"It's a consumer-owned system.It helps support our parks, ourpools, our police. The moneystags in the community."

Keith A. Hill.boroug'i manager, holdingfilaments like those in Kutztown's Internet link

About 5,000 call ft homo: Main Street in Kutztown Is about to be served by the Pennsylvaniatown's very own bypass to the information superhighway.

Shooflgpie, andbroadband, toos|Kt*i Interm* service,

stall Us own system.

By ANDREW RATXER

KUTZTOWN. Pa. — Thistown midway between Readingand Allentown has about 5.000residents, an annual Amish fes-tival renowned for Its apple but-ter and shoofly pl«. a MamStreet adorned with hex signsand gingerbread facades, aneighborhood park with a

wiire store when? the vendincmachine sells candy for 15 cents.

soon oder Its own high-speedInternet service to every resl-

wlil likely be less than people InMaryland pay If they can even

where they live. Kutztown. onthe edRe ot Pennsylvania Dutchcountry. Is [he latest of 100 citiesand towns across the countrythat have Installed their ownhigh-speed systems for Internetusirra.

Some of the places simplyhave the wealth or know-how todo so. such as Palo A;to In Call-fomla'i Silicon Valley or theHoston suburb of Brain tree. ButKutziown. like many of the more

for one of the lam if providerssuch as Verizon Corp. to dis-

cover them. As politicians InWashington dicker over how tobridge the so-called •digital di-vide." these towns built their

superhighway.'Some of these towns were too

large Incumbent providers; therale of return Isn't there forthem." sold Ron I.unt. directorof telecommunications servicesfor the American Public PowerAssociation, a trade group ofmunicipal Utility companies InWashington. "And I don't see thelarge Incumbent providers up-loading the systems with the en-trenchment and stock prices theway they are."

One of the four regional Bell

Jor. nationwide upgrade of lUsystem {See Broadband, -i-\

Page 4c. Sunday. March 10.2002: The Sun B U S I N E S S

Town builds its owninformation bypassI Broadband, from Page lc\

last fall. Uncertainty about govern-ment regulations made It IOD nskyto invest in distant areas that aredifficult to serve, said Its chief ex-ecutive.

While most midsize and largecities are served by the two majcrforms of broadband Internet con-nections — digital .subscriber linestypically from phone companiesand cable modem service from ca-ble television providers - less man0 percent of towns with fewer than10.000 residents have both serv-ices, according to a governmentstudy.

Kutztown resiileiilj, have hudone option to date — cable-modembroadband service from the localcable TV company. Service Elec-tric Cable TV Inc.

Trie roster o( towns and citiesbuilding tneir own Internet net-works is spread across the country.

The lone one In Maryland isEastun. although its network Isless ambitious than Kuutown'n.

About 500 -i Eastor.'s 5.000 ca-ble TV and electric customers be-gan receiving always-on. broad-band service through the town sys-tem last summer. The monthly fee.about $40. Is roughly what pnvateproviders offer, although privateservice Isn't available In many cor-ners of the Delmarva Peninsula.

When £aston Utilities Intro-duced an earlier cable-modemconnection in 1998. It was the firstarea on the Eastern Shore to offerbroadband service, said BUI Rus-sell, cable and communicationsmanager for Easton Utilities

Glasgow. •:>-, which has beendescribed as UIR most wired townin that state, launched the firstmunicipal Internee service In thelate 1980s LaGrunge, Qa.. pro-vides ll free to subscribers of Its ca-ble TV system. A county in easternWashington state witn Its ownhigh-speed network Is so Isolated—12 homes per square mile — thatits project has been referred :o as•fiberto the trailer."

These systems are oftencheaper than commercial provid-ers. According to Lunt of thepower association, public systemrates average J33 a month, at least20 percent less than market prices.

Cheaper doesn't mean lesser.though. KutKtown's fiber-opticsystem will be able to downloadniea In an eye blink — 10 timesfaster than cable modems. 20

Small towns, high-speed linksSome towns that created their own broadbandInternet systems: _ „

\ V O Gta>f°w' Ky" Regarded as the Erst.";• municipal Internet service, with

,--y> r amonjr the cheapest subscription fees" ; y1' In the country

- 0 LaGrang-e. G*.: Fr«s Internet serviceto cable subscribers.

^ Klulmmee, Ha^ Offers free computertraJnlnc and users' croups In Er.Elishand Spanish for bilingual clientele

./jl Kutztown, Pa^ Completing; fiber-optic

speed Internet to residents, one-thirdof whom are scudents at a nearbystate university.

O Eaiton, Udj Town's utility companyprovided first high-speed Internetconnections available on theEastern Shore

(ft North AlUeborough, Maw,: Connects\r 1.500 school computers to Internet

SOURCE: Aniericwi Public through municipal system;• - i AiiucUlkm

Web bargain on the way: These Kutztown homes awaithigh-speed Internet service at rates well beluw market prices.

times raster than digital sub-scriber lines and 225 times fasterthan the dial-up modems in mosthomes with Internet access.

Several factors encouragedKutztown's push Into cyberspace.

The town has Its own electricgenerator - and resells energy tolocal energy companies — so it feltthat it already had the equipmentand know-how to maintain anEthernet system, which transmit*voice, data ano pictures In theform of light through tiny strands

of glass.Kutztown anticipates strong

demand For such service becausehalf oi Its dwellings are rented outto Internet-sawy s'.udents who at-tend the nearby state university.Also, the town manager is a civilengineer by training, so he wasn'tIntimidated by the technical chal-lenge.

"It Is feasible for certain com-munities.' said Keith A. Hill. Kutz-town's borough manager since1690. Tou nave people ask, 'Is the

annapolisvolvo.com

888-231-2998

Before you spend more for less,

Reward yourself with an affordable

Somewhere a buyer: BUI Schuster Counts on the Web to attract distant buyers to painted milkjugs. Pennsylvania Dutch hex signs and other products of the workshop that he and his wife run.

government competing with theprivate sector?' But I don't look atIt that way. It's a consumer-ownedsystem. It helps support our parks,our pools, our police. The moneystays In the community"

Kulztown said It wrote to Veri-zon Corp. beginning a few yearsago asking It to bnng digital sub-scriber line service to town, but re-ceived no reply. It also unsuccess-fully solicited Service Electric, thelocal cable television provider, tobecame a partner In the town's fi-ber-optic system by leasing lines orproviding local TV production

"We were like everyone else. Wewanted DSL." said Frank P. Ca-ruso. Kutziown's director of Infor-mation technology. "We're still onthe waiting list."

$300 biniou tab possibleUnK Koewlng. a^v.iir.1 vice

president for Internet and technol-ogy policy for Veruon in Washing-ton. D.C.. said the cost of upgrad-ing the nation's telecommunica-tions infrastructure forbroadbandservice could cost $300 billion.That investment is very unlikely aslong aa federal policy requires theregional Bells to share Uieir lines,ho said. Meanwhile, towns buildingthe "last mile" of the Web do a dis-service, he argued.

"One problem with local gov-ernment doing it on a patchworkbasis Is that It undermines our In-centive to invest and huild an inte-grated network." Hoewlng said, 'Itcould be « problem If many Iccalgovernments :rled to do this. Theydon't have the economic chal-lenges we nave. It's unfair competi-tion,"

In fact. 11 slates. Including Vir-ginia, now bar or restrict munici-palities from offering the service.Private companies have also suedsome public providers.

They don't want that marketto go away and lose it all together."said Carol Helberger. an energyand telecommunications consult-ant In Philadelphia. -Qut the citiesand towns are saying. 'You're notdoing anything for me now. Tills isabout economic development.'"

Although typically ccol to gov-ernment Intervention In technol-ogy. Michael K Powell chairmanof the Federal CommunicationsCommission. In a speech In Octo-ber encouraged -communlty-ln-dusfy partnerships" to expandInternet delivery.

This is an exceptional way ofattracting business,' bald DennisM. Cicnelll, owner of a computernetwork company In Kutztown.Because of the town's relative Iso-lation, he pays about $900 a monthfor a high-speed T-1 connection forhis company, which designs Websites for small businesses, among

other things The cost Is abouttwice as expensive as In moredensely populated AUcntown andReading, each about 20 miles awayIn apposite directions, he said.

This part of the county Isn't al-ways ready to accept change." Cl-chelli said. A poster of CamdenYards above his desk is a reminderof Ills boyhood in Sparrows Pointbefore his father was transferred toBethlehem Stcci Corp.'s mainplant 30 miles east of nere. He re-mains a big fan of the Orioles —and of the technology focus at Bor-ough Hall

Said Clchelli. These guys arereally thinking way ahead. Oh.man ~

Kutztown officials say theirnew S i . C million system will domore than pipe the Internet Intohomes and businesses faster. Withthe network linked to electric andwater meters, the town will be ableto collect in leu than two hours tnedata that a meter reader nowspends 10 days collecting. Resi-dents would receive one bill lor allgovernment services, from inter-net subscription to trash pickup.

If the town signs up a competi-tive phone company to offer serv-ice on its volcc-ovcr-lntcrnct sys-tem, town residents will need onlyto mouse-click four digits on theircomputer to reach a neighbor bytelephone rather than dial thewhole 10-digit number — oddlyreminiscent of a long-ago era oftown operators manning plug-Inswitchboards,

The system would also be ableto ring every home In the boroughwithin five minutes In case of anevacuation or other emergency,Hill said

Kutztown Isn't foreign soil forforward-thinking. Just outsidetown Is the headquarters ofRodaleInc , publisher of magazines suchas i'i,-,-.-r,iti>n and known for Itsfounder's environmental run-stousness.

Bui the town of 1,5 square milesnevertheless appears an unlikelyplace for such an experiment.

Its quaint Mam Street could bethe set of a Frank Capra movie —allowing for the occasional tattooparlor and a fancy mlcrobrewerypopular with the college crowd.The housing stock Isn't muchchanged From when It was built forslioe-fMctory workers a half-cen-tury «>;o. And the occasional nnrseand buggy clip-tops past carryingone of the Mennonlte families wholive In the countryside that WilliamPenn bought from the Lennl Lc-napes tnbe in the mid- 1000s.

Many shop owners and resi-dents along the business corridorhad only vaguely heard of the proj-ect as of last week — even as aGeorgia contractor spliced fiber-

optic cables in a trailer a fewblocksaway. Local concerns were mos:lyhow much it would cost — thetown hasn't set a rate yet, butpledges tnat it will be 10 percent to20 percent less than prices else-where — and whether they'd heforced to subscribe. They won't, of-ficials said.

But even before the comingbroadband project, the Internetage has already brought changehere.

Bruce A. Haver. 52, runs one ofthe naif-dozen or so antique shopsIn town. There used to be more ofthem, but they closed as dealingantiques and collectibles over theInternet gained popularity in re-cent years

'Kind of a scary thing*•People keep telling me about It,

but I haven't gotten my feet wetI've got to Jump In tnere. I've got tosee what happens with this Inter-net. It's kind of a scary thingthough." said Baver. who hasn'tbegun trading his century-oldlamps and other Items online.

To this point, he's been contentto sell his goods from a tiny shopwith an Ivory-colored, pressed tincelling — as delicate and intricateas the handmade quilts at thesummertime Pennsylvania Ger-man Festival

Down the street, BUI and Char-lotte Schuster didn't know mucnmore about Kutztown's fledglingDber-opllc Initiative, althoughthey're already hip-deep in e-com-merce.

The couple create and sell Penn-sylvania Dutch hex signs on every-thing from milk |ugs to woodensaws 'If you ain't Dutch, you ain'tmuch.' crowed one sign In theirworkshop lull of vibrant geometricdesigns.

A decade ago. the Schusters' artattracted some international buy-ers, but mostly by happenstance.Bill Schuster, BO. recalled Japa-nese tourists years ago walkingpast his handiwork displayed out-side Ms home and buying a coupleof hundred dollars' worth on thespur ofthc moment.

But with technical support fromtheir grand.son, the Internet nowhelps the couple sell far beyond thehounds of Kutztown throughTvww.hexslgn.com." On this siterecently, they had received an e-mail from Saudi Arabia and werepreparing shipments to Canadaand Scotland.

•My husband is still from hotdogs-for-5-cents." said CharlotteSchuster. 81. "But you don't drawpeople locally. Last year, we pickedup so much business from theInternet."