The competition for high-speed, residential Internet customers in Starkville is now a battle between two companies with differing business approaches to the emerging market.
MaxxSouth Broadband leaders announced last week the company will offer 1 gigabit connections to Starkville residents, a similar service first made available by C Spire to South Montgomery residents in November 2014.
How the two companies will attract customers for the same service differs.
MaxxSouth Broadband President and CEO Peter Kahelin said his company will wire a majority of Starkville in the coming months and offer tiered packages and rates. C Spire, however, began crowdsourcing potential customers in 2013, seeking to cross a threshold of early adopters before committing to build the infrastructure in numerous “fiberhoods.”
While only four of 10 Starkville “fiberhoods” have qualified for C Spire’s service, Senior Media Relations Manager Dave Miller said company officials could look at redrawing the areas in an effort to qualify residents and activate additional neighborhoods.
The availability of high-speed, residential Internet access itself is seen as a potential boon for Starkville’s quality of life, and the two companies’ pledges to provide the service came after Mayor Parker Wiseman and other city staff members traveled to Chattanooga, Tennessee, in 2013 to study how to bring the similar capabilities to Starkville.
On that trip, Wiseman said, they learned building the infrastructure would be a daunting and costly exercise for the city to attempt on its own.
As fate would have it, C Spire approached Starkville that same day about the city becoming a partner for the company’s ambitious gigabit fiber program.
“The timing couldn’t have been better,” Wiseman said of C Spire’s initial offer to bring fiber optic Internet infrastructure to residential areas. “We concluded from our Chattanooga trip that building a system on our own would be high risk at best and impossible at the worst. Hence, we went all in to be chosen by C Spire.
“Today, 40 percent of the city either has been built or is being built with the C Spire gigabit system. We are thrilled with the announcement that MaxxSouth has plans to build the city out with a gigabit system,” he added. “The fact that Starkville will have two gigabit service providers by the end of 2015 will be transformational. It’s a development that exceeds any expectations I had two years ago.”
‘The commitment is not to pick & choose’ customers
MaxxSouth Broadband plans an aggressive campaign to ready local infrastructure for its own system in the coming weeks.
Kahelin said a number of areas should be ready within 30-60 days. The company, he said, will form groups of test customers to assess the services as workers continuing wiring other parts of the city.
A majority of Starkville will eventually be covered by the fiber optic lines, Kahelin said.
“The first thing is to build it out in Starkville, test customers, harden the service to make sure we’re doing it right and then look at our other markets,” he said. “We’ll pick various neighborhoods, packages and speeds and test them until we feel we’re comfortable with them meeting demands.”
“Our commitment is to wire the homes we pass by. The commitment is not to pick and choose (customers). Each home assessed is a home passed,” Kahelin added. “We’re not premarketing our services, and we didn’t call up and ask customers if they want it. This futureproofs our future and our customer’s future. This technology will be able to handle any service down the pipe for a long time to come.”
MaxxSouth Broadband is expected to offer different connection speeds with tiered prices since every homeowner isn’t in the market for 1 gigabit access, Kahelin said.
Officials have not publically disclosed the various packages’ connection speed or their associated prices.
“Some want it faster (than the company’s currently offered 50 megabit package). It’s not just about selling one high-end package,” he said. “We’re still testing the price points, but I can say they will be exceptionally reasonable and competitive.”
The company also announced plans last week for a regional sports network, MaxxSouth Sports, that will feature high school and community college events, as well as games from community sports leagues.
The network will deliver high-definition video and live transmission capabilities, while also offering a companion website, MaxxSouthSports.com, that will provide on-demand access to scores, statistics, video clips and athlete interviews.
MetroCast became MaxxSouth Broadband last fall after Block Communications Inc. completed its acquisition of the cable system last year. MetroCast previously launched its own fiber to the home program in Carthage.
MaxxSouth has approximately 45,000 cable television subscribers and 110,000 homes passed. Its service territory includes 60 communities.
C Spire model ‘is more democratic’
While MaxxSouth expands its infrastructure in hopes of luring customers, Miller said C Spire will continue to bring its service to areas where interest is proven.
When C Spire announced in 2013 that Batesville, Clinton, Corinth, Hattiesburg, Horn Lake, McComb, Quitman, Ridgeland and Starkville would vie to become the first Mississippi cities to receive its high-speed Internet service, the company divided each city into “fiberhoods” based upon geography and population density. Preregistration efforts, which carried a $10 fee per home, were used to measure interest.
Since then, four Starkville “fiberhoods” have qualified for the service — South Montgomery, Timbercove/College Station/Polos, Cotton District/Downtown/Historic Central Starkville and Hiwassee/Reed Road/Hospital.
C Spire activated the South Montgomery neighborhood last year, and installations are occurring in the Timbercove/College Station/Polos “fiberhood.” Crews are laying fiber lines in the Hiwasee area, while the Cotton District is in the engineering phase.
But preregistration momentum seems to have slowed in the remaining “fiberhoods.” Two areas — Blackjack and University Hills/Highlands — require 126-140 homeowners to sign up for the service, while the Crossgates Avalon/Lakeside area requires 742 commitments.
Although the service is live in some parts of Starkville, the entire town is not guaranteed to receive a connection, which could allow C Spire to avoid infrastructure costs in places where demand is low.
“(C Spire’s) model relies on the community to tell us where they want to see these services. It’s really a lot more democratic,” Miller said. “It allows individual homeowners to tell us they want our service as opposed to us saying we’re going to build this, deploy it and we think we know where customers want it.”
Large apartment complexes could be hampering preregistration efforts for some “fiberhoods,” and Miller says C Spire is willing to take another look at how they’ve crafted the areas.
The company is planning to determine the prospect of multiple dwelling units agreeing to the service, and those discussions could lead to omissions that loosen preregistration requirements for neighborhoods seeking access.
“What we’re likely to do is redraw those ‘fiberhood’ maps,” Miller said. “If there are areas where (apartment complex) owners indicate they’re committed to long-term agreements that preclude their customers from subscribing or having the option to subscribe, in all likelihood we could wind up taking those out and recasting (single-family homes into existing ‘fiberhoods’).
“We’ve gained a lot of experience in this process, and we’re still willing to work with neighborhoods,” he added. “We rely on homeowner enthusiasm and viral word-of-mouth. If there’s an impediment in place that can be fixed, we’re definitely going to consider it.”
C Spire offers its 1 gigabit Internet connection at $80 per month, but existing customers are discounted $10. More expensive options are available for bundling a combination of Internet, TV and home phone services, or for all three options.
Starkville’s relationship with C Spire is one that has bloomed in the past two years. Last year, aldermen approved a new telecommunications contract with the company for Internet services at the city’s new administrative home under construction at the end of Main Street.
That contract replaced a previous MetroCast agreement and provides the city savings and increased connection speeds.
Under the deal reached in May, Starkville will spend $1,000 monthly from its communications line item for 100 megabit Internet access. The previous deal cost the city $100 more per month for a 10 megabit connection.
Starkville will partition a portion of its access and dedicate it toward improving public Wi-Fi connections.
C Spire also constructed a $23 million data processing center at Mississippi State University’s Thad Cochran Research, Technology and Economic Development Park, a move that marked the first significant Oktibbeha County investment landed by the Golden Triangle Development LINK.
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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