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Vermont
Content tagged with "Vermont"
Associated Press Ignores Muni Broadband Successes
In September 2009, BT notified the Vermont Public Service Board that it had used $17 million in city funds in violation of its state license. State officials have been mum about the details of their investigation, and an FBI spokesman, through an assistant, would not confirm or deny a Burlington Free Press report that that agency had stepped in.
Vermonters Angry at Wireless Broadband Stimulus Grant Instead of Fiber Loan
Senator Bernie Sanders led off his “broadband town meeting” Saturday morning at Vermont Technical College with a ringing affirmation of the need for better broadband coverage in Vermont and the nation. However, nobody in the crowd of nearly 300 people needed to be convinced of that. What they wanted to know was whether a huge new federal grant to a private company was the right way to do it.VTel, a small private telephone company, received a $116 million grant to build a FTTH network to serve their existing 18,000 footprint as well as a wireless network that is intended to serve the entire state. In contrast, the East Central Vermont Fiber Network (which we have covered previously), applied for a loan to build a FTTH network to everyone in the 24 communities that have joined together to form the network. The ECFiber network would be run by a nonprofit and would repay the loan from revenue generated by selling triple-play services on the network.
ECFiber Launches Pilot Project
The pilot project will provide a solid foundation for the capital lease used to build out the rest of the network, providing 100% coverage in 23 towns in East Central Vermont. While the intent of the project is to prove that the larger project is viable, according to Nulty, “it will be able to stand on its own if we don’t raise another dime of capital.”The project is expected to cost some $80 million in total to cover the 23 participating towns. ECFiber has already obtained the necessary permissions from the State to offer video and telecommunications services. The Pilot Project targets the town of Bethel, where the central hub for the entire network is located. ECFiber is one of many groups that are using a nonprofit ownership model to build the network. The towns work together to create a nonprofit that will finance, own, and operate the network to ensure community needs are put before profits -- now and in the future. Update: The pilot project will only offer broadband and phone services due to the high fixed cost of trying to offer video services for such a small population.
Rules Matter - Burlington Telecom
- It has not passed the entire city within the timeline to which it agreed in receiving its Certificate of Public Good (CPG)
- BT has, apparently, borrowed $17 million from the city's pool (used generally for short-term financing of projects) in contravention of its CPG which states that any money borrowed from the City must be paid back within 60 days. This CPG condition makes running a network more difficult for BT than it would for a company like Comcast - who can readily self-finance short-term borrowing. Across the U.S., communities have to deal with laws and regulations that benefit private companies over public networks. When the economy fell apart, BT was unable to refinance its debt to continue its expansion and chose to borrow from the City to continue connecting new customers. This was the right decision - the CPG did not anticipate such conditions and the terms for outside financing in late 2008 were wretched.
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.
Rural Vermont Fiber Update
First off, compared to the VTel project, I'm immediately inclined to favor ECF's by the simple fact that they're a public project, which the original stimulus language suggested should get priority, and they're looking for a loan rather than a grant, and I think so long as a project will be self-sustaining, it's always better to loan money that you'll get back some day than to just give handouts of free money. I also prefer ECF's project because they're going to be bringing fiber to every home in their service area. They're not going to leave anyone behind, creating second-class digital citizens. Finally, I think that ECF's project has a greater chance of establishing a model that the rest of the country can learn from, proving both that fiber can be economical in rural areas and that open multi-service networks can be financially viable.Vermont was also one of the four states to receive the first awards for mapping broadband.
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.
What Can States do?
Fairpoint May Declare Bankrupty
In a filing with the Securities and Exchange Commission, the company warns that if the offer does not go through, it might not be able to make its interest payments due Oct. 1. In a worst-case scenario, it said, this could lead to "an alternative restructuring plan (that) may include a bankruptcy."If this were a publicly owned network, it would be championed by cable and phone companies as proof that those networks fail. We are not suggesting the opposite - that this is proof that all private networks in rural areas are doomed to failure, but it does offer evidence that a purely private sector-based model in rural areas is foolhardy. Verizon is now getting rid of more rural assets by selling them to Frontier - a company better poised than Fairpoint to handle them, but also a company known for offering slow DSL speeds with a 5GB cap. Communities that want to keep up with the rest of the world should look to themselves to build the networks they need. The private sector is either unable or unwilling to build the necessary networks to compete in the digital economy.
Tim Nulty Interviewed at 2009 Freedom to Connect Conference
Benoit Felten of FiberEvolution.com interviews Tim Nulty (former GM of Burlington Telecom, currently working on massive rural FTTH network in Vermont) at the Freedom to Connect Conference. Covers many topics, especially the economics of FTTH and why the public sector should invest in these networks.