Shentel is looking to provide cable and internet home services in Blacksburg, a market dominated by telecom giant Comcast.
Shentel — an abbreviation for Shenandoah Telecommunications Company — is seeking a cable franchise with the town.
Based in Edinburg, Shentel is the leading cable and internet services provider for Christiansburg and Radford.
The sought-after franchise agreement with Blacksburg is a notable development for the area as it involves one major provider making a rare move to build a presence in a market already dominated by another company.
The same, however, is true for Comcast, which has in recent times expanded services in parts of Shentel-dominated Christiansburg. Currently Comcast is installing infrastructure in numerous neighborhoods on and around Peppers Ferry Road, a top growth area in the region.
Chris Kyle, Shentel’s vice president of industry affairs and regulatory, said the company is aware of the challenge with entering the Blacksburg market but has identified needs that it can address. He said competition also benefits the consumer.
“We spent a lot of time thinking about this,” Kyle said. “It’s going to be a tough fight for us, but what we know is that there is a significant percentage of the population in these markets that want choice … We’re going to give them some other product that maybe they can’t get today.”
Shentel’s plans for Blacksburg are part of a greater and ongoing expansion of services that the company has been bringing to other parts of Virginia, including the Roanoke Valley.
In addition to providing fiber-based internet for Roanoke City Public Schools, the company is looking to start construction on new projects in Salem and Roanoke later this year, Kyle said.
While the company isn’t able to provide a full design yet, it plans to serve as much of Blacksburg as possible, Kyle said.
Kyle didn’t provide an exact amount, but he said the company is looking to invest millions of dollars into Blacksburg alone for what he described as a transformative project.
Shentel currently maintains about 6,000 miles of fiber across the Mid-Atlantic.
Shentel is looking to specifically bring its Glo Fiber service to Blacksburg, he said. The package includes gigabit internet for $80 a month, according to Glo Fiber information provided to the town of Blacksburg.
The ongoing COVID-19 pandemic has pushed more people to work from home, a trend that has raised demand for high quality internet, Kyle said. Fiber-based internet offers faster speeds than the traditional cable system and is much better at tasks such as pushing sizable files, he said.
“There is a need to bring this fiber,” Kyle said. “They [cable internet] do a good job, but it has been stressed with the virus situation here.”
Currently, Comcast’s cable internet service to the home is available in approximately 91% of at least one Blacksburg zip code, according to www.broadbandnow.com, a site that tracks provider and speed availability in communities across the country. Shentel covers the almost exact share in Christiansburg with its same service, but Comcast is now available in approximately 24% of the town.
Verizon does have slightly greater availability than Shentel and Comcast in each town, but its service in the two areas searched only offers speeds of up to 15 megabits per second, according to www.broadbandnow.com.
A speed of 15 megabits per second falls below the Federal Communications Commission’s current definition for broadband, the general term used for describing high-speed internet. The agency several years ago placed the minimum threshold for broadband at 25 megabits per second, a speed that is itself a tiny fraction of gigabit internet.
Both Shentel and Comcast offer home speeds of up to a gigabit in Christiansburg and Blacksburg, according to www.broadbandnow.com.
Blacksburg Town Council is slated to vote on Shentel’s cable franchise on Oct. 13.
Mayor Leslie Hager-Smith said she’s supportive of the proposed franchise and that there appears to be no opposition to the measure among the rest of council.
“I think the council, pretty much as a whole body, believes that will be a good thing for our … citizens to have as an alternative in town,” she said.
Shentel expanding its presence locally strongly raises the chances of internet services becoming more affordable in town down the road and increases options for residents, Hager-Smith said.
“We have heard for many years that people wish they had a choice, an alternative,” she said.
If approved, there will, however, be a slight difference between Shentel’s and Comcast’s agreements with Blacksburg.
Blacksburg Town Attorney Larry Spencer said there exists a long-standing condition requiring Comcast to expand their services as parts of the town are developed and grow. Shentel, he said, wouldn’t have to meet that requirement, at least not immediately.
Comcast’s provision in Blacksburg dates back to 1970s-era policies that generally asked providers to make their services reasonably available to the general population, Spencer said. Those policies, however, are said to decrease competition when newcomers try to enter a market, he said.
Spencer said there’s a chance Shentel’s plans could prompt Comcast in the future to revisit that provision.
Comcast became Blacksburg’s leading cable and internet provider in the mid-2000s when it took over the franchise that previously belonged to the now defunct Adelphia, which went under following a bankruptcy and corruption scandal.
Shentel’s move also comes as Montgomery County, the greater locality that encompasses Blacksburg and Christiansburg, is pushing for an increase in broadband availability.
“I would just say that all options should be explored to bring broadband and wireless internet services to our county’s citizens,” county Supervisor Mary Biggs wrote in a text message in response to Shentel’s plans. “The COVID situation has made this challenge very visible and needed.”
Biggs represents supervisors district F, which includes a portion of Blacksburg.
County officials received a report earlier this year that found the portion of Montgomery and Radford population unserved by high-speed internet falls at 7.6%, which is slightly above the national rate of 6%.
The report identified specific communities in the area that are either without high-speed internet or limited to poor speeds.