The following interview with Curtis T. White and Diane C. Lewis took place during Telecom Inter@ctive in Geneva in September 1997. Curtis T. White is President of the Allied Communications Group, an innovator in telecommunications licensing and venture development that initiated the "Smart Home Communities" project. Diane C. Lewis is Executive Vice President of the ALTA consulting group, a women-owned consulting firm specialising in community development, policy and programme design, human resources development, marketing and project management.
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Thanks to Gift Nuka for asking additional questions that helped us complete the interview.
Smart Home Communities - Wiring affordable housing to the information superhighway
Curtis, could you briefly describe the Smart Home Communities project?
A nation-wide effort is currently underway in the States to change the public housing sector because it has been an abject failure. The central notion is to bring those low-income neighbourhoods back as mixed-income neighbourhoods and to promote home-ownership. The theory is that if those people are made stake-holders that will change some of the problems.
The Smart Home Communities project concerns moving the information super-highway into the affordable housing community. The model project is going up in Washington DC, involving a population of approximately 400 - 450 people, primarily families. In addition, neighboring communities as well as a number of schools, libraries and other community groups will have the opportunity to take advantage of the technology. Multiple cities are interested in replicating this approach. The League of Cities and a number of states have looked at the model as a way to revitalize similar communities around the country.
Seed funding for the telecom and information side of the "Smart Home Community" model is provided by the Fannie Mae Foundation. The Fannie Mae Corporation is the world's largest manager of mortgage portfolios and the largest financial institution in the US. Fannie Mae is chartered by Congress to find and provide funding for the affordable housing market (an affordable house in the US is considered to cost less the 250'000$). Fannie Mae specialise in lending in the low to moderate income communities including new immigrants, low-income neighbourhoods and coloured people.
The Allied Communications Group was brought in as a telecom manager. We are a small telephone company specialised in private licensing. We were asked to provide four deliverables:
- Create jobs and business opportunities for the residents in new technology;
- Create bundled services and discounts for residents in terms of video, cable television and telephones, but more particularly, new services like telemedecine, tele-education,...;
- Determine if there was a business opportunity that would help this process role out naturally without federal or local funding;
- Provide user-friendly technology that would help enhance the quality of life and make the neighbourhood better off.
The first things we did was to develop training modules in the neighbourhood ranging from providing health care to pulling fibre. We have already trained seven residents in pulling fibre and they have helped in pulling and splicing the fibre that is going into their homes and all of them have subsequently been hired by major companies so we now have to train some more. And not one home has the slightest problem with fibre, television or telephones. The residents are contributing to connecting up their own homes, their own community based Internet and router. Some of them will help maintain the LAN (local area network). Others will be systems operators. And they will get paid for their work.
The reason this project has attracted so much interest from around the world is that we have focused on human resources needs and let them take the technology where it should go, rather than have the technology dictate where the community is going. We have gone forward very slowly on purpose, because we believe that if we start modestly the project will continue to grow afterwards. The business aspects are certainly present, but they are very much in the background of the process.
Diane, how do you work on the integration of this kind of technology into the community?
Allied Communications brought ALTA Consulting Group, a women-owned consulting firm, to do the human service interface. Our role is to make the application of technology work for the community. ALTA understands that technology is a vehicle in the delivery of services and not an end in itself. Thus, we are looking at those issues which are common to all elements of the community and for whom a creative solution will provide a "buy-in". The community focus is quality education and health care because both are absent in the community and both require unique solutions and community-specific approaches to address access issues and the design of service delivery models.
With regard to education ALTA is working with a community whose access to education and training opportunities are minimal: over 50% of the population is without a high school diploma. The educational level is important because most employment, for even the most basic work, requires a high school diploma or its equivalent. The approach we are taking is to develop a vehicle which expands the educational horizon and engages people in the learning process. Broad band technology makes that happen by providing education which is accessible, interactive and custom tailored to the learner. By placing broad band capacity in the technology center, residents are able to link with educational institutions which provide a range of educational opportunities including courses to receive a high school diploma, professional certification courses, training and life long learning. The technology center through relationships with colleges and universities, will also be able to provide college preparation, college-level courses and credits toward a degree.
With regard to health care, it was very important to ensure consistent quality health care for a community who did not have access to health care and for whom health care was a luxury. It was also necessary to ensure that health care providers delivered health care services in a way which was respectful of culture and tradition, and caring.
The vast majority of households in the community are supported primarily through public assistance and are eligible for public health insurance. The absence of a consistent and predictable health care delivery system has led to episodic and emergency health care often resulting in poor health outcomes. As a result, ALTA is bringing together health care providers to develop a multifaceted strategy which includes prevention and health education, and management of chronic health conditions. Of particular importance was the need to address some of the issues which arose from community health assessments and health indicia of the community. These issues include children's development, women's health, environmental health, and a number of chronic health conditions which are life threatening or left un-managed serve to exacerbate other health conditions.
Another factor in the integration of technology is that the community and health care providers are comfortable with the solution. Thus, we will provide medical treatment similar to that received in a doctor's office or hospital. The telemedicine solution will replicate the office visit: specifically, a private environment in which the patient can discuss health concerns with a health care practitioner, receive a diagnosis, and be given a treatment protocol and appropriate medication. To facilitate the telemedicine consultation and provide follow-up with the patients, a "health extender" will be trained by the participating health entities. The "health extender" will be trained to operate the telemedicine equipment as well as trained to assist the health practitioner.
In the United States, the health care industry creates a substantial impact on the growth of the economy. Therefore, there is a clear mandate to deliver an economic benefit to the community. Training and employment are the initial benefits but business development and community revitalization become the buy-in's which ensure sustainability and integration.
Diane, what was necessary to have the community adopt the project?
A number of things. Most public housing complexes have elected "resident councils" which represent the people living in those housing complexes. We work directly with the resident councils and the community. We discuss the needs of the community and how the project can address those needs. An important element for any community is our ability to shape the project to the community and not the reverse. We are making a concerted effort to integrate the community's needs into the project and the specific applications, since each brings its own unique requirements. The underlying premise of the project is that we are not just bringing a project to the community, but that we are including them in the operation, in setting the priorities and determining how the approach will be developed and implemented.
An additional factor in acceptance and adoption is "time". It takes time to learn and become familiar with the technology. We address a community's resistance to change by bringing them into the technology center and having them use the computers. The introduction may begin with something simple and easy as e-mail. When people recognize that they control the technology and not that the technology controls them, they are more willing to engage. We feel strongly that knowledge and the ability to control the technology will make the difference in how people interact with it. In our training sessions on fiber optic cable, we found that people who were new to the technology have adapted to it very readily and are excited about their potential and the potential of the technology.
Diane, how is this project financed?
There are two issues. One is the transmission costs, which will be covered through the "universal service fund". The "fund" was created to subsidize the provision of telephony services to unserved and underserved communities, and ensure access primarily to rural and inner cities. The growth and expansion of telecommunications, has broadened the definition of access and with it the application of the fund. The fund will support telecommunications access to rural and inner city communities for schools, libraries and hospitals throughout the United States.
The second element of cost in funding this project is the delivery of services. With regard to education some of the courses are free, others have nominal fees and others are full tuition. To the extent that individuals meet eligibility requirements, there are a range of educational scholarships available. With regard to health care many of the community residents have public health insurance or commercial health insurance which traditionally reimburses face-to-face consultations and other health care services. This project will develop, in concert with the local health care financing agency and local health care entities, a reimbursement methodology for telemedicine which mirrors or at least approximates existing face-to-face reimbursement schemes. The health partners in our project are looking at what other states are doing, and in fact, one of the team members has been involved in just such an effort. His experience and knowledge will guide us in developing this approach.
Curtis, will this lead to a sustainable model?
When people think of low-income communities, they imagine revenues don't exist. The reality is that revenues are available to provide services if you can direct them in the right direction earlier enough. The Smart Home Communities model provides a mechanism that permits residents to use some of the money that traditionally leaves the community. That can be done because the residents have ownership or part ownership or have an agreement to receive revenue from the transmission charges with everything from telemedecine to cable television on the community grid. Not only do they save money, but a part of the revenue goes back into a community fund to underwrite everything from staffing the technology centre to maintaining the LAN.
As telecommunication managers we run the system rather like an apartment complex. A portion of the revenues, in this case what is privately owned by the residential community, goes to that residential community. A portion goes to the city when they retain ownership of a public housing site. A portion of it will go to the resident council. A portion will go to the overall home owners. In other circumstances we go to the community and agree to pay for all of the installation, in exchange for a private licence. In other instances, a city might pay for it and ask us to manage it, taking a management fee. In the more affluent communities, they are likely to own the grid themselves. Whereas in lower income communities the company that funds the development is more likely to own the grid.
Our objective in the Smart Home Communities is to show full sustainability within a five year period. We are going to easily meet that goal.
Curtis, earlier you mentioned the importance of getting in from the outset ...
Yes. One of the very important lessons of this project is that it is imperative that the advisors and consultants are involved before anything starts. Let me give an example. A developer who knew about this project contacted us about providing some services. We started to talk about telemedecine, telelearning,... skills development, business training. The guy looked at us and said "Stop! We are a business. We are not a social service agency. We need to build this thing and make some money. All we want from you is to tells us how to get cable TV money, telephone money and power money. That's it. We don't want to discuss all that other stuff." The difference between that person and the developer of the model in Washington is that we had the chance to sit with the him early enough so that he could understand that he was going to make more money, going to get a good reputation attracting other such projects and that he was going to be appreciated by the residents by putting the accent on human resources.
Interview, Alan McCluskey, Geneva, 12th September 1997
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Created: October 1st, 1997 - Last up-dated: October 22, 1997