Providing broadband or high-speed internet to most of Fayette County’s rural area would cost more than $43 million. Providing some fiber to the rural area would cost more than $11 million, a new study by CTC Technology and Energy has found.
The first-of-its-kind detailed analysis of how much it would cost to lay fiber and maintain high-speed internet to the rural area also found it would take substantial public investment to provide the service even to a limited number of costumers, who would have to pay as much as $3,200 a month or $38,400 a year.
“Both of these options are expensive. There is no other way to say it,” said Aldona Valicenti, co-chair of Lexington Mayor Jim Gray’s effort to bring high-speed internet to Lexington.
There’s more bad news. There is no federal grant money to pay for broadband to cover rural Fayette County, CTC found.
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Instead, the study recommended the city determine the interest in the rural community in high-speed internet and connecting those would-be subscribers to groups and businesses interested in providing internet service to that area. It’s similar to the rural electric co-operatives started at the turn of the last century.
Discussions with providers and with interested rural subscribers has already started, Valicenti said.
The $58,000 study gives the city and any private companies interested in providing broadband service detailed cost information that many rural communities don’t have, said Scott Shapiro, the city’s chief innovation officer who is co-chairing with Valicenti the effort to bring broadband to Lexington.
The city will continue to pursue private partnerships to develop high-speed internet inside the urban service boundary — which controls growth in Fayette County. Broadband in the rural area will be on a separate track, Valicenti said.
A previous analysis by CTC showed it would cost will be $175 to $200 million to build a fiber-optic network to increase sluggish internet speeds and expand internet access inside the urban service boundary.
A timeline to release a request for proposals — a type of bid — for providers to build a broadband network in the urban service area has not yet been set, Valicenti said.
The city is still talking to interested providers.
Shapiro and Valicenti will present the CTC rural study at an August Urban County Council committee meeting. It’s possible the city may have a more definite timeline for issuing the request for proposals by that August meeting, Shapiro said.
Each week the city hears from other providers interested in fiber in Lexington.
“Issuing this report combined with the last report has generated a high-level of interest,” Shapiro said. “Companies want to come to markets that have done their homework.”
In the nearly three years since Gray announced the effort to bring high-speed internet to Lexington, the market has changed dramatically, Valicenti and Shapiro said. Those changes have slowed the city’s efforts to find a low-cost option to bring high-speed internet to Fayette County.
Gray announced in September 2014 he wants the city to become a “gigabit city.” Gigabit refers to speeds of 1,000 megabits per second. Lexington's average Internet speed is 16.2 megabits per second, according to some studies.
Google Fiber, which recently announced it was coming to Louisville, has backed off some of its earlier investments in other cities. Google Fiber also does not provide fiber for an entire city, only portions of it. Google has traditionally focused on cities much larger than Lexington. Lexington wants to be able to provide high-speed internet for the entire city — not just portions of it.
Nearly every major city in the country is trying to figure out how to pay for fiber to increase internet speeds, but with little to no federal funding available, it’s proven difficult, said Shapiro.
Chattanooga, Tenn., and Huntsville, Ala., have or are in the process of building infrastructure for a high-speed internet that covers the entire city. But they have a key advantage: “They own their utility companies,” Shapiro said.
Lexington does not. That makes digging trenches for fiber or connecting lines to utility poles costly.
“The marketplace for fiber is changing dramatically,” Shapiro said. “It’s changed a number of times just in the time that we have been pursuing gigabit speeds. We are now seeing other shifts in the marketplace.”