21st: Small-town net of dreams

Lusk, Wyo., built it, but they didn't come. Now its digital network is a road to nowhere.

Published June 8, 1997 7:00PM (EDT)

seven years ago the little ranching town of Lusk, Wyo., decided to seek some Information Age commerce by building a cutting-edge communications network. Today, a half-million-dollar fiber-optic and coaxial cable system runs past every business and home in Lusk -- but only the schools and public power stations are actually connected to it. Nor is the network linked to the rest of the world; instead, it comes to a dead end behind the local telephone company's central office.

Lusk's network is largely unused because there has been no demand for the services it could supply. Although the network is capable of providing high-speed data and Internet connections, cable TV, video-conferencing and any number of other telecommunications services, no company has been willing to risk the investment to provide them. As a result, Lusk enjoys the digital equivalent of a 12-lane highway with no on-ramps and virtually no traffic.

The town's story is a cautionary tale for communities that hope to hunt corporate buffalo the 21st century way, luring industry with high-tech infrastructure instead of tax breaks or sweetheart land deals. Businesses may be looking to flee the high costs of the cities, but as Lusk has learned, a shiny new telecommunications network is no guarantee that they will flock to your town.

Perched on the rolling short-grass prairie of eastern Wyoming, Lusk (population 1,504) was founded in 1886 in the wake of one of the last great American gold rushes. It occupies one square mile near the middle of what used to be the Cheyenne-Deadwood Trail, a north-south route once frequented by Calamity Jane, Wild Bill Hickock and stage coaches laden with gold. The trail has given way to U.S. 85, a highway used by tourists heading to the Black Hills and Mount Rushmore.

As befits a Western range town, Lusk has a colorful history. During the mining boom of the 1920s, for example, the town decided to install a water and sewer system and eliminate the outhouses; much of the start-up money was provided by the town madam, Del Burke, a petite redhead of legendary business acumen and philanthropy.

Mining plays a less important role these days than ranching and oil drilling, but the county remains a place where people largely make their living off the land. Although many residents want to keep things just the way they are, many also feel that the ways of the past will not sustain Lusk in the future, says Leslie Kee, community development coordinator for Niobrara County.

The fiber-optic network was intended to bring a new source of jobs and income to Lusk. It was the brainchild of the town's longtime mayor, a retired clothing retailer named Don Whiteaker. "He's always been one to want to be ahead of the game as far as telecommunications," says Larry Stolz, chief information officer for the state of Wyoming.

The goal of the network project, Whiteaker explains, was "connectivity to the outside world for rural America." But Whiteaker wasn't interested in just connecting; he wanted an information pipeline big and fast enough to accommodate companies that make heavy use of telecommunications networks.

Such pipelines are easy to find in the downtown business districts of America's cities, where multiple companies compete for phone customers. In Lusk and many other rural towns, however, there is no such competition, no such facilities. The absence contributes to the towns' sense of isolation.

"I guess you could talk to the outside world," Whiteaker says, "but you couldn't send any data. I think rural America needs to be connected ... Someday rural America can come back and play an important part in our infrastructure. Right now it's not. It's bypassed by the metropolitan areas."

Whiteaker's concern is echoed by a number of small-town officials around the country. They fear that the communities left off of the information pipeline, like their predecessors that were bypassed by the railroads and the interstates, will wither on the economic vine.

Rather than waiting for the local Bell to bring the information superhighway to them, a number of small towns have built their own high-capacity networks. One of the pioneers was the municipal power agency in Glasgow, Ky., which built a coaxial cable network in 1988. Originally intended to monitor and control electricity use, the network has been modified to provide cable TV, high-speed Internet access, interactive educational video and a limited amount of telephone service.

Billy Ray, the manager of Glasgow's network, says that the availability of bandwidth is increasingly vital to a town's ability to attract companies. "Industries now see bandwidth the way they used to see a river 100 years ago, as being something that is necessary for them to be successful," Ray said. "They come to Glasgow and their first question is, 'Tell me about the bandwidth. What does that cost?' That's before they ask what a kilowatt hour costs."

Inspired by Ray, Whiteaker took a similar approach to building Lusk's network. Working through the municipal electrical utility, the city won a $290,000 grant from the state in May 1991 to upgrade the utility's communications links. Over the next five years it installed a fiber-optic backbone the length of the town, with coaxial-cable arms running past every building. Whiteaker also persuaded the local Bell, USWest, to speed up Lusk's connection to the rest of the world. The company replaced its outdated switching equipment in Lusk with a digital switch, which it then connected to the distant high-speed backbone of its Wyoming network with a 45-mile-long fiber-optic cable.

These investments -- some $2.4 million by USWest and roughly $300,000 by Lusk, in addition to the state grant, City Attorney Dennis C. Meier said -- have spawned only two new activities. The town's electric utility now monitors the demand for power in half a dozen town-owned buildings, and the school system has a high-speed data link between its buildings. The schools also have video-conferencing and Internet access, but those services are provided through the state's educational network.

Of the 700 to 800 homes in Lusk, only about 50 have actually been connected to the new network, for testing purposes. Not that anyone has a reason to be connected: The network doesn't carry any signals. To provide video, Internet access or any other telecommunications service, the network must be fitted with more equipment -- expensive equipment, in the case of cable TV or interactive video.

Al Titchener, the superintendent of Lusk's utilities, says, "We got to the point where we wanted to get. The capabilities are there. It just takes more money now, and we don't have more money."

Whiteaker, who lost his post as mayor in June 1996, disputes the suggestion that the network is incomplete: "The system's done. You can run, at no cost, or maybe $10, you can run that to my house. It's just, nobody has the dream. Nobody has the desire. They don't have the dream."

The original hope, according to several town officials, was that the robust bandwidth of the network would attract companies willing to make the investment necessary to put it to use. They envisioned catalog companies, reservation systems, corporate branch offices and the like tapping into the town's fiber to move data across the country at top speeds. Residential services like cable TV would be further behind, they said, because of the expense of connecting all those homes to the network.

The town's efforts earned some glowing press from the national media, generating a stream of inquiries from companies wanting to hear about the bandwidth and how it might work for them. The inquiries at Town Hall have slowed to about one a month, though, and no companies have moved in.

"Nobody's seen the realistic value of using the broadband distribution system," Whiteaker laments. "We're set up in Lusk, Wyo., right now so that if you wanted to have ISDN (an accelerated digital transmission format) in this community, you could have it at my house. I can run 50 feet of coaxial cable, and I'd have broadband distribution ... out of this home. What home, what community in this world can say that? I don't know. But most people don't understand."

Meier, the city attorney, said that a combination of events -- Whiteaker's defeat at the polls, the retirement of the school superintendent, the departure of a key Town Hall employee and the town's liaison at USWest -- brought the town's marketing efforts to a screeching halt. "We're just dead in the water until we get somebody fired up to take it over again," he says.

The current mayor, a former oil well driller and engineer named Donald M. Wilson, is not the enthusiast that Whiteaker was. "They got themselves into a position that nobody likes to get into, of not getting (the network) completed and not having it down to the place they advertised they were going to be with it," he says, adding, "It kind of devastated this little town. Broke their back, really."

As for using the network to recruit industry, Wilson says, "The problem is, we don't have a whole lot to offer these people." Indeed, Whiteaker and Meier said that Wilson recently told a motel reservation center that Lusk's network was not yet ready for that kind of use -- an assessment that Whiteaker strongly disputes.

Still, Wilson has a point about the limits to what Lusk can offer. The town is so small, it has only one grocery store. The nearest shopping mall is over an hour away. Most important, there just aren't that many workers available in a county of 2,600 residents.

Wilson says he wanted the town to cut its losses and sell the network. The decision ultimately rests with the full Town Council, however, and Wilson has only one vote. Sentiment among the other members has been running against a complete sell-off.

Councilman Tony Anderson said that town officials have talked with the local cable TV company, CommuniComm, about leasing a portion of the network, but "they don't want to lease it, they want to own it outright." Other cable TV companies, meanwhile, don't want to take on CommuniComm: "They all don't want to compete. They want the whole pie. And that's somewhat understandable -- we are a small town."

Rick Luchsinger, superintendent of the Lusk school system, is leading a faction that wants the town to establish a community utility that would provide cable TV, Internet access and telephone service over the network. It would save the residents a tremendous amount of money in the long run, Luchsinger says, noting how deeply Glasgow's network cut cable TV rates.

One hurdle for Luchsinger and other supporters of the network has been the residents' lack of understanding about the technology. Titchener says that when older residents hear that the network could provide 200 channels of video programming, many of them scoff and say, "My TV doesn't have that many channels."

Kee, the community development specialist, says that Whiteaker may have done a poor job laying the groundwork for the network, but the community is coming up to speed -- and the evolution of opposing factions is a sign of progress: "A year and a half ago, we didn't even have camps ... We're headed in the right direction."

As the residents of Lusk debate the future of their network, far larger cities are jumping onto Whiteaker's bandwagon and building their own networks. For example, in early April the city council in Tacoma, Wash., approved the municipal power company's plan to build a $65 million high-bandwidth network throughout the city. The rationale was much the same as Whiteaker's: The city aims not only to make the utility more efficient, but also to gain an edge in connectivity.

While other cities may be endorsing Whiteaker's do-it-yourself vision, the question remains whether his approach can pay off for a community as small as Lusk. Unlike other rural towns that built networks, Lusk did not create a finished system that pumped cable television or electronic mail into the community. Instead, the town took a leap of faith that it could lure companies just by hanging the fiber-optic wires on its poles, and the companies would do the rest. So far, it's been a leap into a void.

By Jon Healey

Jon Healey is a freelance writer who follows the telecommunications industry and Congress.

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