The City of Salem, MA and SiFi Networks have signed a $35 million contract for construction of a network using the open access approach that the builder says will break the monopoly providers hold on the communities in which they deploy networks.
The infrastructure developer will privately fund the project without taxpayer subsidiaries. The network will be used by multiple service providers, mobile carriers and the municipality.
The press release notes that the U.S. differs from most European and Asian nations in providing exclusive ownership of broadband networks, a scenario that, according to SiFi Networks, leads to local monopolies that drive up prices and reduces choice. The company claims that its model eliminates these drawbacks.
SiFi Networks has big plans for its “FiberCity” strategy. It says it has agreements in six states to fund, build and operate networks, though the number of actual projects is unspecified. The company says it has $450 million of capital committed for the coming months and an “unlimited pool of infrastructure capital to roll out the strategy to hundreds of cities in the coming years.”
“Traditionally, service providers who are also infrastructure providers look for a quick return on investment, so they tend to limit the construction of fiber networks to areas with a higher density of wealthy consumers,” SiFi Networks CEO Ben Bawtree-Jobson said in a press release. “This has exacerbated the country’s staggering digital divide. SiFi Networks has a different business model. We are interested in long-term investments, so we build citywide. We believe that excellent connectivity helps level the playing field.”
Bawtree-Jobson also said that SiFi Networks has identified more than 200 cities with more than 10 million households that fit its model.
The press release has no information on the timeline or other details for the Salem project.
In April 2019, SiFi said it planned to build an open access network in Fullerton, CA, using private funds. It said that broadband providers GigabitNow and Ting had agreed to use the network on a wholesale basis.
