1. Joint Meeting Pima County Cities and Towns May 31, 2001 Getting Connected Telecommunications In Tucson and Arizona Presented By Steve Peters Executive Director, Community information and Telecommunications Alliance Member, Connecting Communities Hot Team Arizona Partnership For the New Economy CITA Community Information and Telecommunications Alliance

2. Tonight’s Presentation Telecom policy issues Recommendations developed by the Connecting Communities Hot Team under the Arizona Partnership for the New Economy An Action Plan Status of Telecommunications in the Tucson Metropolitan community (if time allows)

3. About CITA CITA is a countywide, nonprofit organization. Our initiatives: Promote and support the adoption of technology Encourage deployment of an advanced telecommunications infrastructure Support education and economic development in Tucson and statewide Build opportunities for Tucson’s citizens to have access to the tools, technology and skills to participate in the electronic community Over the past six years CITA has been providing leadership in addressing local and statewide telecom and Digital Divide policy issues.

4. Fifth Annual Tucson Telecom Expo and Community Update Getting Connected: Telecommunications In Tucson June 26, 2001 La Paloma Resort 3:00 – 5:30 pm EXPO 3:00-3:30 & 4:00 - 5:30: COMMUNITY UPDATE 3:30-4:00 BEGINNERS CORNER

5. Telecom and Public Policy Traditional public policy has focused on addressing issues such as: Compensation for use of the public right-of-way Recovery of expenses such as street repair and maintenance Connectivity for City government and other public institutions A revenue stream for local government

6. Today’s policy needs to also address: Insuring availability of affordable, high quality, high- speed telecommunications services readily available throughout the Tucson community. Removing barriers and identifying market-driven strategies for infrastructure development. Where no market-driven solution can be found, identify ways in which the community can “fill-in” the gaps. Developing voice, video and data applications that ride over the infrastructure that will link the Tucson community and support education, economic and community development Defining strategies to Bridge The Digital Divide.

7. The Digital Divide A recent Tucson Link Forum expanded the definition of the Digital Divide to include: the have’s and have-nots- those who have access to computers and the Internet and those who do not. The have-nots generally include minorities, low income, and some geographic areas. the cans and can-nots– those who cannot effectively use the Technologies of the New Economy. the wills and will-nots – those who will not engage in the use and adoption of technology due to a variety of reasons: cost, fear of technology; don’t see the value, etc. Definition adopted by the APNE Connecting Communities Hot Team and the Arizona Town Hall.

8. Our challenge - to insure that all Tucson’s citizens, businesses and organizations will have: access to technology and the Internet the skills to effectively use technology Digital Divide strategies (Examples) Ensure that all schools, libraries, community centers and other public resources have access to technology and the Internet. Open schools for student and community access after regular school hours Establishing Technology Resource Centers to support small business in the adoption of technology

9. Picture This It is estimated that 80% of “New Economy Companies will be “Old Economy Companies” doing business in new ways The Gartner Group suggests that 75% of eBusiness solutions will fail Many small businesses have not even automated their accounting and databases, and they do not have e-mail or a web site What does this mean for Tucson’s economic development? How about Technology Centers to support small businesses in the adoption of technology?

10. Connecting Communities Hot Team - Arizona Partnership For The New Economy Breakthrough Outcome The State of Arizona will take a leadership role and be a supporting partner of communities in identifying and implementing strategies for providing advanced telecommunications services to support business, education, economic, and community development. Recommendations Digital Divide - The Committee supported the definition referenced earlier.

11. Identify market-driven strategies to encourage private- sector expansion of telecommunications infrastructure. Where no market-driven solution can be found, identify ways in which communities and the state can “fill-in” the gaps Develop a statewide Telecommunications Directory. Assist local communities in assessing their needs and developing telecom plans Provide State funding to assist local communities in implementation of their telecommunications strategies. Explore the use of GADA, the Greater Arizona Development Authority, as a funding mechanism.

12. Develop a Statewide Strategic Telecom Plan and Summit to assess the needs of the state and the options available to meet those needs (this is a statewide strategy, not just state government) Support TOPAZ, The Telecommunications Open Partnership Of Arizona including strategies to secure access to advanced telecommunications services in all 87 Arizona towns with a population greater than 500. Statewide educational technology standard for high- speed access to every school and school district. Springboard to support broader community public access. Minimum of 1 computer per four students.

13. Public access at libraries, schools and retail sites - encourage communities to open schools for after school hours, expand access in libraries and other public venues. Develop a network of Technology Resource Centers to support small businesses in technology adoption. Develop a Statewide Audio, Data and Video Teleconferencing Network to support economic development.

14. Status APNE Telecom Funding: $ 2 million has been allocated for telecommunications. Funding is for community assessments; project TOPAZ, telecom directory/mapping, etc. Allocation of the APNE funds and process for distribution will be determined after the appointment of the new Director of the Arizona Department of Commerce.

15. TOPAZ - Telecommunication Open Partnership for Arizona State government is the largest telecommunications customer in Arizona. TOPAZ will aggregate and leverage State-buying power to encourage build out of public telecommunications infrastructure throughout the state. TOPAZ will also encourage other qualified entities who can use the statewide “carrier services contracts – such as educational institutions, libraries, and local governments, to aggregate demand, leverage their purchases, and provide the additional business case for carriers to build enhanced infrastructure in their community. While there are a number of concerns about the TOPAZ implementation, Pima County needs to explore the implications for the community.

16. School Facilities Board: Utilizing Student First, Federal e-rate and other funding, the school Facilities Board has signed a $100 million contract with Qwest to construct and support the development of high-speed school and district (local and wide area) broadband networks for the state’s 1,222 schools by June 2003. The funding does not include external Internet connectivity, teacher training, curriculum development or on sight technical support personnel. An additional $60 million has been provided for purchase of computers and additional soft capital funding for software.

17. Arizona Telecommunications Directory: The Arizona Telecommunications and Information Council is developing the Arizona Telecommunications Directory. The project will: develop a database of telecommunications providers in the state (there may be 200 –300), identify the areas they serve the services they provide in those areas Contact information The information will be accessible from the Internet. Phase 2 and 3 may also include statewide infrastructure mapping.

18. Statewide Teleconference Network: CITA & ATIC are developing a statewide audio, video and data conferencing network to support cluster and other economic development initiatives. This will enable people to participate in economic development meetings and events from their office or local community We are developing pilot sites at Pima Community College and Rio Salado College in Tempe using the Arizona Learning System distance learning network. ATIC has provided meetings that have allowed people to participate by video conference, telephone, viewing data presentations over the net, and webcasting. We are now exploring webcasting other business and economic development meetings and conferences, including cluster events.

19. Community Assessments: APNE funding includes funding for grants to local communities to support local community assessments and plans. It is not yet clear whether the Tucson metropolitan community will be eligible for these funds – the target is smaller rural communities. Statewide Strategic Telecom Plan and Summit: During the next year CITA, ATIC, the government Information Technology Agency, the Arizona Department of Commerce and many other organizations around the state will join together to facilitate a statewide strategic planning process and Summit. The Summit will address such issues as legislative and regulatory policy, private sector incentives, the role of state and local government, coordination of initiatives, etc.

20. Action Plan To become one of the best connected communities in the country we need to: Provide local funds to match APNE community assessment funds (if needed) - Develop and fund a Connecting Pima County Hot Team to coordinate a public and private countywide technology needs assessment and planning process. Convene a meeting of public agencies, educational institutions and nonprofit organizations to explore the implications of project TOPAZ for Pima County. Support and participate in the Statewide Telecom Summit and strategic plan

21. Provide funding to support the development of a Pima County/Pima Community College audio, data and video teleconferencing center and the development of a statewide network. Explore the Maricopa Association of Governments conferencing network connecting all Maricopa County jurisdictions. Establish Technology Resource Centers to support adoption of technology and bridging the digital divide Establish a regional telecom authority, one-stop application and consistent telecom licensing and franchising policy and processes across all jurisdictions. Provide funding to support CITA’s regional telecom foundation initiatives.

22. Remove barriers and identify market-driven strategies that will encourage competition, and private sector investment in, and rapid deployment of advanced telecommunications services. Where no market-driven solution can be found, identify ways in which the community can “fill-in” the gaps. This may include government funding, tax incentives, special zones, a community network, and other strategies to encourage investment in underserved areas of the community.

23. Complete the I-Net implementation, but, move carefully to explore the potential disincentives to private sector infrastructure investment by removing large customers from the public network. Ensure that all schools, libraries, community centers and other public resources have access to technology and the Internet. Develop voice, video and data applications that ride over the infrastructure that will link the Tucson community and support Tucson’s educational, economic and community development

24. Getting Connected Telecommunications In Tucson Since the passage of the Telecommunications Act of 1996 Tucson has seen: new telecom companies entering the Tucson market mergers and acquisitions of existing companies deployment of new technologies US West/Qwest merger

25. Who Provides Infrastructure? Local Exchange Carrier Qwest Communications Serves business and residential customers throughout the metropolitan area. They provide a full range of voice and data telecommunications services Some advanced telecommunications and high-speed Internet services, including DSL, are not available in some areas of Pima County. There have been many service and infrastructure issues With the merger, it appears that Qwest will improve service and infrastructure in the Tucson communities.

26. Competitive Local Exchange Carriers There are four Competitive Local Exchange Carriers (CLECS) (Time Warner Telecom formerly GST; e.Spire Communications now in bankruptcy; WorldCom and; Mountain Telecommunications) CLECS provide a range of business services targeted primarily to large business customers (more that 7-10 lines) in limited areas of Tucson. Long Distance Providers In addition to the CLECs, there are a number of companies providing only long distance service

27. Cable Companies Cox Communications nonexclusive license to provide Cable TV (video) services to customers inside the City limits of Tucson. They are in the process of upgrading to a fiber infrastructure They have recently introduced digital Cable TV High-speed Internet (Cable modem) service is now available in many areas of Tucson. Will likely provide telephone service in the next few years New services will also be delivered in South Tucson and Green Valley.

28. ComCast ComCast (formerly Jones Intercable) provides Cable TV service to approximately 70,000 customers in unincorporated Pima County, Marana and Oro Valley. ComCast has 1700 miles of coax cable. System upgrade to fiber optics is underway with expected completion by the 4 th quarter of 2001/1 st quarter 2002. Cable modem Internet service will be available in some areas by mid to late 2001. Comcast is the nation's third largest telecommunications provider.

29. People’s Choice TV/Sprint Broadband Direct In September 1999 People’s Choice TV was purchased by Sprint and is now offering fixed wireless broadband Internet service under the name Sprint Broadband Direct. Sprint currently provides wireless cable TV service to about 13,600 customers. They will continue to provide cable service for awhile.

30. Wide Open West Non-exclusive license from the City of Tucson to build a 2100 mi fiber network within the Tucson City limits. They planned to provide broadband telecommunications services including digital cable television, high-speed Internet, video-on-demand and telephone services to residents and small businesses. While they had expected to start construction in 2001 and complete construction in Dec. 2005, their plans are now on hold due to funding issues. WOW also has an application pending in Pima County.

31. Satellite and Fixed Wireless There are now several wireless solutions available for high- speed Internet service in areas that previously had no other options available. Fixed Wireless Broadband Internet providers are now providing point-to-point high-speed Internet in many areas of the Tucson/Pima County community. Satellite: Starband is offering satellite delivered high- speed Internet service for the Tucson consumer market. There are no geographic boundaries, only a direct line of sight to the southern SKY is required.

32. Cellular/PCS Ten Cellular/PCS carriers are providing cellular/PCS service in metropolitan Tucson. Some of these companies are also providing mobile wireless Internet. City of Tucson’s I-Net The I-Net is a City of Tucson fiber optic network utilizing 24 fibers over 125 miles of network. The I-Net, an institutional, non-commercial network, will initially link 91 sites including: City departments; the University of Arizona; Pima Community College; and some local school sites. The City portion of the network will become operational in 2001.

33. What Does All This Mean Competition, lower costs and new options for many larger customers for local and long distance service within limited areas of Tucson No competition for local telephone service for homes and most small businesses, but its coming Fixed wireless, satellite and other new technologies, new providers, infrastructure upgrades, and mergers mean increased options for low cost high-speed Internet access for most homes and small businesses this year and in the next few years 10 cellular/PCS companies are providing a range of service options and competition that is driving down prices Tucson still needs to be aggressive in promoting the expansion of our infrastructure and low-cost, high-speed Internet options