(Editor’s Note: MCNC President and CEO Joe Freddoso testified on Feb. 27, 2013 before the U.S. House of Representatives House Committee on Energy and Commerce Subcommittee on Communications and Technology. The hearing entitled “Is The Broadband Stimulus Working?” focused on the federally-backed Broadband Technology Opportunities Program. )
RESEARCH TRIANGLE PARK, N.C. – “Joe, I’m with the subcommittee on communications and technology from United States House of Representatives Committee on Energy and Commerce. We have a Broadband Technologies Opportunities Program (BTOP) oversight hearing next Wednesday and we would like you to testify.”
That’s the way it began less than a week before the seventh oversight hearing about BTOP; a request to give testimony about MCNC’s Golden LEAF Rural Broadband Initiative (GLRBI).
Several things ran through my head. I knew there were a few projects under scrutiny. Colorado, West Virginia and maybe a couple of others that turned money back into the BTOP program. I was pretty certain that with sequestration so close these programs would be the focus of the hearing.
I knew I couldn’t speak to the Colorado and West Virginia grants but I could highlight the successes MCNC experienced in implementing the GLRBI and in operating the North Carolina Research and Education Network (NCREN).
There were many that came to mind:
• MCNC applied for BTOP funds with the right motivation to add geographic reach, capacity and resiliency to a 25-year-old backbone network (NCREN) to serve the broadband needs all of K-20 public education, private colleges, non-profit and public health care providers, and numerous research agencies.
• Through our service to education, we had helped increase education-related revenues for private service providers, allowing more bandwidth for all institutions and saving these education sectors millions of dollars. Community colleges use five times the bandwidth they used two years ago, and the K-12 public school districts use 20 times more than five years ago – and both pay less for backbone services and Internet access. Building this winning scenario took a lot of work and deep business discussions with the service providers who were willing, responding to Request for Proposals in partnership with several organizations, and taking MCNC’s public benefit mission very seriously.
• Connecting to a backbone network allowed K-20 education institutions to gain buying power and technical service priority they could never receive as individual institutions. MCNC had the ability to hold itself and our service provider partners accountable for network performance and also to create significant buying power for public education institutions.
• MCNC applied for BTOP funds only after having a long series of discussions with private-sector service providers and learning they did not have the middle-mile capacity to serve the needs of NCREN connectors in many rural parts of the state.
• MCNC raised the $40 million in matching funds required to pursue BTOP funds without requiring any State of North Carolina investments. The summary of matching funds was: $24 million from the Golden LEAF Foundation, $8 million from MCNC, $4 million from private-sector wholesale telecommunications company FRC, and $4 million in donated conduit and land.
• When MCNC won the grants, we spent significant amounts of matching funds and BTOP funds on 20-year leases of fiber in areas where service providers of all types (cable, telecom, electric membership cooperatives) had existing fiber and were willing to lease it to us. This was a tangible display that those providers were willing to share their infrastructure, benefitted from the grant and this philosophy avoided the overbuild scenarios that were talked about in the press about EagleNet in Colorado.
• MCNC has built more buried fiber quicker than any BTOP grantee in the country and currently stands more than 98 percent complete, as of the date of this invitation.
• MCNC has invited and continues to invite service providers to use parts of the GLRBI network to expand the geographic reach, resiliency and capacity of their rural networks, and we are gaining great traction in these discussions.
I decided to build the testimony around these facts and seek counsel on content and delivery of the testimony from internal MCNC staff and external experts.
Particularly helpful were: Pat Moody CFO at MCNC; Tommy Jacobson COO at MCNC, Mark Johnson CTO at MCNC, Deb Bryant with the Ferguson Group in Washington, and Marty Stern with K&L Gates D.C. office. Pat and Tommy have led MCNC’s BTOP efforts and were particularly helpful in preparation.
On the drive to D.C. last Tuesday night, my wife April was my sounding board. She knows the industry well and makes great suggestions on how to present technical concepts with every day examples. After the drive, I felt prepared for the next day.
Wednesday morning, Feb. 27 arrives, the morning of the hearing. I meet Deb Bryant and Marty Stern for breakfast, and we discuss the types of questions I could get during the Q&A portion.
One issue on which we focused at breakfast was that I had received word from a couple of congressional offices that at least one service provider in North Carolina had accused MCNC of overbuilding them with the BTOP build.
This was one of the service providers that had turned down several offers from MCNC to buy infrastructure from them saying they had none to sell. The same service provider that has had significant reliability issues with several unscheduled outages the last three years. The same service provider MCNC donated funding to in 2000 to build infrastructure in underserved parts of the state and had accepted tens of millions in federal subsidies to build a network in North Carolina.
We decided not to be combative during the hearing but to stick to the facts if this issue came up.
The hearing itself was contentious.
There were accusations of wasteful spending in West Virginia and overbuilding in Colorado.
National Telecommunications and Information Administration (NTIA) Administrator Larry Strickling did a very good job defending the BTOP program. Less than 10 percent of the $4.5 billion in BTOP infrastructure investments were in question and of the $450 million – about $15 million had been expended – still an unforgivable use of taxpayer funding but hardly a sample size by which to brand a whole program.
I was the last to testify. I talked about MCNC’s successes and during the Q&A portion about the importance of prior assessments of infrastructure before building. I also talked about how overbuilding in the middle-mile was a dying concept. For economic development, health care, and the deployment of emerging wireless services – more fiber is needed in most rural areas than exists. The network resilience and network reliability for telehealth, the big data movement, public safety, and other critical functions requires multiple runs of fiber along various paths to key endpoints.
The world is in 2013 headed quickly toward 2020 and beyond – a network-centric world where being online in a robust way leads to innovation, better health, economic vitality, and educational attainment.
Overall, testifying was a great experience. It wasn’t nerve wracking at all when you are confident that the great team at MCNC had done a stellar job building a future-proof infrastructure that will help propel North Carolina to thrive in an increasingly digital world.
(Video of Freddoso’s testimony is available at YouTube.)