Broadband grows; home service coming

Published in the Coalfield Progress, May 22, 2007

JODI DEAL / Staff Writer
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    With a regional broadband network project nearing completion, local officials say high-bandwidth Internet access could be extended to many Wise County homes within three years.

    Planning officials have worked for four years on a regional network of fiber-optic cables connecting six Southwest Virginia counties. The $6 million project, which crisscrosses local communities in loops, is more than halfway finished. It should begin serving most Wise and Lee county public schools, government offices and the Lonesome Pine Business and Technology Park by July 1. Other government offices, businesses and hospitals are already online.

    But why can’t you get affordable service at your house?

    Simply put, the fiber-optic cables don’t run that far yet.

    As Sunset Digital Communications founder Paul Elswick explains it, the broadband projects local officials have been working on have been creating networks that are like the main arteries that deliver blood to and from your heart — high-capacity and centrally located.

    For affordable broadband to make it into homes — like blood makes it to your extremities — smaller-capacity cables will need to be installed in every neighborhood. And for that to happen, Elswick’s company needs more money.

    Making profit

    Sunset Digital Communications is a Duffield-based telecommunications business. It sells Internet service and operates the broadband network for Lenowisco Inc. — a non-profit organization created by the planning district of the same name, which owns the network.

    The Lenowisco Planning District has joined forces with the Cumberland Plateau Planning District to create the Coalfield Coalition, which has overseen the regional broadband project in Wise, Lee, Dickenson, Russell, Buchanan and Tazewell counties.

    Sunset Digital hasn’t turned a profit since its creation four years ago, when local broadband efforts began. That’s about to change.

    High-bandwidth broadband connections like those found in schools, hospitals, major businesses and government offices are much more expensive than what you pay for a cable modem or DSL service at home.

    For example, Sunset Digital will charge local schools $700 per month for the high-capacity connections. Those large connections are needed so that in addition to Internet service, schools can beam streaming, real-time classes to one another in high resolution.

    A similar pricing structure can be found in hospitals and government agencies, which need to send and receive high-resolution maps or medical screening results.

    But for standard Internet connections in areas that already receive home services from Sunset, such as Lee County, the cost is far less. For 7 megabytes of download capacity, home users pay $79.95, while users with 5-megabyte capacity pay only $49.95.

    Hitting schools, hospitals, government offices and major businesses provided high bandwidth service to those who needed it most, Elswick explained. But it also will help his company start earning more money than it costs to run the system. And once that happens, he’s one step closer to becoming a personal Internet and television service provider.

    Still expanding

    The Virginia Tobacco Commission Monday announced a grant that will help expand the broadband network closer to homes, Lenowisco Planning District Commission Executive Director Ron Flanary said Monday.

    A $1.25 million grant to Lenowisco Inc. will fund 60 additional miles of backbone fiber beyond the existing network. In Wise County, a connection line will be installed from Big Stone Gap to Norton by way of Appalachia, and another new loop will be put in place between the towns of Coeburn and St. Paul.

    Once that fiber is installed, the only Wise County schools left behind by the original backbone project, those in Appalachia, will be served.

    A second grant of $1.5 million to the Coalfield Coalition will help cover cost overruns in the original $6 million project caused by unexpected rock, bad weather and other delays that drove construction costs up, Flanary said.

    In addition, a side project is underway to lease fiber from Wise to Charlottesville to connect the University of Virginia’s College at Wise with UVa. When that comes online in July, local students will be able to take real-time classes from Charlottesville professors.

    Plenty to do

    To provide service to individual homes, Elswick predicts this company will have to take out substantial loans. He’ll need more equipment, more employees, and most of all — more fiber.

    Grants aren’t available to get the fiber to the home like they are for major backbone projects, Flanary noted. And, he added, you don’t take on debt until you have a revenue stream to pay the debt back.

    When Sunset becomes profitable in July, Elswick and Lenowisco Inc., which owns the local network, can start looking at those options, Elswick and Flanary explained.

    Flanary noted that he expects Sunset to be “in an aggressive mode” within a year.

    Wise County Administrator Glen “Skip” Skinner noted during a recent interview that he hopes to see service through Sunset available to Wise County homes within 30 months.

     

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