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Jackson, Tennessee, Profiled
Jackson is considered one of the most technologically advanced cities in the U.S. We have four competitors in the market with AT&T, Bell South, Charter and JEA. We computed that over $8 million to $9 million has been saved by residents in this city when compared to other cities of its size because of the competition.These are the kind of hard-to-quantify savings that too often go unnoticed in discussions about the value of publicly owned broadband projects. What is the value of competition? How much economic development has occurred directly from the JEA network and indirectly from the lower prices and greater investments that result from competition?
News from Communities - Seattle, Clarksville, Chattanooga, and Rutland
Communities around Rutland in Vermont are moving forward with a planned universal full fiber-to-the-home network. Interestingly, this network has been spear-headed by the Rutland Redevelopment Authority, not a local City Hall.
Back in Tennessee, the Clarksville Fiber Network is running ahead of schedule.
Having reached the 6,000-customer mark, CDE Lightband's broadband service is slightly ahead of schedule in adding new subscribers, an official of the Clarksville utility said Wednesday — good news for a telecommunications division, which is still in its infancy. Initial projections had the utility servicing around 8,000 broadband subscribers by next June. ... New installations usually have about a six-week wait, primarily because of high demand, Batts said.
Though demand is high, the goal of profitability is still a ways off — around 4,000 additional customers are needed to push the utility's telecommunications into the black, according to early department projections.
Seattle's new mayor campaigned on building a publicly owned, full fiber-to-the-home network. Reclaim the Media asks if Seattle will get its broadband 'public option.'
As Reclaim the Media noted last summer, the main obstacles to moving forward with next-generation fiber to underserved areas in Seattle are (1) money and (2) political will. The city budget remains in slash-and-burn territory this year; next year's budget would be the earliest that the new Mayor would be able to effectively push a significant new priority. This winter, however, Schrier's office will be able to apply for federal broadband stimulus funds to build out the skeleton of a citywide fiber network (possibly in collaboration with Seattle City Light), and to provide actual door-to-door "fiber to the premises" (FTTP) service to underserved neighborhoods in the Central District and Beacon Hill. McGinn's leadership will be key in making this project happen.
Charter to Cleveland, TN: You Are Not Sufficiently Profitable
Not too far away from Chattanooga, Tennessee, (home to the largest muni fiber network in the U.S.) lies Cleveland (Tennessee). Five prominent residents asked why they cannot get broadband:
The homeowners have discussed the problem with Charter Communications Director of Government Relations Nick Pavlis three times.
Pavlis said in a telephone interview it would cost the cable company $130,000 to run an underground cable 2 1/2 miles and “it’s just not a reasonable payback.”
He said the company spends $500 per house as a general rule, which gives them a 36-48 month return on investment.
Yet Charter has no problem lobbying the states to prohibit publicly owned networks. Tennessee probably has more fiber-to-the-home initiatives than any other state - perhaps it is time Cleveland looked into their own or cajoling a nearby network into expanding.
How Publicly Owned Networks Start
It’s important to understand that while it costs a lot of money to create a broadband network, over a five-to-ten-year period, it costs even more to operate that network than to build it. Say it costs $1 million to build a wireless network. During the municipal wireless heyday, it was estimated to cost 20% of buildout expense to operate the network annually – to pay for customer service, maintenance, upgrades, etc. That’s $200,000 a year.This is a great intro article for those who may not be used to thinking about the economics or business plans networks need. For the rest of us, it is a strong reminder of how many networks start (and a good path for those who want to create a network):
Santa Monica, California, had a legacy PBX phone system and slow connection circuits from incumbents. The city pooled money it was already paying for voice and data services, using this capital to build a fiber network and implement new communication technology. City CIO Jory Wolf states, “By switching to fiber we realized a $500,000 savings in data circuits and $250,000 savings in voice circuits, all of which stayed in our fund. Ongoing savings enabled us to provide our police with video streaming in their vehicles. We have excess bandwidth, so we provide (a) large number of sites with free wireless access.” Wolf said that the city is also selling companies fiber lines that haven't yet been turned on. “Our network budget is self-sustaining,” he said, “and I have $2.5 million in capital.”I remember Tim Nulty saying that Burlington Telecom started the same way. They figured out how much they were paying each month for telecom as a city.
Chattanooga Launches Nations Largest Public Full Fiber Network
Prices and Options
All broadband speeds are symmetrical; prices by month
Option | Price |
---|---|
15 Mbps | $57.99 |
20 Mbps | $69.99 |
50 Mbps | $174.99 |
15 Mbps and basic phone | $68.83 |
15 Mbps / basic phone / basic cable | $92.97 |
15 Mbps/ phone & 120 min long distance / 77 Channels | $117.24 |
Caveats: an extra $5.99 a month for HD Capability on the TV, but even the basic phone package comes with caller ID and 3-way calling
Johnson City, Tennessee, Considers Network
Statewide Video Franchising: Bad for Communities
Roundup: Chattanooga, Seattle, Portland, and More
A couple of short interesting stories this week:
The Chattanoogan.com published a "Declaration of Independence from Comcast", written by a "fi-oneer" or person who is testing the new publicly owned FTTH services.
Unsurprisingly, there are some glitches this early in the process, but the fi-oneer seems pretty happy with it overall:
The television is fantastic; we have a multitude of channels, both high def and non high def; local, 'cable,' sports, movies, etc. Contracts are still being completed with a couple of providers, so we are missing my favorite, HGTV. I have been told that it will be coming in less that two weeks.
Although as with any new product there are occasional glitches, but we have only had a few, minor not major ones, at that. The picture might freeze for a few seconds, or pixilate for a few seconds. There are some things you need to learn about the remote control.
Interestingly, early problems can actually help community networks. In Burlington, Vermont, early problems allowed the publicly owned network to demonstrate how good its customer service was compared to the incumbents and gained a better reputation.
More news out of Seattle - following up on our recent story noting Reclaim the Media's push for public broadband in Seattle, Seattle radio station KUOW's program "The Conversation" had some guests discussing the existing network in Tacoma and a potential network for Seattle. Follow that link to listen in, the relevant portion runs from 14 minutes to 21 minutes (a total of 7 minutes).
- Karl Bode at DSL Reports slams a recent report by incumbent-flack group Discovery Institute that concludes government regulation of broadband is unnecessary. Bode's response is worth reading, here is an excerpt:
Short Shots
Some shorter news items from this weeks' news:
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Salisbury may be a great example of just how a community should build a network. They have opened many chains of communication with citizens to keep everyone involved in the process:
To get the message out about their fiber-to-the-home cable utility now under construction, Salisbury city officials already have conducted radio, newspaper and magazine interviews.
The city also hopes to provide daily "fiber" updates on its blog (www.salisburyftthblog.com) and have a continuing newspaper advertisement called "Straight Talk about Fiber" in the Post.
Any community considering the hard path of building one of these networks should take note of how Salisbury is ensuring citizens know what is happening and why this network is important to the city's future.
Clarksville Department of Electricity (CDE) Lightband creates local careers as they roll out the FTTH network that will deliver triple play services. They also have a spiffy video:
This video is no longer availableGarn Anderson, of the Knight Center of Digital Excellence says "Smart Infrastructure starts with planning."
The success in and around Cleveland demonstrates not only the benefits of Smart Infrastructure, but also the reality that local communities are best equipped to implement today's fundamental need for infrastructure that empowers innovation.
He expands on those thoughts in a post on the Community Connections blog.
Nation's Largest Citywide FTTH Network to be Completed Next Year
"There are two primary components to building this system. One component is taking longer than we thought and the other is happening much faster than we anticipated", said Harold DePriest, President and CEO. "The end result is that services will be available to the entire cities of Chattanooga, East Ridge and Red Bank by summer of 2010." DePriest says once in place, EPB's fiber optic network will be the largest of its kind in the country.However, Chattanooga has suffered the same problem that has plagued other publicly owned broadband projects around the country: incumbent telco and cableco lawyers. Comcast has sued Chattanooga in multiple courts in an attempt to limit competition (see here, here, here, and here for a few examples). As with these cases across the country (from Monticello, MN to Bristol, VA, to Lafayette, LA), the incumbents have lost the cases but successfully slowed the build-out, which hurts the community while padding company profits for an extra couple of years. The network will offer symmetrical speeds of 10-50Mbps while keeping costs lower than the standard prices in the market.