State

As coal falls, a digital revolution begins in Appalachia. This hurdle blocks the way.

A hill towers above a busy highway just outside Pikeville in September.
A hill towers above a busy highway just outside Pikeville in September. The GroundTruth Project

Editor’s note: This story is part of Crossing the Divide, a cross-country reporting road trip from The GroundTruth Project and WGBH. The team of five reporters is exploring issues that divide us and stories that unite us. Follow their trip across America at xthedivide.org.

PIKEVILLE — Silicon Valley, meet Appalachian Mountains.

In Eastern Kentucky, in the heart of rural Appalachia and amid the coal-dust remnants of the Industrial Revolution, a nascent digital revolution is taking shape. After the rapid decline of the coal industry, Eastern Kentuckians are attempting to diversify the region’s economy, but limited access to broadband internet poses a significant challenge.

Nestled in the mountains of Pikeville, in what was once a Coca-Cola bottling facility, is BitSource, a software development company where former coal-industry employees design web pages, create software and develop augmented reality applications. The building, featuring an exterior studded with large black-and-white photos of soft drink production, was chosen partly because of its proximity to a fiber optic cable connection.

“We located there, along that pipeline, and got a connection that’s very expensive,” said Charles “Rusty” Justice, the co-owner of BitSource. “It’s still not enough. We don’t have adequate bandwidth there.”

Of the nearly 700,000 people without broadband access in Kentucky, 90 percent live in rural areas like Pike County, according to data from the Federal Communications Commission. This is because installing fiber optic cables carries expensive front-end costs. To earn profits, providers would have to charge their few rural customers prohibitive rates.

Despite the lack of access, some in Appalachia are attempting to enter the digital economy while diversifying the region’s professional opportunities after the loss of nearly 11,000 coal-related jobs since 2010, according to data from the Kentucky Energy and Environment Cabinet.

Justice, a Pikeville native whose family goes back four generations in the area, did not originally intend to work in software development. He holds degrees in mining and civil engineering, but after his excavation and engineering business was hurt by the decline in the coal industry, he sought other opportunities.

He co-founded BitSource in 2014, and nearly 1,000 people applied for the computer coding training the organization offered, Justice said. Ten were selected.

“The idea of a hillbilly from the coal industry doing high-tech work is counter-intuitive,” said Justice. “But we’re working deliberately and intentionally to change search results for ‘Appalachia.’”

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Michael Harrison, right, at BitSource, an internet start-up in Pikeville. To offset lost mining jobs, officials, business leaders and environmentalists in Kentucky are setting aside political feuds to try to create an entrepreneurial economy. George Etheredge New York Times

A statewide program called KentuckyWired intended to create a “middle mile” fiber optic cable network throughout the Commonwealth — like the one that drew BitSource to the bottling plant — is under construction. However it is not scheduled to be completed in Eastern Kentucky until 2020.

The middle mile will run through more populated hubs like Pikeville, then the state anticipates that municipalities and private businesses will extend the connection from the hubs to the rural “last mile.”

So far, a fraction of the publicly-owned network has been built.

“In today’s world, high-speed broadband is just as essential as running water, telephone service and electricity in terms of attracting jobs and business to your particular location,” said former Kentucky Governor Steven Beshear.

“This is a much bigger issue than just a private telecommunications issue,” he said. “This is an issue about getting people back to work and taking obstacles out of the way so people have an opportunity to be successful.”

In spite of the lack of broadband connectivity, prominent West and East Coast entities took note of the potential growing in the mountains. In late September, Facebook co-founder Mark Zuckerberg visited nearby Hazard and met Appalachian computer science students. At the same time, a representative for the Massachusetts Institute of Technology visited Pikeville to meet with Justice.

Zuckerberg
Facebook founder Mark Zuckerberg traveled to Hazard in September to meet with students and teachers about the innovative learning taking place in public schools across Eastern Kentucky. Jacob Stratton Photo provided

“As a software engineer, I would say the people here are as good as you find in Silicon Valley,” said Jeff Freilich, associate director of alliances for Massachusetts Institute of Technology’s Computer Science and Artificial Intelligence Laboratory. “There is real potential here. What’s stifling it is the infrastructure.”

But coders are not the only people poised to gain opportunity through broadband.

At the University of Pikeville, the second U.S. institution of higher learning to offer athletic scholarships for eSports, 24 students are earning their degrees while professionally playing video games. One student, from neighboring Floyd County, received a full scholarship at the university to play League of Legends, a multiplayer online battle game.

“I’ve played on and off, then I was pretty much done playing it because I had to move and get a job,” said player and nursing major Brody Johnson. “I didn’t want to go back to school, because I couldn’t really afford it. Then, when [the coach] called me, it was like a whole ‘nother opportunity.”

Kelly Porter, the team’s interim head coach, explained that recruiting a player from Eastern Kentucky is often difficult.

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Pro gamers spend their evening tactfully planning their next moves at the University of Pikeville’s ESports Arena in September. The university has offered scholarships to the students, who are classified as student athletes on campus. Brittany Greeson The GroundTruth Project

“Kentucky is much more diverse than mountains and hillbillies,” Porter said. “This area is a little bit different, mostly because of the resources that they have. Internet is hard to come by, and that has widened the technology gap.” He also said that he likes to recruit from Eastern Kentucky when he can, because those players tend to be more invested in the local community.

“I guess [Porter] found it really rare that I was good at the game and from around here,” Johnson said. “Not many people who are from around here are good at the game at all.”

Johnson, in his professional capacity, said he benefited from access to faster internet. “When I got upgraded internet, I jumped a whole division,” he said. “Almost a whole division and a half.”

Eastern Kentuckians are also increasingly telecommuting — where broadband is fast enough — through an organization called Teleworks USA. The organization trains people to work from home — generally in customer service positions — allowing people in areas with limited job opportunities to stay in Appalachia.

“It’s a rapid way to get people employed in the digital economy,” Teleworks director Michael Cornett said. “We could do much more if service were more widespread instead of just in these pockets of really good internet which are just here and there.”

In Eastern Kentucky, Teleworks has created about 1,000 jobs, according to data from a regional development program called Shaping Our Appalachian Region. Before retraining workers, Teleworks asks that applicants print internet speed test results for their homes. If they don’t have sufficient access, prospective workers may lease space from the organization. However, some employers exclude anyone who can’t work from home, Cornett said.

“We can put people in our hubs, but that limits the opportunities we can place them in,” Cornett said. “We’re all holding our breath here. I mean, honestly! Broadband in this region, to me, is no different than utility service. It’s no different than water, and sewer, and electricity. In this economy, broadband is the thing that’s going to make you or break you in terms of expansion and joining this larger global economy.”

Teleworks
From left, Jeannie Gray, Marion Johnson and Carla Gabbard worked on computer and customer-service skills at the Teleworks USA training hub last year. The three hoped to get jobs working from home for companies such as U-Haul, which has hired several other people from the program to take reservations. Bill Estep bestep@herald-leader.com

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