Esri GeoConX Conference 2019
December 16, 2019

Fiber Broadband Market Research and Analysis from RVA

In this episode of the Broadband Bunch, we speak with Mike Render, Founder and CEO of RVA LLC Marketing & Consulting.  RVA is known as North America’s premier market research expert tracking fiber broadband deployment and corresponding consumer attitudes.

RVA has a long partnership with the Fiber Broadband Association, providing fiber broadband market research, producing annual North American Fiber to the Home (FTTH) forecast reports and most recently generating The Broadband Experience Index.

Evolving into Fiber Broadband Research

Pete Pizzutillo: Thank you for joining us from Tulsa, Oklahoma. Mike, before we get into some of the work that you’ve been doing and some of the interesting metrics and measures that you’re introducing into the marketplace, maybe you can help our listeners understand a little bit about your journey.

Pete Pizzutillo: How did you become the person that you are today and end up leading the RVA team?

Mike Render: Sure. Well, I started out working for… Back in the late 1970s, working in sales early on. Then had an early startup, technical startup opportunity that ultimately failed, but it was a great learning experience. Went to work for a corporation, did market research and then was head of marketing for a firm that did consumer electronic products. About 1990, started my market research firm and I’ve been doing that ever since. Somewhere in the later ’90s, we combined with another market research firm, so I’ve been doing that ever since. Locally, we do research related to many different subjects, diverse. We’re the largest full service market research firm in this region, so we do a lot of that.

Mike Render: But in about 2002, I got involved with the Fiber to the Home Council, now the Fiber Broadband Association, and started doing all their work related to broadband. I had done some before. Williams Communication was a fiber provider, a long haul here in Tulsa that was important back in those times and so forth. But really got involved in 2002, with the Fiber Broadband Association and started working with them, doing many projects for them. And then of course over the course of these nearly 20 years, I’ve done work for many other companies along the way in broadband as well. So, that’s what we’re really known for nationally and internationally is the broadband work we do, which is a big part of what we do.

Pete Pizzutillo: No, that’s great. That’s very helpful. Yeah, if you get a chance, check out his profile on LinkedIn, he’s got a rich background. You have just recently released in conjunction with the Fiber Broadband Association, this 2019 Broadband Experience Index.

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 Partnership with the Fiber Broadband Association on the Broadband Experience Index

Pete Pizzutillo: We are going to dig into that a bit, but first off, what led to this conversation with the Fiber Broadband Association? What was the problem that they were trying to solve that they’ve asked you to do some research and propose a solution?

Mike Render: Yeah, sure. Well, our consumer research that we do for the Fiber Broadband Association, we determined that broadband is really important to people’s lifestyles now. People spend nearly six hours, even at home online, sometimes multitasking, but a lot of time online. They say when you give them a list of features of things people want to look at when they’re moving to a new home, it’s one of the most important items, usually number one. More important certainly than granite counter tops, and even the view out the window and so forth. It’s just such a big part of our lives now, both in terms of entertainment, and work, and doing the tasks of life. So, very important. So, all that’s important.

Mike Render: With that in mind, we felt that sometimes consumers and policymakers and providers just didn’t have a good way to measure broadband. And the Fiber Broadband Association, some people there have been talking about that for a while. Unfortunately, the only measure that many people see is advertised download speed, as the measure they look at when they compare different providers, or compare different types of broadband. So, that was really the reason that this came about. It’s important in people’s lives, and two, people and policymakers, network operators need better ways to determine how to compare these different methodologies.

Pete Pizzutillo: And even more broadly, right? So, there’s a lot of criticism around the FCC reporting about served and underserved communities, right? And that when folks like Microsoft are comparing them to usage statistics, and there are certainly discrepancy between those two parties in their reporting. But it sounds like adding a more robust definition versus something that’s reported and qualitative, something you’re suggesting it’s measurable and objective, gives not only a way to compare existing broadband performance, but also to help highlight the underserved areas.

Mike Render: It can certainly. It certainly could be used in that way as well, to show the index. Geographically, we haven’t done that yet. But to your point, we know that for example, looking at that rural digital divide, people in the rural areas according to our research, actually need broadband more. And it actually makes sense when you think about it. They’re two hours from a mall, they’re two hours from places of work sometimes. It varies, but the need is certainly there for entertainment, for shopping, all those things.

Mike Render: So, the need is certainly there and they more than anyone needs not only the download speeds, but the full range, reasonable latency, upload speeds, reliability, and all those things are important. So, yes, it could be used in a geographic sense as well.

Fiber Broadband Research – Better Metrics and Measures

Pete Pizzutillo: Interesting. So, let’s dig into a little bit. You describe the Broadband Experience Index as a multiple measurable performance criteria, to compare consumer experience by broadband type. But help us understand at the highest level what it is, and then maybe dig in a little bit in terms of the dimensions of the index.

Mike Render: Sure. So, yes, we’ve tried to develop an index that one was transparent, that people could see exactly how we were developing it. That was credible, that had as its basis measurements that were based on real surveys and studies and so forth. So, that people could understand it. They may have different interpretations, but it should be something that’s right there for people to see how we got there.

Mike Render: We wanted to use multiple criteria, because again going back to our consumer work, we’ve found that while broadband speed is what most people talk about when they talk about broadband, download speed. It’s actually… The number one issue that people are concerned about is reliability. They’re at home and they need that broadband for work. They need it for school, they need it for just shopping, whatever the purpose is. It’s quite concerning when that broadband is down for periods of time, or they frequently have to make adjustments to try to get their broadband back up, doing rebooting, calling customer service, all those kinds of things.

Mike Render: So, reliability is certainly very important. Download speed is important, but when we do measurements of regression analysis and compare different factors back to satisfaction, upload speed actually currently is a bigger determinant of satisfaction than download speed. And I hypothesize that that’s because people are more constrained with their upload speed currently than download speeds.

Mike Render: So, that’s important. Latency is an issue that not everyone understands, broadband is the amount of data that’s coming down, which is important to make things load and work quickly. But the distance… The time it takes an individual packet to reach one place to another is important also.

Mike Render: And of course as you know, Pete, if it was high latency, this conversation would be difficult.

Pete Pizzutillo: Right.

Mike Render: Like when we see sometimes talking across the ocean and people seem to have to wait a few seconds before they answer. So, those things are important. It’s important for gamers, it’s important for people doing stock trading. Obviously as we get into smart cities and we’re trying to determine an incident up ahead on the road and get that information back to the cars behind, latency becomes very important. So, that was another factor to really look at in this study. So, we wanted to look at all of those.

Pete Pizzutillo: Yeah, so you’re looking at four primary factors, reliability, latency, upload and download. And then you’re looking across a couple of technologies. What are those technologies that you’re investigating?

Mike Render: Sure. So, we wanted to compare it to everything that’s reasonably being used today. And that would be DSL over copper wire, cable modem over hybrid fiber coax, coax in the last leg to the home. A true fiber network, fiber all the way to living units, wireless technologies, which we currently are combining both mobile and fixed wireless, if that’s the source that they have it at their home. And then satellite technologies, using a dish to get the information from satellite.

Pete Pizzutillo: So, what are some of the key findings that people should be thinking about that you guys have uncovered?

Mike Render: We measured reliability indirectly by asking people how many times they have to reboot their modems, how many times they have to call customer service?

Mike Render: But for the other measures, we can actually take a measurement during the survey, excuse me, and take it over… Without them having to write down measurements, as we used to have. We have a speed test built into our surveys, so that we can actually measure download speed, upload speed, latency. And so that’s important. We’re also asking how satisfied they are with these issues. And we take a Net Promoter Score, which is looking at people that are really promoters, give it a nine or a ten on a rating scale, less detractors, those who give it a lower score, and come up with a Net Promoter Score rating.

Mike Render: So, using all that data, then we pulled it together and looking at the actual results by technology.

Pete Pizzutillo: Right. And so I’m looking at the raw data and it’s not just the RVA data that you’re showing here, you’re contracting that to the FCC data, specifically around the performance measurements. What are the observations between what you all are seeing and versus what the FCC is reporting?

Mike Render: Well, we do use the FCC data as well, just to show that they from their own measurements are getting fairly similar information. The note of difference there is that their data tends to be older. For example, currently, or at least at the time we last did the index a couple months ago, 2017 was the last data available from the FCC, and they tend to use a smaller number of providers, mostly tier one providers that they’re measuring. Whereas we are effectively measuring all providers, using a random sample of people across the country. So, we’re measuring people that are getting their service from a Verizon or an AT&T, but also an Ajax telephone company, or a small rural electric, whoever is providing that service.

Mike Render: So, there are some differences that we see in the data.

Pete Pizzutillo: And this is all consumer data. Are you doing any commercial sampling at all?

Mike Render: No. At this point, this is all consumer index. So, looking at these factors from a consumer point of view.

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Fiber Broadband Networks are Best in Class

Pete Pizzutillo: So, who’s the winner? I mean, after all this, you have a combination of your survey, the data that you’re collecting, the FCC comparison, some of the attitudinal measurements, as well as the Net Promoter Score, and you’re looking across fiber, cable, wireless, DSL and satellite. So, who’s the winner?

Mike Render: Right. Sure. Well, fiber because of being best in class in many of those categories, or almost all of those categories, is the winner. Just using a normalized index to compare the best in class to the lowest in class, fiber is number one, cable is clearly number two. It’s kind of a neck and neck tie for third place between wireless and DSL / fiber to the node. And then in last place is satellite, with a very low score because of not only lower speeds, but very long latency, having to go way out to a geosynchronous satellite over 22,000 miles away and so forth.

Pete Pizzutillo: Have you sent this report to Amazon and to Tesla, whoever else is trying to launch all the satellites out there, to tell them to stop wasting their time?

Mike Render: No, we haven’t. Now to be fair, their technology is a little different. They’re looking at not a geosynchronous satellite. The advantage of those satellites being that far away is they stay in one place over the earth, so it’s easier to point a dish at them and keep it. You can put satellites closer to the earth, which gets rid of some of that latency, potentially has higher speeds.

Mike Render: But what they have to do is have a number of satellites that are rolling past you, and you’re going to have to be passing from one satellite to another. So, I’m a little skeptical that it’ll be a great advancement for most of us. It may have some applications, in certainly third world countries, maybe, perhaps some rural areas of the U.S. But it’s yet to be seen.

Mike Render: So, when those technologies actually come out, that’s probably a place where we would have a separate category for that kind of satellite technology.

Fiber Broadband and 5G

Pete Pizzutillo: Yeah, a little more granular look at types of satellites. What about 5G? I mean, how do you see 5G, and the architectural evolutions that are coming along with that? How do you see this affecting any of these?

Mike Render: Well, we will certainly take a look at. We may want to break out millimeter wave, or 5G, true 5G kind of wireless and look at it separately. Again, I’m a little bit skeptical that it’s… It’s important. 5G is important. But as with all the past introductions of wireless technology, they tend to be over hyped. Sometimes the aspirational goal for 5G is described, but below that you have the real laboratory tests that are actually attainable, and then you have the actual user experience, when you get multiple users, and obstructions and real world conditions.

Mike Render: And so while 5G is very important, it’s not going to be the wonderful savior of all broadband. And especially in rural areas, because it takes… One of the aspirations, one of the aspects of 5G, especially for the millimeter wave type of 5G is closer towers.

Pete Pizzutillo: Right.

Mike Render: And so it’s going to be more important in urban areas. But we’ll certainly want to take an objective look at it. It could be better than I hypothesize, who knows? So, we want to add it to the mix, and look at it with this kind of an index objectively as it really rolls out.

Pete Pizzutillo: Yeah. And it’ll be interesting. I mean, looking at the results, I think they kind of line up with people’s expectations. But was there anything surprising or unexpected that you found while doing the study that would be worth sharing with the audience?

Mike Render: Well, I think the things that were more surprising to me was, A, the importance of upload speeds. We all know that’s important, but the fact that it is now entering daily life, and people need upload speeds, comes out in this data.

Mike Render: Secondly, latency. I was a little surprised at how bad latency can be. Certainly we can understand that with satellite, because of the distance it has to travel. But when you get to rural DSL and so forth, there are cases of extreme latency, which really pulls down the average index for those sources. So, I was a little surprised at that. It was worse in our study than the FCC shows, which we think relates to the fact that FCC’s using more tier one providers, and more best conditions, where we’re using average conditions of real world consumers to measure.

Pete Pizzutillo: Right. The dead of winter. So, this is really interesting and I do agree that we do need a common language and framework to help compare broadband apples to apples. And I think you guys have done a great job on that. What are your expectations for the index itself, and how do you anticipate it being adopted by the community, and what’s your role in trying to help that?

Fiber Broadband Deployment – Weighting Cost vs. Value

Mike Render: Well of course we’re rolling this out with the Fiber Broadband Association. So, they’ll play a role in helping do that there. They’re currently using it to take it to policy makers at the FCC, along with some research from the Cartesian Group, that shows the social economic differences and the impacts of these different broadband types. And one of their goals is to look at the current CAF-

Pete Pizzutillo: CAF-II funding?

Mike Render: Yeah. And try to look at how do you weigh it? So, we don’t want to just have broadband rolled out based on the lowest cost. It’s got to be some measure of cost versus quality.

Pete Pizzutillo: Right.

Mike Render: And the FCC has actually tried to do that to some degree, weighting lower performing methods, so that the same cost doesn’t get the same. Otherwise, all we’d have is satellite and lower performing wireless. So, there’s got to be some weighting scale.

Mike Render: But the Fiber Broadband Association assumes that they’re not weighting it enough, to really give the emphasis that should be given to higher performing methods, such as high-performing HFC, and certainly fiber to the home. So, they’re using this as evidence that the weighting should be different.

Mike Render: We also hope that it’s used for network operators, as they start thinking, well our current infrastructure is getting old, we need to do something, do we upgrade and just replace some parts? Or do we do a more dramatic upgrade and at this point change the fiber all the way, and that kind of thing. So, hopefully looking at this index will help them make decisions, and certainly blast consumers as they churn, both because of a home move or just because they’re unsatisfied with a current service, do they churn to higher performing broadband?

Mike Render: And by the way, we did look at that recently. We looked at churn when they’re not moving, and about half of that group where fiber is available, move to fiber. So, they are certainly making the right choice, where all the other methods went down during that churn, especially the lower performing ones.

Mike Render: But not everyone moved to fiber. And of course maybe there’s other reasons that you wouldn’t move to fiber, your price, there’s a better price, you’re satisfied with the brand. But we want to make sure that people have all the information when they’re making those choices during a churn, where they’re trying to get to a better performing broadband.

Pete Pizzutillo: Yeah, it’s interesting. People are voting with their dollars, which makes a lot of sense. I could definitely see an extension of this. There are a lot of resources online, they kind of list out the providers in your areas, and then see what kind of packages that are available. But this is really a nutrition label for these types of services. And it’d be really interesting too, from a consumer side to help people understand more fairly how to evaluate the providers in their area, in the geographic area.

Pete Pizzutillo: So, it would be interesting to see if there’s a way that hopefully one day this evolves to a consumer mechanism, or tool to help them make that decision. I think it would be helpful.

Mike Render: Sure.

Pete Pizzutillo: So, great work on that. Thank you for that. So, this is just a sample of some of the stuff that you all do. I know you’ve spoken in the past about doing some feasibility studies for municipalities.

Pete Pizzutillo: If you can just give a sense of, what are you working on next? And what are some of the other research that would help some of the folks out there, either providers or consumers understand the state of broadband?

Additional Fiber Broadband Research

Mike Render: Sure. Well we do an annual providers study for the Fiber Broadband Association, where we are doing a number of surveys of network operators. We also compare that to the consumer work we do, where we ask random survey, what providers are they using? And we compare that to FCC data. So, annually we come up with a pretty accurate, we feel estimate of where the nation stands in terms of its deployment of fiber. Both in terms of the homes marketed, the homes that could get it and the homes connected. And that’s coming up in December. There’s a webinar, certainly open to Fiber Broadband members. I think that one may be open to the public as well, but that’s one resource.

Mike Render: Every year, as I mentioned, we do consumer studies of people across the country to determine not only their satisfaction with broadband, but how is broadband impacting their lives? Especially good quality broadband, how is it impacting their lifestyle, their work? Looking at things like work from home, and home-based businesses and the impacts, even green impacts. So, all those kinds of things are from a consumer study, that’ll be next presented, I believe at the annual conference of the Fiber Broadband Association, next June.

Mike Render: We often do a forecast report, which is looking out five years for different segments. And the last one was done in April of this year, which is available for sale on our website. This year, we did an interesting study on the urban digital divide, looking at it from the point of view of people that have recently joined the online ranks from lower income areas, and in this case in particularly urban dense situations. And that was really interesting. It was quite interesting to see the passion of people that are now online and how it’s changed their lives, in terms of they mentioned information and being able to communicate with family and convenience of life tasks, work from home, shopping, the children’s education.

Mike Render: And one of the things that was really interesting to me was how many people had started a home-based business that were low income folks online. And it was up there competing with, even above some of the averages for the nation. And it just made me think, entrepreneurial-ism is still alive when people have the tools and that gives them an opportunity, and in some cases it’s contributing significantly to their income, and even moving them out of low income categories. So, that was very encouraging. That’s a free study that’s available on our website.

Mike Render: So, those are some of the things off the top of my head that I can think of. We do, do some local feasibility studies by communities, looking at as Pete mentioned, looking at the need for broadband in a specific community and so forth.

Pete Pizzutillo: Yeah. No, that’s great. I mean, I’ve seen you present a couple of different times, some of the economic development, some of the connection to how fiber supports both smart cities and small cell, which is crucial for 5G.

Pete Pizzutillo: And your point about the work at home, right? There’s a book coming out about, it’s called Digitally Invisible or Digital Invisibility. And it’s related to the digital divide. And rather than think of it simply as not access, or not having access to broadband, Dr. Lee is presenting the concept that these folks that don’t have access are not participating in our digital economy. Right? So, to your point, if they don’t have broadband, then the work at home is one way that they can’t participate. But no access to online banking, they can’t apply for jobs. Right? So, I think, looking at it really from that holistically, not just a technology gap, but more from a… There’s a significant financial disconnect that’s happening and it just makes a lot of sense.

Pete Pizzutillo: You look at what Microsoft doing with the white space, the Airband Initiative, right? Trying to find some way to leverage the existing infrastructure to bring 2 million people online. Part of it, it’s the goodness of their heart. But part of it is those are serviceable customers, right? People that are just not able to participate into gaming, or whatever else, and e-commerce and that type of thing. So, shedding light on that, I think it’s really important to help people understand why this is really no longer an argument of should, but it’s more of how do we get broadband to everybody within with the United States?

Mike Render: Right, right.

Pete Pizzutillo: So, yeah, this is the Broadband Bunch, and we’ve spent some time speaking with Mike Render from RVA Research, and he has given us a walkthrough of his 2019 Broadband Experience Index Report, which is available through the Fiber Broadband Association.

Pete Pizzutillo: Mike had mentioned that there’s an upcoming 2019 annual provider’s survey webinar, that’s going to feature some of the research that you’re delivering in December. So, we look forward to that.

Pete Pizzutillo: Mike, how can people find out more about you and the kind of research that you’re providing?

Mike Render: Well, sure. Well, certainly through the Fiber Broadband Association. Encourage you to become a member if you’re, especially on the network operators side or consultancy side. Some of the information there is public information, so encourage you to look there. You can sign up for access to some of the resources, even the ones that are behind the curtain, you can sign up for guest access for some of those things. Some of the more in depth ones are member only, that are more focused on the infrastructure itself.

Mike Render: But certainly resources there. Our own website, RV LLC. We have some information available there as well, such as the urban study, digital divide study I just mentioned.

Mike Render: I certainly enjoyed visiting with you, Pete, about these topics today.

Pete Pizzutillo: Yeah. No, thank you for sharing. It’s really insightful research. Thank you for doing that work. It’s pretty important work that we believe in, and we need people like you that are smart enough to figure out how to get out and get this information together. And then champion the research and the findings to both the Fiber Broadband Association, and the government, and all the local municipalities. So, Mike, thanks. And if you get a chance, check out RVA website and Mike’s great work. Thanks again, Mike.

 

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