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While everyone seems to agree that expanded broadband access is necessary for economic growth in the Northwoods, there is little agreement about who should be responsible for supplying the infrastructure necessary to make it happen. As government agencies and telecommunications giants dance around the issue, entrepreneurs and frustrated users are busy working on alternative solutions. Jeff Collins is CEO of SonicNet, an Internet Service Provider (ISP) company that has taken a different approach to the problem of broadband access in rural northern Wisconsin. Collins, a retired consultant, couldn’t get high-speed access at his home in Phelps and his business acumen led him to search for a proactive solution to the problem. "We started in Phelps because I live there and I didn’t have Internet," Collins said. Collins thought about paying for a T1 line to his house, but the cost was prohibitive. His search for a wireless solution led to Mike Stafford of Fast Air Internet in Caspian, Mich. Fast Air provides high-speed Internet in Iron County by using a system of T1 cables linked to a central transmission tower. The wagon wheel is supplemented by a microwave relay system that expands the coverage area significantly. Fast Air was not interested in expanding into Wisconsin, so Collins, ever the entrepreneur, took on the task himself. SonicNet now provides high-speed Internet in Phelps, Eagle River West, Land O’Lakes and is working on a contract to begin transmission using the water tower in Three Lakes. The microwave relay system SonicNet employs a low-frequency 900 MHz signal that is more effective at penetrating trees than traditional relay signals. SonicNet’s customers are supplied with a receiver, which is basically an antennae and a computer that de-modulates the signal, that enables them to establish a standard ethernet plug connection. Collins said his company is doing what it has to do to deliver broadband to customers in areas where the population density can’t support hard line connections. "With conventional DSL or fiber, the weighted average cost of capital can be between nine and 15 percent. With the population densities we have it’s difficult to recover that investment," Collins said. SonicNet provides high-speed access without running cable or fiber, but the company relies on access to existing towers for relaying its signal. "Our challenge right now is access to available towers," Collins said. "Our plan right now is to work closely with town boards and the counties to get access to towers." Collins said commercial towers are owned by cellular companies whose commercial models are cost-prohibitive to start-up companies. "They’re used to seeing thousands of dollars per month in rent and our economic model could not sustain that," Collins said. Collins said he can imagine a world in which there is a better solution than the one his company is offering, but right now he is working hard to reach customers that don’t have service and to create a sustainable business model in rural economy. He is excited about the technological innovations that Ken Schlager of HierComm Inc. presented at the Northwoods Economic Summit, but he believes adapting innovations to the Northwoods requires extra work. "I think what Ken Schlager is talking about is combining Internet access with emergency services bandwidth," Collins said. "But it doesn’t work when you live in the middle of the forest which is where we want to live. The question is how do we adapt those technical advances to a more difficult coverage area?" Collins believes the role of government should be to establish partnerships that can incentivize the construction of new towers. "Rather than chasing the larger telecom companies, the more successful model is to develop public/private partnerships where these entities can encourage construction of towers or use existing towers," Collins said. Collins said 200-foot tower could provide wireless access over a three to five mile radius for an investment of $15,000. He has accepted an invitation from Grow North to join the group as chairman of a committee devoted to solving the problem of regional broadband access. "I would love to see a coordinated five-county Grow North initiative to provide Internet to a much larger percentage of people than exists now," Collins said. Phil Mendham, owner of Sunrise Lodge in Land O’Lakes, is one of SonicNet’s newest customers. Mendham said "We’ve struggled for a long time to get it. Just on the other side of the lake from us is Michigan and they’ve had it for years through UP Telephone. We have Verizon on this side and it’s been pretty frustrating," Mendham said. Mendham said his resort has advertised its computer room, which he built two years ago, as an amenity, but when guests found out the connection was dial-up they expressed their own frustrations. "Our guests were saying, ‘What do you mean dial-up?’" Mendham said. "Nobody uses dial-up. Everything has evolved." According to Mendham, with his old connection it could take up to 10 minutes just to load the Weather.com home page because of its image- intensive design. Images are a big reason Mendham believes his investment in SonicNet technology will pay him back. The Sunrise Lodge now posts images taken by guests on its Web Site and designs its own brochures on its computers. "We like it for ourselves to manage our Web Site and upload pictures to create our brochure," Mendham said. "It saves us a lot of advertising money." Mendham said it used to take all night to download a hopper of photographs to post on his Web Site, www.sunriselodge.com. The business’s current connection with SonicNet is 20 times faster than dial-up and doesn’t have the same liabilities as satellite. "We’ve tried satellite here, but when it’s snowing or raining it doesn’t work very well and that’s when you really want it," Mendham said. Mendham said he has a new understanding of the term digital divide. "I know some retired people who said they chose to live on the Michigan side so they could keep doing their business," Mendham said. "We kept harassing Verizon and they kept saying it wasn’t in their three-year plan, so it was either SonicNet or satellite." Now Mendham’s guests check their e-mail at picnic tables outside or while they’re having their morning coffee in the dining room. Deputy Tourism Secretary Mark Richardson told attendees at the Northwoods Economic Summit that broadband access was crucial for businesses like Sunrise Lodge. Richardson believes expanded access to broadband is critical for the survival and expansion of the tourism industry in the information age. "It’s not that people want to be on the phone or on the computer when they’re on vacation, but they need to have access," Richardson said. Richardson said he was excited by Schlager’s address at the summit because of the potential for new technology to create new delivery mechanisms in the Northwoods. "The technology changes every 18 months," Richardson said. "There’s a new generation of wireless that didn’t exist two years ago and that may be the solution to the problems the area faces." Richardson said the summit was an important venue because government actors, consumers, and service providers came together to listen to one another. "What was important about that conference is we all came together in the same room and started a discussion," Richardson said. Bob Egan is chairman of the economic development committee for Vilas County. As owner of Eagle River Tires, Egan is acutely aware of the fact that there isn’t any kind of business these days that doesn’t need broadband. "If you think people don’t need it anymore, you’re burying your head in the sand," Egan said. Egan has had his hand in all areas of business in Vilas County and he believes access to reliable broadband will help the region to expand its economy in a number of directions. Home businesses, the tourism industry, the home healthcare industry, and even the real estate market depend on a supply of broadband to expand in rural areas. "Ask a real estate agent how big an issue this is when they go to sell a house," Egan said. He also believes the Northwoods, with a robust broadband architecture, could house more the type of information age industries that rely on call centers and data entry rather than railroads and assembly lines. "Look at Doctors Foster and Smith. You have 800 workers there who could be located anywhere in the U.S." Egan said. Egan also serves on Grow North’s executive committee, and he has already negotiated a deal with Vilas County officials to make it easier for Collins and SonicNet to gain access to municipally owned towers so the company can transmit its broadband signals. "What we’re trying to do is to help him be able to start his business with a manageable up front cost," Egan said. "It’s a win-win situation for Mr. Collins and for Vilas County." Egan does not mince words about the problems big corporate providers present in rural areas. "One of the problems we have in Vilas County is Verizon," Egan said. Verizon controls the T1 infrastructure in the area and charges companies like SonicNet $1,400 per month for access to the lines. That amount is prohibitive for Collins, who has gotten around the problem by transmitting from the other side of the Michigan border, where he has been able to get access to the same type of T1 from the phone company for around $400 per month. Egan said the topography of the region presents particular problems. Lakes are barriers to running fiber optics lines. The high, dense tree canopy is rough on wireless signals. But he believes the issue is so important that his county committee must work with towns, regional planning organizations, and different government agencies to expand broadband coverage throughout the area by harnessing all the available technologies. But there are certain types of businesses that can’t be adequately served by wireless broadband. Jim Kumbera, executive director of the Oneida County Economic Development Corporation, sees the issue of broadband access as a challenge facing the county’s eco-business park development. "We’ve taken a close look at it in the business park. We’re in the data age. Dial-up was great when the Internet first started, but that’s long gone. DSL doesn’t make it and there’s many reasons why," Kumbera said. Kumbera said the types of businesses interested in Oneida County’s eco-business park will likely demand fiber-optic connections capable of transmitting huge amounts of date. "No matter where you are, you’ll ultimately have to go to fiber," said Kumbera. "There are some technologies that we could operate at just about the same speed as fiber in a wireless environment and it would be cheaper, but anytime you go wireless there are some issues." But Kumbera realizes that for much of the region, the need for access to fiber optic channels creates a Catch-22. The cost of running the fiber is expensive enough to discourage companies and too weighty for cash-strapped municipalities. Kumbera believes government has to help come up with a solution to the dilemma. "I think government is going to have to step in. Exactly how they step in, I don’t know," Kumbera said. "What really needs to be done is it has to be driven from a regional standpoint so you can get all partners involved in it." Until then, small regional towns are left in the lurch. "Let’s face it if your Verizon are you going to rural Three Lakes to put infrastructure in when you don’t have any clients. What is the financial incentive? There isn’t any," Kumbera said. Fred Bouwman is a member of the Three Lakes Town Action Group (TAG). Three Lakes’ TAG has taken on the responsibility of creating a comprehensive town plan in response to state’s mandate. "Basically it says every town has to have a comprehensive plan and if you don’t put one together, someone else will put it together for you," Bouwman said. In the process of putting the plan together, Bouwman said the town became aware of the need for broadband. "Our group took a survey of property owners. We have the raw data and there was an overwhelming desire for high-speed Internet," Bouwman said. Three Lakes is in the process of finalizing a contract with SonicNet that would allow Collins to transmit from the town’s water tower. The contract would provide revenue for the town, give Collins a much- needed foot in the door, and provide a large portion of area residents with high-speed Internet. Bouwman believes the deal is a good example for how small towns can cross the digital divide. "Any town can do this. It’s a good model and it’s a good start for the Northwoods. A lot of the telco’s have said flat-out they won’t provide to these areas." Bouwman works for Ministry Health Care as part of a virtual work group of individuals located all over the state. He said that SonicNet’s initial coverage plan won’t benefit him right away. "This would be a good thing for me at home, but the first installation would not affect me because I’m way back in the woods," Bouwman said. The reality is that while SonicNet may be provide expanded broadband access, it can’t provide a way for towns like Three Lakes to cross the digital divide. Bouwman attended the Northwoods Economic Summit and was impressed by Schlager’s presentation. "I took away two things. First, let’s take a look at this new technology," Bouwman said. "The second thing is the whole premise of little broadband and big broadband." The industry standard for consumer broadband is around 1.5mb per second, roughly the speed of a DSL connection, but Schlager sets the standard for "big broadband" much higher, between 10 to 20 megabytes per second up to 1 gigabyte per second. While the problem of "little broadband" can likely be solved through entrepreneurial enterprises like SonicNet, access to "big broadband" will likely depend on some type of government initiative. Jack Sroka is the executive director of the Lincoln County Economic Development Corporation and he spear-headed Grow North’s first effort to secure grant funding for a feasibility study for expanding broadband access in the organization’s five-county sphere. "Two-and-a-half or three years ago we did a business retention and development study and one of the things that came up was 25 percent of businesses felt broadband access was inadequate," Sroka said. Sroka said the community development grant he and his committee develop was ultimately rejected and the team who worked to put it together dispersed. "I was left with a project and the people working with me were all gone," said Sroka. Sroka was told at the time the grant application was rejected that would fit better as a planning grant than as a community development grant. He believes Grow North has a good chance to get the planning grant approved, if they can come up with a good model for implementation. Now that he has service providers like Collins and technology experts like Schlager involved in the Grow North initiative, Sroka believes the region has its best chance ever to win the government support it needs to invest in a long-term broadband infrastructure project. "Government has to be the leader in rural areas," said Sroka. "It has to be at least a partner. This is basic infrastructure like highways and the electrical grid. The private sector has done a pretty good job where money can be made but it can’t do that."

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