More on Montana Opticom’s stimulus award to improve rural broadband

Montana Opticom logoAs I wrote in the post immediately before this one, the Gallatin Gateway-based Montana Opticom has received $64 million from the federal government to lay fiber-optic cable in western Gallatin County.

This will bring very fast Internet service to rural areas currently limited to mostly dial-up service and some cable access — when it comes to landlines, that is. People in those parts could, of course, opt for satellite or even cellular Internet service to get their broadband fix.

In my article, I wasn’t able to get into some of the details of how this fiber build-out will work or why it even needs to work. I’ll supply a few more of the details from my interview with Opticom spokesman Dean Genge.

One thing that has made it so hard to bring landline broadband to rural areas is the cost. Burying cable is expensive, especially when the population density on the receiving end is low. If you build a million-dollar cable for only 10 people to use, it’s a losing investment.

That, Genge said, has kept a lot of investors from putting money into expanding broadband into rural areas. Now, though, thanks to spurring from the National Broadband Plan and the Recovery Act, the federal government is subsidizing part of the cost, making it more affordable for ISPs and telcoms to bridge that “last mile” between main trunk lines and rural homes.

“Because the government is supporting the development of the infrastructure, it makes it workable for providers,” Genge said Wednesday afternoon.

The U.S. Department of Agriculture has an interest in helping bring modern services such as broadband to rural areas, said spokesman Bart Kendrick, who I spoke to by phone from Washington, D.C.

Kendrick noted that the USDA has a history of helping hook rural areas up to the grid, dating back to the Rural Electrification Act in the 1930s and to the spread of telephones in the 1940s. Internet access is the modern equivalent, and the feds see it as an investment in future American productivity.

“We’re trying to move it forward,” Kendrick said. “It’s more of a down-payment and not a balloon payment. We’re making strides forward, and this is a great step in that direction.”

Opticom’s funding, $64 million, comes half in the form of a grant and half in the form of a loan, which the company will have to pay back over the next 25 years.

Opticom’s award was part of a $1.31 billion rural broadband funding package announced Wednesday morning. This was the second round of funding for rural broadband projects, and Kendrick said the USDA has about 600 more applications to go through before the end of September, when all the funding pool will be emptied.

Another $26 million will go to Nemont Telephone Cooperative to improve Internet access to Brockton, Froid, North Poplar, North Wolf Point and Frazer within and around the Fort Peck reservation, the Associated Press reported.

As far as the technical details, and bear with me because I’m no expert in these things, Genge said that Opticom’s fiber-to-the-premise program would be using a gigabit passive optical network, or GPON, specifically a Calix C7 GPON.

Genge said this would provide downstream speeds of 2.5 gigabits/second and upstream speeds of 1.25 gigabits/sec. Each of those streams can be split to up to 64 customers, though Opticom only plans to split them out to 32 customers max to ensure quality service.

Now, this next part is a little up in the air, Genge said, so consider this to be tentative:

The plan for the build-out is to bury the fiber-optic lines along roads. As the crews reach homes, customers will have the chance to get the fiber installed at their house right then at no cost, Genge said. If the customers put off the decision, they will likely later have to pay an installation fee to get the cable from the line near to the road to their houses.

Again, that’s tentative, but it’s the general idea as I understood it from Genge.

Oh, and before I wrap up this miscellany, of course we must note that Montana’s politicians chimed in on Opticom’s award.

Sen. Max Baucus:

“I am so glad this broadband funding is coming to Montana. … Projects like this are critically important for folks in our state to connect with each other, improve education opportunities for our students, and to grow and market small businesses at home and around the globe. This is such good news.”

Gov. Brian Schweitzer:

“Affordable and accessible broadband service is critical to economic growth in Montana. … These funds will help a Montana business provide educational and economic opportunities in rural parts of our state.”

2 Replies to “More on Montana Opticom’s stimulus award to improve rural broadband”

  1. Hi Michael,

    Just wanted to say thanks for your excellent coverage on this topic. I'll be interested to learn more about Montana Opticom's contract and the details included in it. However, I'm initially elated to learn that both my home and business will potentially have a much speedier option for broadband internet access.

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