Lexington to study cost of high-speed internet for rural Fayette areas

Lexington’s push to increase internet speeds will be delayed a few months as the city studies the cost of providing ultra high-speed internet access to Fayette County’s rural areas.

During the Urban County Council’s work session Tuesday, the council gave tentative approval to hire CTC Technology and Energy for $58,000 to do an analysis of the cost to put fiber-optic cable in the rural service area. A final vote on the contract will come in a few weeks.

Scott Shapiro, chief innovation officer for the city, told the council Tuesday that CTC will talk to stakeholders, do an engineering and cost assessment and build a financial model. That information will help potential bidders for a yet-to-be-released request for proposals to build a fiber-optic network in Lexington.

“We are looking for private partners,” Shapiro said of the city’s efforts to build a high-speed internet network. “The goal is to hold the (request for proposals) until this study is completed.”

Mayor Jim Gray first announced the city’s intent to become a “gigabit city” in September 2014. Gigabit refers to speeds of 1,000 megabits per second. Lexington’s average internet speed is 16.2 megabits per second, according to many studies. For internet speeds that fast, the city will need a fiber-optic network.

In early 2015, the city issued a request for information to determine interest in a private-public partnership or a commercial-only solution to build a fiber-optic network. The city received a dozen responses.

The city has prepared a request for proposals, a type of bid, that asks for input on how the city could build its own fiber-optic network, and how companies could partner with the city to build it. The request for proposal would allow potential bidders to include the rural area but it’s not a requirement.

Councilman Russ Hensley, who represents the 12th District and much of Fayette County’s rural area, requested the city include the area outside the urban service boundary as part of the bid. Hensley, the owner of technology companies, said internet service outside the Urban Service area is sluggish at best.

During Tuesday’s meeting, Hensley applauded the city for doing the study.

“The original study did not have any input from the rural — or 12th district — area,” Hensley said.

Shapiro said he is not aware of any company that has provided high speed internet in a rural area. This study could be one of the first in the country to determine how much it would cost.

Aldona Valicenti, the city’s chief information officer, said the study will give the city data so it can understand how much more it would cost to provide high-speed internet in the rural area. Fiber optic cable either has to go underground or on poles. It’s a major infrastructure undertaking. Valicenti said requiring bidders to bid on both the urban service and the rural area is not part of the bid. It may chase too many potential bidders away.

“Density determines price,” Valicenti said. “One of the reasons why Lexington has received so much interest is because of the density inside the urban service area.”

Shapiro said it’s not known how long the study will take — possibly a few months. The city will issue the request for proposals when the study is completed.

Valicenti said the city is working as fast as it can but cautioned that ultra high-speed internet is still years away.

“This is a long-term process,” Valicenti said. “This is like building a huge road but you can’t see it.”

Other cities are also trying to figure out how to provide high-speed internet service. Lexington doesn’t have a publicly owned utility that owns electric poles. In Chattanooga, Tenn., the publicly owned electric company spent nearly $300 million on a fiber-optic network.

Louisville is also pursuing high-speed internet. In early April, four companies, including Google Fiber, responded to requests for proposals to use public right-of-way to build infrastructure for high-speed internet.

Since Lexington announced its gigabit city push, both Time Warner and Windstream, the city’s two internet providers, launched limited high-speed internet options for customers.

Ookla, an Internet metrics company, said Lexington’s 16.2 megabits per second ranks 38th of 96 Kentucky cities and towns where the internet is available.

This story was originally published May 3, 2016 at 5:26 PM with the headline "Lexington to study cost of high-speed internet for rural Fayette areas."