Our Community Broadband Map documents over 400 communities where publicly owned infrastructure serves residents, business, or government facilities. We rarely hear of publicly owned systems sold to private providers, but it does happen once in a blue moon.
Accelplus, the fiber optic FTTH network deployed by Crawfordsville Electric Light & Power (CEL&P) in Indiana was sold earlier this year to private provider Metronet.
According to a July Journal Review article, the transition for customers began this summer with completion expected by the end of 2014. Metronet invested approximately $2 million in upgrades. Metronet will also offer voice services via the network; Accelplus offered only Internet and video.
In the past, we have found that networks that offer triple-play can attract more customers, increasing revenues. In states where munis cannot offer triple-play or administrative requirements are so onerous they discourage it, municipalities that would like to deploy fiber networks sometimes decide to abandon their vision due to the added risk.
A November 2013 Journal Review article reported that the network, launched in 2005, faced an expensive lawsuit commenced by US Bank. Apparently the network could not keep up with the repayment schedule for Certificates of Participation, backed by network revenue, that financed the investment.
Metronet purchased Accelplus and its assets for $5.2 million. The City also provided some economic development incentives. When all is said and done, investors are settling for a total of $5.6 million and the City avoids a $19.6 million lawsuit.
A February Journal Review article reported:
Metronet will receive a 10-year, $24,000 per year lease from CEL&P on property currently used by Accelplus. Metronet can purchase that property for $1 after the lease expires. Accelplus manager John Douglas has segregated those areas and provided AutoCAD drawings to Metronet.
Furthermore, CEL&P will lease 72 strands of fiber to Metronet at the rate of $24,000 per year for...