More than 54 U.S. cities own citywide fiber networks and another 79 own citywide cable networks, according to a new report from the New Rules Project, a program of the Institute for Local Self-Reliance. The ILSR also has made an interactive map available on-line that shows the location of each of these community owned broadband networks and enables users to click on a project to see project highlights.
The new report, titled “Publicly Owned Broadband Networks – Averting the Looming Broadband Monopoly,” makes a case for community ownership of broadband networks, arguing that cable and telephone companies have little incentive to upgrade infrastructure in certain markets.
“Even as we grow ever more dependent on the Internet for an expanding part of our lives, our choices for gaining access at a reasonable price, for both consumers and producers, are dwindling,” the report author argues in the report’s Executive Summary. “Tragically the Federal Communications Commission has all but abdicated its role in protecting open and competitive access to the Internet.”
Not all Telecompetitor readers will agree with those statements. But one of the more compelling aspects of the report is a series of mini case studies highlighting successful community networks, including:
- Kutztown Hometown Utilicomn (Kutztown, Penn.) saved residents more than $1.5 million in telecom expenses for the city
- Chattanooga Electric Power Board (Chattanooga, Tenn.), the largest community fiber network, is exceeding its triple play business plan goals and even supporting service up to 1 Gb/s
- Bristol Essential Services (Bristol, Tenn.) attracted a $20 million newspaper printing plant with modern broadband infrastructure
- Reedsburg Utilities (Reedsburg, Wisc.) broke even on its community fiber network years ago and now generates net income for reinvestment in the community
- WindomNet (Windom, Minn.) saved many jobs in the community over the years with its modern broadband infrastructure
A few unsuccessful community network projects have garnered a disproportionate amount of attention, and it’s important to recognize that some other community projects have had considerably more success.
Isn't it too early to tell. Most of these networks haven't been around that long and are in a honeymoon phase. Check back in ten years – that's when we'll know.
Actually there are several communities that have been out there for long enough time to show how putting very high bandwidth networks changed their community. If you look for example on several counties in WA like Grant, Mason and Douglas deploying fiber based network created an economical growth and attracted companies like Microsoft and Yahoo to the area.
Such an economical growth is an incentive to community owned network more than to a local cable or telephone company operator.
Here's a list of 10 community networks, most of which have been around for 5 – 10 years or more – http://bit.ly/Ejg6L. And there's more. This column deconstructs the myth that muni networks are all failures. Far from it – http://bit.ly/gWFC1j. And this article on the state of broadband in Washington, DC shows why community networks are a good idea in urban areas that are supposedly well served – http://wapo.st/hDfxGp. The disparities described here are part of the reason DC got broadband stimulus money to build community infrastructure.
So exactly where should for profit service providers serve? The moon?
Well, for starters, there are plenty of communities private sector companies won't serve at all. So it would be nice if the incumbents such as Time Warner in NC would stop acting like jackasses and let those communities do their thing. Then there are places such as Keen, NY and Franklin County, Va where the communities partner with private sector companies to give companies the financial boost they need to build a business.
There's a growing interest in creating arrangements in which the communities own the infrastructure and service providers offer services. Everyone wins. The problem is too many private companies lack vision or have an inability to drag their minds out of mid-20th Century thinking. The mantra of free market has become an anchor and chain about their ability to find creative solutions for a changing world. Sort of Neanderthal meets Einstein. It's not a pretty picture.
So is there any example by your standard, where the free market works, and private sector companies can offer services independent of community partnership, without the community 'suffering?'
Some markets are freer than others. Telecom infrastructure is a natural monopoly due to its high CAPEX and OPEX costs.
For-profit are free to serve anywhere under current regulations. Most community networks serve a community with at least one incumbent provider. And some providers, like HBC in Minnesota, are unlikely to ever have to deal with a community overbuilding them because they actually do a fine job meeting community needs.
Sort of like private and toll roads. Only where needed.
Instead of privatizing our entire road/highway infrastructure and having every road a toll road for private profit – think of the transportation system as common carrier, public infrastructure. We need basic transport networks that meet the essential needs of society.
Private networks should be like private roads – where needed and not instead of public roads.
Existing US networks are built with ratepayer funds and corporate welfare from local/state federal governments … not a lot of integrity in claims that essential communications infrastructure is private property …
Craig is simply anti-business. He wants to wipe out free enterprise in favor of government-controlled, taxpayer funded monopolies.
Probably everyone here knows this, but Brett spends his time running around the net alternately accusing people of hating businesses and being funded by Google to destroy the American way of life.
"Free enterprise" is not how a rational person would describe monopoly/duopoly providers whose profit depends on corporate welfare!
For those who advocate the open community networks, there’s one big detail which I’m trying to get square with. What do you do with the thousands of existing private sector service providers and the billions they’ve invested? What would you suggest we do with them once all these open community networks appear?
It is not an easy question. What was to be done with the typewriter manufacturers and operators? They even had a great union. Things change.
In most cases, the networks built over the decades have long been amortized. Major companies like AT&T and Comcast have had a sufficient ROI that I think it more valuable for us all to move into the future rather than be stuck with whatever they deign to offer.
Successful service providers will thrive on an open network despite their inability to limit competition by controlling the infrastructure. Those who cannot compete, won't. These major companies constantly talk about how they are so competitive, so I'm sure they'll have no problem adjusting when people have a real choice.
I'll jump in here. I don't think this is an all or none situation. There is certainly room for both approaches. For example I would argue a telecom cooperative is a community owned network, of which there are hundreds in the U.S., some of which have been around for a 100 years or so.
This new breed of community owned open access networks looks interesting, and I'm sure has a place in the overall scheme of things. That doesn't negate the need for private sector companies and investments. There's plenty of room for both and great successful examples of both as well.
A challenging question that really impacts all of this, that few want to (or know how to) wrestle with is the current flow of population from more rural areas to less rural areas. Everyone wants to save their community and make it sustainable. In reality, not everyone will be able to do that given population trends. Being raised on a farm and valuing all I learned there, this is hard to absorb, much less accept, and I imagine that is the case for many.
Yes, I know that communications infrastructure is a large tool in the economic development tool kit. I was involved with projects like those starting back in the early 90s. Some rural communities are better off with private sector companies providing the service; some are better off with a public-private partnership. In my experience those are the best two options in rural and semi rural communities given the type of leaders that exist in rural communities.
I know some have made community networks work very effectively, but I have no direct experience with them and therefore I cannot comment directly about what has made them successful. I would guess that they had the good fortune of bringing together a collection of the right people for those situations to make it work for them. That might happen in rural and semi rural areas, but usually this is an area where a great public/private partnership can thrive.
An interesting fact from rural SE MN – the places in which HBC (a private company) has built its FTTH networks, population decline ceased and modestly grew. Not clear if all rural communities had this tech what would happen to the trend though.
Local government investments in broadband infrastructure does not automatically equate to an anti-business government monopoly. Projects like nDanville, The Wired Road, Palm Coast FiberNET, and Utopia operate as digital road systems: communities build the roads, but the private sector offers the services transported on those roads. In these projects and other open access networks, no one is buying TV and telephone service from the local government. They have a choice of private sector providers to choose from, and we are seeing cost reductions of 50% to 60% for business and institutional customers, including local government–saving taxpayer dollars.
It's nice to know so many readers are interested in this topic and are so engaged about it. It seems to me that the ultimate question in determining who is in the best position to get a local fiber project off the ground is directly related to who has the best local focus. Some telcos do a great job of focusing on the needs of the community. Others, not so much.
There is a way for the public and private sector to coexist amicably in building community networks. A community should establish a community development co-operative made up of all the residents, businesses and institutions, one vote, one share. The same co-op would own controlling interest in an enterprise which would build an open access network and/or community media center while allowing for competition and local investment with 49% of the enterprise being available for equity investment purposes. In this way, a private/public partnership has been established keeping the diverse community interests and personalities out of the actual running of the enterprise. The local incumbents now have a way to increase their business while also having an exit strategy. Dividends could be passed back to the co-op. The model is not unlike Native American enterprises where tribes own casinos, fisheries, lumber companies, etc. which are in turn controlled by a board of directors whose majority is made up of tribe members, not necessarily members of the band council.
Furthermore, the co-op could also establish a community foundation through which grants could be applied for as well as receiving USF and local philantrophic gifts. With the privatized Federal Reserve being in such dire straits, the community foundation could go so far as to have its own currency to foster and measure local buying. Why not even create a local co-operative community bank? Some of the detail and links I have put up under http://communitydevelopmentcooperative.wordpress…. with a running commentary in the form of posts on my own endeavors in my community of Maple Valley, Washington.
find it quite interesting when one looks in the areas around the world where there is unrest ..the internet or lack there of gives one the sense of importance of an open internet for all…reading the wonderfully thought out comments (even the one's I disagree with) in this post …shows the diverse perspective of our country…NOW HAVING SAID THAT…it is ludicrous to think that for profit companies should or have the interest and needs of anyone or anything but there very own Stated goals ….we (the general public) don't share in any of the P AND L activities of major companies (unless we are in fact shareholders)..period (except for maybe one of the previous commenter) ….the fact is most of the major government spend ( for tech service ) goes to those same big companies who are crying for "protection of private capital spent on infrastructure"…then we (the people) are asked to spend for access "get this" …from those same companies even to access govt related sites…NICE WORK IF YOU CAN GET IT …it says here internet should be free to all…not the great services that the big companies sell us (duh) BUT THE KIND OF LIFELINE SERVICE WE GET HERE IN NYC where everyone regardless of economic condition can access the community broadband network ….what is really important is THINKING AND finding out the box ways to HELP PEOPLE HELP THEMSELVES ..to earn a living and become better educated …everyone should have a computer IN THEIR HOME that should be the focus not trying to justify doing something that looks like a for profit business ..duh period end of story…
I believe if Municipalities were to enable vs. compete with the 2-3 local providers, in a collaborative construction effort to upgrade from copper/coaxial to fiber, where it does not exist today, all would be better served. I see today's situation very similar to the predictament US and Foreign Carriers found themselves in when trying to figure out how to upgrade copper to fiber in the ocean. They put their differences to the side, and got it done.
That is the foundation of my business model that I share at my website, at http://www.lightthewaysolutions.com. I see our neighborhoods as the new ocean shoreline..that is where we do not have fiber.
The most hilarious boondoggle in municipal networks is probably the million dollar fiber network in Santa Monica that has nine (9) users. You know some palms were greased to get that baby going.