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.

Comments

I have a dream, brothers and sisters

[caluml]

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.

Re:I have a dream, brothers and sisters

[Dutchmaan]

a single fiber serving 4 square blocks is plenty

..so is 640k...or so I hear.

Summary of the article in one paragraph

[floppy ears]

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).

Re:Summary of the article in one paragraph

[floppy ears]

Actually, I don't always blame the corporations. But in this case, they're apparently lobbying to prevent municipalities from doing FTTH. That's the downside of profit maximizing. Rather than creating "stuff" for the public good, they are spending money to control politics.

There have been some interesting economic studies of this phenomenon. To summarize, when companies start spending profits to secure more profits, rather than create new goods, the economy starts to go downhill.

Fiber Run Throughout the Town

[Matrix272]

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.

RIAA to dispatch field investigators to Grant Co.?

[djeaux]

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. That's good news for rural communities that are looking for ways to keep their kids from leaving.

No doubt, the RIAA will be moving field investigators into Grant County within the week. Must be a hotbed of P2P ;-)

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,

That is a pipe dream

[blcamp]

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.

Take you case before the City Council...

[Anonymous Coward]

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.

I think you guys are missing the boat here

[aldousd666]

Listen, to all of you compaining about big government:

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?

There can be problems with municipal systems too..

[SwedishChef]

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.