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Velocity Broadband could seek customers outside of Hudson

By LAURA FREEMAN Reporter Published: May 31, 2017 12:00 AM

Hudson -- Although a majority of Council members wanted the city to look at expanding Velocity Broadband to neighboring communities, one member wanted a detailed business plan before proceeding.

Jim Stifler, economic development director, said May 23 that in the past 20 months, Hudson has built the foundation for innovation with Velocity Broadband, the city-owned utility for high-speed internet, and this validates Hudson as a progressive and intelligent community. He asked Council for authority to talk with businesses in neighboring communities to see what type of interest there is in the utility.

Council member Beth Bigham said Velocity Broadband makes Hudson unique and draws businesses to the city. She wondered if sharing the high-speed internet with neighbors would make Hudson less desirable.

"We need to look to the future," Stifler said. "Opportunities in the immediate proximity [of Hudson] are not as detrimental."

Stifler said there are businesses located close to Hudson who would benefit from the utility, and they want the service.

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"We could target close businesses who would pay a premium and pay to get it [internet service] there," he said.

Because businesses outside of Hudson would have to cover all costs of hooking into the service and pay a premium price for the service, Stifler said there would "not be much risk to Hudson."

Stifler said he wanted to talk to those who have approached Velocity Broadband or have mutual interest with Hudson.

"It potentially would help us maximize the high-end users and provide additional revenue to invest [in Velocity Broadband]," Stifler said. "The call to expand will get louder."

The cost question

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Council member Dennis Hanink wanted to see a business plan with ongoing expenses and staffing needs as the utility grew. He asked Stifler to return with a thorough review of the financials with "realistic numbers" so he could understand the financial risks and whether a profit would be made by expanding the service.

"Outside of borders should be icing not cake but we don't understand the cake yet," Hanink said. "Whatever we do, I want to understand with my eyes wide open."

The majority of Council was in favor of the staff talking with businesses outside of Hudson to determine what the market potential is and come back to Council with the information, according to President Hal DeSaussure.

"You [Hanink] are looking for more information, but I don't think we come to a halt while we provide a document," he said. "We have a quarterly update from Velocity [Broadband] so we can match the current business plan with where things are."

Council member Casey Weinstein said a business plan can't be developed without first talking with other communities.

"We're in a position to think about these things," Stifler said. "We don't know what some of this will cost. The business plan isn't perfect but it's a fluid animal."

Council member Alex Kelemen said if they expanded service to other communities, he wanted an agreement to receive income tax from those communities because of the increase in land value due to the Hudson utility.

City Manager Jane Howington said an agreement would have to be in place with other communities for expanding a utility into their right of way.

She said the staff would explore other communities and businesses and come back with more information and also explore the potential for establishing Memorandums of Understanding with other communities for use of the utility and any shared taxes.

Email: lfreeman@recordpub.com

Phone: 330-541-9434

Twitter: @LauraFreeman_RP


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