Western Carolina might never be the next Silicon Valley, but experts say improving Internet access could help kick-start the region’s economy.
David Hubbs, CEO of BalsamWest FiberNET, said with the manufacturing sector mostly on its way out in WNC, it’s time to look to a new kind of model for economic development.
“The days of hoping for a factory to come to town, that’s probably not going to happen in the foreseeable future,” said Hubbs. Nurturing a tech-friendly environment would level the competitive playing field and allow students to stay in the area after they graduate, however.
“We’re helping to create an opportunity for people who grow up here,” Hubbs said.
Robin Kevlin, co-owner of Metrostat Communications, a Sylva-based telecom company, provides services to certain companies that would not have stuck around WNC without access to quality Internet service. The Internet can be an important tool in recruiting new businesses and promoting economic development, Kevlin said.
“Because of the way the land is around here, you’re not going to bring in a Dell Computer,” said Kevlin. “But you can bring in the smaller companies.”
For many companies, the Internet is not a luxury but a real need.
“Internet connectivity is as basic as water, sewage and infrastructure,” said Pam Lewis, senior vice president of entrepreneurial development at AdvantageWest, a regional economic development arm.
Earlier this year, the Nantahala Gorge was named as the site for the 2013 Freestyle World Championships in kayaking.
The Nantahala Outdoor Center is equipped with high-speed Internet from BalsamWest FiberNET, but only at its headquarters. Fiber is not an option at branch offices, where Internet is both expensive and unreliable, according to Kevin Sisson, Chief Information Officer at the Nantahala Outdoor Center.
“If it rains, it’ll go down, or if it’s foggy, it’ll go down,” said Sisson. “It really hampers the ability of these branch offices to connect to our reservation system.”
Sisson and others in the rafting community are worried about the Gorge’s preparedness for the kayaking championships. Lack of widespread Internet access might make it difficult or impossible to upload event photos or videos.
“We’re going to have an international community arrive here,” said Juliet Kastorff, owner of Endless River Adventures. “Journalists, competitors, families that get here and have no high-speed wireless.”
The Internet is a necessity even during the regular tourist season. Kastorff says that about 10 percent of tourists anticipate working during their vacation. They sometimes rule out a travel destination if Internet connections are spotty.
The web is not just useful for browsing endlessly on YouTube or Googling for directions.
With the Internet increasingly being used to educate, children in WNC will need better Internet access at home as well as school.
John Howell, owner of Telecommunications Consulting Associates in Waynesville, said students in other regions are receiving laptops as early as the ninth grade. They complete assignments requiring Internet connections and interact with teachers via email.
“If a kid’s got dial-up, he or she can’t compete with kids from more populous areas of the state,” said Howell.
Data-intensive entities, like hospitals and Internet-based companies, also need the Internet to simply operate. The hospital group, MedWest, processes millions of transactions every month. On top of billing and registration data, hospitals need high-speed capacity for sending X-rays, MRIs and detailed medical records to doctors.
Since the creation of MedWest in January, administrators have also discovered a need for video conferencing to avoid excessive travel.
Kevlin said that the Internet is immensely useful for cutting down on pollution.
“If we’re going to be a greener society, more people are going to be working from home,” said Kevlin. “They need the tools necessary to do that, and broadband Internet is part of that.”
A few years ago, Michael Wade was ready to hang up tin cans and have tenants at his Rabbit Ridge Apartments in Cullowhee yell messages at each other — all to avoid the daily aggravation caused by two telecom corporations.
The 170 students who lived at Rabbit Ridge also lived on the Internet, and poor service forced Wade to reset modems at least three or four times a day. No matter how often Wade called each company’s customer service line, there was no end in sight to the infuriating Internet outages.
“They simply did not have the amount of bandwidth needed in the area,” said Wade. “It was a nightmare. Both companies were just a nightmare to work with.”
Then in November 2008, Wade decided to splurge. It cost him $25,000 to buy a high-speed connection to BalsamWest FiberNET, a Sylva-based telecommunications carrier.
Wade footed the entire construction bill for physically hooking up to BalsamWest’s 300-mile fiberoptic network.
“It was the best 25 grand I’ve ever spent,” said Wade, adding that now, there are no more outages at Rabbit Ridge.
But not everyone in Western North Carolina is lucky enough to be within spitting distance from BalsamWest’s fiber network — or rich enough to afford the thousands it would usually take to connect initially.
“If I was just a homeowner, it wouldn’t make sense,” said Wade. “But because I was a business and I had 170 kids, it made total sense.”
See also: Internet could be key to economic development in WNC
Over in the Nantahala Gorge, Juliet Kastorff, owner of Endless River Adventures, is still struggling with her own Internet woes. The outfitter is still using a snail-paced service via satellite. It’s the company’s one and only option.
“It’s so unreliable and so slow,” said Kastorff. “Considering three years ago, there wasn’t even cell phone reception in the gorge, I’m not entirely surprised.”
Kastorff said she’s encountered high-speed wireless in some of the world’s remote places.
“In South America, wireless and cell phone service is easily 100 percent better,” Kastorff said. “So we’re talking about developing countries that have more progressive infrastructure than we have in WNC.”
In a rural and mountainous area like Western North Carolina, telecommunications service is bound to be a challenge. But solutions, like BalsamWest, are slowly creeping up.
Million-dollar federal grants and millions more matching funds from nonprofits like the Golden LEAF Foundation will slowly bring high-speed Internet to rural counties like Haywood, Jackson, Macon and Swain in the next three years.
WNC can be said to fall into the middle-mile phase on the path to quick and reliable Internet. Most people talk about middle-mile to last-mile connectivity by using road analogies.
“Middle-mile is more like the highway instead of the off-ramp that goes to your home,” said Hunter Goosmann, general manager of the nonprofit ERC Broadband. “The off-ramp is the last mile.”
“You can’t go down the dirt road until you get off the paved road,” said John Howell, owner of Telecommunications Consulting Associates in Waynesville. “And right now, the paved road is being built.”
Middle-mile solutions, like BalsamWest, usually target anchor institutions in a community, like schools, hospitals, libraries, government offices and only major companies. BalsamWest, which is jointly owned by the Eastern Band of Cherokee Indians and Macon County-based Drake Enterprises, focuses on providing Internet service to businesses found within its fiber footprint in the six counties west of the Balsam Mountains (Jackson, Macon, Swain, Cherokee, Clay and Graham counties).
“We’re not in the business of building out to everybody’s homes,” said BalsamWest CEO David Hubbs.
The reasons that BalsamWest and other telecoms have not tackled the last-mile part are primarily financial. Most companies would have to put up millions of dollars to build infrastructure, only to have a relatively sparse number of customers.
Government help is on the way, however.
Soon, nonprofit MCNC will begin work on a $111 million broadband fiber project that will install 1,448 miles of new fiber through 69 of the most rural counties in North Carolina. BalsamWest and ERC are both major partners in the initiative. Particularly important to WNC will be the fiber link constructed in Haywood County.
Mark Clasby, economic development director for Haywood, said it’s been his priority to get Haywood connected to the fiber networks found east in Asheville and west of the Balsams.
“It’s essential we get this done,” said Clasby. “We’re kind of like the hole in the donut. It’s critical for our future that we have some type of system.”
Gene Winters, CFO of MedWest, a collective of hospitals in Haywood, Jackson and Swain counties, said the connection would save his company at least half a million dollars.
Presently, MedWest is forced to use multiple telecom companies since there is no fiber running from Haywood County to west of the Balsams. If such a connection existed, MedWest would not have to duplicate services.
Winters said MedWest, too, has spent thousands on Internet infrastructure. Recently, the hospital group dropped $18,000 on bringing Internet service from one building to another just 75 yards away.
“You got to look at it as a four- to five-year investment to recoup your cost,” said Winters. “Most small companies don’t have a longer view, and they can’t because cash is tight.”
All eyes in the telecommunications community are on the MCNC project, which will expand broadband capability exponentially on the middle-mile scale.
“I think the future is being written right now,” said Howell. “We should see deeper penetration of broadband into at least the business community and anchor institutions.”
“This is truly a game changer,” said Goosmann, whose company is tackling fiber in Buncombe, Madison, McDowell, Mitchell and Avery counties.
Meanwhile, BalsamWest will bring middle-mile broadband to 480 miles in 37 counties. It is also working on a major project connecting its fiber network west to Knoxville and Oak Ridge, Tenn. The link will bring instant access to universities, and scientific and high-tech industries.
In addition, Frontier Communications Company has taken over Verizon’s landline footprint in North Carolina. Unlike Verizon, Frontier markets itself as a telecom company for rural areas of the country. The company promises to bring high-speed Internet to 85 percent of all areas they serve in the next three years.
“We’ve been doing this a long time,” said Brigid Smith, assistant vice president of corporate communications at Frontier. Smith says that her company has brought broadband to the mountains of Moab, Utah, the deserts of Arizona and isolated areas of the Midwest where it takes six hours to reach the next house on the road.
“Terrain issues are not new to us,” said Smith, adding that Frontier is also “very financially healthy.”
Smaller telecom companies like Sylva-based Metrostat Communications are also devoted to bringing Internet to the most unlikely places. The company says its goal is to bring Internet service to everybody, not just the big companies.
“My goal is to serve Annie’s Bakery and all the little guys on Back Street … I’ll use any means I can to do it,” said co-owner John Kevlin. “Sometimes we use radios, sometimes a fiber network. It depends on what’s cheapest and easiest.”
The company receives calls daily from bewildered new residents of WNC who expected Internet service to be just a phone call away.
“They are not understanding that not every place in the world has broadband Internet,” said Metrostat co-owner Robin Kevlin.
“I know people who can’t even get telephone access, and this is 2010,” said John Kevlin.
At times, Metrostat has to use admittedly quirky methods that aren’t always available to bigger corporations. For example, the company will ask someone if it’s OK to install a radio in their house to help a neighbor down the street.
“We have to look for creative ways to spend a smaller amount of money to get to the most people,” said Kevlin.
Hubbs says that extraordinary progress has undoubtedly been made in WNC in the last decade.
“You can get the same kind of connectivity in Franklin, N.C., that you can get in Atlanta, New York or Washington, D.C.,” said Hubbs. “In economic development terms, that is part of the most critical infrastructure that large 21st century knowledge-based companies have to have.”
Clasby calls the quest for reliable Internet complicated but also one of the most exciting issues he is working on.
“I see light at the end of the tunnel,” said Clasby. “It’s still probably two, three years away, but we’re getting there inch by inch.”
According to Goosmann, it will take time for the average citizen to benefit from the progress being made. But that progress is coming.
“It’s going to be years before we really see the full scope of what this is going to do for the mountains,” Goosmann said. “But the ball is starting to roll downhill, and it’s going to gain momentum.