TMCnews Featured Article


October 22, 2009

Broadband Stimulus as Job Creator: An Interview with Towerstream

By Michael Dinan, TMCnet Editor


The head of a Middletown, R.I.-based fixed WiMAX (News - Alert) service provider that’s seeking millions in grant money through the federal broadband stimulus program told TMCnet in an interview that its plans would help stimulate the economy by creating more business and jobs.
 
According to Jeff Thompson (News - Alert), president and CEO of Towerstream, the only way to create jobs is by helping small businesses and reaching urban, under-served populations.
 
“And in some communities, even if there is minimal access, it has never been designed for, or used by, businesses,” Thompson told TMCnet in an interview, printed in full below. “Therefore it is really important that urban underserved be reached if this program is going to have the stimulative effect we all want.”
 
Thompson went so far as to say that if his company receives funding, it would eventually lead to the creation of thousands of new jobs.
 
“This would include the people we would need to hire, such as customer care and sales staff and network engineers and installers,” he said. “In addition, each company that receives service will become more productive and competitive, enabling them to make more money and grow their businesses. This will also lead to more job creation for the individual companies. So the opportunities here are vast for businesses and consumers alike.”
 
Unlike many other applicants we’ve heard from, Thompson also said he was impressed with aspects of the government’s broadband stimulus program.
 
Our full exchange follows.
 
TMCnet: We’ve read the Executive Summary of your application, and clearly the organization feels there’s a strong need for funding. Take us a little bit beyond the numbers. How will U.S. citizens, consumers and businesses benefit if you’re awarded this grant money?
 
Jeff Thompson (pictured left): While the lack of broadband connectivity is certainly a hassle and a challenge for consumers, for businesses – which make up Towerstream’s main customer base – not having high-speed Internet stunts growth and hurts business operations. These businesses should have the same Internet connectivity as other players in the market in order to stay productive and competitive, and to grow their businesses, which will lead to additional prosperity and job creation for that community.
 
For example, during the FCC’s (News - Alert) recent staff workshop on broadband competition, one of their expert panelists stated that only 2 percent of all businesses in the United States use cable for broadband. This confirmed what we discovered in putting together our application that if you want to create jobs – which is done through small businesses: You have to reach the urban underserved. And in some communities, even if there is minimal access, it has never been designed for, or used by, businesses. Therefore it is really important that urban underserved be reached if this program is going to have the stimulative effect we all want.
 
If Towerstream receives the grant money, we will be able deliver our reliable, high-speed, wireless broadband to businesses in urban underserved areas. Towerstream will also be able to provide this service to more businesses in need at a faster rate because of our proven and cost-effective model and ability to roll out services quickly.
 
The main point of the stimulus is job creation to help jump start the economy in areas of need. If Towerstream receives funding, we will create thousands and thousands of new jobs. This would include the people we would need to hire, such as customer care and sales staff and network engineers and installers. In addition, each company that receives service will become more productive and competitive, enabling them to make more money and grow their businesses. This will also lead to more job creation for the individual companies. So the opportunities here are vast for businesses and consumers alike.
 
TMCnet: How did you find the application process? What would you recommend the U.S. government tweak in the process, if anything?
 
JT: Our team at Towerstream was especially impressed with how quickly this all happened. The ARRA programs are meant to stimulate the economy right now and the organizations have done a great job of rolling things out quickly to make this happen.
 
We may have some constructive feedback during the public comment period, but will consider it at that time.
 
TMCnet: What would you tell reviewers at NTIA about your organization if you could have one minute to talk to them moments before they looked at your application?
 
JT: The great thing about our model is that it doesn’t change for the audience. So what we would tell them is the same thing we tell everyone. Instead of spending $120 million to cover one area with wireline technology (as some applicants propose to do), Towerstream’s proposals will give the federal government an opportunity to cover key underserved areas in 17 cities for the same cost. Towerstream will reach hundreds of thousands of underserved people in an urban market without requiring the hundreds of millions to provide wireline to that same city.
 
This will allow the funds to go further and cover other underserved areas across the country. It means this program can cover urban and rural underserved. It’s also much faster and easier to roll out and repair wireless technology than wireline. This keeps costs low and ensures the people that need broadband the most are getting it as quickly as possible.
 
In addition, since rolling out our first network in 2001, Towerstream has perfected and replicated a model for quickly and effectively rolling out and growing new markets. So executing our stimulus strategy, if we receive funding, will follow this proven process ensuring job creation and service delivery happen quickly.
 
TMCnet: Tell us in plain terms how important it is for your organization to receive this grant money. If you do not receive government funding, what will you do to improve services in the way you’re seeking?
 
JT: Towerstream’s long term success is not dependent upon receiving grant funding under the Broadband Stimulus program. We are presently well capitalized, and with eight of our nine current markets EBITDA profitable, we are well positioned. If we do not receive grant funding, we will continue to provide reliable, high-speed wireless broadband to businesses across the country. However, receipt of this grant funding would enable us to accelerate our long term plans to expand into new markets across the country. It would also enable us to reach urban underserved areas that would otherwise not be economically feasible to provide service to.

Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.

Edited by Michael Dinan