Roughly a year ago now, I spoke to the members of Gov. Roy Cooper’s broadband task force and noted how, from the viewpoint of anyone looking objectively at the issue of broadband access, the public-private partnership model advocated by NCLM is a “no-brainer.”
Obviously, a lot has happened in the world since then. The legislation that our organization backed, the FIBER NC Act, did not pass this year largely based on opposition by the larger incumbent telecommunications companies. At the same time, yet another of the major internet providers in the state, Frontier Communications, declared Chapter 11 bankruptcy, and on Wall Street there has been growing speculation that another, CenturyLink, will be selling its residential business after several years of retail home business contraction.
Even more recently, AT&T announced that it would be pulling back serving a thousand households or more in the state where it now provides aging and slow DSL service, meaning those homes could be left without service at all.
And, of course, these developments have occurred against a backdrop of the COVID-19 pandemic that has forced students and employees to learn and work at home.
If allowing local governments to bring their assets to bear in addressing the critical infrastructure issue of our time was a no-brainer in December of 2019, it is even more of a no-brainer in December of 2020.
It has simply become unacceptable and unconscionable that a handful of companies stand in the way of allowing this to happen almost a decade after banding together to block municipalities from building and operating their own systems, and proclaiming as they did so that they would address the digital divide in the state.
Despite taking hundreds of millions of dollars in FCC grants, they haven’t.
The implications are dire, not just for individuals, but for whole towns and their economic future.
What makes this public-private partnership model even more of a no-brainer is that there are small, home-grown companies in North Carolina that would love to be on the private side of these partnerships, connecting homes and businesses and running the retail service. To make the business model work, they need the fiber backbone or existing infrastructure that municipalities can bring to the table.
And let’s be clear. These types of partnerships would be fully open to the same companies in this state that don’t want them. They could participate. In fact, in Missouri, CenturyLink has partnered with the City of Springfield to bring lightning speed internet to residents there.
So, what’s the big deal?
It is that these larger telecommunication companies don’t want competition, even in the places that they poorly serve and are potentially walking away from. For some—loaded down with debt and left with aging technology—they do not have the financial wherewithal to make the investments that are going to close the digital divide and bring reliable, fast internet to all of North Carolina.
The time has come to recognize this reality. Doing so, the North Carolina General Assembly should make its first priority upon meeting in January passage of legislation that incorporates the principles of the FIBER NC Act and takes another substantial step in closing our digital divide.
After years of a community visioning project, and driven by the value of wanting equal access throughout the community, West Des Moines, Iowa has made the major decision to build an open conduit system to every address in its 65,000-population community, and to then lease conduit access to fiber ISP providers. Google Fiber will be its first tenant.
Enjoy CLIC’s October 14 interview with representatives of West Des Moines and Google Fiber in this 20-minute chat, including Jamie Letzring, Deputy City Manager, David Lyons, a key city consultant on this project, and David Finn, Director of Corporate Development for Google Fiber. We delve into the why and how this project is unfolding, and reactions it has generated.
To watch the conversation, click on our Zoom cast here.
To listen to the chat (and maybe exercise at the same time), click here.
We at CLIC thank Benton for this terrific collaboration and we’re cross-posting below the summary and introduction to the report from Benton’s Digital Beatcolumn:
Broadband networks rank among the most important infrastructure assets of our time—for purposes of economic development and competitiveness, innovation, workforce preparedness, health care, education, and environmental sustainability. In the brief 25 years since the advent of the commercial internet, broadband access has become foundational to the American economy and participation of everyone in the U.S. in our democracy.
The criticality of broadband was illustrated when the COVID-19 pandemic shut down the U.S. economy. Households with fast connections were able to continue working and attending classes online. Unconnected households found themselves more cut off than ever. If there were ever any doubt about the centrality of broadband to the national interest, the devastating pandemic erased this doubt. Yet the United States faces persistent gaps in broadband availability and affordability—as well as a troublingly noncompetitive broadband ecosystem in which most communities are served by only one or, at best, two high-speed broadband providers.
The persistence of these gaps demonstrates that private-sector investment alone is not closing our digital gaps. In rural areas of the country, in particular, there exists insufficient return on investment for private capital; as a result, broadband deployment does not emerge absent some form of public support. In less rural areas, competition is rare because return-on-investment challenges deter new investors from competing against existing monopolies and duopolies.
Given these difficult economics, even the most optimistic estimates are that only a third of American homes have access to all-fiber-optic networks. Fiber represents the holy grail of communications infrastructure, recognized as a future-proof technology for facilitating the bandwidth needs of homes, businesses, schools, libraries, institutions, and government agencies—and a necessary platform for advanced wireless services that require fiber to deliver high speeds.
How, then, can America’s communities secure the benefits of fiber-optic infrastructure?
Our answer is that local governments need not accept a binary option of waiting for the private sector to solve the problem—which the private sector already would have done if it made business sense—or taking on the challenge entirely as a public enterprise. Rather, public-private collaboration can disrupt this binary and give communities options. Indeed, in recent months and years, a range of collaborative public-private models—involving various levels of risk-sharing—have emerged and proved worthy of emulation.
In some of the most promising of these partnerships, the public entity funds, builds, and owns the underlying communications infrastructure and the private entity does the rest: It provides the electronics and service over that infrastructure and deals with the complexities of running a broadband business. This Public Infrastructure/Private Service model puts the locality in the business of building infrastructure, a business cities and counties know well after a century of building roads, bridges, and utilities. The model leaves to the private sector most aspects of network operations, equipment provisioning, and service delivery.
The level of risk (and potential reward) can be calibrated under the partnership terms to suit local conditions and community goals.
The Public Infrastructure/Private Service Model
Dark fiber is fiber-optic infrastructure that is not yet “lit” or put into use by a service provider.
“Public Infrastructure/Private Service” is shorthand to describe this model, and in most cases the public infrastructure is dark fiber. But in some cases, the infrastructure might be conduit for housing the fiber; in others, fixed-wireless technologies might supplement the fiber if local conditions warrant. In rare cases, the public fiber infrastructure might include the electronics, forming a public “lit” network over which partners can provide services over virtual circuits.
And alternative emerging approaches among other kinds of entities confirm the model, demonstrating the wisdom of the separation of function according to the partners’ capabilities and the most efficient allocation of responsibilities. For example, the collaborators could be private-private, public-public, and even cooperative-cooperative—but playing the same basic roles, with one providing infrastructure and the other providing service.
The Public Infrastructure/Private Service model leverages the best capabilities of the public and private sectors. In this model, cities and counties do what they’ve always done: finance and build basic infrastructure, manage rights-of-way, and maintain that infrastructure over long periods of time—ensuring that the entire community benefits from the infrastructure and that government functions can happen over fiber that connects municipal offices, libraries, public safety agencies, and schools.
At the same time, private entities do what they traditionally do well: run a business, engage in sales and marketing, handle customer service, and adapt to changing technologies and customer preferences. In some cases, public or cooperative entities ably perform these service roles in a partnership with their infrastructure collaborators.
This emerging model presents a scalable option for communities that lack the expertise or interest to operate communications networks or act as internet service providers themselves but want to own and control the core communications assets in their community as a means of securing the benefits of the broadband internet.
It should always be the prerogative of local community leaders to make their own decisions about whether and how to address the need for broadband in their communities. The Public Infrastructure/Private Service model is an option to add to their menu of choices: a pragmatic, community-driven, pro-market, pro-business approach to advancing broadband in communities where solutions have not already emerged.
CLIC represents a wide range of public and private interests that support the authority of local communities to make the broadband Internet choices that are essential for economic competitiveness, democratic discourse, and quality of life in the 21st century.
A new paper—authored by the Coalition For Local Internet Choice (CLIC) and published by the Benton Institute for Broadband & Society—defines and describes the model (and related variations, such as private-private and public-public) from both a business and a technical standpoint, and it summarizes case studies across the country of partnerships solving problems today. We provide a strategic overview of the basic Public Infrastructure/Private Service model and its variants, together with a framework for public-sector entities to consider as they evaluate potential technical approaches and levels of risk-sharing. And we address the key legal issues that arise in public-private partnership deals.
Fiber Now For America’s Future
Fiber optics represent the most scalable long-term broadband infrastructure option. For purposes of capacity, reliability, and scalability, fiber-to-the-premises is superior to all other broadband technologies. Despite some industry marketing claims, fiber-to-the-premises is superior to even the best of all theoretical wireless technologies. Fiber infrastructure represents a long-term, prudent investment for a public entity with significant potential use and impact.
But fiber will not reach everywhere unless communities actively pursue it. Rural regions, other low-density populated areas, and low-income areas of cities have seen far less investment in 21st-century broadband networks than have more densely populated, higher-income areas of the United States. This is part of the reason the economies of these areas can stagnate, young people depart for more promising locations, and communities decline.
CLIC warmly congratulates Matthew Rantanen, Director of Technology at the Southern California Tribal Chairmen’s Association, and CLIC Board Advisor, for being selected as the co-recipient of the IP3 Internet Protocol award. Matt will share this award with Geoffrey C. Blackwell (Chickasaw, Choctaw, Omaha, Muscogee Creek) who is Chief Strategy Officer & General Counsel for AMERIND and former founding Chief of the Federal Communications Commission’s Office of Native Affairs and Policy. Public Knowledge hosts the IP3 awards ceremony each year to honor those who have made significant contributions to technology and tech policy in the categories of Intellectual Property, Information Policy, and Internet Protocol. Matthew and Geoffrey are being recognized with the Internet Protocol Award for steadfastly fighting for broadband deployment and access on Tribal lands.
This year’s ceremony will be hosted online on September 24, from 6:30 – 8:00 pm. Tickets and more information on the event can be found here.
CLIC heartily congratulates Matthew Rantanen, Director of Technology at the Southern California Tribal Chairmen’s Association, and CLIC Board Advisor, for being selected as a winner of the Internet2’s 2020 Rose-Werle award. Matt is known as the Cyber warrior for Tribal broadband.
In receiving this award, Matt was recognized for his leadership in extending high-speed broadband services and advanced technology to community anchor institutions on tribal lands. Under his leadership, the Tribal Digital Village Net has resulted in more than 650 miles of internet connections to 105 key tribal community and administration buildings, EPA departments, fire stations, law enforcement facilities, utility departments, libraries, schools, Head Start programs, and tribal homes. Matt also recently facilitated the connection of 14 Native American tribes in Southern California to the state-of-the-art research and education international Internet exchange, Pacific Wave, via CENIC. This new connection enables their tribal libraries, scientific research facilities, and cultural preservation institutions to collaborate with partners around the world.
The Rose-Werle Award is
named in honor of Richard Rose (1947-2007) and James Werle (1971-2018), early leaders
in the national Internet2 K20 Initiative, now part of the Internet2 Community Anchor Program (CAP), who tirelessly advocated for extending the Internet2
Network and advanced technologies to students, libraries and community
institutions. The Award is given annually based on criteria such as commitment
to the vision of the Internet2 Community Anchor Program, recognized innovation
in the community, and leadership and mentoring qualities.
This, I believe, is our broadband moment: a hinge of history that will
determine whether today’s residential broadband is fit for the changed world in
which we inhabit or whether its limits work to disadvantage those that are not
equipped to use it.
For the good of all, each of us has been asked to stay at home as much
as possible. Broadband makes that bearable, connecting us to entertainment, to
family, to friends. Broadband also makes it possible for us, if we are lucky,
to continue to work and to learn. Most importantly, it connects us to health
services and vital information so we can stay safe in what feels like a very
But what about the millions of Americans for whom broadband does not
And what about those for whom broadband may not be affordable like
newly-unemployed workers, low-income students, and at-risk seniors?
And, of course, as we emerge into a changed world, what about our
ability to re-start the economy and reduce unemployment without setting off yet
We are facing a digital chasm that will emerge if we do not act and the
cluster of digital divides gets larger, longer-lasting, and harder to close.
The challenges are diverse – from connecting rural homes to providing
affordable service for low-income families, from people (of any age) seeking to
gain skills to enter the workforce to patients relying on telehealth, to
students receiving online instruction.
This is the time to invest in, plan for, and engineer High-Performance
Broadband for every person in America.
Three enduring principles should guide us:
1. Everyone in America should be able to use High-Performance Broadband by the end of the decade.
2. To do that requires a multifaceted and comprehensive broadband agenda.
3. State and local leadership are critical.
As Congress considers how best to recover from the COVID-19 pandemic
and jumpstart our economy, the multifaceted broadband agenda must address, I believe, four key areas: deployment, competition, affordability & adoption,
and community anchor institutions. (I hit the highlights here. More detail will follow in subsequent articles.)
To encourage broadband deployment that
finally reaches everyone, Congress should:
Fund the buildout of High-Performance Broadband (think 100/100 Mbps networks fit for the future) to all of America. Estimates are that this will cost $60-$100 billion.
Enlist the U.S. Department of Agriculture to help rural areas that lack broadband service today to formulate their own broadband plans.
To ensure communities reap the benefits of competition, Congress should:
competitive entrants, for example, rural electric cooperatives and
broadband providers accessing open-access middle-mile networks. Institute
public-policy that empowers competition in multi-tenant facilities.
Pre-empt states laws
that hinder the ability of municipalities to experiment with their own
Broadband networks become more valuable as more people use them, as the
recent health crisis proves. To make broadband service affordable and encourage adoption, Congress should:
For the first time, establish a targeted subsidy for fixed-broadband subscriptions, aimed at connecting low-income households and the newly-unemployed.
Fund job-related, digital skills training, with emphasis on middle-skills jobs and other jobs that will be key to our recovery.
Finally, our community anchor
institutions play a special role in ensuring everyone has
access to broadband. Recognizing this, Congress should:
Facilitate, at separate
expense, buildout of broadband networks linked to community anchor
anchor institutions to use their spare broadband capacity for communities.
The sooner we start to build a comprehensive broadband agenda the
sooner we will reap the benefits of building broadband networks.
Because, after this crisis, life will be changed. Already, 74% of
businesses plan to permanently shift to more remote work post-COVID-19. We must make sure we all can make that, and similar shifts, as well.
Let us be up to our moment, our broadband moment.
*Jonathan Sallet is a Benton Senior Fellow. He works to promote broadband access and deployment, to advance competition, including through antitrust, and to preserve and protect internet openness. He is the former-Federal Communications Commission General Counsel (2013-2016), and Deputy Assistant Attorney General for Litigation, Antitrust Division, US Department of Justice (2016-2017)
As the nation continues to ride out a pandemic that will persist for months, the need is acute for fast and inexpensive broadband rollout. Many communities have thrown up their hands because there are no LTE hotspots to be found on the market (the supply delay is many months at this point) and because network construction seems like it could take years.
But it’s important to know that you have options to deploy new facilities – options that can be exercised in days or weeks, not years. Earlier, we shared some ideas for using fiber, mmWave, and Wi-Fi to get services to the unserved. Today, we’d like to share more detail for how you can connect 1,000 or more households in a town or city for less than $500,000, possibly considerably less.
These rapid deployments would be engineered to provide broadband speeds (at least 25 Mbps download/3 Mbps upload) using backbone fiber, point-to-point wireless, and Wi-Fi solutions.
Every building or development will require custom analysis and design, but here we generalize for three development scenarios: small multi-family buildings, closely spaced single-family homes, and large apartment buildings.
Scenario 1: Free connectivity to small multi-family buildings
Let’s say you wanted to serve a collection of buildings of around two to four floors each. Each floor has four to six units and a shared hallway or other central area, which could be either outdoor (as will be typical in the South) or indoor.
We’ll assume that a lead stakeholder (perhaps the city or county, a local university, or a utility) has fiber to a location within a half-mile of this development. We’ll also assume that the lead stakeholder will take responsibility for installation, maintenance, and operations. And we’ll assume that the service will be delivered for free – so as to remove all barriers to use – thus also keeping operating costs low by eliminating the need for marketing, billing, and other back-office tasks.
The new facilities would include mmWave wireless equipment to bring bandwidth from the fibered location to the buildings to be served, as well as Wi-Fi access points on each floor, one for every four units, installed in the hallways so as not to require installers to enter private homes.
Our budgetary cost estimate for equipment and deployment (including installation labor but not including operating costs) is $500 to $750 per household, though the number could be considerably lower depending on where the fiber is located and the costs of labor locally.
Scenario 2: Free connectivity to single-family homes in a neighborhood
In a scenario where the residences are detached single-family homes, we will assume there is fiber and bandwidth available within one mile of central or “anchor” locations in the neighborhood. These central locations will, in turn, need clear lines of sight to the homes.
We further assume that each home is 300 feet to one mile (depending on the obstructions between the antenna on the building and the end user home) of the central anchor locations. If the home is more distant from the anchor, a community mast will need to be erected, increasing costs.
As before, we assume the municipality or other stakeholder is willing to do installation, maintenance, and operations and that the service will be delivered for free.
Here the network will consist of mmWave wireless equipment to bring bandwidth from the fibered building rooftop to the rooftops of the central anchor sites, at which, in turn, the bandwidth is distributed to Wi-Fi access points at each home.
A conservative budgetary cost estimate for equipment and deployment (including installation labor but not including operating costs) would be $500 to $1,000 per household – again with the potential for significant savings depending on local considerations.
Scenario 3: Free connectivity to larger multi-family buildings in an urban area
This scenario involves a large apartment building such as a high-rise public housing site. As before, we assume there is fiber and bandwidth available from a point-of-presence to a building within a half mile of the locations to be connected or, even better, to the building itself.
We also assume each building to be served is high-rise and that the rooftop is available and accessible to place mmWave equipment. As before, we assume the municipality or other stakeholder is willing to do installation, maintenance, and operations; and that the service will be delivered free.
In this case the network will start with a point-to-point wireless solution using mmWave equipment to bring bandwidth from the fibered building to the rooftop of the building to be served. From there, cabling from the mmWave radio on the roof will reach a switch in a secure closet in the building.
From there, bandwidth can be distributed within the building in one of two ways. The first uses existing wiring to each unit (which requires installation in each unit). The second uses Wi-Fi access points on each floor, one for every four units, installed in the hallways so as not to require installers to enter the residences.
The budgetary cost estimate for equipment and deployment (including installation labor but not including operating costs) would be $500 to $750 per household, with significant savings possible if the fiber directly reaches the building or based on other factors.
Benjamin J. Fineman, President, Michigan Broadband Cooperative
In a recent article from the Mackinac Center for Public Policy, titled “Bill Would Let Townships Impose Property Tax Hikes for Broadband Projects, author Dawson Bell reiterates incorrect talking points about House Bill 5673 that are designed to undermine the need for municipal broadband, all the while failing to mention that this bill is designed to enable public-private partnerships in rural areas through special assessments. The areas where broadband special assessments would be useful have a low population density such that incumbent providers will not build due to low returns on investment. Special assessments would enable residents to finance broadband infrastructure themselves, and partner with a private service provider to operate the network. This is not anti-competitive with private service providers. On the contrary, it enables them to provide service in areas where doing so was previously infeasible due to their return on investment requirements.
In his article, Mr. Bell
states: “A Washtenaw County lawmaker is renewing efforts to authorize
local tax hikes to finance government-owned high-speed internet infrastructure
projects, despite concerns that they may saddle taxpayers with losses.”
In reality, the special
assessment mechanism has very little risk of any “losses,” since funding of the
infrastructure is not dependent upon revenue. The author is confusing this
financing mechanism with revenue bonds, internal loans, and other vehicles that
require a certain take rate for the project to be solvent. The use of the
terminology “government-owned infrastructure” is intentional to evoke negative
reactions, as opposed to “municipal infrastructure”.
The article continues: “Theodore
Bolema, director of the Institute for the Study of Economic Growth at Wichita
State University, said that local governments can either use their regulatory
powers to favor their own projects or rework regulations to help private
companies. ‘Governments have no sustainable advantage in offering broadband, as
compared to private companies that bring far more experience from other
communities where they operate,’ said Bolema, who is a member of the Mackinac
Center for Public Policy’s Board of Scholars. ‘So the only way governments can
compete is by giving themselves regulatory advantages or by arranging for
taxpayer subsidies for their operations. Instead of building government-run
systems that drive off private alternatives, local governments could help
private companies obtain regulatory approvals and access to rights-of-way.’”
In reality, the main barrier to broadband deployment in rural areas is not government regulation but simple economics. Rural areas with low population densities cannot provide fast enough returns on investment to satisfy the requirements of for-profit companies. Local governments, such as townships, have little to no control over any regulations that would have any effect on broadband deployment costs. The assertion that local governments would “favor their own projects” implies a competitive scenario that does not exist in rural areas, and ignores the fact that the local governments in these rural areas want to partner with private companies to provide broadband, not compete with them.
The author continues: “Publicly
funded broadband initiatives have a poor record of success. A 2017 study
conducted at the University of Pennsylvania found that only 2 of 20 such
projects reviewed nationally earned enough to cover the projected costs over the
life of the network.”
In truth, this 2017
study has been widely debunked by industry experts (see here,
and here). The
study has been criticized for using limited and cherry-picked data,
erroneous assumptions, and flawed methodology to support pre-conceived
conclusions. As one example, the study claims that the municipal network in
Chattanooga, TN would take 412 years to “turn positive”. In reality, since the
publication of this study, the Chattanooga fiber utility has already paid off
its entire debt and extra revenue from the fiber service helps to keep electric
Such assertions also
conveniently ignore the significant community benefit of such projects, which
is the entire reason that municipalities undertake them, as opposed to the
profit motive of private companies. For example, a
2018 Harvard study found that in
Chattanooga residents could subscribe to Comcast’s service and receive 25 Mbps
download / 3 Mbps upload for $66.95/month, or they could subscribe to the
municipal service and receive 100 Mbps download / 100 Mbps upload for
$57.99/month. Residents now have access to a municipal service more than four
times faster than the private option, all while saving more than $100/year.
This same scenario plays out in the overwhelming majority of municipal fiber
Bell then falsely asserts:
“This poor record is probably due to the same local market realities that
cause officials to perceive a need for taxpayer funding in the first place.
Specifically, less-densely populated communities might not have enough
potential subscribers to justify the cost of installing high-speed fiber
networks. If there were, private internet service providers would install
Beyond this false assertion
that municipal networks have a “poor record”, Mr. Bell stumbles upon the exact
reason why municipal financing, such as special assessment districts, is a
helpful tool: private service providers motivated by profits will never make
the capital investments to build broadband in these areas.
Bell continues: “According
to the U.S. Census Bureau, nearly 9 of 10 Washtenaw County residents (88.6%)
subscribed to high-speed internet in 2017. But local elected officials there
have persistently sought to expand that number in the county’s rural areas. The
county commission has an active group called a ‘broadband equity subcommittee’
that seeks government-led solutions to a perceived deficit of broadband options
in rural areas.”
The implication from Mr.
Bell’s language is that this “perceived” deficit is not a real problem. Even
using the U.S. Census Bureau statistic cited, this would mean that 41,909
residents in Washtenaw County do not have access to broadband. It’s not clear
why the author implies that it is not important for these residents to have
access to broadband.
Mr. Bell then attempts
to criticize a township which has taken proactive steps to deploy its own
modern broadband infrastructure: “In 2017, voters in Lyndon Township, a
rural outpost north of Chelsea, approved $7 million in bonded debt to finance
universal local broadband access. The average taxpayer in the township has been
paying $22 per month for the system since 2018. Both users of the service and
those who do not use it are responsible for this amount. According to the
Lyndon broadband committee, by 2020, about 850 households have signed up for
the service (at an additional cost of $35-$70/month). Construction of the
network is scheduled to be completed later this year, a forecast clouded by
uncertainties related to work stoppages caused by the COVID-19 coronavirus
What Mr. Bells fails to
mention is that Lyndon Township residents will have access to 1 Gbps symmetric
broadband service for $70/month (or lower speeds for lower costs) where
previously most had access to nothing. Even when including the average millage
cost, gigabit broadband service for $92/month compares favorably to Comcast’s
gigabit service available in the neighboring City of Chelsea for $113/month. Also,
Comcast’s service is not symmetric, and includes only 35 Mbps upload speed as
opposed to Lyndon’s 1,000 Mbps upload speed. Comcast’s service has a 1 TB data
cap, while Lyndon’s service is uncapped. Again, this comparison is illustrative
only since almost no Lyndon Township residents had access to Comcast or any other
The article then attempts to persuade with herd mentality: “In 2018, voters in Sharon Township, also in Washtenaw County, resoundingly rejected a similar broadband property tax proposal of $4.9 million from a levy of 3.25 mills over 20 years. Lasinski said she believes the negative vote in Sharon Township was a consequence of many voters, who already had broadband service, rejecting the idea of subsidizing a broadband build out for their neighbors. Creating a special assessment district, in which only those within the prospective service area are required to pay for it, would obviate that concern, she said.”
What the article should have mentioned is that the main reason for the broadband defeat in Sharon Township was due to the political influence and disinformation campaign of a few large property owners, but it is correct that special assessment districts would be very helpful for townships that have significant areas with existing service, and is a good reason why this bill should be supported.
In conclusion, this article reiterates industry talking points that are not grounded in fact and fail to mention the value of using special assessments to increase broadband access. Special assessments would enable residents to finance broadband infrastructure themselves, and partner with a private service provider to operate the network. This is not anti-competitive behavior. On the contrary, it enables local communities and private service providers to provide service in areas where doing so was previously not feasible due to the private sector’s return on investment requirements. Now more than ever it is critical to enable more tools for broadband financing rather than artificially limit communities’ choices on working locally to close the broadband gap.
Ben Fineman is an advanced networking professional and community broadband advocate. Some years ago, Ben realized that many people in the U.S. do not have access to internet connections that allows them to participate in the most basic of online activities, let alone emerging technologies. This led Ben to co-found the Michigan Broadband Cooperative, where he volunteers as President and leads the organization toward the mission of achieving ubiquitous broadband in Michigan. Ben was also a key member of the team that led Lyndon Township through a community initiative that took this rural township from the limited choices of spotty DSL, cellular, and satellite services to in a township-wide municipal fiber network offering symmetric gigabit service. Since then Ben has served on county and state broadband task forces. He can be reached at: firstname.lastname@example.org. More on the Michigan Broadband Cooperative can be found at:http://www.mbcoop.org
by Jonathan Sallet, Senior Fellow, Benton Institute for Broadband & Society
I was General Counsel of the Federal Communications
Commission when it sought the preemption of state laws in Tennessee and North Carolina
that limited the ability of municipalities to promote broadband. We failed in
that effort, but the case laid out the key facts.
The FCC found that the provision of municipal broadband in
Chattanooga, Tennessee, led to lower rates, increased investment, and improved
service from an incumbent broadband provider.
Similarly, in Wilson, North Carolina, when faced with a municipal
broadband entrant, an incumbent cable company held rates flat even as it raised
rates in nearby geographic areas by up to 40 percent for comparable offerings.
By the FCC’s calculation, new competition saved Wilson’s approximately 50,000
residents more than $1 million per year.
This is a familiar story, known to the members of CLIC but not given sufficient attention generally. The Benton Institute’s “Broadband for America’s Future: A Vision for the 2020s” calls for an ambitious goal. That every person in America have the ability to use High-Performance Broadband by the end of this decade. To achieve that goal requires success in each of four building blocks: more deployment, greater competition, emphasis on affordability and adoption, and empowerment of community institutions.
The competition story needs to be told: We can expect people
with only one choice to pay monopoly prices, and people with only two choices
to pay the higher prices typically charged by duopolies. People with three or
more choices typically pay less. Clearly, people who can barely afford to pay a
competitive price, say, low-income Americans, are particularly vulnerable to
artificially high prices.
In fact, new FCC data (which we all know systematically
overstates the presence of fixed broadband competition) shows that, at the
typical speed of 100/10 Mbps, 80% of Americans have either no choices in
broadband providers (monopoly) or only two choices (duopoly). That’s very
Local communities should have the freedom to help their
people fully participate in a broadband world: learning, getting jobs, obtaining
healthcare online. This is not to say that one-size fits all; there are many
variations of public-private broadband partnerships. It is to say that empowering
local leadership and action is imperative.
Here’s a recent example: Alexandria, Virginia, has only one high-speed, fixed-broadband provider. As Alexandria Mayor Justin Wilson explains, lack of competition leads, he believes, to an inferior product. Moreover, small-business owners say that lack of broadband competition limits investment and makes Alexandria a less attractive location for businesses. One small-business owner, whose business requires the transfer of large data files, told Mayor Wilson that he sends his employees who live in other places home to send and receive files where their broadband is better than it is at work.
After confirming that the local telecommunications company
would not be expanding its fiber footprint, this past November, the City of
Alexandria issued an invitation to bid for the construction of a municipal
The idea is to build a fiber backbone that brings broadband
to community anchor institutions – including public safety, schools, and
libraries – but that will also lease capacity to private companies wanting to
serve residential and small-business customers. That’s an important strategy
because the network is, in effect, dual-use: providing immediate value for
community institutions and longer-term possibilities for residential service.
As Mayor Wilson explains, just serving the government buildings
with municipal fiber makes financial sense; the ability to serve residential
and small-business customers is a bonus.
Academic research tells us that more broadband competition
matters: pushing rivals to up their game, saving money for consumers,
increasing the quality of service.
The actions of so many other CLIC members and communities gives voice to the need to promote competition.
We’ve learned a lot from talking with CLIC and local communities. But we’re eager to gain new insights and I would appreciate hearing from communities (you can reach us at email@example.com) who have learned how to improve the broadband choices of their people. This is a story that must be told and it is rightly told emphatically by community leaders who understand their communities and the importance of broadband to their communities. And the Benton Institute will do our best to help tell that story as well.
This guest blog is co-published with the Benton Institute for Broadband and Society
We will be devoting three hours to a focused discussion
on actual partnership solutions between local communities and private partners
to solve our local broadband needs. Session 1: Models for Successful
Public-Private and Public-Public Partnerships will feature CEOs, business
development managers and innovation officers from Point Broadband, FACEBOOK,
Lexington, Kentucky. Session 2: Identifying and Selecting your Partner, includes
recognized private partners such as TING and Google Fiber.
And Session 3: Broadband P3s and Federal and State Incentives: A Force
Multiplier draws on federal
broadband experts, and state grant experts from Maryland and Virginia.