Fiber-optic network rates being negotiated

CANTON — The cost to connect to the Development Authority of the North Country's fiber-optics network in sparsely populated areas is too high to attract broadband Internet providers, but the authority and St. Lawrence County officials are working to change that.

DANC officials told members of the Legislature's Information Technology Committee on Thursday that the authority has little flexibility in its rates.

"We can't sell a 10-megabyte circuit from Watertown to Newton Falls and then charge someone else a different rate," said David M. Wolf, general manager of DANC's Open Access Telecommunications Network Division. "We have to be careful about how we price things."

Committee members have asked DANC to consider a lower pricing structure for providers expanding into sparsely populated areas.

"The providers' plea is that they just can't make it work in communities of that size," said Laura J. Perry, IT Committee chairwoman. "We know there is success in large communities, but we need to also have it in small communities."

Mr. Wolf said DANC has some discretion over rates for unique networks, such as those controlled by a community, but the state Public Service Commission scrutinizes how often such rates are offered.

"There has got to be some mechanism around charging the same tariff you do for Sprint to connect in Syracuse than you would for someone to connect to Star Lake, because Sprint is obviously not interested in Star Lake," said IT Committee member Marc D. Rusch, of Cadnor Ltd., Rossie.

Mr. Wolf said the rates are not based on how much bandwidth a provider uses, but smaller bandwidth options could be offered to Internet companies serving a small number of customers.

Kevin P. Lynch, Clarkson University network services director, said it might also make sense to develop a template communities could follow to extend a fiber connection on their own and buy bulk service.

DANC officials also discussed an advertising campaign to draw more providers to the fiber pipeline, securing funding to extend the line from sources such as the federal stimulus package, and giving companies time to build a customer base before charging them the full connection rate.

"The fiber is out there, so you have to support it whether anybody's using it or not," Mr. Rusch said. "If it's not being used and you can get someone to use it for less money than you could get from a big provider, something is better than nothing."