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Reliable broadband crucial for rural businesses and economic sustainability

In rural communities, and even some areas of our more urban areas, a lack of affordable, reliable and fast Internet is limiting business opportunities.

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By
Latisha Catchatoorian
, WRAL Digital Solutions
This article was written for our sponsor, the North Carolina League of Municipalities.

In a world of email, digital file sharing, Internet-based research and online sales transactions, reliable Internet connections for businesses and entrepreneurs are no longer a luxury. They are essential tools for success.

Throughout the country and across North Carolina, the discussion around fast, reliable Internet often focuses on a lack of last-mile broadband connections to many rural homes. Without reliable last-mile connections, rural residents are losing out on educational, health care and professional opportunities – or having to take extraordinary steps to access them.

But the damage doesn't stop at a lack of last-mile connections to homes. In rural communities, and even some areas of our more urban areas, a lack of affordable, reliable and fast Internet is limiting business opportunities.

A 2019 study from the U.S Chamber of Commerce and Amazon estimated North Carolina, over the past three years, has seen $3 billion in business revenue and 13,740 jobs unrealized due to the lack of access to digital tools by rural small businesses. Sixty-six percent of rural small businesses said poor Internet or cell phone connectivity negatively impacts their business, according to the study findings.

Bob Scott is the mayor of Franklin, a Macon County town that enjoys the advantages of being surrounded by the beauty of the Nantahala National Forest. Additionally, the Little Tennessee River winds through the town and a popular section of the Appalachian Trail is just down the road.

Scott and town leaders are rightfully proud of the town's unique charm and attractiveness as a destination for outdoor adventurers. However, Scott also recognizes Franklin and other towns across the region could be more appealing as permanent places of residence to young entrepreneurs and young families if more reliable broadband was available.

"I hear from residents of Franklin about the speeds of the Internet, and I can vouch for that personally. The other day I had a program and it took me over an hour to download it," Scott said.

These limitations are not just restricted to mountain communities. Travel to the eastern part of the state and you will find some of the same concerns.

Sheila Pope and her husband own a law firm in Angier in Harnett County. They live in nearby Coats, on a road that has no connectivity at all. Whether for work or personal purposes, using her office Internet has become the work-around for her family. That includes her daughter, who is now in college, when she returns home and needs to do schoolwork.

"The trend is for more and more online work. She [Pope's daughter] would have to come to our office or go to the coffee shop in town. We got unlimited data through our cell phone provider so that we could use our phones as a hotspot, but that's unreliable and sometimes the connection would go out and she would lose all her work. It's very problematic," Pope said. "People are not going to want to come here to live and businesses aren't going to come here when they can't get what they need to do business in this digital age."

Rhino Shelf in Angier, which makes storage shelving, understands that businesses need reliable Internet as well. Aaron Carter, the company's director of marketing, said the business was only recently able to get higher Internet speeds after a long time of living with 20 mbps download speeds, which were not ideal for many of the company's requirements.

"Broadband is so important because no matter what your business is, efficiency is the bottom line. It doesn't matter if you have the greatest product in the world; if you're not manufacturing it efficiently, that's a loss. If you're not selling or marketing it efficiently, you're losing," Carter said. "I grew up in Sampson County. I have friends there who run businesses and the way they do business is old-fashioned because they don't have fast Internet."

He continued, "There's an assumption that if someone's in a rural area that their ideas might not have a certain appeal or their products might not have a certain level of sophistication. That's completely not true. People with spectacular ideas who live in rural areas — it's worth it to our state to give those people a voice or an avenue to get their ideas out there."

Angier and Coats are in a county, Harnett, that is seeing increasing residential growth due to both its proximity to the booming Triangle and the spillover effects of a growing major educational institution, Campbell University. To fully leverage that growth for the area's economy, local leaders increasingly recognize how crucial fast, reliable Internet has become.

But is that so different in even more rural areas of the state?

Mark Maloney, CEO of Optima Bio, a company that's operating a pilot project at five Duplin County farms converting hog waste into energy, doesn't think so. He notes his operations require remote monitoring data and now relies on radio signals to get the job done because of a lack of reliable broadband.

Maloney said many modern agriculture operations will only see more needs for reliable, fast Internet connections in the future.

"As Optima grows our projects and presence in eastern North Carolina, reliable, robust and affordable Internet access will continue to be a constraint and likely an increasing one as we require more bandwidth," Maloney said. "As for other ag business, I know some large players have to find special solutions."

Meanwhile, it has become clear many of the larger, incumbent telecom providers serving rural North Carolina are unlikely to invest in the technology upgrades needed to solve the state's digital divide. Serving less-dense areas costs more per home or business, and some of those larger providers already face financial difficulties, with one, Windstream, filing Chapter 11 bankruptcy in early 2019.

Other big Internet providers have acknowledged to investors that their focus moving forward will be on densely populated areas.

That reality is why local, state and business leaders have increasingly called for policy solutions that would bring to the table resources of not only private providers, but also nonprofits and local governments. But even with that recognition and state legislators agreeing in 2019 to free up electric cooperatives to bring their resources to bear, legal hurdles remain for local governments.

"We have to allow legislation that will allow municipalities to enter into partnerships," Scott said. "I think the legislature needs to give towns more local rule to deal with the Internet and the lack of Internet services."

Chris Mitchell, director of Community Broadband Networks for the national Institute for Local Self-Reliance, studies broadband access issues across the country. He said no single solution will address the problem.

"There is almost no opportunity for economic growth without high-quality Internet access," Mitchell said. "There needs to be more significant investment in changing the way municipalities are able to bring high quality access to everyone."

This article was written for our sponsor, the North Carolina League of Municipalities.

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