of the Phase I auction for the FCC’s Rural Digital Opportunity Fund (RDOF).

The FCC has identified RDOF as its “next step in bridging the digital divide,” with the $20.4 billion fund earmarked to “bring high speed fixed broadband service to rural homes and small businesses that lack it.” Phase I is targeting census blocks throughout the country that are “entirely unserved by voice and broadband with download speeds of at least 25 Mbps,” while Phase II will target census blocks that are “partially served.”

The RDOF Phase I auction, held last year, allowed ISPs to submit bids to the FCC for how much subsidy money they would need to build out broadband service in unserved areas. All told, the FCC awarded $9.2 billion to 180 bidders, which will now have a 10-year timeline in which to spend the money and build out their new service infrastructures. FCC officials say the projects should expand broadband access to 10 million rural Americans.

Stephenson, who serves as a community technology advisor for Connected Nation Michigan, says that Michigan “came out big” in the Phase I auction. Connected Nation Michigan is an organization partnered with the Michigan Economic Development Corporation, the Michigan Public Services Commission, and the Michigan Department of Technology, Management, and Budget that seeks to “ensure that all Michiganders can experience the benefits of broadband.” Stephenson’s territory as a community advisor includes northern Michigan.

The RDOF projects won’t affect Traverse City itself, where residents already have access to robust internet service from multiple providers. However, the FCC’s preliminary Phase I map (see map 1) include areas near Empire, Port Oneida, Arcadia, Bear Lake, Manistee, Mesick, Kingsley, Manton, Lake City, Cadillac, Boyne City, Mackinaw City, Cheboygan, and much of the northeastern corner of the mitten.

The areas that will be connected by way of the RDOF project align with many of the spots in the state that Connected Nation Michigan has identified as unserved or underserved (see map 2). Most of those areas, Stephenson says, will be getting broadband at gigabit speeds (download speeds of one gigabit – or 1,000 megabits – per second).

Getting gigabit internet speeds to homes and businesses is also a priority right now for Traverse City, where several providers are in the midst of projects to build out fiber optic networks. According to Connected Nation Michigan, 94.65% of Grand Traverse County’s 35,000-plus households currently have broadband internet with speeds of up to 100 Mbps download and 10 Mbps upload, but only 2.47% of local households have gigabit service.

One project aimed at raising that number is being spearheaded by Traverse City Light & Power (TCLP), through the utility’s TCLPfiber project. TCLP’s end goal is to make fiber optic service and gigabit internet speeds available to all of its approximately 12,700 residential and commercial customers in the City of Traverse City.

Phase 1 of that buildout (pictured above) opened up fiber service to roughly 2,200 customers, effective Oct. 1 of last year, while a small additional buildout called Phase 1.1 will add about 1,021 customers to TCLP’s fiber service radius by the end of April. Phase 2 will extend TCLPfiber to the remaining areas within city limits – a project buildout for which TCLP is seeking $18 million in funding from the United States Department of Agriculture.

According to Scott Menhart, TCLP’s chief technology officer, TCLP so far has 136 active customers from Phase 1, plus another 50-plus who have signed up and are awaiting installation and onboarding. Phase 1.1 has drawn an additional 18 prospects, or customers who have signed up and are coordinating installation steps with the TCLP team.

Michigan Broadband Services is also making moves to build out its fiber network to the Traverse City area. Though the company has been providing fiber to the area since its first commercial build-out at Grand Traverse Commons in 2017, Michigan Broadband’s roots are actually in telephone service.

The company’s telephone entity, Upper Peninsula Telephone Company, has been operating in some form since 1908. Michigan Broadband Services continues to operate the phone service to this day – a factor that President and General Manager Bruce Moore says is actually helping drive the company toward offering fiber internet service to underserved areas in northern Michigan.

“What we’ve done is upgraded our connection for our telephone customers,” said Moore, referring to the telephone exchange east of Traverse City, in what he calls the Manistee River area. “We’ve invested over a half a million dollars in fiber optic cable and we are now offering anywhere from 25 Mbps/3 Mbps service (upload/download) all the way up to fiber to the home, in a very remote area of the state. We are focused on bringing fiber and higher bandwidth speeds to these underserved markets that are in our telephone network.”

As for Traverse City itself, Moore says Michigan Broadband invested $1.5 million in bringing fiber optic technology to the Traverse City market in 2020 and plans to invest an additional $1.5 million in 2021. That money won’t just bring fiber possibilities to businesses and residences in the city itself, as is the current plan with TCLPfiber, but will also expand the reach of fiber service out to communities and neighborhoods slightly outside of the city limits.

Joe Dey, Michigan Broadband’s sale director, says the company is building out its network toward Acme and Williamsburg, as well as throughout East Bay Township. Those buildouts will allow Michigan Broadband Services to serve fiber to several new development projects in those areas, which Dey and Moore think is a boon for raising real estate values and attracting new residents to the area.

“Real estate developers want to build infrastructure, and then they want to fill it up with renters,” Moore noted. “And nothing helps accomplish that goal faster than assuring their new tenant that the internet connection is going to be wicked fast.”