Tag: "utility"

Posted June 24, 2014 by lgonzalez

The people of Huntsville recently decided to delve into the possibility of deploying a fiber network. According to AL.com, the City Council approved funding for a feasibility study to look at ways to better use existing fiber assets.

Huntsville, with 180,000 people is located in Madison County in the extreme north central region of the state. The county seat, known for generations as a cotton producer, later became known as "The Rocket City." In the 1950s, the U.S. army developed missiles at its facilities there, setting the stage for our space program.

A recent unscientific poll by AL.com revealed that a countywide high-speed network is a high priority for locals. The online poll suggested potential projects for the community; 40% of respondents ranked a network at the top of the list.

Huntsville Utilities offers electric, water, and gas services to the community. The municipal utility owns a small amount of fiber for its own data purposes. At this point, local leaders want the study to focus on the possibility of expanding that network to serve the business community. 

Mayor Tommy Battle said it is crucial to take a serious look at citywide, high-speed, fiber-optic Internet service, whether it is provided by Huntsville Utilities or a private company. Dozens of U.S. cities are already wired for speed, including Chattanooga and Opelika.

Battle called high-speed fiber "the infrastructure of the future" and said it will eventually be as important as roads, water and sewer lines.

Posted June 23, 2014 by lgonzalez

As the FCC considers its next move in the question of local telecommunications authority, a growing number of organizations are expressing their official support. The American Public Power Association (APPA) recently passed a resolution supporting the doctrine that local communities should not be precluded by states from investing in telecommunications infrastructure.

The APPA official resolution, approved by members on June 17, urges Congress, the FCC, and the Obama Administration to officially support the ability for public power utilities to provide advanced communications services. The resolution states:

That Congress should state in clear and unequivocal language that it supports the ability of local governments, including public power utilities, to provide advanced communications services that meet essential community needs and promote economic development and regional and global competitiveness. 

You can read the entire resolution, calling for updates to the Telecomunications Act of 1996, at the APPA website.

Posted June 20, 2014 by lgonzalez

Chanute City Commission decided on June 9th to take the next step to bring ftth to the community; Commissioners voted unanimously to pursue and finalize funding to deploy a municipal network.

The City's current fiber network provides connectivity to schools, hospitals, electric utility and municipal facilities, the local college, and several businesses. Chanute has worked since 1984 to incrementally grow its network with no borrowing or bonding. Plans to expand the publicly owned infrastructure to every property on the electric grid began to take shape last year.

At a work session in May, Director of Utilities Larry Gates presented several possible scenarios, associated costs, and a variety of payback periods. The favored scenario includes Internet only from the City, with video and voice to be offered by a third party via the network. Residential symmetrical gigabit service will range from $40 - $50 depending on whether or not the subscriber lives in the city limits. Commercial service will be $75 per month. Advanced metering infrastructure will also be an integral part of the network.

The Commission authorized the pursuit of up to $14 million to get the project rolling.

Posted June 6, 2014 by lgonzalez

Chanute has been exploring available options for a citywide FTTH network. In addition to offering residential service, city leaders want to expand the business use of its municipal fiber network. A limited number of businesses currently join schools, government, and utilities on the fiber infrastructure.

The community incrementally built a fiber network to serve government, utilities, and schools with no borrowing or bonding. The broadband utility continues to expand and uses WiMAX for public safety and to connect several businesses. For the full story of this central Kansas community, download our case study Chanute’s Gig: One Rural Kansas Community’s Tradition of Innovation Led to a Gigabit and Ubiquitous Wireless Coverage

As we reported previously, the City Council began reviewing potential scenarios to bring fiber to each premise. The Wichita Eagle reported that Utilities Director Larry Gates recently presented price and speed estimates to a City Council study session:

When complete, the city system will offer service at a speed of one gigabit per second.

City residents will pay $40 a month; it will cost $50 outside the city limits and $75 for businesses.

To put that in perspective, Chanute will offer the same ultra-fast connection speed as the Google Fiber system being rolled out across the Kansas City metropolitan area, but 42 percent cheaper than Google’s $70-a-month charge.

Or, to use another comparison, Chanute’s fiber-to-home system will be 14 times faster and cost 60 percent less than the best Internet service the town’s residents can get today.

Wow! And recall that this would not be possible if the cable lobbyists had their way earlier this year in the Kansas legislature. Kansas briefly considered making it impossible for communities to build their own networks and will likely take up the matter again next year.

We contacted Gates, who elaborated on Chanute's plan. The City will provide Internet only; a third party provider would use the network to offer voice and video. The service area will include...

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Posted May 21, 2014 by lgonzalez

Last December, we reported on Chanute's decision to move forward with plans for a FTTH network. The community has a fiber and wireless network in place that serves utilities, public facilities such as libraries and schools, and several businesses. The network also provides free Wi-Fi across the community. As we discussed in our 2012 case study, Chanute developed its network incrementally over two decades with no borrowing or bonding.

In a City Commission work session on May 5, officials reviewed several options for an FTTH network. In a nutshell, the City is contemplating their involvement in the operation of the future network.

Utilities Director Larry Gates presented several options, reported the Chanute Tribune. Two choices stood out for the working group members:

Scenario C calls for the build out of city provided fiber optic-to-home broadband internet services. Service drops would only be provided to homes that want the internet services.

Under Scenario C, the initial investment would be about $10,926,842 to build the fiber core. The city would need $9,468,033 in funding to complete the project. The project would become cash-flow positive in two years, one month. It would take five years, nine months to pay back financing for the project. The 20-year net present value for the entire system would be an estimated $40,623,151.

Scenario D calls for a build out of the fiber optic-to-the-home system for private communications companies to pay a fee to the city to lease the network and provide services to residential customers. The city would seek private companies for voice, video and internet services.

Under Scenario D, the initial investment would be about $13,906,416 to complete the build out. The city would need $9,468,033 in funding to complete the project. The project would become cash-flow positive in one year, seven months. It would take eight years, 10 months to pay back financing for the project. The -20 year net present value for the entire system would be an estimated $25,667,301.

Under an altered Scenario D, the City would lease out the network for five...

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Posted April 30, 2014 by christopher

Stop and think for a second. Would you regard the electricity grid and water system as an abysmal failure or success? If you are lobbying for cable companies in DC, you apparently think they are monumental failures.

Michael Powell, former Chairman of the FCC must be dizzy after his trip through the revolving door on his way to heading the national cable lobbying association. From his remarks at their cable show [pdf]:

It is the Internet’s essential nature that fuels a very heated policy debate that the network cannot be left in private hands and should instead be regulated as a public utility, following the example of the interstate highway system, the electric grid and drinking water. The intuitive appeal of this argument is understandable, but the potholes visible through your windshield, the shiver you feel in a cold house after a snowstorm knocks out the power, and the water main breaks along your commute should restrain one from embracing the illusory virtues of public utility regulation.

Pause for a second and think of the last time your water rate went up. Think of what you were paying 10 years ago for water and what you pay now. Compare that to anything you get from a cable company.

His point seems to be that because more regulated utilities like water and electricity are not PERFECT, regulation has failed and we should just let the private sector handle that. Well, some communities have privatized their water systems and the results have been disastrous - see a company called American Water in David Cay Johnston's book The Fine Print and also explored here.

Let's imagine if electricity was not tightly regulated and the market set the rates. How much would you pay for illumination at night? A refrigerator? Probably 10 times what you do now if that was your only option. Maybe 100 times after a few Minnesota winter nights. Market-based pricing for electricity would at least encourage conservation and efficiency, I'll give it that.

Public utility regulation is far from perfect but the alternative is far scarier. There is no "market" for these services over the long term. There is monopoly. And unregulated monopoly means...

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Posted April 16, 2014 by lgonzalez

By a 3,982 in favor and 1,397 opposed, the voters in Montrose decided on April 1st to take back local authority for telecommunications services. The state revoked the community's ability to establish a telecommunications utility in 2005. 

Jim Branscome covered the election results in the Daily Yonder. Branscome, a resident of Montrose, knows the local broadband situation:

Internet service here is currently a hodgepodge. Some of us depend on broadcast towers, some on DSL from CenturyLink and some on cable service from Charter. Service is generally at less than 10MB. It’s expensive, and customer service is erratic.

Community leaders state that they want to encourage fair competition and ensure every one has the opportunity to fast, reliable, affordable connectivity. 

In addition to ensuring that local businesses are in a position to compete with any large corporations that might attempt to establish a major share of the market, Turner said the city also wanted measures to enable lower income households to benefit from the advantages of gigabit speeds and capacity. “We don’t want to create two levels of society here, those who are connected and those who are not,” he said.

While Montrose is a long way from getting every person connected, the community is discussing the idea of financing a network with revenue bonds. 

This election result demonstrates Montrose's desire to be in control of their own connectivity. They understand the need to think of the future. From the Daily Yonder article:

It used to be that if a town wanted to prosper, it needed a river, then a railroad, then an Eisenhower Interstate highway, and then a cell phone tower. Today it needs to be a “gigabit city.”

Posted April 10, 2014 by christopher

Last summer we reported on Sebewaing, the community of 1,700 in the tip of the "thumb" in Michigan. At the time, Sebewaing Light and Water (SLW) was exploring the possibilities of deploying its own FTTH network. Like other small communities, Sebewaing could not get the service it needed from large corporate providers. We recently caught up with SLW's Superintendent, Melanie McCoy, to get an update.

The community released its RFP [PDF] and received responses from two bidders. McCoy tells us that in Michigan, such a low response rate allows the municipality to deploy its own network, so SLW decided to proceed.

The construction bid for the fiber backbone went to Earthcom, located in Lansing. Air Advantage successfully bid to supply bandwidth and the headend. Calix will provide the customer premise equipment that will offer data and voice services.

Sebewaing's network is 90% aerial and the final estimate is $1-2 million. The network will provide 1 gig capacity with the potential to expand to 10 gigs. Because the utility has its own poles and in-house expertise to handle labor, SLW is able to perform make-ready work themselves, lowering the final cost of the deployment. SLW will use an interdepartmental loan from its electric, water, and wireless utilities to fund the investment. According to McCoy, the RFP responses were both about $1 million higher than the final estimate.

In 2003, SLW began providing wireless Internet access to residents in Sebewaing so staff has experience as a broadband utility. They also installed a small fiber loop in the downtown area to serve businesses and municipal facilities. The old fiber loop will be retired because it has fewer strands and has been maxed out for some time.

The new fiber will replace connections between fifteen public facilities, including wells, public safety, and administration buildings. Each facility currently pays only $15-25 per month to be connected, saving thousands in yearly fees for leased lines from incumbents. Rates will not change, even though the new network will offer higher capacity.

Bandwidth is currently purchased as part of a consortium that includes the school district. The district...

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Posted January 29, 2014 by lgonzalez

Its extensive free Wi-Fi has brought Ponca City into the limelight but the mesh network did not appear overnight. The community effort began with miles of fiber network that provide connectivity and enable the mesh network financially and technically.

Ponca City, home to 25,000, is located on Oklahoma's north central border; Tulsa, Oklahoma City, and Wichita are all more than 90 miles away. The petroleum industry flourished in Ponca City until the oil bust in the 1990s and the population began to decline as workers moved away. Community leaders sought ways to salvage the local economy through economic development. They began to focus on the technology, manufacturing, and service industries.

The municipal electric department, Ponca City Energy, installed the first five miles of fiber in 1997 and five more in 1999 to connect outlying municipal buildings to City Hall. Line crews from the utility and the City Technology Services Department handled all installation to keep expenses down. The City continued to add to the network incrementally, exapanding it to over 350 miles. The network also serves the City's SCADA system.

In 2003, Ponca City Energy connected the local schools, and the Ponca City Medical Center to the network. The network also began providing Internet to the University Learning Center of Northern Oklahoma, now named the University Center at Ponca City. The Center collaborates with thirteen higher education institutions to provide distance learning in 48 online degree programs.

Ponca City eventually began offering Internet access via the fiber to commercial customers. According to Craige Baird, Technology Services Director, most businesses in the community purchase Internet access from the City. Revenue from commercial Internet customers, approximately $36,000 per month, pays for the wireless mesh network.

In 2008, Ponca City installed the wireless...

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Posted January 27, 2014 by lgonzalez

The Sun Prairie City Council met on January 14th to discuss a possible investment in a municipal fiber network. Thank you to local resident Jonathan Kleinow for alerting us to developments in the south central Wisconsin town.

The Star published an article about the meeting in which The Motive Group presented information to the Committee of the Whole. According to the story, the consulting firm has been working with Sun Prairie Utilities for a year to find ways to improve local connectivity and spur economic development with fiber. The community is considering the possibilities of a triple-play FTTH network for the areas 30,000 residents.

Sun Prairie Utilities solicited responses to a community survey. They received 700 responses with 88% in favor of a fiber investment. 

From the article:

The recommended plan put for[th] by The Motive Group has a total cost of near $27 million, with $21 million of that as year-one capital expenditures to serve roughly 13,550 homes and businesses in the city.

Budgeted in the initial year's expense total is $11 million for aerial and underground construction and equipment.

Once the fiber system is operational and available for customers, [The Motive Group's Beth] Ringley said projections show $9.97 million in annual operating revenue by year 20 of the system to go along with expenses of $1.26 million.

By year 20, total assets are projected to be at $27.16 million, with total cash at $12.56 million.

Councilman Jon Freund commented that he was opposed to the idea at first but that he now believes Sun Prairie Utilities and the City could partner to distinguish the community. From the article:

“Technology has become a greater and greater need for both businesses and residents,” Freund continued. “This is an opportunity for us to basically differentiate Sun Prairie from all the other communities in Dane County.”

...

He added that fiber installation would “put Sun Prairie on the leading edge” for...

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