How a super-broadband system might benefit S.C.

How might a WiMAX system enrich Sourh Carolina? Today's editorial throws out a few possibilities:

"Two years ago, S.C. leaders deemed creation of an economy grounded in knowledge-based high-pay jobs their top economic priority. So strongly did they believe in this vision that they passed a law to align high-school education with this hoped-for future job market.

"Now our state has an opportunity to make this vision real. For minimal public up-front investment, the state could convert its 67 S.C. Educational Television licenses into a super-broadband WiMAX 'wireless cloud' that covers the entire state. The hardware that would sustain this system - more than 200 transmission towers erected for transmission of ETV programming to schools - is already in place.

"All that's lacking is a plan to convert those ETV 67 licenses to WiMAX use. If the legislature doesn't authorize such a plan soon, those licenses will revert to the Federal Communications Commission in less than a year - and likely be lost to South Carolina forever.

"How would this statewide WiMAX system foster the creation of a knowledge economy? Here are some possibilities identified last year by the state's chief information officer in a report to the S.C. House. WiMAX (essentially a high-power long-distance Wi-Fi system) could:

"*Reduce the social divide between haves and have-nots. Because the wireless cloud would cover the entire state, poor, rural residents, at low cost, could be part in the knowledge-economy revolution.

"*Reduce the cost of the S.C. public sector. Pooling information technology for state and local government into a single super-high-speed system would yield tremendous savings for taxpayers.

"*Attract knowledge-based businesses to South Carolina. No such statewide system exists anywhere else in the country. Create one here and businesses that depend on movement of information would have to be in South Carolina.

"*Create a test bed for emerging wireless technologies. The very telecom and cable TV companies now legislatively impeding the creation of an S.C. WiMAX system could develop new products in here, at low cost to themselves - Internet-based voice systems, for instance.

"*Deliver high-quality educational services. All residents, not just schoolchildren, could get training and information, and conduct research, from any part of the state.

"Some other possibilities: Medical professionals could use such a system to accurately diagnose distant injuries - anywhere in the state - and instruct EMTs on how to treat them. Businesses of all kinds could quickly and cheaply get the information they need to become more profitable.

"Local possibilities: Independent Myrtle Beach hotels and restaurants could tap into the system for joint marketing and booking. Horry County could credibly recruit high-tech businesses that it can't attract now for lack of broadband capacity. The only limit on the uses for such a system is the human imagination.

"Come early February 2009, when the national digital high-definition TV changeover occurs, those 67 ETV licenses could be gone. Two bills trapped in the S.C. House Labor, Commerce and Industry Committee, HB 4692 and HB 4735, could break the legislative WiMAX logjam and prevent that from happening.

"The first would direct the state to create the wireless cloud. The second would direct ETV to make the necessary FCC filings to convert those 67 licenses for super-broadband purposes. Local legislators - none of whom is a sponsor on either bill - should join the effort to make certain that our state quickly capitalizes on this once-in-a-lifetime (literally) to create a real S.C. knowledge economy."

Comments?

Comments

[jim sefter]

I think it would be foolish for the State of SC to basically turn over an asset such as the 67 licenses to private individuals or Corporations, and then have to pay to use them at a later time! It sounds to me like all they have to do to keep them is have a PLAN! Surely the State already has a geek squad available on the payroll to come up with such a plan. What comes to my mind is how an individual (Mark Warner - former Gov. of Virginia - and one-time Presidential aspirant) made $millions (billions?) by acquiring and then selling cell phone licenses. I don't have any comprehension of how he did it, but he did it. So why not have the State of SC make those dollars to benefit the citizen-taxpayers rather than private interests. It might be, as BGO said, OLD technology, but there is obviously an interest in using it, and it would be nice for the State (taxpayers) to reap some of the benefits.

[Denney Clements]

Jim: Wonderful comment. As I understand it, the WiMAX supporters envision a state owned system, perhaps run by a technology authority, that leases broadband space to public and private entities. Also, this would be "old technology" made new, as the 67 licenses, now tied to analog TV broacast facilities, would be digitized. I'm no tech wizard, but as I understand it, each of those channels would increase four-fold in capacity as a result of digitization. Again, WiFi on steroids, as noted in the first editorial. The mind boggles at how much broadband capacity S.C. could create, with very little up-front expense and enormous potential profits for the state.
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[Nick]

It is amazing to think that we could be the first state to offer it. There are cities that as far as I know, they can't even get the idea off the ground.

[Denney Clements]

And other cities, such as Milwaukee, that have. Here's an article, from the Milwaukee Journal-Sentinel, on how WiMAX is coming into being there -- and how lucrative it is for the TV license holders:
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Schools turning broadband into cash
MPS, UWM, MATC to lease channels to private group for $100 million
By ERICA PEREZ
eperez@journalsentinel.com
Posted: Jan. 10, 2008
Three local educational institutions have discovered they are sitting on the telecommunications equivalent of beachfront property, and they're about to cash in - to the tune of more than $100 million over 30 years.

In the 1970s, the University of Wisconsin-Milwaukee, Milwaukee Public Schools and Milwaukee Area Technical College each got licenses for a set of frequencies to broadcast televised lessons in their classrooms. But by the mid-1990s, they had switched almost completely to the Internet, leaving these frequencies virtually unused for more than a decade.

Now, new rules from the Federal Communications Commission have cleared the way for these channels to be converted to wireless broadband. And commercial providers, eager to expand their wireless reach, have been racing to lease the frequencies from their owners.

Together, UWM, MPS and MATC plan to lease a dozen channels of educational broadband to Kirkland, Wash.-based Clearwire Corp. Under the deal, each institution will get $4.2 million up-front and monthly payments of $55,000 that increase annually, for a total estimated payout of about $36 million each over three decades.

The agreement could also bring Milwaukee Public Schools one step closer to bridging the digital divide. Clearwire spokeswoman Helen Chung would not comment on the company's future business plans. But Todd Gray, an attorney with Washington, D.C.-based firm Dow Lohnes, who helped negotiate the deal, said Clearwire will likely use the spectrum to expand its wireless broadband network into the greater Milwaukee area.

MPS, in turn, plans to use its lease royalties to buy Clearwire's broadband service and broadband cards for MPS families, giving all students Internet access at home, said MPS Director of Technology James Davis. The district would still need to find more computers for students who don't have them, but it's a step forward, Davis said.

"This is simply huge," Davis said. "Learning is a 24-hour proposition, and we want to make sure our students in Milwaukee have the same benefits as students in more affluent areas."

Rise of the Internet
The FCC started granting licenses to educational institutions in the 1960s so they could send televised instruction to classrooms or campuses in a one-way broadcast.

UWM, MATC and MPS got licenses for four channels each. Elementary schools and high schools used the network to broadcast math lessons to classrooms, Davis said. UWM's College of Nursing broadcast lessons to area hospitals and health organizations, said UWM Chief Information Officer Bruce Maas.

But the Internet soon provided cheaper and more interactive distance learning, and by the mid-1990s few schools were using the broadcast spectrum in any significant way, both Davis and Maas said.

Then, in 2005, the FCC cleared the way for the spectrum to be used to create wireless broadband service.

Since that time, companies such as Sprint Nextel and Clearwire have been snapping up the spectrum to expand broadband coverage in more areas, said Gray, who is counsel to the national Instructional Television Fixed Service Association and is considered an expert in educational broadband.

Gray has completed 218 lease deals between license-holders and wireless providers since 2005, with a total value of at least $1 billion dollars, he said.

"There is a fairly . . . limited number of educational institutions that have these licenses," Gray said. "(UWM, MPS and MATC) are lucky enough to be sitting on the spectrum when it has become quite valuable for these purposes."

The institutions still own the spectrum and must maintain 5% of it to keep the FCC license. They have the option to terminate the agreements after 10 years, said Joan Aguado Ware, contract specialist for MPS.

FCC must give final OK
Gray said the three Milwaukee-area institutions got a better deal than most because they created a competitive bidding situation and negotiated together, creating a large spectrum package in an urban area that was attractive to commercial providers.

"The ultimate deal values they got there, in my view, are exceptionally good," Gray said.

Barry Orton, professor of telecommunications at UW-Madison, said the deal provides several public benefits. It sets a marker for what other licenses around the state are worth. The state's Educational Communications Board owns 45 licenses in communities around Wisconsin, but none in the Milwaukee area. The agreement also could provide a much-needed resource.

"The good news is . . . it's going to free up some of this infrastructure for private-sector broadband use, which is an economic development issue in Milwaukee," Orton said.

Each educational institution approved the lease agreements at recent board meetings. The FCC still has to give final approval, but it is expected to do so, Davis said.

The deal comes as MATC and MPS, in particular, have faced criticism for high property-tax levies. Last year, Germantown began trying to secede from MATC's district because of the tax rate.

Milwaukee Area Technical College spokesman Jim Gribble said the school has yet to determine how to spend the lease royalties, but the one-time payment will go into the school's reserves for now.

"There's really been no decision at this point as to how the money will be used," Gribble said. "Always, our intent is to keep the tax increase to a minimum."

Milwaukee Public Schools, too, faced the scorn of many taxpayers last year when Superintendent William Andrekopoulos proposed a 16.4% increase in the property tax levy. The board ultimately passed a 9% increase.

Ware said the district has long aimed to address the digital divide among its students, and the educational broadband has always been seen as a resource that would help achieve that goal.

"We are meeting MPS' long-term goal at no taxpayer expense," Ware said. "Were it not for this asset, we would still have to sink taxpayer dollars into meeting this goal."

At UWM, Maas said university officials weighed the idea converting the spectrum to provide wireless broadband themselves, but found the project would be too expensive and beyond its mission as nonprofit educational institution.

"Ultimately our choice came down to, do we run our own business, or do we lease (the spectrum) and use the funds in support of our highest strategic priorities for the university?" Maas said.

UWM Chancellor Carlos Santiago said at a recent University of Wisconsin Board of Regents meeting that the university would use the royalties to help cover a $3.2 million lapse in state funding from the 2007-'09 budget, to create a technical infrastructure allowing connectivity between the main campus and the planned regional campuses in Wauwatosa and downtown Milwaukee and to pay for scholarships to students.

"This is a really significant grant," Santiago said.

[currahee]

Sub-leasing to Clearwire is the way to go - they have extensive experience in developing networks using these specific licenses in rural/underserved areas Moreover, they already have technical assets not too far away in Charlotte, Greensboro, and Raleigh.

Full disclosure: I'm a former Clearwire employee.

[Denney Clements]

Clearwire would work, but the current broadband providers should also have a level playing field to make their proposals for use of the S.C. WiMAX system.
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