EDITOR'S NOTE: This is the second in a three-part series about internet deserts in rural Richland County.
HUDSON — The City of Hudson had heard multiple complaints from its businesses about being unable to access high speed internet, an all too familiar issue for rural Richland County businesses.
“We had two incumbent providers, (Spectrum and Windstream) already in the city,” said Will Ersing, Hudson’s network systems administrator. “What we were hearing from our business communities was those two services were not providing the service they needed to operate their services.”
Ersing said the city asked both internet services to expand to their city, but were denied, due to the provider’s return on investment figures.
Internet providers responded with inadequate and expensive fixes until they stopped returning phone calls, Ersing said. The city decided to create its own internet product for the community.
“Ultimately, they really didn’t do anything. Eventually we just stopped hearing from them,” he said. “That’s what led us down the path of being our own internet service provider and provide service for the city.”
Hudson officials announced a five-year plan on July 22, 2015. The city would wire Hudson with fiber optic cable to allow internet speeds as fast as a gigabit per second — 100 times faster than copper wire connections could provide, according to the Akron Beacon Journal. Hudson called the city-owned ISP Velocity Broadband.
Hudson was essentially a black hole, Ersing said of the city now known as Ohio’s first Gigabit City.
“We realized we can’t attract or keep businesses if they can’t get internet. We called this an economic development project," Ersing said. “We offer two big themes for our packages —internet services and voice services.
“For our internet packages, we do symmetrical speeds (uploading and downloading speeds) for all our packages.”
The effort is appreciated by Lee Barnhouse, whose IT company, LTech Solutions Limited, has improved in a myriad of ways.
“With the dramatically-improved bandwidth and network reliability, we’ve been able to move all of our servers out of the building and into a data center in Cleveland,” Barnhouse, said. “Before Velocity Broadband, this simply was not possible.
"As an IT support company, a large part of what we do for our clients is remote technical support. Our Velocity Broadband service enables us to better service our customers by significantly increasing the speed at which we can connect, as well as the reliability of the connection.”
To ignite the project, Hudson took an internal loan of $3.3 million out of its general fund to begin the process of running fiber optic cables throughout the city.
“Initially, we had a pilot area, which was the area where city offices were. We used this area to set up the network,” Ersing said. “That alone cost Hudson $800,000.”
Ersing said there was some coaxing with the city to pass the project, but the business plan and the city’s case for the fiber lines proved to be necessary for the Hudson's economic development.
“We went down a very methodical path. It wasn’t like we woke up one day and said, ‘Let’s buy fiber and start putting in the ground,” Ersing said. “We went out, hired a consultant to evaluate if this something we wanted to do. We built a business plan, a business case and we more or less presented it to the city council, and they approved it.”
The next phases included building fiber-internet lines for four business zones: shopping plaza, downtown area, the industrial area and southern lake area of the city.
“Right now we have fiber across parts of each area, and by the end of this year, fiber will work throughout all areas,” Ersing said. “It’s taxpayer money, so every penny counts. We try to be very fiscally responsible.
“The whole project is right around the $3.3 million. We are very conservative in that regard. We want to make sure we are only spending money where we need to, how we need to and buy the best materials so we don’t have to spend a lot of money to repair and replace the materials.”
Hudson charges each customer — so far businesses only — as a bill similar to a utility bill. By the end of 2017, the city expects to be cost neutral from Velocity, the network systems administrator said. Because the money for this service was taken out of the city’s general fund, Hudson is allowed to begin repaying the internal loan and use excess monies how the city sees fit — street repairs, branch trimming or adding new traffic lights.
Velocity is offered in different packages to businesses.
"Right now, we just offer service to the business parks," Ersing said. "We have had conversations with residential and right now those discussions are on going. Over all from what I’ve heard the community supports (Velocity).”
The city’s 96 customers are benefitting too, and Hudson anticipates its customers to double to within the 200 range by the end of this year, Ersing said.
“Before Velocity Broadband, the most significant challenge we experienced was obtaining reliable, cost-effective bandwidth for our business,” Barnhouse stated in an email. “For years we limped along with slow, unreliable, expensive service from the only two providers that we had available to use – Windstream and Time Warner.
"Since no provider had built their fiber optic network into our office complex (or anywhere near it, for that matter), the only way for us to obtain fiber service would be to shoulder the entire burden of the construction cost – not to mention the high ongoing cost of service.”
Of course it wasn’t all smooth sailing in Hudson. Ersing said the city could have planned better.
“We weren’t expecting it to grow as fast as it did,” he said. “We need more staff and more IP addresses, which are hard to get. We are currently dealing with a lot of commodities.
“We sort of do a lot of it as we go. It would have been better to have had a more concrete plan.”
All has not been bliss for the new ISP either, Ersing said. The company has had several hiccups including a carrier’s fiber pole being damaged. The town’s internet was down for “the better half of the day."
“That was certainly a trying moment,” joked Ersing.
Among the list of hiccups was when CISCO, one of the city's internet carriers went down after one of its poles was hit and fiber was damaged.
But the trouble has been worth it.
"We are hearing from businesses who want to move to town and that will contribute to our tax base. Our business parks were empty. We are now attracting new businesses," he said. "We have one park near the middle of town, there are four new buildings coming to town. That's because of this service, to a certain extent.
"Businesses when they are looking for places to look to relocate, they are looking for community, clean water, quality electric and fiber. It helps us with the tax base because now we have that business contributing and in the long run, we'll have them as a contributor to our general fund."
Ersing said the project is feasible for others to try, but they should do it with caution.
Regardless of project size, you should bring in a consultant," he said. "It's better to spend a little money than to lose a lot because you thought there was business opportunity where there isn't."
One Richland County city has begun to mirror Hudson's project.
Shelby councilman, Nathan Martin said he too sees opportunities in growing the the city's economy by increasing the internet speeds for local businesses.
"The problem is we have a monopoly. That's why we have last-mile service," Martin said. "We are on the outer bands of (internet provider's) service, so they provide the minimal investments as possible.
"It's the same way in Mansfield. We are not getting as good of service as people in Columbus."
Martin said it all comes down to an internet provider's Return On Investment — more dense population equals for more customers.
"It's just a numbers game," he continued. "We don't have enough customers to make it worth it."
Shelby had a population of 9,129 as of 2013. So Martin has come up with a plan.
"What we are looking for is to include quality fiber for businesses, so they get the internet they deserve," he said.
Martin said Shelby has not yet explored the possibility of residential zones for high-speed internet, as Hudson utilized.
Under his plan, Shelby could become fourth "10 Gig" city and the 54th "1 Gig" city in the United states. This means the city would be able to offer 10 gigabytes of internet or one gigabyte of internet. He hopes to implement the new network in four to five months, he said. That plan distribute up to 750 megabytes to customers — that's a lot of of speed.
Martin said the money to get started will come from the city's utility department. He expects the project to use $70,000 in the first year to help set up the new city-government operation, after 13 months.
He expects to break even and by year three the city should be making money, which would help create utility funds for projects such as updating the wastewater treatment plant and creating solar energy plants as well as other infrastructure projects that fit the commuity.
The city wants to keep and draw businesses, especially tech-based and savvy organizations.
"Our plan is, if you're a tech business, why are you (anywhere else in Richland County)?" he said. "Why wouldn't you want to work in Shelby?"