Unique Partnership Answers the Call for Broadband in Rural Minnesota

Read more on this unique partnership between Wikstrom Telephone and Roseau Electric. Finley was instrumental in helping the two come together and provide much needed broadband for their rural community. 

As seen in RE Magazine (August 2020)

‘ Follow the Power’

Unique Partnership Answers the Call for Broadband in Rural Minnesota
(summary) Roseau Electric Cooperative is an electric distribution cooperative providing power to more than 6,400 rural customers in northwest Minnesota over an area of more than 2,500 square miles. Roseau is a member-owner of Minnkota Power Cooperative, a regional generation and transmission cooperative located in Grand Forks, North Dakota. A portion of the community in its existing electric utility service area had limited access to broadband due to slower DSL services. Because of the many limitations and challenges of providing broadband in these rural communities, Roseau made its primary goal to bring quality broadband services to the area.

Project Overview
After attending an industry meeting, Roseau Electric recognized a shortcoming in its territory’s broadband services. Realizing this is a deterrent to economic development and has a negative impact on their members, the co-op wanted to take action. Roseau began polling its members and collaborated with their community to gauge service requirements. “The most asked question: Why hasn’t Roseau done this already?’” said Ryan Severson, assistant general manager at Roseau.

Roseau began developing a business case with an extensive feasibility study and strategic plan with the help of a local Community Action Partnership (CAP) agency (Northwest Community Action). It relied heavily on its engineering firm, Finley Engineering, for consulting services to understand the telecom industry, funding sources, and requirements. The primary objective would be to provide high-speed broadband service to the community and ultimately build out smart grid technology.

“Our philosophy was, we did this 80 years ago with electricity,” Severson said. “Since RECs possess important assets that make expansion into broadband favorable, our goal now would be to offer every member a high-speed internet connection by strength of partnership or we would ‘follow the power.’”

Out of this came the opportunity for a new kind of partnership with Wikstrom Telephone (Wiktel), a company with a long and trusted history in Karlstad, Minnesota. The merger of the two resources would quickly deliver economic development opportunities across Minnesota. Roseau would be able to serve their members, not only with enhanced electric service reliability, but also with offerings that connect these rural communities to life-changing resources.

Roseau decided to brand this new venture under the name NorthStream Fiber. The co-op would use their own poles and construction crews to install fiber, saving money and time, and would own and operate the fiber down to the subscriber and the customer premises. Wiktel would provide re-branded services over the fiber, operate the optical line terminal, provide triple play services, and technical support.

Roseau received $2.08 million from the FCC’s CAF II Reverse Auction program for phase one of the project. This would cover four census block groups that pass 326 customers. It is now looking at other federal government and state funding mechanisms to fund the next phase of their project that includes another 1,500 passings. It hopes to eventually serve about a third of their service area with broadband.

Business Case/ NW Architecture
NorthStream implemented a traditional GPON based Fiber­to-the-Home (FTTH) system. They used unique solutions to solve problems including the utilization of All Dielectric Self-Supporting (ADSS) fiber which is manufactured by AFL and supported by the existing electrical system pole infrastructure. The use of ADSS allowed the cable to be placed in the restricted electrical supply zone permitting them to quickly and efficiently deploy the network.

NorthStream’s partnership combined the new fiber build with Wiktel’s experience, existing network, and services. Wiktel provided traditional triple-play services on NorthStream’s fiber allowing subscribers access to world-class service at a great price. NorthStream is rapidly deploying the network and Wiktel will gain a new revenue stream and expanded access for the residents and businesses of Roseau County. Using Wiktel’s existing workforce saved money on training and operating costs and they can build aerial fiber routes year-around without having to break for seasonal weather. It is truly a win-win­ situation.

Future phases of the project will expand on the service offerings to include Distributed Automation and Smart Grid system management for Roseau’s distribution system. Advanced Metering Infrastructure, which is currently 70% complete, will allow for smart meters, communications networks, and data management systems with two-way communication.

Challenges and Surprises
Major investments in high-speed broadband can come with significant challenges. There are a lot of moving parts when launching a fiber network so it was important to understand every detail including the level of capital commitment and budget impact. The companies had to see that bringing broadband to this territory was a natural extension of their duty to serve the community. Then, understand what the member service requirements would be in order to fulfill their responsibility to the community.

RECs should not be afraid to collaborate with companies who already have expertise in certain areas. There isn’t
a one-size-fits-all approach, so communication is key between the two entities. The two can complement each other and both realize increased revenues and profits. And both can benefit from trusted relationships that have already been built with customers.

Why is this Case Study Important?
Building a new fiber broadband network is an important undertaking, with significant implications for NorthStream and the rural communities they serve. The benefits are numerous, including more tools and services to better serve their members. The merger of the two resources will quickly deliver economic development opportunities across Minnesota that are life changing to their residents. While traditional broadband providers have a business model that requires a fast ROI, RECs are anchored in their communities, enabling them to take a long-term view that can be suitable for significant broadband investments. The willingness of RECs to look at these investments as long-term puts them in a unique position to close the digital divide where it is needed most, through unique partnerships like this one that “Follow the Power”.

 

 

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