Tag: "lease"

Posted July 21, 2016 by alexander

Santa Clarita, a community of 220,000 in Los Angeles County, California, recently signed a dark fiber lease agreement with Southern Californian telecommunications provider Wilcon. The city hopes to improve high-speed Internet access for local businesses; this ten-year contract allows Wilcon to provide services via publicly owned fiber-optic cable originally buried for traffic controls. 

The New Agreement

From the City Council’s June 28th agenda, the new agreement includes the following:

  • Initial anticipated annual revenues of $72,256 based on $840 per year per fiber mile.
  • Annual fiber lease rate adjustment based on [Consumer Price Index] (CPI) for the Los Angeles area.
  • Initial anticipated lease of 86.02 total fiber miles.
  • City maintains control and ownership of all fiber at all times.
  • Lease of dark fiber is not exclusive to Wilcon.
  • City may opt out of the contract without cause after ten (10) years.

Santa Clarita and Wilcon can extend their agreement on identical terms for three consecutive periods of five years following the original ten-year term, leading to a potential contract length of twenty-five years. 

Using Existing Assets To Promote Business Connectivity

The third largest city in Los Angeles County is home to the Six Flags Magic Mountain amusement park, a handful of aerospace engineering firms, several medical equipment manufacturers, and a strong business community. Yet, local industry groups like Santa Clarita Business Journal (SCBJ) identified unaffordable Internet access as a major barrier for local businesses, as highlighted by its May 2015 publication

The City Council recently published its 2020 Goals, which include two Internet-specific objectives:

  • Work with the Economic Development Council (EDC) to provide recommendations and strategies on how to ensure high-speed Internet access to business parks.
  • Establish a revenue-generating program that utilizes existing infrastructure to...
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Posted July 6, 2016 by alexander

The city of Grover Beach, California, recently finalized a 10-year agreement with Digital West, Inc., to bring gigabit speed fiber to local businesses. The coastal town in San Luis Obispo (SLO) County wants to attract tech companies like those making waves in Silicon Valley and the "Silicon Beach" in Los Angeles. 

Terms of Agreement

The agreement specifies that Grover Beach will maintain ownership of the conduit system and lease Digital West conduit access at an annual rate of 5.1 percent of total fiber revenue. Digital West will build, own, and maintain the fiber-optic network, several lines of which will be leased to the city for public administrative use. Upon approval from both parties, the 10-year agreement can be renewed in 5-year increments.

A May 2016 Grover City staff report provided an optimistic forecast from Digital West:

The forecasted revenue amount speculated by Digital West Network, Inc. for the City is estimated to grow from a first year projection of $4,437 to $112,302 in year 10, for a total over the 10 years of $602,285. This amount is much higher than the originally predicted 10 year projection of $32,038 per year represented by Digital West Network, Inc. in 2014. The increase projections are due to the fact that they plan to add the residential market to our options which is projected to fall under the lease agreement. This brings greater benefit to the community, as well as more revenue commission to the City. 

We outlined the network’s projected costs in a story last year.

Fiber Surfin’ USA

The Central Californian coastal city hopes its unique location near a trans-Pacific cable landing station will attract scores of investment and cause the moniker “Silicon Dunes” to stick. Pacific Crossing’s undersea cable is part of a four point fiber ring connecting the Japanese cities of Shima and Ajigaura with Harbour Pointe, Washington, and Grover Beach.

Initial plans call for connecting the city’s 727 businesses. With little more than 13,000 residents and a city area of only...

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Posted April 30, 2016 by lgonzalez

Caswell County School Board members recently voted to take a long-term approach to student connectivity in North Carolina.

Ten Years Was A Lifetime Ago

Earlier this month, the issue of Internet access for the schools came before the Board because a lease with the telecommunications company connecting school buildings is about to end. Since the inception of the 10-year agreement, computer and Internet use in schools has skyrocketed; Caswell County Schools now aim to have every child on a computer at school. The district is now served by satellite Internet access to school facilities and in order to supply the speed and reliability they need, the Chief Technology Officer David Useche recommended a fiber-optic network to the Board.

Lease vs. Own

Useche offered two possibilities: 1. lease a lit network, which costs less in the first years of the contract but will not belong to the school district; or 2. pay more for the first five years to have a dark fiber-optic network constructed. The dark fiber network infrastructure will belong to the school district. Caswell County will use E-Rate to help fund the construction of the network, which will result in an overall long-term savings of $35,000. Useche told the Board:

“If we look at the projections for the Lit network, in ten years after E-Rate our cost is going to be $214,255. With the Dark network the cost is $178,729. The difference is a savings of $35,000,” said Useche, who added that the district will use $751,000 in E-rate funds to help build the network. Useche said that the State of North Carolina is using E-rate funds to build networks in some of its rural areas. “If we didn’t have E-Rate funds we could not afford either of these options. We are lucky to have them to provide the services the schools need.”

The Board agreed with Useche’s recommendation to approve the dark fiber option. The agreement will include 10 Gigabit per second (Gbps) connectivity for less than $100 per month more than 1 Gbps connectivity. “It’s not like we need ten gigabits right away but pretty soon we will need that much bandwidth,” said Useche.

Posted April 25, 2016 by Scott

Virginia Beach has launched a $4.1 million capital improvement project to extend the city’s high-speed Internet network to all municipal buildings. The network will also offer connection spots on the system for colleges, businesses, and neighboring cities, according to the Virginian Pilot.

The city (pop. 448,479) plans to more than double the reach of its municipal network, adding 73 more sites, including more police stations, fire stations, and libraries. Project work is currently underway and is expected to finish in the next year to 18 months. In addition to extending the municipal network, the project will include buying new networking equipment. The city is using money from its capital fund to pay for the project.

Once the project is completed, Virginia Beach will become the first community in the South Hampton Roads region of Virginia with its own Internet network linking all of its government buildings, the Virginian Pilot reported

Growing City Internet Needs

Virginia Beach started its municipal Internet network in 2002 with the local public schools. Since then, the city has invested a total $27 million to install about 225 linear miles of fiber-optic cable, linking all the public schools along with  “connecting many government buildings, including police stations, fire stations, libraries, recreation centers, and Human Services facilities,” according to a city news release.  

Today, Virginia Beach’s burgeoning Internet needs are fueling its municipal network expansion. The network helps maintain traffic lights, facilitates video conferencing, and provides infrastructure for email. A city spokesperson told us that 100 Megabit per second (Mbps) symmetrical service is available to most of the sites on Virginia Beach’s municipal network. 

Network Yields Savings

Once Virginia Beach’s municipal Internet network is fully implemented, the city will save about $500,000 annually in Internet access fees,...

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Posted February 22, 2016 by lgonzalez

Huntsville Utilities and Google Fiber announced today that the utility will construct a dark fiber network and that Google Fiber will offer services to the community via the city's new fiber infrastructure investment.

We applaud Huntsville and Google for helping develop an innovative model that will create more choices for local businesses and residents. We believe this is an important step that can lead to a true market for Internet access, allowing people a real choice in providers while ensuring the network is accountable to local needs.

Next Century Cities (NCC) describes the arrangement as a "promising new model for ensuring greater access to high-quality broadband Internet." We see this as a significant step forward in creating competition and bringing high quality Internet access to every one. For many years, we have seen communities desire to invest in infrastructure but not have to engage in service competition with powerful rivals like Comcast or AT&T.

Huntsville Is Different

Google Fiber is already known for bringing affordable gigabit service to subscribers in Kansas City and Provo, Utah and they have plans to expand in a number of other communities. Huntsville will be more than "just another" Google Fiber community because the infrastructure will belong to the community.

Other providers will be able to offer services via the network as well, ensuring more competition and providing choice for residents and businesses. Smaller providers will have an easier time establishing themselves in Huntsville with infrastructure in place on which to offer services. If subscribers are not happy with one provider, there is a good chance that there will be other options.

In Kansas City or Provo where Google owns the fiber network, the company ultimately decides where to expand. Here the Huntsville community can decide where to build the network. The utility will blanket the community in fiber, rather than building only in areas that have signed up a minimum threshold of subscribers...

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Posted December 16, 2015 by lgonzalez

Lincoln, Nebraska, population 269,000, is making the most of a tough situation to improve connectivity and increase telecommunications competition; the city is doing it with conduit.

The state has severe restrictions that ban communities and public power companies from offering telecommunications services. Local businesses, government facilities, and citizens must rely on the private sector to keep them connected. Faced with that limitation, Lincoln city leaders are enticing private providers with an extensive, publicly owned conduit network.

Using Tubes to Draw in Partners

In 2012, the city invested $700,000 to install a conduit system that has since grown to over 300 miles across the city. Over the past three years, Lincoln has leased conduit space to multiple providers, including Level 3 and NebraskaLink, which offer a range of services to businesses and anchor institutions. NebraskaLink provides backhaul for Lincoln's free Wi-Fi, launched in 2014.

Mayor Chris Beutler recently announced that Lincoln will be partnering with provider number six, ALLO Communications. This local company plans to be the first provider to use the conduit to build its gigabit fiber-to-the-home (FTTH) network to every home and business in Lincoln. The network is scheduled for completion in 2019. ALLO is based in Lincoln and offers telephone, Internet, and video to residents and businesses.

Smart Conduit Choices for Long Term Vision

Installing conduit is a major expense when constructing an underground fiber network. Communities which take advantage of opportunities to install conduit during excavation projects, traffic signal upgrades, and...

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Posted December 15, 2015 by lgonzalez

"We have fiber in the ground that is currently dark...It's a resource we have that other communities want," said Rochester, New York, Mayor Lovely Warren at a November press conference. The city is now working with Monroe County to take advantage of that dark fiber.

There are more than 360 miles of fiber under the ground serving public safety entities, suburban police and fire departments, libraries, schools, and public works facilities. In downtown Rochester, there is enough fiber to provide the redundancy that high tech companies need to establish operations. Over the past two decades, there have been several public works projects involving excavation. During those projects, crews installed fiber.

There are approximately 211,000 people living in Rochester, the county seat of Monroe County. The county is situated along the northwest border of the state, along Lake Ontario; about 750,000 people live there.

City and county officials estimate that more than 70 percent of the fiber network capacity is not being used. Local leaders are taking steps to change that. In November, the two entities released a joint request for proposals (RFP) seeking an expert to assess the current network and make recommendations on how to make the most of their investment.

At the press conference to announce the collaboration, Warren said:

The Rochester community is fortunate to have a substantial fiber optic network already in place. Very few cities have the advantage of this infrastructure in their city center. We need to be sure that its capacity is being used wisely and, ultimately, that this capacity is being used to help employers create more jobs. This fiber network gives Rochester a competitive advantage when it comes to attracting companies with high bandwidth needs and the jobs they bring with them.

According to Monroe County Executive Maggie Brooks and Warren, the city and county are hoping to work with private partners. At the press conference, they suggested leasing out capacity but they acknowledged that this is only the first step in a long process.

Posted October 29, 2015 by lgonzalez

Elected officials hope competition via city-owned fiber will give businesses and residents some connectivity headway in College Station, Texas.

The community will lease its city-owned fiber to local ISP, WireStar, in order to foster local competition. City Councilmember James Benham told KBTX that community leaders want high-speed connectivity for businesses and residents and want to create a competitive environment to encourage affordable prices. He described incumbent Suddenlink as "not always the best fit," pointing to the need for high-speed access in multi-family dwellings.

WireStar will begin by offering Internet access up to 1 gig download to businesses and large apartment complexes. Expansion to single-family homes will depend on the demand. WireStar is taking a similar approach as iTV3 in Urbana-Champaign - asking potential subscribers to sign up at their website and offering service in areas that show demand.

WireStar will pay more than $21,000 per year plus maintenance fees to lease the city's fiber; the partners have agreed to a 10-year agreement.

The city, located in the east central part of the state, is home to approximately 94,000 people and part of the Bryan-College Station metro where about 229,000 people live. College Station is home to A & M, along with laboratories for a number of research entities such as NASA, the National Institutes of Health, the National Science Foundation and the Office of Naval Research. 

Benham told KBTX:

"Competition is good for prices and for consumers and for businesses and for this case having multiple choices is good for them."

Posted October 14, 2015 by lgonzalez

Plans for a fiber network collaboration between the city, school district, and county will save hundreds of thousands of dollars in Stormlake, Iowa. The school district recently voted to take advantage of significant savings for connectivity by switching to the publicly owned infrastrucutre as soon as the network is ready.

The Storm Lake Pilot recently reported that under the current contract with Vast Broadband, the district pays $7,500 per month to lease two strands of fiber. The new arrangement will allow the district to lease 12 fibers from the city-owned network for $14,000 per year or $1,167 per month - a reduction of approximately 85 percent. The city and the school district will enter into a 10-year agreement to ultimately save the district a total of $760,000 or approximately $6,333 per month during the term of the lease.

The school will still need to pay for Internet access and as part of the agreement will be responsible for purchasing its own equipment. The School Board voted unanimously to approve the agreement.

As we reported in July, the Stormlake project began as a way to better communication between water and wastewater utility facilities but then evolved into a public safety and cost saving initiative. All three entities - Storm Lake Community School District, the City of Storm Lake, and Buena Vista County - anticipate considerable savings and heightened reliability. We expect to report on more public savings as the community uses this valuable fiber asset.

Project costs for the system of conduit and fiber, which does not include hardware, are estimated at approximately $1,374,000 to be shared by all three entities. This first phase of the project is scheduled to be completed by December.

Posted September 11, 2015 by phineas

The New York State Bridge Authority (NYSBA) expects to bring in over $900,000 over the course of the next ten years in revenue from dark fiber leases. The agreements, which allow private companies to access publicly owned dark fiber spanning the bridges, will also help maintain low tolls and allow regional telecom operators to expand their data transmission networks. The NYSBA announced on August 4 that it would be leasing dark fiber on two new bridges - the Bear Mountain and Rip Van Winkle bridges in upstate New York. These will be the third and fourth NYSBA bridges that generate revenue from fiber leasing.

The NYSBA dark fiber leasing program is now in its fifth year. Since the Authority does not receive any state or federal tax money for the operation and maintenance of its bridges, it has sought creative solutions to finance the upkeep of its infrastructure. It has now leased dark fiber on four of five intended bridges, with plans to lease more on a fifth - the Kingston­-Rhinecliff Bridge - in the near future.

In March, the Authority leased the Newburgh-Beacon Bridge to QCSTelecom, Inc. for $535,000. While such dark fiber leases are one-time fees, and usually last for at least ten years, the immediate benefit to the community takes the form of lower tolls for everyone who crosses the bridge. One editorial, posted in the Daily Mail, considered the locally-scaled benefits of the project:

Locally, we don’t have much to worry about from another toll hike in the immediate future. Although the lease won’t replace tolls as a principal source of revenue, it will help the bottom line and help keep tolls at current level. It’s clear that getting to the other side of the Hudson River can be costly over time and, as energy and transportation costs rise, we are not prepared for another toll hike. But with the success of the dark fiber leasing program, now in its fifth year, we can believe with some certainty that the drive to Columbia County won’t cost more.

The NYSBA’s strategy seems to be working at keeping tolls low - really low. Kathy Welsh reported in the Hudson Valley News Network that the $1.25...

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