Subject: [NEXTEL-1] Wireless broadband can keep small companies -- and communities -- competitive

From: [email-masked]
Date: Wed, 20 Aug 2003 23:47:40 -0400

Wireless broadband can keep small companies -- and communities -- competitive

      Larry Werner,
      Star Tribune

      August 20, 2003

Genevieve Roessler, physicist and radiation safety expert, edits a Web site
and two newsletters for professional associations based in McLean, Va. After
too many years away from the grandkids and their native Minnesota, Roessler
and her husband, also a physicist, bought a home on a lake near Elysian,
Minn., where she continued her work with the Health Physics Society and the
Society for Risk Analysis.

But work became increasingly difficult for Roessler without high-speed
Internet access, and she considered moving her office to Mankato -- or
retiring -- until Midwest Wireless and the city of Elysian teamed up to
solve her problem.

Under a 2001 state program that provided Midwest and Elysian with a $220,000
"technology catalyst grant," this rural area of southern Minnesota received
high-speed wireless Internet, which has kept the headquarters of these
internationally distributed newsletters in a Minnesota town of 486.

Midwest Wireless, honored recently by state officials for its contributions
to rural economic development, has grown from the idea of some rural phone
companies 13 years ago into a 430-employee corporation with nearly 300,000
subscribers, a gleaming new headquarters on the edge of Mankato and $162
million in revenue by providing customers such as Roessler high-tech
services, including high-speed Internet and cell phones, that weren't widely
available in rural parts of the state.

In a report released last week, the Center for Rural Policy and Development
in St. Peter, Minn., cited wireless Internet as one reason that people in
rural areas of the state now report about the same level of broadband access
as all Americans. The Rural Minnesota Internet survey showed that 15 percent
of rural Minnesota households have high-speed connections, compared with 16
percent of all U.S. homes.

The report by the St. Peter nonprofit said the "digital divide" is no longer
between rural and urban areas but between the more affluent and less
affluent, regardless of geography.

Dennis Miller, CEO of Midwest Wireless, said his company has demonstrated
that when it comes to technology services in outstate Minnesota, if you
build it, they might stay.

"You can participate in the global economy, and you don't have to drive into
the Twin Cities," Miller said.

Or even Mankato, where Roessler considered moving her office before she got
Midwest's Clear Wave high-speed Internet.

"Between the two publications and the Web site, we probably have about two
dozen editors scattered throughout the United States and internationally,"
Roessler said. "It just became obvious we would have to have the fast
Internet connection. It really has allowed us to continue our work and
broaden our work in this rural location."

Public-private investment

That was the goal of the state's Technology Catalyst Grant Program, which
allocated $1 million to cover 25 percent of the cost of providing high-speed
wireless Internet to nine rural communities. The grants ranged from $16,950
for Marshall County to the largest grant of $220,000 for the city of Elysian
and 21 nearby counties served by Midwest Wireless. These are remote areas
where many homes and businesses can't receive broadband services through
cable modems or phone-company DSL.

The state Department of Employment and Economic Development said the grants
leveraged $6 million in private investment to make high-speed Internet
available to 14,000 businesses and 266,000 homes in outstate Minnesota.

Midwest Wireless paid 75 percent of the tab for equipment that would provide
Internet speeds of at least 256k (kilobits per second) to individuals and
businesses in towns with populations under 2,500. That equipment is similar
to the cellular technology Midwest uses to bring mobile-phone service to the
same southern Minnesota communities.

Unlike broadband provided by telephone or cable-television companies, the
wireless Internet sold by Midwest uses antennae mounted on towers and on the
customers' homes or businesses. Miller said it's often cheaper and easier to
connect rural Internet users through radio waves than to install cable or
wire to remote locations.

At the Minnesota Rural Summit on Entrepreneurship held in Mankato Aug. 3-5,
Matt Kramer, commissioner of employment and economic development, praised
Midwest for bringing technology to rural entrepreneurs. At the summit,
Thomas Dorr, undersecretary for rural development at the U.S. Department of
Agriculture, said rural America needs "a new American Gothic."

He suggested that artist Grant Wood's famous painting of a man, a woman and
a pitchfork is being supplanted by a picture of the global entrepreneur
operating from his rural home office through high-speed Internet. Miller
likes that image -- or perhaps the image of a farmer conducting business on
a cell phone.

"This is all about Genevieve -- and many more like her -- saying, 'I want to
work where I want, and I want to live where I want to live and do my job,' "
Miller said. "When I think about economic development of the future, it's
much less emphasis on bricks-and-mortar and factories. You can work for a
Washington, D.C., company, but you don't have to live there. It allows the
small communities to retool to keep their best and brightest in their
communities."

In Roessler's case, the technology meant keeping a physicist and her
assistant in a home office on a lake. But just a few miles down the road,
the new wireless service meant keeping a company of 40 employees operating
in Waterville, Minn., just east of Elysian.

"I think we would have stagnated and shrunken" without Midwest's service,
said Barb Fasnacht, information technology coordinator for LCS Precision
Molding in Waterville. "It's, 'If you build it, we will exist.' "

LCS makes molded parts for the automobile, appliance and home-building
industries and competes worldwide for customers. It became impractical to
exchange drawings and documents by fax or dial-up e-mail. So Fasnacht worked
with local officials to seek the state grant for high-speed Internet.

"Our company demonstrated the need to the city of Elysian, and the city
applied for the grant, got the grant, and then worked with Midwest Wireless
to get the broadband in," Fasnacht said. "I was one of the first to get it
around here, and it's become so much a part of our lives, I don't even think
about it anymore."

With manufacturing companies facing stiff competition from cheap-labor
countries such as China, companies such as LCS need high-speed
communications technology to stay in business. Now that the company has that
access, Fasnacht said, the rural location might be a plus.

"We have a little advantage over the big companies because we're in rural
Minnesota and have a workforce that wants to go to work," Fasnacht said.
"Our costs are less, and that's one of the reasons we stay here. Broadband
makes the footing more even."

Craig Berdie, a business specialist at Minnesota Technology, said the advent
of wireless Internet has helped to close the technology gap that was making
it more difficult to do business in rural Minnesota. He said cable modems
and phone-company DSL are generally faster and more stable technologies than
wireless but also are limited by the population density needed by cable
companies and the requirement that customers for DSL generally be near a
central telephone office.

"It is, in fact, an important service, important to rural, remote small
businesses in greater Minnesota," Berdie said of wireless Internet. "Those
radio technologies allow for good bandwidth and relatively high quality of
service."

Berdie said the wireless Internet business is so new and fragmented that he
didn't know how Midwest Wireless ranks among Minnesota providers. However,
the Center for Rural Policy and Development's survey shows that southern
Minnesota, Midwest's service area, has significantly higher broadband usage
(19.8 percent of households) than central Minnesota (12.5 percent) or
northern Minnesota (11.9 percent).

"One of the reasons I like Midwest Wireless is they don't gouge people,"
Berdie said.

Roessler's broadband service, for example, costs about $45 a month for a
small antenna on a nearby building that is connected to the house by
fiber-optic cable. The fiber-optic cable was necessary because the radio
waves must have a line-of-sight connection with the Midwest tower, and that
was impossible with a house located on a lake in the woods.

"I feel good about Midwest Wireless, and I feel good about the officials in
Elysian who went to the effort of applying for the grant and and got it for
us," Roessler said in her office, from where she can look through the trees
to the lake where her grandchildren play.

Larry Werner is at [email-masked]

http://www.startribune.com/stories/789/4051054.html

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