Smart Communities: Utilizing Broadband as a Development Tool
Sylvie Albert-Doucet
Economic developers have an opportunity to utilize broadband as a new economic tool to develop Smart Communities. The first step is understanding how the technology works and why it is important to the future development of communities, especially for remote and rural areas. Communities need to understand the various options for telecommunication infrastructure, its advantages and challenges. Technology is only one component of the equation if economic development objectives are to be met. The most important component of networks are people and there are many complexities in understanding how to best manage this resource. Communities must become innovative in introducing applications and ensure that people will want to use them. This creates a complex puzzle which promises many rewards for communities willing to invest to become a Smart Community. Community networks are not new, however, there is a transformation happening from a simple community portal and freenet approach, toward one that is attempting to expand community network services to develop smart services and a virtual society. Technology is being used to increase community knowledge management that transcends the usual geographical borders to allow individuals and corporations to operate from anywhere at any time. Networks, both human and technological, are the most effective means of creating a context for new forms of community development, learning, entertainment, and commerce (Thomassin Singh et al, 1999). Virtual society represents an evolutionary, as opposed to a revolutionary, movement. Although information technology (IT) is the main enabling force of the virtual society, other components are also at work; namely, economic, political, cultural, and social forces. Smart communities can be defined by the applications that are available on the community network, the infrastructure that it makes available to its citizens and organizations, and the ability of citizens to utilize the technology (Igbaria et al, 1999). The Internet is an excellent economic development tool, especially for more remote communities. High bandwidth can provide the following opportunities :
- Upgrade the skill level of the population in remote communities through e-learning and potentially change the economic fabric of the community, including a decrease in youth out-migration.
- Provide services not currently available in remote communities, such as telemedicine and remote monitoring.
- Develop and link teleworkers to larger companies looking for human resources.
- Improve e-commerce activities and generate new services within the community, such as in transportation and information technology.
- Increase entrepreneurship by educating citizens on Internet-based service provision and identifying new business examples that can be developed through the Internet or as a result of expanding local activities on the Internet.
- Provide increased opportunities for companies to utilize various tools such as knowledge management at a distance. The applications described above require higher bandwidth whether in business, or directly in the home. Communities that do not have the physical infrastructure to offer broadband may be left behind and should consider moving in this direction.
BUILDING INFRASTRUCTURE
Municipalities own hard infrastructure, such as water and sewers, and there has always been the option to approach partners to build or improve a community''s infrastructure in order to remain competitive. To upgrade the infrastructure of a community network, the first phase usually links organizations such as schools, hospitals, municipal buildings, and other public and/or private partners. This usually forms a backbone from which the community can expand its services to the home. Expansion to home services should come relatively quickly given the speed of new technology and applications developed on the Internet by private industry. There are several reasons that a community should consider building or at least taking some level of control over its telecommunications infrastructure. These include:
- Reduce the cost of construction and decrease or eliminate the damage on city streets. Municipalities can take control by sharing infrastructure with private sector partners, or by owning the conduits and controlling new construction (usually by overbuilding and leasing infrastructure to new entrants).
- Attract new entrants. Since the construction cost is a high portion of the cost of telecommunications, it is a detractor for small companies and it certainly does not encourage the private sector to offer services in remote areas. Remove the entry barriers and more companies may be able to compete in various markets, encouraging economic development.
- Decrease the cost of telecommunications. At minimum, the cost of telecommunications could be reduced for non-profit organizations. Municipalities also may be able to encourage economic development by leveraging their infrastructure capabilities.
- Increase bandwidth availability. For many communities and regions, the only way to access new economy services and promote knowledge workers will be to increase its telecommunication capacities and provide high bandwidth. In more remote areas, investment will not come on its own.
Some organizations such as schools and municipalities are already spending substantial amounts on telecommunications. Existing connectivity costs might be displaced to cover short term capital costs in order to save money in the long run. Today''s technology is allowing communities and non-profit organizations to build their own dark fibre or wireless networks at increasingly affordable cost. A dark fibre network, for example, can provide ample bandwidth to schools, and repay its investment within 2-5 years depending on the number of partners sharing the construction costs. When one considers that fibre technology can last up to 20 years, this becomes a very attractive investment. Negotiation with the private sector will not be completely successful unless the community understands its cost of construction and maintenance, and if it is not ready to build. There are several models of successful relationships with carriers including aggregating demand to negotiate improved pricing for members of a consortium, government subsidies for infrastructure improvements in exchange for concessions, and condominium-style construction. Public-private partnerships can decrease the cost of construction for everyone, and if a community-model is undertaken, it can provide room and an incentive for new competitors and application providers to offer services in the community. Construction costs are usually about 90% of the cost of a network. Fibre is expensive, therefore, communities or non-profit organizations need to partner to decrease the construction cost and make the network feasible. Typically, schools and municipalities are natural partners. Schools have several locations which they need to connect and so do municipalities. The network topology within a municipality or region can often accommodate half or more of the routes for construction under a shared arrangement. This means that two organizations sharing these routes would pay 50% of the cost of construction each, with three partners the cost of construction is 33% for each partner. There are usually a smaller number of locations that are remote and which present a challenge in finding partners willing to share the construction costs.
HIGH BANDWIDTH APPLICATIONS
Cairncross (1997) forecasted that the death of distance as a determinant of the cost of communicating will probably be the single most important force shaping society in the first half of the next century. Technological change will alter, in ways that are only dimly imaginable, the concepts of national borders and sovereignty, and the patterns of international trade. Its effects will be as pervasive, transforming labour productivity at the office and in the home. The Internet is a series of networks originating with the U.S. Department of Defense and several universities that wanted to share information. The World Wide Web, developed in 1989, brought multimedia to the Internet. It allowed the display of colourful pictures, music, moving images, as well as text and data. The result has made the Internet much more fun to use and look at, and richer in content. However, richer content will require larger bandwidth than the common 28.8 or 56.6 Kbit/s of today''s modems, and even high speed DSL and cable modems (1.5 Mbps) will soon be too slow for upcoming applications. The user needs an appropriate access device (high speed network using fibre, wireless, or other technology) to browse the information and invoke the functionality on the network. No one will want to wait hours to download a video, or wait several minutes to receive a large file. Future services and applications that will require a faster technology include on-demand video (download an entire video to your set top box), or video phones with full screen full motion video. Future office tele-workers (employees who are working outside the conventional office) will require improved sound, the ability to send and receive videos and large data files, and the ability to quickly download software to their home computer. The following are other examples of broadband applications: Telework: Working from home for an employer located in another region; running a home-based business selling goods and services to a region or the world; working from a subsidiary office for an employer located in another region. Call Centres: A wired community could attract more call centres, and a virtual call centre project with employees working from home would have a competitive advantage over other locations offering standard service. Tele-medicine or Tele-health: Receiving health information or a consultation through a video conference system; sending patient data to a specialist over the Internet for an opinion or assessment. Tele-education or e-learning: Attending a college, university, or training program from home or a community classroom connected to any number of educational institutions; attending a conference or a one-on-one training session from home or the office, while the trainer or conference is located in another region. Virtual Libraries: The ability to browse through any library in the world, download books or articles, reserve and order books, talk to a librarian on-line from home, download a video available at the library, etc. E-commerce: Doing business on the Internet by developing a site where consumers can shop, pay bills, obtain information, register for a class, book a hotel room, etc. Entertainment: Receive videos, music, games, or other forms of entertainment from the Internet to your home computer. IP Telephony: Make telephone calls from a computer, with or without video (still or moving pictures of the person you are calling), and avoid long distance charges using the Internet. Software Access and Data Storage: Allowing users to download software from the Internet, sometimes free of charge; allowing users to use a central memory located in another part of the world to store large files on a rental basis.
PATTERNS OF ADOPTION
The first step in ensuring that the Internet is used in the community is to provide applications people can use. Approximately half of the Canadian population uses the Internet, according to a study performed by Angus Reid. If we want more people to use it, they need help to understand how it can be of use to them. The way people adopt new technologies will be influenced by culture, convenience, and cost. Culture: If people are used to doing things one way, they may be slow to change, especially if they are over 65. Younger people are more adaptable to change and can become a force to help those more wary by providing their skills and knowledge and training older users of the technology. Convenience: The more effort it takes to master the technology, the slower and more limited its diffusion will be. The personal computer is already a deterrent to utilization. The project will need to find ways to make information easy to access and use. Cost: The Internet has flourished since costs have declined. Already, some residents are asking if there will be a subsidy toward the purchase of new computers and equipment. Although many residents are willing to pay more for high-level services, they are concerned about keeping costs low. Education: Igbaria et al. explained that the successful use of IT requires individual computer and information literacy skills technology by itself does not ensure the coming of the virtual society, rather it is an enabler and shaper. This implies that any sound plan for the development of a Smart Community must include a large amount of marketing and education. The age of the population may have a strong impact, with municipalities which have a high number of older workers having more difficulty making the transition.
TECHNOLOGY
Euroscom, during the mid-1990s, forecasted that in the short-term home users would need 1 Mbit/sec if digital video is not required, and 4-6 Mbit/sec if video is included. In the future, every home will have several computer terminals, just as today several TV sets can be easily found inside a single home. A number of digital appliances connected to each other via advanced home networks will become very common. The per-home total capacity is expected to increase to support the use of all these terminals, and bandwidth of 15 to 60 Mbit/s is suggested. In early 2000, many customers had switched to 1.5 Mbps services being offered by cable companies and ADSL service through telephone companies. This broadband service is quickly beginning to frustrate users and many customers are already looking for other alternatives to high-speed service. There are a number of possible solutions for building the community infrastructure: •fibre, dark fibre, and fibre- to-the-home (FTTH) •Hybrid fibre solutions (mixed with copper, coax, fibre, wireless) •Wireless technologies (satellite, MMDS, LMDS, MCS, MDS, ITFS, microwave) There is no single, simple metric to compare these broadband technologies. Although the capital up-front costs of some technologies such as fibre may appear high, it is important to look at other issues such as life cycle. Fibre can last 20 years and can therefore be amortized over a long period of time. There are few active components, therefore maintenance and support costs tend to be lower. It is also possible to develop fibre into a private network-style project so that the community can minimize its end-equipment costs. Fibre builds can be done in condominium style where several investors share the cost of construction and each own its share of fibre in the conduit. Condo buyers then sign an agreement to pay for their share of the maintenance. Almost all of the technologies mentioned are capable of operating over a range of speeds, depending on how they are actually implemented. The problem with some technologies, such as copper, coax, and wireless, is that at the moment, they offer limited bandwidth. The operational costs tend to be high and in the case of wireless and cable, the bandwidth is shared and security is poor. With wireless, line of sight, security, and sharing bandwidth may be negative issues for some people in the community. The difference between fibre and other technologies can be made through an analogy what is more expensive, a home or a car? In the long run, the car (wireless technologies) is more expensive because it has to be replaced more often, it costs more to operate, and it is less of an asset on the books, although it does provide a good service. Some communities will not want to wait for the time required to install fibre or will not want to make a large capital investment and wait for returns. However, fibre is the only technology that is long term and meets the needs of everyone in the community for speed, convergence, security, and reliability. There are options for the short term, such as using wireless where the financial case for fibre cannot be made usually in more remote areas of the community. Also, fibre-wireless infrastructures have been used successfully to bring fibre services to businesses and wireless services to homes (such as in Fredericton, New Brunswick). Once there are enough subscribers in a neighbourhood interested in fibre, the technology can be replaced to provide fibre to the home.
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ABOUT THE AUTHOR
SYLVIE ALBERT-DOUCET, BA, MBA, EcD, HRP, is President of Planned Approach Inc., a management consulting firm specializing in economic development projects and community-based telecommunications networks. She was previously Manager of an economic development corporation and a Government of Ontario Training Consultant. She can be contacted by email at sdoucet@plannedapproach.com