Ottawas Broadband Access Spotty

March 28, 2003
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WEST OLIVE — Ottawa County is “very similar” to other communities around Michigan and the nation in broadband Internet availability, with spotty access to affordable services.

While the entire county has access to at least one form of broadband, due to satellite television services that fill the gaps in rural areas, in some cases it’s at a price that residents and small businesses are unwilling or unable to pay.

To bring greater access, competition and affordability to Ottawa County, residents and businesses need to become more aware of what’s already available and of the benefits of broadband, according to consultants examining the issue. Generating more awareness and increased usage, they say, can create a demonstrable market demand that can help to lure future investments and result in universal access to broadband Internet service at affordable rates.

“The intention is we can point out opportunities,” said Arthur Barnard of the Madison, Wis.-based consulting firm Vichow Krause & Co. that’s analyzing broadband availability and access in Ottawa and other counties.

The ongoing study is part of the state’s LinkMichigan initiative now underway in several counties, examining ways to make broadband Internet services universally available and affordable across Michigan.

The issue is one of economic opportunity. The state of a local community’s telecommunications infrastructure and broadband availability is playing an increasingly greater role for companies across the nation in choosing where to locate.

Those communities lacking what companies need will ultimately lose out on job creation in the future, Barnard said. The quality of the local telecommunications infrastructure and service also plays a key role in retaining employers and enabling them to expand locally, he said.

“High-speed access can really affect the perception of a region,” Barnard said. “If you have that, that just puts you in the tier (companies) are looking at, and if you don’t, they’re just going to cross you off the list.”

Ottawa County’s broadband availability is much like that of any other county of similar size and population, Barnard said.

“You’re really where a lot of other places are, and that is spotty and undeveloped,” he said.

Broadband is available throughout the entire county, although the more affordable services are concentrated in the population pockets and the only service accessible to rural areas is via satellite television providers, an option that has high equipment costs up front.

To improve the service level in Ottawa County, an effort is first needed to get more people and businesses using broadband. Part of the problem is a perception that the benefits of broadband service over dial-up Internet service is not worth the higher subscription cost, according to market research conducted in connection to the LinkMichigan initiative in Ottawa County.

“What you have is a cost vs. availability problem,” said Ray Elseth, a senior consultant with the Park Ridge, Ill., firm Broadband Development 3. “People don’t feel it’s worth it to them. They haven’t had a chance to use it and they haven’t seen what it does.”

Any strategy to improve the availability and affordability of broadband services in Ottawa County must start with building public awareness of the service’s business and lifestyle benefits, Elseth said. To businesses, those benefits are improved workplace productivity and processing of data, lower overhead costs, and the ability to quickly transmit heavy databases electronically.

Many people today “have no frame of reference on how to value that service,” Barnard said.

The consultants will present a draft report on their findings, with recommendations, to the Ottawa County Planning and Grants Department by May 1.

Their market research, which included interviews with eight focus groups and mail surveys of residents and businesses, found that 85 percent of Ottawa County businesses are online. Forty-five percent of business respondents who are online indicated they connect to the Internet via some form of high-speed service such as DSL, ISDN or cable modem; two-thirds said they pay less than $50 per month.

Four out of every five households in Ottawa County are online, with half of those using the service for business and two-thirds paying less than $25 a month for a low-speed dial-up connection. Thirty-five percent of the households online subscribe to a high-speed cable modem service.

Survey results show considerable price sensitivity in the market for high-speed service and some views that not enough competition exists locally, as well as perceived communication gaps between what businesses need and what service providers offer.

“Current broadband providers could be more supportive and responsive to local business needs,” the consultant’s preliminary report states.

An approach toward addressing the issues identified in the study must occur on several fronts, consultants say.

“A solution is not going to be one size fits all,” Barnard said.          

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