Muni Fiber and Politics

Wed Aug 6 01:31:47 UTC 2014

On 2014-08-02 15:15, Leo Bicknell wrote:
> But if those cities were to build a municipal fiber network like we've described, and pay
> for it with 15-20 year municipal bonds the ISP's wouldn't have to bear those costs.  They
> could come in drop one box in a central location and start offering service.

  I've mentioned it before, but UTOPIA in the Salt Lake City area is set 
up mostly like this -- it's a multi-city entity that built out the fiber 
L1/L2 using member cities' bond money, and allows ISPs to provide L3 
service over it.  Most of the ISPs offered 50/50 or 100/100 service, 
until UTOPIA upgraded their infrastructure to the point where 
gigabit/gigabit was viable (7/8 now offer gigabit).  As a customer for 
two years now, I can attest that the service is excellent, far more 
reliable than providers on other media, and priced at or below the 
closest alternative offering (which isn't all that comparable to begin 
with).

  Unfortunately, between aggressive lobbying by the incumbent carriers 
to prevent other cities from joining up (and thus providing greater 
economies of scale), mismanagement, political disfavor, and budgetary 
issues, it's left with an uncertain future.  There's presently an offer 
on the table for an Australian investment firm to step in, finish the 
buildout, and manage the network for 30 years to recoup their costs, but 
it's seemed to have made the entire project even more politically toxic, 
decreasing the likelihood of further funding/deployment.

  I attended my city's town hall meeting regarding the deal; it was 
genuinely hard to tell whether some of the concerned citizens were 
corporate shills, or victims of Stockholm Syndrome at the hands of the 
duopoly incumbents (which we were repeatedly told provide "good enough" 
service).  At least one complained that the city was wasting money on 
the existing bond payments (optional, surely) instead of fixing the 
street in front of their house, a complaint I've been told was also made 
in other cities' meetings.  There were more people speaking up with 
repeated, unsubstantiated rumors or willful misinformation than there 
were people who actually understood the ramifications of open, 
non-monopoly internet infrastructure.  (To be fair, there were also 
well-reasoned persons opposing the project, but they were about as 
plentiful as the supporters.)

  So, in theory, the model is great.  In practice, it's too soon to tell 
-- but only due to layer 8+ problems.

      Jima