For example, AT&T planned to build fiber to 3 million homes in 2021, but a couple of months ago, it estimated it would get to only around 2.5 million, mainly due to supply chain issues. This is not a huge miss for AT&T, but it is still half a million homes, and with today’s growing remote workforce, there has never been a more vital need for reliable, high-speed internet.

New funding and training programs offer hope that supply chain and labor issues won’t stall fiber rollouts forever.

Rising Costs, Components Backlog
Supply chain woes currently are among the most frustrating roadblocks to fiber builds, leading to a nasty trickle-down effect. Rising costs of everything from meat to gasoline have plagued the U.S. over the last 18 months. The telco industry is not exempt. It starts with rising oil prices, which raises gas prices, which leads to higher freight and shipping costs for materials to make equipment. Those materials cannot be produced or assembled because of the increased wage demands and shortage of workers needed to do everything from get materials off docks to assemble and install fiber infrastructure.

The apparent shortage in chipsets, semiconductors and other components creates a backlog of work and delays in meeting buildout goals. The materials that make up components don’t make it to the manufacturers and therefore can’t be built. To remedy this, service providers, or the demand side, might consider looking to nontraditional suppliers that may be able to provide necessary components more quickly than their usual vendors. The vendors, or the supply-side, in turn should consider limiting part numbers.

Vendors can alleviate the backlog by providing parts or supplies that can scale (up or down) rather than satisfy a small or niche application. This will help consolidate inventory and materials, reducing time to market and leading to fewer supply failure points. For example, historically, tools that connect fibers came in a wide variety of types and sizes, in some cases to fit a service provider’s specific needs. Phasing out legacy tools and equipment will force service providers to upgrade toward more modern architectures and network components and potentially keep them on track with deployments.

Skilled Labor Shortages
The broadband industry is experiencing a significant labor shortage, but not because of the pandemic. The need is due to the lack of skilled workers to install fiber. It takes people to connect threads and perform installations, and without them, there’s a real possibility that the speed of rollouts will continue to be slow in the future.

New bills and government programs, such as the Rural Digital Opportunity Fund, COVID-19 relief as part of the American Rescue Plan Act, and the newly passed $1.2 trillion infrastructure bill, of which $65 billion is slated for broadband, will create thousands of jobs.

In addition, community colleges and veterans training institutions are working to provide courses that bring qualified individuals to the market, providing service providers and contractors with skilled labor. New training programs, such as the Fiber Broadband Association’s OpTIC Fiber Optic Technician certification course, can help fill the gap.

Lack of materials and labor is slowing down the speed of broadband deployment. It is a vicious cycle, but there is some light at the end of the tunnel. The newly passed infrastructure bill, state initiatives and a strong nationwide focus on workforce development offer hope for a turnaround that will make broadband more accessible to more people across the U.S.

To read this article on Broadband Communities, visit: https://www.bbcmag.com/community-broadband/the-vicious-cycle-of-the-supply-chain-in-fiber-broadband-is-an-end-in-sight. 

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Since its launch in April 2019, Lit has worked with municipalities to guide them through the complex and multifaceted process of deploying fiber optic broadband networks. Through the Lit team’s vast experience in deploying large volume networks, it has created a Community Assessment process that gives local municipalities an actionable business plan for implementing next generation connectivity for their residents. If the business plan requires a private partner to complete the last mile network, Lit creates a local Internet Service Provider and fiber infrastructure subsidiary to deliver the necessary services.

Following the successful build out of its middle mile network, Medina County, OH officials sought a partner to help it extend fiber to the home and business owners throughout the County.  The county selected Lit which completed its Community Assessment and with the funding provided by Stephens and TPO will begin construction on Medina Fiber immediately.

“We spent a long time trying to find investment partners who believe in what we were doing, trust our process, and see the future of how we could help bridge the digital divide that currently exists across America. We found those partners with Stephens and TPO,” said Brian Snider, Founder and CEO of Lit. “With their support we will accelerate the rollout of Medina Fiber and look to future markets where our unique business model can thrive. Stephens and TPO have been true partners and our teams have felt like a cohesive unit from the start. We look forward to working closely together to expand Lit connectivity nationwide.”

 “Lit has a proven model of working in partnership with communities to build out networks properly from the start,” said Alex Feld, Principal at TPO. “The process Lit has built will change how partnerships can help bring broadband into parts of the country that desperately need it. The entire team at TPO is looking forward to working closely with Lit to connect the people of Medina County, as well as  communities across the country in the years to come.”

“From the first day we were introduced to Lit and their team, you could tell that they aligned to what Stephens’ vision is for the future of last mile networks,” said Matt Dement, Managing Director at Stephens. “With their municipal partnership approach, Lit has the tools and long-term vision to bring connectivity to markets that otherwise would be without. Recently, COVID has put a spotlight on outdated broadband infrastructure, which Lit has been working towards addressing for years.  This investment and partnership will provide more homes and businesses the connectivity they need.”

Lit will be announcing additional markets as it continues to grow.

About Lit Communities

Lit Communities is both a forward-thinking builder and operator of next-generation network infrastructure and an advisory firm that guides communities across the country through the complicated process of deploying fiber optic broadband networks. www.litcommunities.net

About Stephens Capital Partners

Stephens Capital Partners LLC (“SCP”) is the principal investing arm of the Warren A. Stephens family and Stephens Inc. SCP identifies opportunities to work with industry-leading management teams with a long-term perspective. SCP provides public and private companies with capital for purposes of growth, recapitalization, and leveraged buyouts. Stephens Inc. is a full-service investment banking firm headquartered in Little Rock, Arkansas serving a broad client base of corporations, state and local governments, financial institutions, institutional and individual investors throughout the United States and overseas. The firm is a member of the New York Stock Exchange and SIPC. For more information, see www.stephens.com

About The Pritzker Organization

The Pritzker Organization is the merchant bank for the business interests of the Tom Pritzker family. TPO is focused on partnering with exceptional leaders to create value across a wide range of industries. TPO looks for opportunities where it can create value for our family’s interests and our partners and colleagues over a significant time horizon. For more than 60 years, TPO has overseen and guided the development of dozens of portfolio companies across a wide variety of industries, including manufacturing, logistics, life sciences, hospitality, healthcare and services. Notable businesses include Hyatt Hotels, Triton Container and the Marmon Group. Recent control investments include TMS International, Lithko Contracting, KBP Investments, Mammoth Holdings and STV Inc. In addition to its core strategy of building businesses over the long term, TPO is also active in special situations, advising the family’s interests in the deployment of capital across a wide spectrum of industries and across every tier of the balance sheet, from senior debt to equity. Additional information can be found at www.pritzkerorg.com

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UIA secured the latest round of funding in partnership with Lewis Young Robertson & Burningham, Inc. (Financial Advisor), KeyBanc Capital Markets, Inc. (Senior Managing Underwriter), and Gilmore & Bell (Bond and Disclosure Counsel). Since 2011, the majority of UTOPIA Fiber’s growth has come from its synergistic relationship with UIA, designing, financing, building, and operating state-of-the-art ultra-high-speed fiber-broadband networks, firmly securing its position as the largest publicly-owned Open Access fiber network in the United States.

“What we’re seeing with this latest round of funding is stronger-than-ever demand for high-speed fiber networks,” said Roger Timmerman, UTOPIA Fiber’s executive director. “The $52.5 million provides the capital to build out the remaining areas of our original 11 cities and to add customers throughout our coverage area. We continue to have the best partners in the business, who have worked tirelessly to get us to this point,” he added.

UTOPIA Fiber provides fiber-to-the-home services in 15 cities and business services in 50. They serve as operational parter for Idaho Falls Fiber in Idaho and are in talks with additional municipalities to bring the network to their communities. UTOPIA Fiber is available to 130,000 homes and businesses, offers the fastest internet speeds in the United States (10 Gbps residential and 100 Gbps commercial), and enjoys being ranked as the highest-rated internet option in Utah.

This round of new funding is the largest that UIA has closed on in agency history and the third in the last 14 months ($48 million in November 2019 and $13 million in August 2020). UTOPIA Fiber continues to bring competitive services from 14 internet service providers (ISPs) at the fastest speeds and best value.

UTOPIA Fiber’s Open Access model enables communities to have access to a free and open internet without throttling, paid prioritization, or other provider interference. Participating cities can also benefit from various Smart City applications that are enabled by the UTOPIA Fiber network including early wildfire detection systems, free public WiFi, Smart water and energy management, and air pollution monitoring services.

“The pandemic has shown us just how important fast, affordable, and reliable broadband service is. We believe publicly-owned Open Access fiber networks are the future of American internet connectivity and are excited to be at the forefront of that movement,” Timmerman said.

The public is invited to visit UTOPIAfiber.com for service maps, build-out timelines, and information on how to sign up for UTOPIA Fiber services.

About UTOPIA Fiber

Created by a group of Utah cities, the Utah Telecommunication Open Infrastructure Agency (UTOPIA) is a community-owned fiber-optic network that uses the Open Access model to promote competition by giving customers the freedom to choose which telecommunication services they want. With fiber availability to over 130,000 businesses and residences in over 50 communities, UTOPIA Fiber is the largest and most-successful Open Access network in the United States, and enjoys the industry’s highest customer satisfaction scores. Since 2009, the agency has successfully designed, built, and operated over $250 million worth of fiber projects throughout Utah, all of which have been funded completely through subscriber revenue, at no cost to taxpayers.

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Since 2019, Magellan Advisors has served the City of Dayton’s needs as a trusted broadband partner to guide City leadership through the process of developing its broadband strategy. In 2020, Magellan Advisors designed the City’s fiber to the home network and developed the strategic business plan to support the deployment and operation of DayNet. Magellan Advisors brought its team of engineering, business, and financial experts to develop the most effective network design and strategy to operate the network, aligned with the City’s capabilities and resources.

Theo Melancon, City Manager of Dayton, stated “We’re excited to deploy DayNet, a community-owned utility, focused on delivering the fastest, most reliable Internet services in East Texas, while delivering top notch, local customer service. We’re equally excited to have Magellan Advisors and their team of professionals by our side, who are leading the day-to-day buildout and stand up of our operations.”

“Magellan Advisors is honored to serve the City’s needs as it builds its next-generation broadband network. In this age of COVID-19, DayNet will give the City key competitive advantages by bolstering local economic development, work from home capabilities and an enhanced quality of life,” said, John Honker, Magellan Advisors’ President and CEO.

About Magellan Advisors

Magellan Advisors provides planning, engineering, grant development, project management, construction management, construction inspection, and implementation management of the fastest, most technologically advanced fiber and broadband networks.

Our mission is to connect every community, one at a time, to the digital economy so that no one is left behind. Our work ensures that communities are able to access every opportunity the internet has to offer so they can thrive in the connected world.

About The City of Dayton, Texas

The City of Dayton is a fast-growing organization committed to making Dayton a wholesome, business-friendly, and dynamic community. 

With over 100 employees, the City of Dayton Government offers a full range of services to residents and beyond. These services include water, sewer, waste collection, public safety, streets, parks, and more.

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Our changes in behavior, many due to the COVID-19 pandemic, have directly impacted our broadband network needs. While at times frustrating, the lessons learned in 2020 will have a long-lasting impact on how our broadband networks are built with the future in mind.

As the world shut down in early 2020 and businesses began their shift to remote working, we saw increased need for not only reliable at-home internet connections, but areas previously unserved were no longer able to function “off the grid” as workers and students alike were forced to “clock in” from home. Providers not prepared for the increased demand were left scrambling.

Farmers Telecommunications Cooperative (FTC) in rural northeast Alabama was ahead of the network demand game in 2018 when it began to shift its customers off Active Ethernet and onto GPON. A catalyst of that change came in the form of a new development that brought tons of families into a very rural area.

A developer unexpectedly came along to transform this rural plot into a very large neighborhood, shifting the economics from Active Ethernet to GPON.

“It was an area that we would have previously expected to serve maybe two homes in,” Charles Austin, Manager of Network Engineering and Operations at FTC, said.

Considering its high cost and infrastructure needs, Active Ethernet was not a plausible solution. GPON allowed FTC to connect a neighborhood of families over a single fiber link.

And for a while, GPON served FTC’s customers well. Until 2020.

According to the Pew Research Center, one in five employees worked from home prior to 2020. In a matter of days, that number jumped to 71%. Eighty-one percent of those employed adults working from home say they use video conferencing services to stay connected with their teams. The number for students learning from home is likely even higher. Higher bandwidth was no longer a luxury but a necessity.

Suddenly, GPON was not sufficient to carry customers’ bandwidth needs. FTC needed a new solution, and it came as a result of a local school district’s needs. Austin said FTC needed a plan to cover a network of schools in its region, and XGS-PON was the answer. Utilizing a single fiber already existing as part of the former GPON network, FTC was able to deploy service to this network of schools with no new construction or slicing needed.

“It’s much more efficient from the fiber standpoint,” Austin said. “And from the operational standpoint, a single fiber running to the ONT is managed by the same group who manage the carrier network–the same people who manage that ONT. So, it flattened the organization quite a bit and reduced the need for specialized–and expensive–knowledge.”

After that school district, FTC bit the bullet and began its shift over to XGS-PON.

Kevin Kuo, Director of Product and Solution Marketing at Calix, said FTC made the right choice in its XGS-PON solution. “XGS-PON is an up-and-coming 10G PON solution, and it conveniently coexists with GPON,” making the transition easy for providers.

While the improvements may look and sound expensive to carriers looking to make the switch, Austin said the upgrade has well paid off over time. He reported that FTC has also seen significant decreases in truck roll numbers thanks to the change.

Austin stressed the importance of making that shift now, rather than waiting and having to scramble when customers start demanding 5G connections.

“As we look into that crystal ball, whether it’s a lump of coal or not,” Austin joked. “5G is going to require a network able to handle multiple 10G connections.”

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Telemedicine usage and telehealth initiatives are growing year over year, with the most recent surge in usage driven by the 2020 COVID-19 pandemic. Stay-at-home orders and social distancing compelled doctors and therapists to embrace telemedicine virtual visits for the safety of both patients and physicians. There has been steady growth in healthcare systems using broadband networks to quickly and more efficiently deliver access to electronic health records and hasten the assessment of imaging tests. Delivering the best medical care requires a 21st century network capable of delivering gigabit-class symmetrical speeds to hospitals, doctors’ offices, and individual households.

However, today’s telemedicine surge is only the tip of the digital health care iceberg. Telehealth and computational medicine initiatives that combine cloud applications, artificial intelligence, Big Data, the Internet of Things (IoT), and off-the-shelf consumer electronics offer the promise of improving individual health care, preventive medicine, and treatment of existing conditions. Data validation and integration from home devices such as blood pressure cuffs, activity trackers, or Apple Watches are now in the early stages of adoption. One can soon envision these enhancing patient care and improving outcomes by potentially providing early warning signs of everything from cardiac issues to virus infection.

Download the paper to learn more. 

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