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Innovation with Fiber

November 14th, 2012

UTOPIA isn’t Google, and Utah isn’t Kansas City, but what is happening in KC provides an instructive lesson on the power of innovation.

As Google starts to connect residential customers to its gigabit fiber network, a funny thing is happening: because the roll-out is residential first, start-ups in the area are renting and buying homes so they can get a gig, too, as Stacey Higginbotham reports for GigaOM. Fiber is bringing together like-minded entrepreneurs, such as the “KC Startup Village.” According to Higginbotham, “this is a loose coalition of startups in the Hanover Heights neighborhood of Kansas City that are either buying or renting homes to take advantage of their awesome broadband connections.”

The Kansas City Star had a similar report (which also references KC Startup Village), beginning its story with this tease: “Mike Demarais, who is 20, arrived from Boston to the Kansas City area’s first ‘fiberhood’ with his MacBook, some clothes and an idea.”

Have laptop, will travel? Is this the new ethos driving innovation and startups? If entrepreneurs are following their dreams to KC because of gigabit fiber, what does that say for locales that don’t have fiber of any sort? Or, in other words, if Google had wired KC with staid, outdated coax, would any of this be happening?

Of course not!

As UTOPIA’s fiber broadband efforts have shown, innovation inspires innovation. There’s no point of doing something revolutionary with un-revolutionary infrastructure. You won’t create any paradigm shifts by looking backwards. People aren’t going to shack up in KC or Reno or Tacoma or Boise for your “average” cable coax connection. People want and need cutting edge technology to foster cutting-edge innovation.

For example, industry analyst Craig Settles recently published a report on broadband and economic impact, querying economic development professionals for their views on broadband. Only 24% of respondents thought broadband at 2Mbps to 50Mbps was good enough to lure business; the remaining 76% said 100Mbps to 1Gbps is needed (32.1% said 100Mbps to 120Mbps). Sixty percent thought 100Mbps to 1Gbps was required to help “local companies grow.”

True, you can get 100Mbps from Comcast, if you want to spend $200 a month. That’s the residential cost. For business, you’ll be looking at $369.95. And, by the way, the upload speed is a paltry 10Mbps. If you work with video or graphics or otherwise have to push a lot of bits around, good luck!

Like Kansas City, Chattanooga has become a hotbed for tech startups because businesses and residents there have access to a gigabit network. The lure is having a test bed where minimum bandwidth threshold has been dramatically increased. The opportunity to find out what is possible on-line when everyone (or at least the majority) has at least a 50/50 connection is fascinating.

To be clear, UTOPIA’s effort is different from Google’s in KC and EPB’s in Chattanooga, but the “network effect” applies to our network just as it does to theirs. That’s why UTOPIA’s fiber network can be a primary factor in bringing businesses to Utah.