Fredericton-based businesses – including the startups in the two incubators that will open this autumn -- will soon be offered a massive saving on their internet fees, which the city hopes will further develop its burgeoning startup community.

E-Novations, the not-for-profit internet provider owned by the City of Fredericton, announced last week it would offer a commercial internet service to local businesses at a discount, which is about 75 percent less than rates available in the rest of Atlantic Canada.

More than a decade ago, Fredericton set up e-Novations as a vehicle for providing the best internet service possible, and it ended up building out a 100-kilometre fibre optic network and offering what it says is North America’s free community WiFi network.

Operating under the brand name GoFredNet, the organization buys Internet services from national wholesalers at attractive rates and resells them to corporate consumers. It recently got an offer for a cut-rate deal and is now offering even greater savings to the business community.

“What this allows us to do is leverage our block purchasing power and pass that low rate on to consumers,” David Seabrook, Fredericton’s Assistant Director, Growth and Community Services, said in an interview. “This is obviously a huge competitive advantage.”

E-Novations is still figuring out the pricing of the program, but Seabrook gave one example of what the savings could mean.

He chose a specific example to illustrate the savings. This deal in technical terms offers a “100 up-100 down megabit service with no contract, which would dedicate 10 megabits per second and free bursts of 100 megabits per second.”

GoFredNet can offer such a service for $200 a month. Seabrook said the same service would probably cost $1000 to $2000 per month in Toronto, and at the upper end of that range in Halifax. He also stressed that businesses receiving the services don’t have to surrender anything in terms of quality or speed to receive the discounts.

“Commercial Internet in Atlantic Canada can cost up to four times what it does in Toronto,” said Mayor Brad Woodside in a statement.  “Today, we’re neutralizing that historic disadvantage and creating an impressive value proposition no other city in Atlantic Canada has been able to match. In fact, no one else in Canada can.”

Any company using this service must be hooked up to the GoFredNet’s fibre optic network, which can entail a one-time connection fee of as much as $5,000, depending on how far the business is from the fibre optics cable.

However, Fredericton has agreed to waive this connection fee for incubators of startup businesses, like the Knowledge Park’s new AcCelR8 centre and the new mLAB Canada in downtown Fredericton. These two incubators plan to open their doors in the autumn.

The slashing of internet fees is just the latest piece of good news for the tech community in Fredericton.

The city hosted East Coast Startup Week in March, and the New Brunswick Innovation Foundation’s Breakthru competition was won by Fredericton-based TotalPave. The competition’s five finalists included three startups that came out of the entrepreneurial programs at the Fredericton campus of University of New Brunswick. The Pond-Deshpande Centre for Innovation and Entrepreneurship is developing innovative programing not only for commercial startups but also for social entrepreneurs. And of course, the city is the home to Radian6, the company that launched the current startup boom when it exited in 2011. Not a bad record for a city of 35,000 souls.

“We’re making a straightforward, bold statement with this initiative,” said Woodside. “If you’re growing a business that needs bandwidth, Fredericton is the only place to be. We are now ready to compete nationally and internationally.”