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Why Municipal Broadband is Good
batageek writes "An excellent interview with Jim Baller (muni-telco-lawyer) concerning the growth and efforts of municipal broadband providers and the fights they go through with the incumbent providers and state legislatures." If you're wondering why you don't have fiber-to-the-home yet, read this.
That one day, all houses will be made with fibre straight to the door, and bandwidth will be just another amenity, much like electricity, or gas, or telephones are now. And then all the local bandwith companies can fight over our business, and offer us lower and lower rates.
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Broadband access is becoming the new extended basic utility.
Just like Gas, Electricity, Water, cable, etc. Instead of Cable coompanies having a monopoly on access, and being about to set there rates as they see fit, I'd welcome a utility regulatory group be put in place.
"This must be a Thursday, I never could get the hang of Thursdays."
The article is kind of long and boring, but here's the key paragraph:
FTTH [fiber to the home] networks are a good case in point. At present, cable can make more money selling relatively modest cable modem services over their Hybrid Fiber Coaxial (HFC) networks, and telephone companies can make more money selling DSL over their copper-based networks, than they can make by investing huge sums in FTTH networks that would allow them to offer substantially more robust broadband services. To wring every last dollar out of their existing systems, the cable and telephone companies are also working hard to persuade Congress, state legislatures and the FCC to allow them to close their systems to Internet Service Providers, CLECs and other potential competitors. Until these conditions change, the cable and telephone companies will simply not invest in FTTH networks. Instead, they will continue to try to convince us that we really don't need more bandwidth than they're offering. At the same time, they will try to block municipalities from building FTTH systems that could disprove these claims.
So it's the usual story. Corporations looking out for their bottom line. Using money and power to prevent competition from organizations that might act in the public interest (and thereby cut into corporate profits).
"If I could live to be several hundred
I could take a walk and really wander, really wonder."
I was an employee of a company that ran fiber throughout several blocks of the downtown city (if you could call it a city) area and connected quite a few locations directly. The problem turned out to be need. People could already get cable modem or DSL, and even though the prices were incredible (I think it was $40 for a 10mb 2-way connection), nobody saw the need for that kind of speed.
Granted, Lock Haven, PA is hardly the technological Mecca that some other places in the country are, but you'd think that for $40 a month, with no download or upload cap, and no monitoring of any kind, someone would want it... but as it turns out, not so much. It's still successful enough to keep the company from going under, but it's hardly the money-maker they anticipated it would be.
The project itself was called Lock Haven Electronic Village, and was started by KCnet (Keystone Community Network). They're an educationally oriented ISP that was started by the school district and gets grants from the government for education-based projects. If memory serves, they did the first phase for around $250,000.
"It's better to have a gun and not need it than need a gun and not have it." ~ Christian Slater, True Romance
But see-riously, wasn't one goal of the Telecommunications Act of 1996 to increase access in rural areas? Needless to say, that's not what happened. Baller's comparison of broadband access to the situation when the Rural Electrification Act was passed is valid. But telcos & electric companies are going where they get the biggest return for the least investment. Even "rural" EPAs tend to concentrate on small towns & suburbs these days -- services in the really rural areas are not much better than they were 40 years ago.
The high-tech redneck,
"Obviously, I'm not an IBM computer any more than I'm an ashtray" (Bob Dylan)
If you think private telco monopolies are bad, you haven't seen anything yet until you've seen government-owned monopolies.
Our electricity monopoly here is government owned. I am overhauling my house right now, and a friend of ours, who works for the electricity company, mentioned it'd make his job a lot easier if the meter was in a box on the outside of the house, rather than inside (meaning the meter reader can read the meter at his convenience, rather than when I'm available to let him in). I agreed.
The first hurdle was trying to acquire the plastic box to put the meter in. We went to the Manx Electricity Authority shop and asked for one. We were told to fill in a confetti-like shower of forms, and we'd have to wait a couple of weeks for it to show up. The guy behind the desk wouldn't budge. He had them in stock, and available, but no, he couldn't give us one. He terminated the argument by announcing, "Well, we ARE the government, you know".
Finally, we get the box. I did all the work myself to install it (cut the hole in the wall, secured and set it in the wall, concreted the hole etc.) at my expense. All we needed was to have the MEA move the meter from its present position to the new box. We fill in yet another form to tell them what we want to do.
A couple of weeks later their guy shows up and says, "Nah, I can't do that, you need a jointer to do that. And you need to fill out these forms".
Yet more forms. We had already told them exactly what needed doing, and they sent the wrong type of person out.
"Oh, you're on a six-week waiting list for a jointer" they then said, after filling out yet more forms. I escalated the matter, and had a long debate with a guy about it and told him all our woes. He tried to wriggle out of it.
"What electrician's qualifications do you have to do the installation?" he asked, trying to pry open an "excuse hole" he could exploit.
"It's a plastic box set in a wall. You are telling me you have to be a qualified electrician to cut a hole in a wall, put a plastic box in, screw in the supplied screws, and re-render around the hole?"
"Well, what about all the cabling?"
"There _IS_ no cabling! That's the point! This is why we've been filling out a confetti-like shower of forms to get your guy to come out, move the meter, and recable!"
Finally, sensing he was on a loser (and about to receive a LARTing) he gave up on that tack.
We first asked for the meter box in January. It is now late May, and the meter STILL hasn't been moved. We are only doing this to benefit the municipal electricity company, and at our expense. I keep explaining this to them but it doesn't seem to make any difference.
Even Texas-New Mexico Power was never that bad.
Government is almost NEVER the answer. A government monopoly is orders of magnitudes worse than a private one in my experience.
Manx Telecom (the private telecom monopoly we have) despite their faults are a joy to work with by comparison. They have even acquired a clue when it comes to running an ADSL network. We did a similar job relocating the telephone line, to have it run underground. No forms to fill out - we just asked them to lay a new cable and they did it when they said they'd do it - no waiting lists and no bullshit.
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Around where I live, one can get a decent cable or DSL broadband connection for a fair price. However, to get optimal broadband, and I mean really optimal, you need to have a fiber-optic connection into every house. Think of how great that would be - streaming audio and video, ability to download whole CDROM ISOs in incredibly short amounts of time. (You really need that if you want to download RH8 and 9.)
The problem with this is that it's so darn expensive. Those fiber-optic connections have to be perfect. It's just too expensive to put that in on a mass scale. It would be great if the government could fund that. But you have to wonder whether society will really benefit from everyone having a super-fast connection. Would these fast speeds be used as a tool or as entertainment?
and bandwidth will be just another amenity, much like electricity, or gas, or telephones are now
Yeah, right.
Ever since so-called "deregulation" of gas and electric in Michigan (where I live), all of these have gone up. In the case of gas, wwaaaaayyyyy up. My broadband (cable) is $45/month and I only get one provider to choose from. When it becomes another "amenity", it may go up to $60.
Please pardon my skepticism, but it seems to me we will always be paying inflated prices for the sins (one of which is greed) of the telcoms, utilites, and Lord knows what else.
The problem with socialism is that they always run out of other people's money. - Margaret Thatcher
then you don't live in an area controlled by broadband monopoly.
I moved from NW Ohio to Burnsville, MN in November (I am now 15-20 mins out of downtown Minneapolis). I moved from an area that offered a steady 300kB/s cable pipe (TimeWarner RR) to an area that offered a 1.5mbs pipe (about 220kB/s steady with ATTBI)...
Comcast recently took over the entire region and raised my Internet rates (without CATV) to 60.95 from 46.95... Not only that but now I have download speeds in the 180kB/s range.
More money, slower speeds, and the same crap customer service...
Entertainment? Funny, I primarily use my broadband access for work. I guess that changes broadband access to a "Multiple-use" classifcation. Anyhow, your local/municipal government is already in the "entertainment" business -- they probably have a senior citizen's club, a little league team, some sort of recreation fields, maybe a new year's eve celebration...The list goes on. Just because you may only use your network access to play some poker game doesn't mean that other people may use it for other purposes.
As for the private sector handling your business, what do you think will happen in the next few years? DSL from several vendors will switch into Verizon DSL, and that's about it. All the other smaller providers will be muscled out, but that's another topic. You really only have the choice of two cable (most likely only one) providers, satellite is slow and is being phased out, and dialup is for webtv, or something.
The variety of choice for broadband is going to lessen over the next few years, so as i see it, it would benefit both myself and my community to have a network connection utility that would have to answer to the people (publicly run or regulated) rather than a private company whose main interest is profit.
As for big brother -- if someone wants to monitor you, they'll monitor you, whether you've got earthlink or anything else. Worrying about that is like pissing into the wind.
I work for a city govt in Texas, and if anyone in our public utilities customer service positions treated someone that way, they'd be fired in short order... but only if you actually bothered to prepare a formal complaint to the department. If the complaint is factual, well documented and is not a lunatic ranting, it is taken *very* seriously here. We've even had citizens bring their complaints (well prepared and "educated") before the city council as initial complaints, not going thru the normal departmental channels first, and let me tell you doing that usually gets investigative results FAST. It is a municipal employee's worst nightmare for a citizen to voice their complaint first to the council, so we make it well known at the service counters that if someone has a valid issue with a city utility, that they get priority attention from us, the staff.
The best example is the electric power generation and distribution in Québec (Canada). Since the early 1960's, electric power generation has been nationalized in Québec, and the result is the lowest electricity rates in the world, all the while paying-off the northern native communities on whose land the dams have been erected so well that, on the whole continent, they are the better-off natives (that's "indians" for you non-PC types).
Even with all this, it manages to pour billions of dollars in the government's coffers (that's so much taxes we won't have to pay).
Much of the revenue is made through exportation, and this is thanks to the hydroelectric nature of the generation system: unlike a thermic or nuclear power plant, a dam can be turned-off during off-peak times. So, during the night, we close the dams, and buy surplus power from the US at 2, while during the day, we open the whole shebang and sell our surplus at 4...
By contrast, Hydro-Ontario (which had been owned by the province for a century) has been privatized and the market "opened-up", just like in California. The result is a complete fiasco, as small businesses face 500% electric power cost increases (for electoral reasons, consumers have been guaranteed - at government expense - a lower fixed rate).
Come have a look up here, and whenever someone says that government-ownership is bad, you can safely answer back "bullshit", and then ask him why the roads and highways aren't owned by private entreprise to see him bumble...
The government doesn't have to be an ISP. I think they should be willing to help put in place infrastructure, like fiber lines, or whatever other kind of lines you want to use.
These lines can be used by any schmoe company to sell service. I used an example, in my previous posting, of roads. The roads are the infrastructure, whereas the actual service comes from Ford, Chevy, Toyota, or wherever.
The point of the whole story seemed to me to be that the telco companies aren't going to put up new infrastructure because at this point, (and forever at this rate) it's not profitable to do so.
If we have the government grant money to municiplaities to put the infrastructure in place, then they can sell to their heart's content all of the service they wish. In the end they would end up with a bigger customer base. How's that not good for business?
Speak for yourself.
This quote about "ultra-rural" Grant County PUD is somewhat misleading:
"In fact, in ultra-rural Grant County, WA, where users of the County's FTTH system have affordable access to speeds of 100 Mbps in both directions, bandwidth usage has jumped more than 600 percent and upstream usage actually exceeds downstream usage. Why? The County believes that small businesses are sending substantially more information to the Internet than they are downloading, and gamers are vastly increasing their real-time usage."
While it's true that the users are getting 100mbps access, they are *paying* for only 1mbps access. The PUD is simply too lazy (or incompetent) to limit the actual rates. Now that the PUD is running out of cash to continue rolling out the program they are still fighting any efforts on the part of service providers to actually rate-limit connections and use that to provide quality of service (and enough cash-flow to the PUD to pay for the program).
The other problems with public power doing broadband is their bureaucratic nature. These are not business people but salaried workers who are accustomed to a business model that does not include competition or the risk of going bankrupt. They have been tutored in a regulated monopoly environment in which the "bottom line" can often be whatever they want it to be. Here in Grant County they have apparently (it's hard to get a straight answer) raised the electric power rates to help cover the fiber rollout costs. This has enraged the agricultural interests who feel, with some justification, that those who will benefit most from fiber should pay the most to roll it out.
Additionally, the PUD here has entered into questionable contracts with favored service providers. There is at the present time an investigation into these dealings being undertaken by an "independent" Seattle-area lawyer. The word "independent" is in quotes because the attorney doing the investigation told me he is acting as the attorney for the PUD Commissioners with all the secrecy a client-attorney relationship can imply. Whether the results of this investigation, which could be politically damaging, will be released to the public is "entirely up to the PUD Commissioners", he said.
The Grant County PUD is hardly a shining example of local-control broadband. The PUD controls two hydroelectric dams on the Columbia River and will spend something over $200 million in their fiber project (no one yet knows the real costs). This is big money no matter how you look at it and allegations of sweetheart deals to special interests abound.
Broadband is expensive no matter who does it and no matter what a high-power lawyer in Washington, DC says. Trying to do it with a community effort might be successful or it might not be. There are many pitfalls and with so much money involved there is always the possibility of corruption and waste.
No one ever had to evacuate a city because the solar panels broke!