GRAND RAPIDS — The state is hoping to build a new highway, one with a really fast lane — but one that has already been paved with a lot of infrastructure history.
Gov. John Engler recently said the state’s new broadband initiative will send high-speed Internet service to all Michigan residents, wherever they live. And a local IT expert gives the legislation a pretty good chance of making that trip.
Engler recently signed three bills he said will provide enough incentive to spur broadband development throughout the state. He also said he has been told the plan will create 500,000 new jobs and expand the state’s economic output by $440 billion over a decade.
In effect, the governor feels that Michigan now has access to the virtual fast lane.
“The fast lane to new jobs, new investment and new opportunities is now open,” he said.
If so, it’s a new lane the state has traveled on in the past.
Dirk Koning, executive director of the Community Media Center and recognized guru in the high-tech IT realm, feels the state is on the right road. Koning, who has been trying to develop Internet access throughout the city, told the Business Journal that the broadband plan looks similar to a magazine article he wrote in 1988.
“While the bill isn’t perfect, it’s much different than what was initially proposed. I have to say for myself and the Media Center that we support the initiative and think that it has some really good potential to expedite activity,” he said, “especially in the areas that don’t meet the traditional capitalist model for deployment.”
Koning likes the initiative because it follows the trail of other successful programs that used commerce as a tool for society’s benefit. He compared the plan to the rural electric cooperatives that lit lights in isolated areas, and the interstate highway system that provided access to remote regions.
A more recent example he offered was the e-rate that former Vice President Al Gore pushed. The e-rate taxes cell-phone use and uses the money to provide low-cost Internet service to libraries and schools.
“That has met with resounding success. Republicans initially touted it as the ‘Gore tax’ and subsequently, because of it, something like 94 percent of the schools and libraries are now connected,” said Koning.
Koning also thinks the initiative may work because gubernatorial candidates have told him that they support the measure. Koning sits on the Michigan IT Council, which recently met in Ann Arbor with most of those seeking Engler’s term-limited office.
“On those levels, I see this legislation as being a real supportive mechanism for a lot of initiatives for those of us who are social entrepreneurs,” said Koning. “This has really good potential.”
But if Koning had his way, he wouldn’t phase in the per-mile charge as the initiative does. The plan’s first year charges 2 cents per mile for rights-of-way, and then permanently moves to 5 cents the next year. Koning said he would just charge the nickel from the start.
Then there is the Michigan Broadband Authority, the overseer of the development.
At first, the MBA was to have been a granting agency. But it ended up a financing bureau that offers low-interest loans instead of grants. Koning would have preferred the grants, which he feels would have had more benefit for local governments and nonprofits such as ETIP.
The Electronic Telecommunications Infrastructure Planning (ETIP) is a local nonprofit coalition that has applied for a $100,000 Michigan Economic Development Corp. grant. If MEDC approves the grant, ETIP will use the money to map out Kent County’s broadband highway.
Big broadband providers also have issues with the plan, especially with the House having eliminated a provision that would have let companies receive up to $800,000 in tax credits for maintenance and investments. That action could make firms like Ameritech and Comcast balk at striking out in new territories.
“By the time these bills went through the legislative process, they were so watered down that whatever incentive there may have been was compromised right out,” said Scott Stevenson, president of the Telecommunications Association of Michigan.
Still, Koning feels good about the plan. But he knows there is a lot of work to be done yet. And he thinks that maybe a tougher chore than building the highway will be deciding who and what gets to travel on it.
“All the bandwidth in the world is worthless if there aren’t important applications on it that make your life better, and not just strictly a market approach of what will sell,” he said. “Otherwise, we’ll just end up with more boxing matches featuring Tanya Harding.”