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Spanish Fork Network Brings a Generation of Savings and Community to Utah - Community Broadband Bits Podcast 416

This week on the Community Broadband Bits Podcast Christopher talks with John Bowcut, Director of Information Systems and Network Director for Spanish Fork Community Network in Spanish Fork, Utah. As John approaches the end of his career he reflects on the network's founding, its success over the last two decades, and the missed opportunities which stemmed from a 2001 law limiting municipal networks. 

That Spanish Fork has achieved an impressive level of success is revealed by the numbers. In 2013, the utility had already paid off the majority of its debt and enjoyed a take-rate of 60% of the community of 35,000. In 2015, it began a fiber buildout to replace the hybrid fiber-coax neighborhood by neighborhood. By refusing to take on any new debt and focusing on neighborhoods with the most interest, the network was able to spend about a million dollars a year over the last five years, and is close to completion. Today SFCN enjoys a take-rate of 78% on its Internet service in the city of 40,000, with some neighborhoods subscribing at a rate of almost 100%. It continues to save Spanish Fork over $3 million a year, adding to the tens of millions it has already saved the community.

To what does John attribute their success? Community. Finding qualified, passionate people to build a network dedicated to the needs of people and businesses in the surrounding area. He highlights the utility's customer service and responsiveness to its users needs. Christopher and John consider the success of SFCN in the context of the the long-term consequences of HB 149, which in 2001 installed signficant new hurdles by preventing new municipal from providing services directly to residents and businesses like SFCN does. Finally, Christopher and John talk the importance of marketing, and using it as a way of forging community connections and creating messaging that fosters dialogue. 

Listen to Episode 60 or Episode 170 of the podcast for more on the Spanish Fork Community Network.

This show is 30 minutes long and can be played on this page or via Apple Podcasts or the tool of your choice using this feed

Transcript below. 

We want your feedback and suggestions for the show-please e-mail us or leave a comment below.

Listen to other episodes here or view all episodes in our index. See other podcasts from the Institute for Local Self-Reliance here.

Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license.

Promo Video Highlights Spanish Fork Network

Spanish Fork, Utah, was recently highlighted in a promotional video touting the successes of its municipal Internet service. The video, produced by the trade group Internet Association, is all about economic development and growth -- something this community of nearly 40,000 has seen since the municipality introduced the service back in 2001, and then subsequently upgraded to fiber.

As the mayor of Spanish Fork notes in the video, before the municipality established its own network, incumbent providers wouldn’t invest in broadband infrastructure in the city. Inadequate Internet access would have pushed out businesses in the community. A number of small business owners are featured in the video, and all emphasize how integral high-speed Internet has been not just for orders, but social media promotions.

The video also features U.S. Senator from Utah Mike Lee, who spoke to the business owners in the area. He concluded that an open Internet needs to be supported, not suppressed, by lawmakers such as himself:

“Our biggest most important task as lawmakers is don’t wreck the Internet, don’t interfere with the Internet," Lee said. "Leave it alone, allow it to be what it has been, what has made it such a wonderful thing, which is a free marketplace.” 

Check out the video here:

We spoke to the network director for the municipal, John Bowcut, back in 2015. At the time of the interview, Bowcut said that the ISP had a take rate of about 80 percent, mainly because they were able to keep prices much lower than the incumbent Comcast. You can check out Christopher’s entire interview with Bowcut here.

Digital SouthWest Videos Now Available

You might not have made it to Mesa for the Digital Southwest Regional Broadband Summit, but you can now watch some of the speakers and panel conversations. Next Century Cities has posted video from panel conversations and the keynote address from Commissioner Mignon Clyburn.

In her address, Commissioner Clyburn said:

“Access to high-speed broadband is a necessity in today’s 21st century economy, providing a gateway to jobs, education, and healthcare. I am honored to join state and local leaders who are on the front lines of closing the digital and opportunities divide. Working together, we can achieve our shared goal of affordable broadband for all Americans.”

The Commissioner’s full remarks were about 18 minutes long:

 

Sharing Knowledge on Infrastructure 

Christopher moderated Panel Two, focused on infrastructure needs, which included CISSP President and CTO of CityLink Telecommunications John Brown, Partner at Conexon Jonathan Chambers, Director of Technology at the Southern California Tribal Chairmen’s Association Matt Rantanen, Manager of Tribal Critical Infrastructure at Amerind Riskand Kimball Sekaquaptewa, and Vice President of Digital Innovation at Magellan Advisors Jory Wolf. If you listen to the Community Broadband Bits podcast, you’ll probably recognize most of these voices.

The video lasts one hour thirteen minutes:

 

The other videos are available on the Next Century Cities YouTube channel page, or watch them here.

 

Welcome and Introduction: Deb Socia, Executive Director of Next Century Cities and Eric Farkas, Fujitsu Network Communications, 7:32

Op-ed: Spanish Fork Proves Utah Law is Counter-Productive

The Salt Lake Tribune published this op-ed championing local investment in Internet infrastructure on December 11, 2015.

 

Op-ed: Spanish Fork’s success shows municipal Internet networks work

By Christopher Mitchell

For nearly 10 years, large telephone and cable companies have claimed municipal Internet networks are so risky that local government authority should be restricted. But after 15 years of experience, we can only conclude that the cure is worse than the disease.

Utah has three municipal networks, where local governments invested in Internet infrastructure to provide choices in a monopolistic environment. But only two of those networks are regularly discussed and used as examples of why local governments shouldn't be in this business: iProvo and UTOPIA, which were not able to meet their financial targets.

The network missing from the conversation is Spanish Fork Community Network, which has just finished paying off its debt and has generated millions of dollars in surplus revenue for the community. The network is now upgrading from community cable to community gigabit fiber optics.

Of the over 450 municipal networks tracked by the Institute for Local Self-Reliance, Spanish Fork's experience is above average. The vast majority of municipal networks deliver benefits well in excess of costs and do not require subsidies to operate.

It may come as a surprise, but iProvo and Spanish Fork are nearly twins, separated at birth and raised in dramatically different environments. Both were conceived at the same time — the same consultant did the feasibility study for each. But Spanish Fork, being smaller and more nimble, was able to move forward before Utah's Legislature weighed in to restrict local decision-making.

Comcast and the predecessor to CenturyLink crafted the legislation, which was revealed in a brilliant 2011 BusinessWeek article aptly entitled "Pssst … Wanna Buy a Law?" by Brendan Greeley and Alison Fitzgerald.

Since then, any new Utah municipal network has been subject to numerous requirements unlike anything private providers face, including a de facto requirement to use a wholesale-only arrangement.

How Lobbyists in Utah Put Taxpayer Dollars at Risk to Protect Cable Monopolies

Facing the threat of municipal broadband networks disrupting their cable and telephone monpolies, big telecom lobbyists wrote a law to restrict municipal networks under the guise of protecting taxpayers. Here's the irony: the law put taxpayers at much greater risk even while restricting their choice of Internet and cable providers. Before Business Week became Bloomberg Business, Brendan Greely and Alison Fitzgerald published a remarkable story entitled, "Pssst ... Wanna Buy a Law?" It offers chapter and verse on the role of cable and telephone incumbents using the American Legislative and Exchange Council (ALEC) to push Internet anti-competition restrictions in many states. We have been reflecting on these laws that discourage or bar municipal broadband networks while drafting a brief for the 6th Circuit regarding the FCC decision to strike down monopoly-protection statutes in North Carolina and Tennessee. We realized that the Utah law isn't just anti-competitive, it dramatically increased the risk to taxpayers from building a municipal network in the state. The Debt-Financed Wholesale-Only Model Industry lobbyists convinced Utah legislators to restrict local authority over municipal networks to "protect" taxpayers and that argument is still frequently used today by groups opposing local Internet choice. The law does not actually revoke local authority to invest in networks, it monkeys around with how local governments can finance the networks and requires that municipalities use the wholesale-only model rather than offering services directly. However, the debt-financed citywide wholesale-only model has proven to be the riskiest approach of municipal networks. Building a municipal fiber network where the city can ensure a high level of service is hard and can be a challenge to make work financially. Trying to do that while having less control over quality of service and splitting revenues with 3rd parties is much harder. This is why we recommend either incremental efforts or subsidizing the upfront capital costs for those who want to use the wholesale-only model (which we continue to believe has tremendous potential).

Spanish Fork Building Gig Fiber over Cable Network - Community Broadband Bits Podcast 170

The Spanish Fork Community Network has long been among the most successful community broadband projects. And now that the community has finished paying off the debt of the network, they are using the net income to upgrade to a fiber network that will be capable of delivering a symmetrical gigabit to anyone in town. John Bowcut, Director of Information Systems and SFCN Director, speaks with us again this week to explain how the project is doing and how they plan to upgrade to fiber. 

They are pursuing a unique upgrade to our knowledge -- they are building fiber over the coax and will operate both. Telephone and Internet access will run over the fiber and television over the cable. The network has paid back its debt and continues to generate impressive community savings. With a take rate of 80 percent of the community, the network saves a cumulative $3 million each year. That is a lot of money circulating in the city of 35,000 people. We previously spoke with John in episode 60. You can read all of our coverage of Spanish Fork here

This show is 25 minutes long and can be played on this page or via Apple Podcasts or the tool of your choice using this feed.

Transcript below.

We want your feedback and suggestions for the show-please e-mail us or leave a comment below.

Listen to other episodes here or view all episodes in our index. See other podcasts from the Institute for Local Self-Reliance here.

Thanks to bkfm-b-side for the music, licensed using Creative Commons. The song is "Raise Your Hands."

Spanish Fork Upgrading to Fiber in Utah

Spanish Fork Community Network (SFCN) recently announced it is upgrading its cable network to a fiber optic network. The network has already started improving services by increasing speeds for the highest tiers at no extra cost reports the Herald Extra.

Residents and businesses in the town of approximately 37,000 have relied on the municipal cable network since 2001. Over the past 14 years, the network has come to provide triple-play to 80 percent of Spanish Fork homes.

Officials kicked off construction on September 3rd:

“We’re excited this is the next step for the SFCN network," [SFCN Director John] Bowcut said. "We’ve always planned on doing fiber to the home, and now we’re in the fiscal position where we can go ahead and install that for our customers."

Customers who choose to remain with the lowest tier - 12 Mbps / 3 Mbps - will remain on the coax infrastructure, says Bowcut, but will be switched to fiber if they choose to upgrade to a higher tier.

The city made its last bond payment for the existing system this year and will use newly available funds from retiring the debt to fund the upgrade. Assistant City Manager Seth Perrins describes the early deployment as "soft" so officials can obtain a better understanding of cost demands, construction management, and how long the project will take. They estimate the project will be complete by 2020.

According to Bowcut, Premium service that is now 120 Mbps / 15 Mbps will transition into symmetrical gigabit service for around $68 per month. PLUS service, currently 60 Mbps / 10 Mbps, will be upgraded to 100 Mbps symmetrical for approximately $45 per month. The Starter tier at 12 Mbps / 3 Mbps will remain $35 per month. All three tiers offer discounts when purchased with TV service.

Read more about Spanish Fork, one of the early municipal networks, and listen to Chris interview John Bowcut during Episode #60 of the Community Broadband Bits podcast. We have an updated interview with John ready for an upcoming podcast.

Spanish Fork Discusses Stunning Success - Community Broadband Bits Podcast #60

The Spanish Fork Community Fiber Network (SFCN) is an incredibly successful HFC cable network in Utah. It delivers television, telephone, and Internet access at incredibly low rates to most of the community despite competition from Comcast. Located south of Provo, Spanish Fork has a population of 35,000. Director of Information Systems and SFCN Director John Bowcut joins us for episode 60 of the Community Broadband Bits podcast. We discuss why they built the network in 2000. Funded with 15 year bonds, the network mortgage is nearly retired. In the meantime, the network generates an extra million in revenue for the local government and keeps over $2 million in the community each year with its low rates that force competitors to keep rates lower than they otherwise would. Read the transcript of this show here. We want your feedback and suggestions for the show - please e-mail us or leave a comment below. Also, feel free to suggest other guests, topics, or questions you want us to address. This show is 27 minutes long and can be played below on this page or subscribe via iTunes or via the tool of your choice using this feed. Listen to previous episodes here. You can can download this Mp3 file directly from here. Find more episodes in our podcast index. Thanks to Break the Bans for the music, licensed using Creative Commons.

Utah's Spanish Fork City Network an Incredible Success

Back in 2010, we reported on the municipal network in Spanish Fork, Utah. Back then, the utility innaugurated its telephone service, which completed its triple play offering. With recent discussion around Utah's UTOPIA, Spanish Fork is getting a second look.

A Cimaron Neugebauer, Salt Lake Tribune article, highlights the success of the Spanish Fork Communications Network (SFCN). When we last reported on SFCN, 60% of residents subscribed to its cable television and high-speed Internet service. Two years later, the numbers are even higher:

Spanish Fork runs its own municipal network to deliver telephone, cable TV and Internet services. The network has deep ties with the community and is popular with residents, nearly 80 percent of whom are customers.

"It’s exciting to live in community that invests in this kind of thing," resident Bret Bills said.

A combination of bonding and borrowing paid for the $7.5 million network including a municipal electric utility substation. Construction began in 2001. The investment continues to pay off:

Today, the city currently makes about $1 million a year profit from the service and its bonds of $600,000 annually will be paid off in 2015.

The network is a combination of fiber and coax cable. As is often the case, the community acted to fill the gap left by the failure of the private sector, involving the community along the way. From the SFCN website:

SFCN offers services that no other company will provide and can only be implemented by the public sector. The Spanish Fork Community Network has been established to serve the residents of Spanish Fork, not the interests of some large corporation.  We have involved the citizens of Spanish Fork since the systems inception through a local Citizen's Ad Hoc Committee and it has ensured the system is design to meet the needs of Spanish Fork.

Unlike UTOPIA, SFCN is able to offer retail services, having been grandfathered in at the time of the crippling Municipal Cable TV and Public Telecommunications Services Act.

Spanish Fork Telephone Benefits Community

Spanish Fork, a well-regarded community broadband network, is now offering triple-play services on its hfc network. Previously, the town was offering broadband and television but recently added telephone after feeling the time was right. From the article:
John Bowcut, director of Information Systems for Spanish Fork, said 15 percent of homes signed up when told telephone service was available over the cable. The network only used door hangers to advertise at first because it intended to have a slow rollout. Then the service was promoted in the city newsletter. SFCN's phone rollout was slow for a reason. Small neighborhoods were notified one at a time, which allowed the network to handle the load. Bowcut said they didn't want to open sign-ups citywide and then have to tell people their connection date was three months out. He said the most people had to wait this way was 10 days. Initially about 1,500 homes signed up for phone service, out of 5,534 homes in Spanish Fork.
The new telephone service runs an economical $14.95 with a variety of features. 75% of the town takes at least one service from the network, perhaps because of the great customer service:
Perrins was a beta tester for the system. He thought going through that process was awesome. They fixed every problem quickly and fine-tuned the network. "It was fun because the employees were so excited and eager to find and fix the problems."
Prior to the telephone rollout, only some 60% of the community took a service from the network, as explained in this article
About 60 percent of Spanish Fork residents already subscribe to SFCN's cable TV and high-speed Internet. The customer appeal of the city-run communications utility is that Spanish Fork provides both the infrastructure and the service -- a practice that was actually outlawed by the Utah Legislature in 2004, though Spanish Fork was grandfathered in. This means SFCN can cut out any middle-man service provider, which amounts to about $2 million in savings each year, Mayor Wayne Andersen said. "I think it was a sad day when the state Legislature put the kibosh on that sort of thing," Andersen said.