For more than two decades, Internet and network service providers have dreamed of building broadband-speed Net access across North Carolina. In 2013, those dreams are becoming reality.

And MCNC is helping make the Manteo-to-Murphy Information Highway possible through its in-part federally funded and Golden LEAF backed $144 million expansion plan.

A fiber-optic network that will make high-speed commercial Internet widely available across the state from Shelby-based RST Global Communications is one of numerous private sector efforts focused on taking the net to under-served areas and those with little or no access at all. These networks have one backbone piece in common – North Carolina’s Research and Education Network. Although built to serve educational, healthcare and non-profit clients, NCREN has excess”dark” – or unused – fiber strands that RST and others are leasing.

In an exclusive interview, Joe Freddoso, CEO of MCNC which operates NCREN, talks about how a “build it, they will come” strategy is paying off.

“RST is not the first firm to lease fibers on all or part of the MCNC network,” Freddoso tells WRALTechWire. “This is actually the fifth transaction. RST is the first to publicly disclose their purchase. The leases leave it to the discretion of the company leasing the fiber to disclose their plans.”

Our Q&A with Freddoso:

Can you disclose financial terms and length of agreement with RST?

We do not disclose the specifics terms and conditions of an individual lease, however MCNC’s price for a 20-year lease of fiber runs between $325 and $750 per fiber mile based on the number of fiber miles purchased. These transactions are leases of the dark fiber for typically a 10-to-25-year period.

MCNC maintains underlying control of the strands and conduit in these leases, and at the end, of the lease the fiber reverts back to direct MCNC ownership.

This agreement seems to offer the potential of realizing one of the goals for the expanded NCREN – taking the Internet to bypassed or underserved communities and consumers statewide, correct? Isn’t that a remarkable achievement?

While RST’s investment is a very positive step, communities across North Carolina need to work with RST and other providers to address their citizen’s need for broadband. Service providers from large entities like AT&T, Time Warner Cable, and CenturyLink to new market entrants like RST are not going to deploy new and better last-mile broadband service into rural communities without seeing the community willing to drive demand for the services and make the logistics of the deployment less costly.

Individual municipalities and counties have a lot of tools at their disposal to help with broadband deployment – easements, waivers of franchise fees, waivers of building attachment fees, and property taxes are some of these tools. All of these can be smartly leveraged by a forward-thinking community.

Personally, I am partial to rural communities working with their Telephone Membership Cooperative, if they are served by one. The telephone co-ops have local boards of directors and are steeped in the local community. The co-ops are typically willing to make investments that have smaller rates of return. I also encourage communities to work with their incumbent carrier. The incumbent cable and telephone companies (Time Warner Cable, AT&T, CenturyLink, Frontier and Charter) have made significant investments in people and infrastructure in the state and are willing to work with local communities to find solutions to meet existing and future broadband demands.

A great resource for local communities is NC Broadband through of the N.C. Department of Commerce. The staff is extremely knowledgeable and can help a community or group of communities plot a course of action. The best case scenario is for several municipalities and counties in close geography to band together offering similar programs to encourage service deployment and then seek a service provider partner.

The NC Next Generation Network program in the Triangle [seeking to build a Google Fiber-like network]  and a recent Person County RFP on broadband also are good models.

Are other firms expressing interest in dark fiber and if so have any other agreements been reached?

Four other agreements have been reached, and MCNC is in discussions with more than 10 other entities about leasing fiber on the new backbone.

What do such contracts mean for MCNC’s network in terms of strengthening it financially? Now that the expansion is done and the grants have paid for that, does MCNC need contracts with companies such as RST for network improvements and maintenance?

MCNC’s production network, the North Carolina Research and Education Network (NCREN) today serves the bandwidth needs of all of K-20 public education in the state, most of K-20 private education, and more than 100 health care providers and research institutes. The upgrade of NCREN provided by the BTOP [Broadband Technologies Opportunity Plan]  investment allows us to serve the rapidly growing bandwidth demand of these entities at relatively flat backbone costs for the foreseeable future. It also leaves MCNC with the responsibility to provide funding for the capital refresh of the network long-term.

The BTOP grants required that MCNC build fiber to share with commercial service providers. The proceeds from the sale of the commercial portion of the fiber are solely dedicated to the capital refresh needs of NCREN.

We hope to cover about 30 percent to 40 percent of the capital refresh of NCREN through these fiber sales and our existing MCNC Endowment.

This allows us to keep our rates low and avoid any one-time assessments to NCREN users when capital refresh is required. NCREN is one of if not the only state research and education network that does not rely on assessments for refresh. In today’s fiscal environment that’s a huge advantage for North Carolina.

[NOTE: On Aug. 12, MCNC will celebrate the completion of the NCREN project.]