Rural communities get gigabit Internet: ‘We went from the dark ages to highest-speed Internet available’

theglobeandmail.com
Oct. 14, 2015
By Tracy Hanes

For decades, Scugog Township, a rural community of 22,500 residents in Ontario’s Durham Region, has depended on agriculture, tourism and a smattering of light manufacturing to drive its economy.

But its future may rest not in farmers’ fields, festivals or the local casino, but in blazing-fast Internet service. Communicate Freely, a local Internet service provider, recently received a $1.9-million Connecting Canadians grant to help provide areas of the township that have slow, unreliable Internet with upgraded service.

George Cope, president and chief executive officer of BCE, addresses shareholders at the company's Annual General Meeting, in Toronto April 30, 2015.

The larger vision is for Scugog to become a “gigabit smart” community, following the path blazed by the small town of Olds, Alta., population 8,500, where every home and business is connected to a fibre-optic network. Data in the form of pulses of light travel across glass strands in the fibre and provide the fastest Internet service available.

In Scugog, Connect Freely will install a fibre-optic network starting with 820 homes on Scugog Island. The municipality will supply a loan to match the government grant and enter into a partnership with Connect Freely owner Tim St. Pierre to operate the company as a public utility.

“Gigabit“ internet refers to the amount of data transferred per second; one gigabit is 1,000 megabits. It allows for downloading movies in seconds rather than hours, or uploading 3-D drawings in minutes rather than days.

But it’s about much more than that, says Lance Douglas, former chief executive officer of O-NET in Olds, the only community-owned gigabit network and service provider in Canada, and current CEO of Lightcore Group, a private telecommunications company that specializes in gigabit communities.

He says it is also about more than being able to virtually connect in real time with educators, family members and emergency responders, or offloading businesses’ automated processes to the “cloud” to allow for cost reduction.

“It is about living, working, playing and learning out from under the artificial boundaries set by the incumbents (large Internet providers such as Bell and Rogers). It is about being part of the global economy at our own pace,” Mr. Douglas says.

Patrick Lyver, founder of Kleurvision Inc., a digital marketing and branding company in Port Perry, the largest village in Scugog Township, believes that Scugog can become the next Stratford. That city of 51,000 has been globally recognized as a leading “smart city” for its citywide WiFi and a 70-kilometre fibre-optic network that can run at speeds of up to one gigabit per second.

The University of Waterloo has opened a campus there specializing in digital media, Royal Bank of Canada has built a major data centre and Stratford has become a test city for tech companies such as Toshiba, LeoNovus and Cisco. Its Internet service provider, Rhyzome Networks, is owned by the city.

Statistics on the exact number of gigabit communities in Canada are not as readily available as they are in the United States, Mr. Douglas says, although he has heard of pockets in the Vancouver area, in the Muskokas and in Atlantic Canada.

Mr. Douglas says a true gigabit community provides symmetrical upload and download speeds to all homes and businesses, and as far as he knows, Olds remains the sole Canadian one. Some providers may split the fibre among 32 and up to 64 homes, resulting in slower speeds because the people living in those homes – each with up to five online devices - all compete for bandwidth. He says O-NET split the fibre a maximum of 16 times and the larger the municipality, the less splitting is required for balanced costs.

The Olds Institute for Regional and Community Development believed that a fibre-optic network would help to retain existing businesses, attract new ones and bring in new families - common challenges for small towns.

The institute secured a $2.5-million grant from the provincial government and a $6-million loan from the town to build the network. When large Internet providers declined invitations to sell their services on the network, the community-owned O-NET was created to provide the service (one-gig plans start at $100 a month).

Olds College has been one of the big winners, becoming the most connected college in the country and a leader in mobile learning, Mr. Douglas says.

Doug Rieberger, who owns Ultimate Safety Alberta Ltd. in Olds, says his company was not able to transfer large files by e-mail before and if he wanted to order a video to use for training, he would have to wait for a DVD to be delivered, rather than download it from the Internet.

“We are able to transfer information between our clients and ourselves much quicker and we’ve been able to do online registration for courses that wasn’t possible before,” Mr. Rieberger says. “Another thing it will allow us to do is grow our technology side. We will be able to do remote training [where courses will be able to be live-streamed to off-site locations]. We haven’t done much of that yet, but it is coming.”

Bill Gispen is operations manager for Lakeland Networks in Bracebridge, Ont. Its sister company, Lakeland Energy Ltd., created a fibre-optic network to improve internal communications between its sites, then decided to extend the service to local businesses. The Internet provider is owned by five local municipalities.

“We wanted to be leader and attract new business,” Mr. Gispen says. “We thought one-gig service would attract people who vacation here to bring their businesses. We went from the dark ages to highest-speed Internet available.”

He says the economic benefits will be a long-term payoff. “In about five years, we’ll see the business benefits. The immediate turnaround comes more on the residential side and that uptake has been great.”

One of Lakeland’s clients is the Muskoka Animation Studio Huntsville (MASH) that opened in the Waterloo Summit Centre for the Environment building a year ago with about two dozen employees. The studio required reliable, high-speed Internet to be able to locate in the area, Mr. Gispen says.

Nearby Gravenhurst is also slated for a fibre-optic network to be built by Sudbury-based telecommunications company Vianet that will be capable of delivering gigabit service.

Vianet also has customers in Huntsville, where it offers 20-to-45-megabit service, faster than in many large cities. One of them, Darla Stipanovich, owner of Soapstones, says that has made a huge difference to her business, which manufactures, retails and wholesales soap and skin-care products.

“We could sell tons of stuff all summer, but we needed to create methods of selling all winter and the best way was to have our summer customers be able to buy online when they are at home during the winter,” Ms. Stipanovich says.

Soapstones does more than $500,000 in sales a year and at least 2 per cent is through online business. Mrs. Stipanovich has also embraced social media as a marketing tool.

“One things that we haven’t accomplished yet but that we plan to is to set up our own YouTube channel,” she says. “We want to do a series of how-to skin-care videos.”

In August, Bell announced the first phase of the launch of Gigabit Fibe, now available to 1.3 million homes in parts of Quebec and Ontario and offering packages of up to 940 megabits per second, increasing to one gigabit in 2016. The service will be available to an additional 650,000 locations in the Atlantic Provinces this fall and to 250,000 more in Quebec and Ontario. In Ontario, it is available in parts of Brampton, Kingston, Kitchener-Waterloo, Milton, Ottawa, Peterborough and some neighbourhoods in Toronto, including Regent Park, the Distillery District, Harbourfront and Willowdale. Rogers recently announced speeds of up to 1 gigabit per second will be coming to parts of Toronto as well as Vaughan, Markham, Richmond Hill, Ajax, Pickering and Whitby later this year.

Mr. Douglas says getting gigabit service is tough for communities of fewer than 25,000 homes. Large companies such as Bell and Rogers are not directing their efforts to small communities and it is difficult to entice private industry to invest in network upgrades.

So municipalities are left with an option: Ignore the lack of new investment, or to take matters into their own hands as Olds did, Mr. Douglas says.

Mr. Pierre of Communicate Freely says gigabit Internet will “future proof” Scugog Township.

He has heard from local real estate agents that area property deals often hinge on whether high-speed Internet is available. Residents of Scugog Island, who currently can do little more than check e-mail with their current service, will be able to use their mobile devices, work from home or start new home-based businesses, he says.

“Lots of people in Scugog are commuting to Toronto or Markham and they won’t have to go to the office any more,” Mr. Pierre says, “and local businesses can also use it to find new ways to sell and market their services and wares.”

“If we look at businesses in small towns, they have a ‘buy local’ campaign going nearly constantly, but most are not improving their businesses to compete with their non-local competition, such as online 24/7 ordering, nearly instant shipping, and real-time customer service interaction, if even just by e-mail,” Mr. Douglas says. “Productivity is lost due to slower Internet - and we’ve all experienced that.”