The political long knives are out in Washington as the search intensifies for budget cuts with an ever-intensifying “sequestration” debate raging between the President, Democrats and Republicans.
Caught in the crossfire today will be Joe Freddoso, chief executive officer of MCNC, who will testify at a House subcommittee meeting about the federally backed national broadband initiative known as BTOP, or Broadband Technology Opportunities Program. MCNC is in the process of building the Golden LEAF Rural Broadband Initiative, which will turn the North Carolina Research and Education Network, which MCNC built and operates, into a statewide high-speed fiber backbone. The goal is to deliver the information highway across the state’s 100 counties.
While NCNC’s program is on track to meet deadlines and within spitting distance of hitting budget, other projects around the country haven’t fared as well. And Greg Walden, the Republican Congressman who is chairman of the House Energy and Commerce communications subcommittee, is hopping mad about what he sees as abuse and waste in the $7 billion program launched in 2009.
“The government has spent millions on equipment it did not need and on stringing fiber to areas that already had fiber,” Walden said ahead of the hearing. (Hearing details are available online.)
“At a time when government is considering cutting meat inspectors and FAA traffic controllers to address the federal spending problem, we need to be careful how we use taxpayer dollars.
“There are undoubtedly some success stories but, overall, was the program well-conceived and well-implemented?
“I won’t tolerate any waste or abuse, and it appears we’ve uncovered millions that fit that category.”
Mr. Freddoso Goes to Washington
So it is into this hostile environment that Freddoso, a longtime Cisco executive before taking over MCNC, descends to delivery a defense of MCNC’s project and BTOP in general.
”I will explain how we have implemented our project and what it means to the future,” Freddoso told The Skinny before heading for the lions’ den.
“In short, MCNC’s experience has been quite different that what Chairman Walden describes and I can only speak to MCNC’s project in North Carolina.”
Freddoso plans to mount a rigorous defense and will point out that MCNC met federal requirements for matching funds through a variety of sources.
“For the Golden LEAF Rural Broadband Initiative [also known as GLRBI] which MCNC is overseeing, we raised our match privately – $8 million from MCNC; $24 million from Golden LEAF, $4 million from wholesale service provider FRC and $4 million in donated conduit and land.
“That’s $40 million in private matching funds – a large portion of the build. The two grants total $104 million so the project total is $144 million.”
The NCREN project was not something for the faint of heart to undertake. It’s as massive as the nation’s 10th largest populated state, a project stretching from the coast to the mountains – or Manteo to Murphy, as the saying goes.
“MCNC is within 50 miles of completing the 2600 mile GLRBI project,” Freddoso explained. “We will be done before our deadline and within 2 percent of budget. MCNC will cover any overages.
“We have worked closely with telephone and cable companies, electric membership cooperatives and others who had disparate runs of fiber along our route to lease that existing fiber and only build new fiber where there were gaps – so the end result is 1800 miles of new fiber built to fill in the gaps between 800 miles of existing fiber we leased from these entities. Those providers who were willing to lease us fiber along the path of the build benefited greatly from MCNC’s approach of combining their local infrastructure with our new builds to create a powerful statewide infrastructure.”
NCREN’s mission has been to service schools, educational institutions, healthcare providers, non-profits and research organizations.
But to make more broadband available to citizens and the private sector, MCNC is partnering with companies to extend the network and make unlit fiber available for fees.
“As you know we serve all of K20 public education, many non-profit and public health care providers, private universities, research institutes (like RTI) on the NCREN backbone,” Freddoso said.
“Just two examples, our North Carolina Community Colleges have five times the bandwidth demand they had two years ago; our North Carolina K12 community has 20 times the demand for bandwidth they had five years ago.
“Use is exploding among the institutions we serve on NCREN.
“Without the MCNC fiber build these institutions would never within the economic constraints they have, keep up with demand and infrastructure would be a limiting factor in educational attainment, better health outcomes and idea formation/economic vitality in the State.”
Then there is the private sector.
“Since NCREN will never serve businesses and consumers directly, we are in at least 10 discussions with different wholesale service providers and enterprises to use all or portions of the new fiber route to bring enhanced broadband services to rural areas of North Carolina,” Freddoso explained. “The fiber is of very high interest right now and we are working with the provider community to provide them access to our new build to bring services to areas that were inaccessible because of a lack of infrastructure.
“The rural last mile [to get service to consumers] is quickly migrating to wireless – 4G/LTE, WiFi mesh, WiMAX and others and all of these over the air last mile services need economical fiber based backhaul and transport to be implemented. The MCNC fiber build puts North Carolina in a very unique position to see these last mile wireless services introduced earlier and broader than other states.”
Freddoso will point out that North Carolina has become a growing center for Internet and data centers, with Google, Facebook, Apple, IBM and others picking the state. Freddoso sees NCREN boosting the state’s infrastructure by making more fiber available.
“Having not just one, but multiple paths of fiber to an economic development site is key to its attractiveness or multiple paths to a healthcare site is critical to a provider functioning,” Freddoso said.
“North Carolina for example has attracted several large data centers to rural areas — these data centers require multiple runs of fiber in and out of these facilities to function; the same will be said of a rural call center. These facilities need multiple paths for resiliency of service – having just one route and having it cut costs millions of dollars – one outage typically would justify the cost of building a second fiber run.
“In the last week, we have had calls from at least wholesale service providers asking if they could access fiber from our route as a second path, in addition to their own, to serve a data center area in rural North Carolina.
“This is a typical week. Despite us being ahead of timeline on construction – providers want us to finish now to access the fiber.”
Freddoso also believes NCREN will provide a significant booth to telehealth and the utilization of electronic medical records.
“In addition, as telehealth, healthcare information exchange and other technologies become more critical in healthcare, hospitals will need several routes of fiber because of the critical nature of the information these lines carry,” he said. “You don’t want a single fiber cut to stop information flow from a rural hospital any more than you would want a vehicle accident on one road to block access to the hospital.
As for BTOP and the federal National Telecommunications & Information Administration which oversees the program, Freddoso plans to tell the subcommittee that the groups deserve praise.
“The BTOP at the NTIA has been great to work with,” he said. “Their advice and guidance has been key to our success. They are a small team who work very hard in oversight. We would not have progressed to completion without their guidance.”
(Note: Freddoso’s complete testimony can be read online.)