Officials in the City of Ammon, Idaho, are moving closer to expanding their municipal network to residents with a Fiber-to-the-Home (FTTH) network. The FTTH expansion is the latest phase in their incremental approach in this community of 14,500 people in the southeast corner of Idaho.
Ammon’s Director of IT, Bruce Patterson, told us the history of the network’s development in a 2014 Community Broadband Bits Podcast. After starting the network several years ago with just a single link between two municipal buildings, the network gradually expanded the network to community anchor institutions. They also decided to serve businesses on a case-by-case basis. Since the beginning, the city kept its eye on its goal: to offer fiber access to every home in Ammon.
Ammon's FTTH Expansion Process
Ammon officials are acting prudently to gauge customer demand and wait for the necessary funding mechanisms to fall into place prior to additional construction. As we reported in August 2015, officials are asking residents to submit an online form to express their intent to sign up for service. City officials also held meetings with residents in September and October to explain the proposed expansion plans and give residents a chance to test out the gigabit speed service.
The city plans to extend residential service one large neighborhood at a time, letting customer demand dictate the direction of the expansion. The city will pay for the expansion entirely through service commitments from residents who choose to have a fiber connection extended to their home. This method will allow the city to expand without contributions from non-subscribers.
Patterson told us that the city is currently in the process of getting legal approval to bond on the FTTH expansion phase. He said he is confident the city will soon be approved for the bonding and anticipates that they will be able to put a shovel in the ground by May or June of this year.
What Will Residents Pay?
Ultimately, the exact price of getting an FTTH connection in Ammon will depend on how many people sign up; the more residents who sign up, the lower the prices will be. Details are still being hammered out, but Patterson gave us an estimate of what the city has in mind.
First, the city will secure a bond to pay for the expansion construction process. The city will then ask residents who want fiber connections to their homes to pay a fee that will go toward paying off the bond. The connected resident could pay this connection fee over a 20-year period as a property tax assessment of about $15 monthly. As Patterson told Chris in their most recent podcast interview:
"...[I]n terms of the financing for it, it seems logical that since fiber to your home raises your property value that we'd find some way to bond for that and put the payment for that bond as on assessment on your property tax because it does actually increase your property value so that's our goal. We do that with what they call a local improvement district."
In addition, the resident would pay a utility service fee to the city for operations and maintenance costs of the network estimated between $15-$25. Finally, the resident would pay a service fee to one of multiple ISPs that would provide service over the open access network.
Patterson estimates the total cost to a subscriber for a 100 megabit per second (Mbps) symmetrical connection would initially be about $60 monthly, similar to the price that Ammon residents currently pay for slower and less reliable connections from incumbent ISPs.
“I tell people they’ll be getting better service at about the same prices that are currently available for residential service in Ammon,” Patterson said.
The Ammon Model
Patterson created a new model for the network in Ammon called an Open Access Virtual Infrastructure (OAVI). According to a white paper describing how the model works, Ammon’s OAVI model allows consumers greater choice and control than traditional open access network models.
For example, a customer who’s unhappy with their ISP or their service package for whatever reason in Ammon will be able to visit the network website and quickly select a new ISP or make service changes from a highly customizable set of options. Patterson believes additional benefits of this OAVI model will emerge in future years as Internet service evolves.
More details about the unique Ammon model are also available in our Community Broadband Bits podcast #173 from October. There, you’ll hear Chris talk to Patterson and Ty Ashcroft, Ammon's Systems Network Administrator, about some of the unique freedoms this business model affords end users.