January 9

Industry executives say ‘old Yankee mentality’ in Maine slows Web progress

They say one way to boost high-speed Internet service is for more residents to let go of tradition and accept its many benefits.

By J. Craig Anderson canderson@pressherald.com
Staff Writer

SOUTH PORTLAND — Executives from Maine’s Internet service providers, including the CEO of Biddeford-based GWI, agreed Wednesday that the state’s residents and their “old Yankee mentality” are partly to blame for Maine’s relatively poor broadband service.

click image to enlarge

CEO Fletcher Kittredge of Internet service provider GWI, shown at an event in 2010, says Maine’s high-speed networks must be made more reliable for cloud computing.

John Patriquin/2010 Press Herald file

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Speaking at the Maine Technology Users Group’s monthly meeting at South Portland City Hall, the executives said a lack of demand for high-speed Internet service in many rural parts of the state has prevented them from moving quicker to provide it. They called for a statewide initiative to teach Mainers why faster Internet service is good for residents and businesses.

The executives said a major reason why Maine ranks 49th among the 50 states for its quality and availability of Internet service is a lack of demand for high-speed broadband. “In fact, there is a huge policy discussion in Maine” about how to increase demand, said Fletcher Kittredge, the CEO of GWI.

Kittredge said that improving service in rural areas usually is a money-losing proposition, and that very few government subsidies are available to make such improvements economically viable.

Gib Davis, Northeast region channel manager for New York-based Time Warner Cable, said Time Warner’s pricing is consistent across all of the areas it serves, but businesses in rural Maine simply aren’t willing to pay what those in other states do for high-speed service.

For example, many business customers in rural parts of New York pay a premium for Internet speeds of 100 to 500 megabits per second “without batting an eyelid,” while comparable businesses in Maine usually are reluctant to pay for more than 10 megabits per second, he said.

Charles Lawton, chief economist for the Maine-based consulting company Planning Decisions Inc., agreed with the Internet executives that better education is needed.

Lawton, who also writes a column for the Portland Press Herald/Maine Sunday Telegram, said research by the Governor’s Broadband Capacity Building Task Force, a state-appointed panel, showed that many Maine companies have an “old Yankee mentality” about broadband Internet services – times have changed but they are still clinging to the traditional ways of doing business. Many owners don’t even see the value in having a website, the research showed.

Lawton agreed with a finding by the task force that state funding to subsidize high-speed network expansions in rural areas might be better spent on marketing initiatives to promote the benefits of broadband Internet service in Maine.

“The demand, if it’s promoted, will have a vastly different economic impact” than rural broadband grants, Lawton said. “We need to educate business users about the benefits.”

The idea is that if enough businesses and consumers in sparsely populated areas demanded faster Internet speeds, companies would be compelled to provide them.

The ConnectME Authority, a state entity whose job is to ensure that all Mainers have access to broadband Internet service, has provided about $8 million in grants for development projects in rural areas.

Andy Hinkley, who owns Charleston-based Cornerstone Communications, said his company has used ConnectME grants for projects that connected fiber-optic cable – the gold standard for high-speed Internet service – directly to homes in rural Maine.

“Those projects were 60 percent funded by the ConnectME Authority,” Hinkley said, and they would not have been financially feasible without the grants.

GWI’s Kittredge said $8 million in grants isn’t nearly enough.

“There’s very little money that goes into rural broadband,” he said. “There is no way they’re going to solve this problem at their current funding level.”

Joe Bourgault, senior account manager for FairPoint Communications, said market forces eventually will push faster broadband speeds out across the state, as more businesses come to rely on cost-saving – but bandwidth-intensive – cloud computing services.

Cloud computing allows businesses to save money by renting software on a pay-per-use basis and running it over the Internet, rather than buying a fully licensed copy of the software for each employee who uses it.

Cloud computing has created a significant spike in demand for high-speed Internet service in areas where businesses understand its benefits, Bourgault said. “The speeds are just going up and up and up in areas that can get it,” he said.

Still, Kittredge said, Maine’s high-speed networks must be made more secure and reliable before cloud computing can become the standard for all businesses. “You can’t do good cloud computing unless you can count on the network always being there,” he said.

Don Flewelling, account executive for Houlton-based Pioneer Broadband, said the statistic that Maine is 49th among the 50 states is somewhat meaningless because Internet providers in all 50 states, including Maine, are rapidly improving their networks.

“We’ve expanded tremendously,” Flewelling said. “We’ve got a ways to go, but we’re going to make it.”

J. Craig Anderson can be contacted at 791-6390 or at:

canderson@pressherald.com

Twitter: @jcraiganderson

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