Tahoe broadband development initiative recommended for CPUC funding

A new regional broadband consortia project is on the table for the Lake Tahoe basin, which straddles the California-Nevada border. The California Public Utilities Commission will be considering whether to spend $167,000 from the California Advanced Services Fund (CASF) on a proposal to carve out separate funding for broadband infrastructure planning and development around Tahoe.

The area is included within the Gold Country broadband consortium, funded by CASF two years ago along with 13 others. Nominally, the money will be funnelled through that consortium, but according to the draft resolution the project would be run separately by a regional non-profit organisation, the Tahoe Prosperity Center…

Although the California portion of the Tahoe Basin is included as an area under the existing Gold Country Broadband Consortium, Gold Country’s Commission approved work plan has focused on more rural communities, particularly unserved areas in western Placer and El Dorado Counties. Thus, Tahoe Prosperity Center proponents assert that the area is underrepresented by the current, Commission-approved Consortium structure.

The Tahoe project would focus on “infrastructure data collection, site survey and mapping; a broadband needs assessment; analysis of the assessment; and broadband development plan implementation, including the development of broadband internet infrastructure projects”.

With about $1 million still available, the CPUC opened up a new round of consortia CASF grant applications last year. Five were submitted by the deadline in January, and the Tahoe proposal will be the first to go in front of the commission.

Of the remainder, two were for a new consortium serving San Luis Obispo, Santa Barbara and Ventura counties and another for San Francisco, San Mateo and Santa Clara counties – six counties that were left out of the initial round. One was for extended funding for the existing consortium serving Riverside and San Bernardino counties and the fourth is for a hybrid, which would include Marin and Napa counties, which are not yet part of a consortium, and pull in Sonoma and Mendocino counties from existing consortia. The draft resolution notes that two of those proposals scored well enough to be considered and two did not, although without specifying which is which.

The commission is scheduled to vote on the Tahoe project at its 15 May 2014 meeting.

Tellus Venture Associates has assisted with several CASF proposals, both for infrastructure grants and consortia applications – including the Tahoe project – so I’m not a disinterested commentator. Take it for what it’s worth.

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Shasta County wireless broadband proposal goes to CPUC

A $2.2 million proposal for a wireless broadband and telephone system in the mountains of Shasta County will be going in front of the California Public Utilities Commission next month. Commissioners will be considering a draft resolution released earlier this week that would approve a grant from the California Advanced Services Fund (CASF) to San Diego-based Shasta County Telecom. The plan is to build three new towers that would be positioned to reach about 1,400 homes. According to the draft

Shasta proposes to bring broadband services to north of Bella Vista, Round Mountain, Montgomery Creek and Lake Margaret areas of Shasta County. Currently, the project area is primarily unserved by wireline technology and underserved by fixed wireless and mobile broadband. According to Shasta, there are an estimated 500 households within the project area that do not have telephone service available. The Shasta Project proposes to provide fixed wireless broadband and telephone services by installing fixed wireless transmitters and infrastructure on three mountain tops in Shasta County: Bear Mountain, Hatchet Mountain, and Round Mountain, in order to provide high speed Internet service over a 331 square mile area. Shasta plans to obtain backhaul capabilities from Level 3 Communications and the telephone central office, connection to the Public Switched Telephone Network (PSTN), and Emergency 911 network will be located in an offsite co-location facility located in San Diego, California.

On paper at least, Shasta’s pricing plan is a genuine bargain. They’re proposing to offer Internet service at 20 Mbps download and 10 Mbps upload speeds for $20 a month and telephone service for $10 a month. As is standard with CASF-subsidised projects, the price commitments – including zero installation cost – are good for two years.

There’s no guarantee, though, that all the homes in the mountainous area will be able to link to the towers, with or without a sufficiently good connection to support those speeds, nor there is there any mention of the total capacity of the network.

Commissioners are scheduled to vote on the project at their 15 May 2014 meeting.

Tellus Venture Associates assisted with several CASF proposals in the current round, so I’m not a disinterested commentator. Take it for what it’s worth.

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Current CASF round pushes $42 million with 7 projects pending

The California Advanced Services Fund (CASF) has been tapped for $41.7 million in grants and $127,000 in loans for 15 projects at this point in the current round of applications. That’s the total following last week’s approval of four projects by the California Public Utilities Commission.

Twelve last mile projects account for $23.4 million in grants. Two others – Klamath River and Cressman – combine last and middle mile facilities. One, Sunesys, is pure middle mile. Together, those three amount to $18.3 million.

Ten projects have been withdrawn, rejected or are otherwise off the table, and 7 are still pending. Based primarily on what was stated in the initial applications, the amount under consideration is $38.4 million, although it’s likely that some of those numbers have since shifted. If you assume only some will be approved, there’s likely to be something like $140 million left in the CASF grant fund when the program is rebooted this summer (perhaps in the July or August time frame), more than the $130 million I previously estimated. But it’s still a moving target.

On the other hand, the loan fund has hardly been touched. Of the projects still under consideration, 3 are asking for loans totalling $1.4 million. Originally set at $15 million and later reduced by the state legislature to $10 million, most of it will remain available to applicants, even if all three are approved.

The current round began more than 14 months ago when 32 projects were submitted on 1 February 2013. At least three – a Surfnet proposal for the Santa Cruz mountains and Race Communications projects in Mojave and California City – were withdrawn because the incumbent cable companies upgraded service.

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Commuter survey finds tech talent bonanza in Santa Cruz

Not worth the money.

Ditching a two hour commute and working in Santa Cruz is worth a 9% cut in pay, according to a survey by Civinomics, commissioned by South Swell Ventures. Most of those surveyed – 61% – said they had technical jobs, with software engineers predominating. The most commonly reported commute time was 2 hours (28%), with 80% saying they traveled at least an hour and a half a day. The sample was specifically targeted rather than random…

The survey was conducted in two parts, with half of respondents being randomly selected while boarding company buses at multiple stops, and the other half being referred through a verified link via email. The latter group of respondents are primarily single car commuters who had heard about the survey through local events and co-workers.

Car commuters, though, were more likely – 78% to 46% – to say they’d take less money for working over the hill than company bus riders, which suggests that it’s not based purely on lifestyle considerations. With gas prices hovering around $4 a gallon, there’s also an economic benefit to staying at home, which would partially offset lower pay.

The results validate the assumption that there is a significant reservoir of high tech talent on California’s central coast that’s ready to be tapped, which is an opportunity for local start-ups and growing Silicon Valley companies alike. With a new fiber optic line in the works, the central coast’s broadband capacity will also be up to the challenge, expanding location options south through Santa Cruz County and into the Salinas Valley. Unmatched quality of life combined with superior infrastructure is hard to beat.

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Comcast cash and lobbyists grab southern California beachhead

Money to burn.

Comcast’s acquisition of Time-Warner continues forward, with little apparent notice of the focused but relatively small opposition it’s attracted. That’s thanks in large part to the army of lobbyists Comcast keeps on staff and on retainer to make its case at the local and state level. It’s now redeploying troops from its northern California stronghold to the south, where it would gain a controlling share of the market by adding the Time-Warner systems in the greater Los Angeles area.

Nationally, Comcast is mobilising its lobbyists – staff and hired guns alike – who come bearing cash contributions to politicians without apology, according to a Politico story by Tony Romm…

Asked about the company’s lobbying and donations, Comcast spokeswoman Sena Fitzmaurice said the cable giant, which owns NBC, already operates in 39 states. “It is important and will continue to be important for our customers, our employees, and our shareholders that we participate in the political process and support senators and members who represent our employees and customers,” she said.

In California alone, that participation has pumped more than a million dollars into political pockets, greasing the skids for Comcast to extend its control of the northern half state south through Los Angeles.

Moving staff lobbyists south to work local officials complements the baleful influence it has nurtured in Sacramento with lawmakers from all over the state. Their bag of tricks includes a cynical reboot of Comcast’s low-income Internet service plan, which it first offered to help blunt opposition its earlier acquisition of NBC and was about to shut down before the Time-Warner deal popped up. This time, Comcast won’t say how long it’ll keep the offer on the table, which amounts to a threat to pull it if the merger doesn’t go through.

There are legitimate arguments that can be made in favor of the merger. But political muscle is far more compelling and, legitimate or not, that’s the path Comcast is taking in California and Washington, DC.

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CPUC awards first broadband infrastructure subsidy to an independent ISP

Two small Monterey County last mile projects are now proof of concept for both a key assumption and a major change for the California Advanced Services Fund (CASF).

Proposed by Surfnet Communications, Inc. and approved unanimously last week by the California Public Utilities Commission, the Monterey Dunes and Paradise Road projects validated the assumption that underpinned spending $10.6 million on a fiber link from Santa Cruz south through Monterey County to Soledad: that building middle mile links will lead to faster, cheaper and more reliable last mile service in underserved areas.

Although the Surfnet projects will only reach about 400 homes, it demonstrated that there is a market for dark fiber in the Salinas Valley, where 100,000 people lack access to the CPUC’s minimum standard of 6 Mbps download/1.5 Mbps upload speeds. That was a major difference between the successful Salinas Valley grant application and the failed Golden Bear middle mile proposal in northern California, which had no last mile element.

Surfnet is also the first CASF applicant to be approved without first qualifying for a certificate of public convenience and necessity (CPCN) as a regulated telephone company. New rules adopted by the CPUC in February, as authorised by a new law – senate bill 740 – last year, set strict standards for Internet service providers that don’t fit the traditional telco mold.

However, a lower entry bar appears to mean tougher scrutiny going forward, as commissioner Carla Peterman noted. “These funds are one of the first going to non-CPCN holders”, she said. “So I’d like to emphasise that the monitoring of non-CPCN holders should receive by us under these is important”.

Tellus Venture Associates assisted with several CASF proposals in the current round, including the Sunesys and Surfnet projects, so I’m not a disinterested commentator. Take it for what it’s worth.

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And the 2014 open source champion prize goes to

In with a chance.

When the City of Los Angeles released its gigabit RFI earlier this week, it didn’t put the considerable broadband-relevant assets owned by its municipal electric utility on the table, but it did offer to throw in obsolete computers…

Due to the Microsoft end-of-support for its Windows XP Operating System on April 8, 2014, a mass computer replacement effort has been underway across the City. As a result, thousands of old computers will be salvaged through the City’s e-waste recycling. Under the guidance of the Offices of the Mayor, Council President and Innovation Technology and General Services Committee Chair, the City is working on the design and implementation of a digital inclusion pilot program to take advantage of these salvaged computers.

It’s an odd juxtaposition: asking for a city-wide fiber network on the one hand, and giving out thousands of computers that probably lack the horsepower to do very much with it. There’s a plan to work with non-profit outfits to refurbish the computers, though. It raises an interesting question: which operating system will be loaded in to replace Windows XP?

Some flavor of Linux is one potentially disruptive possibility. As libraries and schools have learned, the usability gap between open source software and shrink wrapped commercial packages has narrowed to the point that there’s little practical difference when it comes to basics like word processing, graphics and spreadsheets. It’s also an option for other public sector IT departments that lack the budget to upgrade immediately.

When Microsoft made the decision to pull the plug on XP, someone must have looked at the risk-benefit trade-off of creating a mass OS switching opportunity away from Windows. We’ll know if they didn’t, or if they miscalculated, if the next bold move out of Redmond is Office for Linux.

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CPUC says a kiss for Cressman beats the alternative

“Just so we understand, it screws five families”, said an animated Michael Peevey, president of the California Public Utilities Commission as he lambasted a move to slice $373,000 from a proposed Fresno County broadband project.

Ponderosa Telephone Company asked for a $1 million grant from the California Advanced Services Fund (CASF) to build a fiber optic middle mile line to the mountain community of Cressman, use it to upgrade DSL service for 65 homes there, and then extend it two and a half miles to five more homes in Rush Creek. But adding those five homes costs $74,000 each, more than twenty times the CASF average.

The justification offered was that Ponderosa could later come back and build out to a U.S. Forest Service station in Blue Canyon and then continue on to complete a fiber loop for the area. That seemed like a fine idea to commissioner Michel Florio, who thought that the five homes should be trimmed from the proposal on the table, and added later when Ponderosa was ready to complete the whole project.

“Over a third of the cost of the project is for Rush Creek which only serves five households”, Florio said, pointing out that average household income in the area ran as high as $80,000 per year. “It seems unjustified to me”.

But Peevey insisted that the money would be spent one way or the other. “The only point is do you exclude these five homes or not. You’re going to have to complete it eventually”, he said.

It came down to the vote. Commissioner Carla Peterman sided with Florio, but Catherine Sandoval and Michael Picker went with Peevey. Once Florio’s proposed changes were rejected, the original proposal was put on the table and all five commissioners agreed to fund it as written.

Tellus Venture Associates assisted with several CASF proposals in the current round, so I’m not a disinterested commentator. Take it for what it’s worth.

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CPUC connects Salinas Valley to Silicon Valley with fast, cheap fiber

A 91-mile fiber optic middle network for the Salinas Valley, stretching from Santa Cruz in the north, to Watsonville, Moss Landing, Castroville, Salinas, Gonzales and Soledad in the south, is on the way. On a unanimous vote this morning, the California Public Utilities Commission approved a $10.6 million grant to Sunesys, LLC from the California Advanced Services Fund (CASF).

“The key point for me was that typically that these projects only make a price commitment for two years”, said Commissioner Michel Florio. “In this case the provider has made a commitment for at least five years, maybe as long as fourteen years”.

Pointing out that there are “still more jobs in agriculture” in the Salinas Valley than in an other sector, Commissioner Catherine Sandoval highlighted the acute need for better broadband access in the area, as expressed at public meetings the CPUC held in Salinas last year. “This could be a game changer”, she said. “This is a middle mile project, a back bone that is critical”.

The project will bring low cost wholesale fiber access to Salinas Valley Internet service providers and major commercial and institutional customers all along its route, at a maximum cost of $1,550 per month for any contracts, of any length signed in the first five years. By comparison, unsubsidised dark fiber can cost up to ten times as much. The network will interconnect with major north-south fiber lines in Salinas and Soledad, and terminate in Santa Cruz where Sunesys earlier built a dark fiber connection to Santa Clara, which provides access to several Tier 1 exchanges in Silicon Valley.

Since the Santa Clara connection was built 4 years ago, the price of wholesale Internet bandwidth in Santa Cruz has dropped by a factor of one hundred, to less than a dollar a megabit per month. Cruzio, a local ISP, leveraged this access to light up last mile fiber optic connections for downtown Santa Cruz businesses and improve speed and reliability for thousands of consumers. This new line is expected to do the same for Salinas Valley communities.

On the retail side, the commission also approved CASF funding for two last mile projects in the Paradise Road and Monterey Dunes areas of northern Monterey County, proposed by Surfnet Communications, a local ISP (and a Ponderosa Telephone project in Fresno County), albeit without the haircut proposed by Florio.. These two systems are the first of what are expected to be many consumer and small business-oriented projects that connect directly to the Sunesys middle mile network.

Gonzales councilman Robert Bonincontri and city manager Rene Mendez told commissioners of the tremendous need for connectivity in the Salinas Valley, where unemployment rates are high and household income levels are low, even when work is available. The social and economic impact of the project, coupled with its financial viability – demonstrated by the Surfnet proposals, as noted in the approved resolution – was the reason commissioners opted to fund 80% of its construction cost. Normally, CASF grants are limited to between 60% and 70% of the tab.

The next step is to finalise construction plans and route details, with completion expected within two years.

Tellus Venture Associates assisted with several CASF proposals in the current round, including the Sunesys and Surfnet projects, so I’m not a disinterested commentator. Take it for what it’s worth.

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Ponderosa takes trimmed broadband grant in the Sierra

While offering a token defence of its original request, the Ponderosa Telephone Company has effectively agreed to chop $373,000 from a $1 million proposal to build fiber middle mile connections and upgrade DSL service in the Sierra Nevada near Cressman in Fresno County. The company asked for a grant from the California Advanced Services Fund (CASF) for the project, but ran into opposition at the California Public Utilities Commission.

Commissioner Michel Florio put an alternative on the table, that would remove 5 homes – at a cost to CASF of $75,000 each – from the project and ask Ponderosa to come back with a more cost effective plan to serve them and their neighbors. The revised project would reach 65 homes at a cost of about $10,000 each.

Via its lawyers, Ponderosa is now saying that’s OK

Although Ponderosa would prefer that the Draft Resolution be adopted, [Florio's] Alternate Draft Resolution correctly captures Ponderosa’s viewpoint regarding the alternative proposal for the project:

Ponderosa stated that if the Commission determines that eliminating the Rush Creek segment of the project is a more prudent use of CASF funds, they will still consider the revised project technically and financially viable.

Ponderosa supports the Alternate Draft Resolution in the event that the original Draft Resolution is not adopted.

Although there’s a vague commitment from Ponderosa to “provide wholesale access to its network”, there’s still no specific pricing or cost formula required, as the commission has done in the past with the Karuk tribe’s middle mile project in Humboldt County and as proposed for the Sunesys project in the Salinas Valley.

The Cressman project is on the CPUC’s agenda for a vote tomorrow morning.

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