June 2, 2009

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Article

Dirt Roads and Telephones

Telecom Is Up and Running In Rural Utah

By Candace M. Little

June 2, 2009


Widespread adoption of telecommunication technology is a two-way street. While using telecommunications advances business, if businesses do not honor the status quo, they can suffer dire consequences. Most successful companies have adopted as much telecommunications technology as possible. It is rare to find a business without a Website, email and certainly every successful business has a telephone, right? As city-dwellers commute to work, they hardly notice the overhead telephone wires and Wi-Fi hotspots at every corner. But in rural Utah, telecommunication outlets sometimes stick out like—well, like a huge telephone pole in the middle of a desert. Rural Utah isn’t exempt from the two-way technology street, and businesses there rely on telecommunication service providers to help them succeed. That’s where the Utah Rural Technology Association (URTA) comes into play. Made up of 14 independent telephone companies and servicing 23 out of Utah’s 29 counties, URTA was organized to promote rural telephony in Utah and to educate the public and lawmakers of the need of advanced voice and data networks in rural Utah. While each URTA company varies in size and services, together they provide a variety of telecom assistance including telephone, fax, Internet and cable television to 80 percent of the state of Utah (geographically), as well as some surrounding areas in Wyoming and Arizona. In The Middle of Nowhere Running a rural telephone company has its unique challenges. Beehive Telephone Company has 20 central office locations dispersed around paved roads, dirt roads and even no roads at all. The company provides phones, Internet and data, including compressed video, to the residents, businesses and schools in remote parts of 11 counties. Bryan Scott, chief information officer and IT manager for Beehive, explains the company’s ability to provide service isn’t always dependent on its own limitations, but also government regulations, paper work and time required for those to take form. Departments like the Bureau of Land Management help regulate equipment installation in rural areas. John Brewer, first vice president of URTA, says the companies in URTA learn from each other and also band together to tell their side of the story on a particular government or legal issue. “One of the reasons we formed URTA was to combine our companies to lobby legislature and to get small company issues in front of the state,” he says. There are hurdles to hop and hoops to go through, but in the end, Scott says Beehive is only concerned about bringing phone and Internet capabilities to its existing customers and expanding its circle as well. “This company is about finding underserved areas in the middle of nowhere where we can give them something better than what they have,” Scott says. “Now, sometimes they don’t have anything to start with, other times we bring supplemental services like call waiting and caller I.D. that they wouldn’t have otherwise.” Beehive has just launched VIP capabilities to its DSL users and is looking forward to upgrading wire systems in many of its areas. Small Businesses, Big Offerings While rural telecommunication companies are much smaller than the national alternative, as Emery Telecom General Manager and CEO, Brock Johansen describes his company, it’s clear company size has nothing to do with the level of technology they use. “Emery Telecom has completely converted to a next generation IP network and is operating its services over a 10 GB Multiprotocol Label Switching IP core. This is allowing the company to converge voice, video and data across one network, and has allowed for increased services, and data transmission speeds,” says Johansen. These improvements do not cost their customers any more to use, and Johansen says they have actually decreased the over-all cost to the company’s customers. Emery Telecom recently purchased cable television plants in Carbon, Emery, Grand and San Juan counties to complement its telephone networks in Carbon and Emery counties. It has also installed a state-of-the-art Internet Protocol Television head end to push video across its IP network. While Emery Telecom has competition on its video product from Dish Network and DirecTV, Johansen says Emery Telecom’s ability to bundle its video with voice and data, and its local content, have given the company an edge over the rest. “We have also established a robust fiber network that connects Salt Lake City to Grand Junction and the cities in between,” says Johansen. “That is working with five other ILECs (incumbent local exchange carriers) to establish a statewide fiber network through the entire Western Fibernet, LLC.” One of the cities Emery Telecom connects is Moab. Rural tele-communication companies provide service for a number of tourist destinations, making it possible for Utah tourists to have a positive experience with local and long distance telephone, video and Internet services. This year Emery is launching an IPTV video product, which will provide a good advertising venue for the local businesses in Utah, and will help to serve the tourism industry. Emery Telecom also connects Carbon and Emery counties where energy production is a primary business. Johansen says the company prides itself in its ability to support local coal, natural gas and oil industries through extending fiber and other facilities to many of the businesses in the area. Another major customer is the College of Eastern Utah, and other schools in the area, where Emery Telcom provides large ethernet circuits. Johansen says this allows schools to provide the information necessary for effective and competitive learning. Johansen also serves as president of URTA and strongly believes in the importance of rural telecommunications. “IP networks are the critical highways for education, business, entertainment and economic development,” he says. “Without sufficient access to information and the forum provided by such networks to other markets, the residents in rural Utah could not compete with the rest of the world, and would not add as much value to the overall success of our nation.” Staying Alive Rural telecommunication companies have each found a business model that works for them, and through the URTA, they help each other. Tony DiStefano, president of operations at All West, says telecom companies must stay ahead of the game. Though a rural company, All West offers leading edge services to local customers and to people across the state. “We have been the first in the state to do many things,” he says. “In 1998 we offered triple play (phone, Internet and TV service) and we were also the seventh in the nation to be a domain registry.” Staying one step ahead is important to All West and its customers, and DiStefano says it’s the employees there that make it possible. “The managers of this company always want to be on the leading edge. They find the latest and the greatest and they make that connection from urban to rural.” Kent Sanders, president and general manager of Gunnison Telephone, says Gunnison has adopted a simple business model—staying out of debt. Sanders has been with the company for 48 years and has done everything from accounting to climbing telephone poles. He says that while there have been some times when the company has borrowed money, today it is completely debt-free. “We operate with eight employees, serving 1,650 subscribers,” Sanders says. Gunnison Telephone does not purchase extra service packages and equipment and then hopes to sell it to subscribers, instead they wait for the demand and then gives their customers what they want. “If we can do it feasibly,” he adds. While almost 40 percent of Gunnison Telephone customers use high speed Internet, some still prefer to use dial up, and some are not interested in the Internet. “With technology changing as rapidly as it does we don’t buy more equipment or bandwidth than we need.” Sanders says. “Because of that, we don’t have any old technology that we are starting to use now. We only buy what we need so new technology can replace the old as it comes.” Sanders says they also control debt by providing whatever their customers need, but do not get carried away with extras or technology the market size won’t support. While other rural companies offer cable TV today, Gunnison Telephone is waiting for the market size to increase before offering it. The URTA is a support to Sanders because it gives him a place to talk with others who have already launched cable TV and other services. He says he is able to compare notes and exchange ideas. The URTA also helps with legal consulting for companies that cannot afford it, and he says it’s helpful to be able to talk to the legislature as a body of companies rather than approaching them independently. Going the Extra Mile Being a rural telephone company means there is more space to cover, and more wire to connect, but in the end, what matters is if customers are satisfied. Gunnison Telephone celebrates its 100th birthday this year—and the company shares its celebration with Gunnison Valley Bank, which has also been in business, and a Gunnison Telephone customer, for 100 years. President of Gunnison Valley Bank, Paul Andersen, says Gunnison Telephone has provided the bank with everything from crank telephones to the Internet, and figuratively speaking, even helped capture thieves. That was in the 1920s when a bank worker cranked the telephone while the robbers were drilling to open the safe and called the police. But that story is only one thing the bank appreciates the telephone company for. “We use our Internet 100 percent of the time.” Andersen says. “Our business literally could not work without service from them.” Not only does the bank recognize the services the telephone company provides, but how they provide it, as well. “If our Internet goes down, we give them a call and they are on it,” Andersen says. “I suspect if we were dealing with a larger company we could wait days or weeks for that to happen.” Andersen understands the kind of commitment it takes to run a business for 100 years where the customer base is smaller, where many customers are long-time users and most are even on a first-name basis with company employees. “The reason we’re in business is because of the customers we have,” he says. “And as we build loyalty with them, they are loyal to us—and customer loyalty is the same reason Gunnison Telephone is still in business today.”
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