The biggest obstacle of running a municipal fiber broadband network is the high cost of entry and the legal red tape.
The first step is to pay the appropriate incumbent for a space on the utility poles or underground, so-called 'make-ready'. That incumbent defines the conditions of their infrastructure and charges you at their labor rates for their crews to 'improve' their poles to allow you access, including replacing stuff they should have replaced themselves years ago, and for moving everybody else on their poles or right of way. This may be a quarter of your costs and you have nothing to show for it other than legal rights. And there are lots of hands in your wallet.
After that lengthy process, you can hire somebody to design the network, and then somebody to build it. It's been a while since I priced it but $30k/mile might be ballpark. Once built, you can start providing connections to users including ONTs. If you were foolish enough to put switches and mirrors on the roads you would further need to contract the local power company for power.
Now you have a network. You need network monitoring and a crew or contract for maintenance, you need billing, you need a site for electronics and you need a contract with a provider from a greater network office for total bandwidth. The good news is that the cost of wholesale broadband has been decreasing year over year.
It will take at least 3 years from start to finish with luck if you know what you are doing, have capable contractors, have no fiber/equipment backlogs and work your way through the signup process. Along the way, to get to reasonable service costs per drop/premises, you will face opposition from state regulations, the local competition, and from the taxpayers who don't like paying and having to wait. And since most munis need to borrow to do capital projects like this, some approval by the bond watchdogs.
Take rate will be a key because you need enough users per mile to pay back the bonds taken out to build and run the system. Competition, since they are already in place, can out price you and out wait you because operation is very inexpensive as is maintenance at ~1% yearly, assuming no natural disasters.
And you need folks in town to oversee all the contractors running the various aspects of the network.
The bottom line is that municipal networks are very good for citizens. But it is a slog to get to it. It is not a 'kingdom' for a pol and his/her buddies or it will fail. It will be vastly less expensive for users, even users that stay with the incumbents (cf. competition). What is the threshold of 'shit' that your citizens need to put in the effort and investment? There are numerous failures of munis, but they all had one thing in common: they spent on stuff that did not matter before they had a real business, like new maintenance trucks and new buildings. This can be done. Chattanooga was one; Leverett was another. Both had 'potholes' along the way.
Leverett is fortunate to have had the skills in an all-volunteer committee to make this happen. It is a testament to the self-reliance of small town New England. It is a model for moving forward but it is not an easy or short road in MA. http://leverett.ma.us/content/broadband-committee Presently there are more than two dozen other towns trying to follow their lead in one form or another.
Some more detail on Leverett: Leverett turned on its fiber last Spring and is providing service for all its customers. The data service is not throttled but depends on backhaul limits coming into town. It is a FTTH Active Ethernet P2P system with a fiber homerun from the premise to the hub. Their ultimate bandwidth is determined by the fiscal limits. As of Summer 2015, Leverett had a take rate of 89%, getting to that level in less than a year.
The Reinvestment Act, funded by the feds and the state, did great 2 things for unserved Western and Central MA towns including Leverett: 1) provided a backbone to the Internet, in this case, in Springfield MA, and 2) provided middle-mile backhaul, 4-8 fibers, to one or more Community access points in each of the 45 unserved towns. Leveret's network would have been much more difficult logistically and more expensive without that. Then, Leverett took it upon itself to fund a a network build.
MBI, the state agency cited above, has been funded to assist these 45 towns with partial grants. I do not believe that Leverett has yet seen much if any of that money. The money allocated for them, when they receive it in full, would amount to only about 1/3 of the total cost for the build. http://broadband.masstech.org/building-networks/last-mile/program-unserved-towns The difficulty is that many of these small towns do not have the wealth or income to afford the remaining cost. Leverett has about 42 miles of roads and a little more than 800 premises and is one of the larger towns being helped by the Commonwealth. It had no internet other than dial-up, some satellite and some cell service. Cell access in town was spotty and wireline copper phone service often had noise on the line in inclement weather. This is typical of the other 44 towns interested in participating in the MBI project/funding. ( I add this as most folks do not consider MA as being at all rural and remote.) But Leverett's multi-million dollar investment, even after help from the state, will bring its citizens into a telecomm environment that most in our country take for granted.
This week at Harvard Law, the Berkman Center for Internet and Society sponsored a symposium to introduce municipal fiber network success stories to other municipalities in Massachusetts. Google did kick start a lot of independent effort in our state, most notably South Hadley and Leverret. However, that was their only contribution.
The summary is as follows: The Feds and State built a backbone and middle mile; The laws of Mass. for telecomm are somewhat arcane; here are a list of folks to get you started navigating the politics and technology; the biggest problem is how to fund the infrastructure.
A very large percentage of Mass. towns were bypassed by the incumbents and there are several towns which the incumbents would like to abandon.
Many municipalities are moving forward using general obligation bonds.
The pointer to the handout: cyber.law.harvard.edu/research/broadband
The bottom line, in my opinion, is that the tactics used by the Rural Electrification Act in the early 1900s should be applied here. Estimates abound that suggest a federal stimulus of $150Billion ( a couple F35s ) would hook everybody up with fiber. The incumbents have bent the wording and the laws, most recently in NYC, to take subsidy and not deliver. My town is moving forward, one hurdle at a time and are especially happy to be in a state that allows this.
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The biggest obstacle of running a municipal fiber broadband network is the high cost of entry and the legal red tape. The first step is to pay the appropriate incumbent for a space on the utility poles or underground, so-called 'make-ready'. That incumbent defines the conditions of their infrastructure and charges you at their labor rates for their crews to 'improve' their poles to allow you access, including replacing stuff they should have replaced themselves years ago, and for moving everybody else on their poles or right of way. This may be a quarter of your costs and you have nothing to show for it other than legal rights. And there are lots of hands in your wallet. After that lengthy process, you can hire somebody to design the network, and then somebody to build it. It's been a while since I priced it but $30k/mile might be ballpark. Once built, you can start providing connections to users including ONTs. If you were foolish enough to put switches and mirrors on the roads you would further need to contract the local power company for power. Now you have a network. You need network monitoring and a crew or contract for maintenance, you need billing, you need a site for electronics and you need a contract with a provider from a greater network office for total bandwidth. The good news is that the cost of wholesale broadband has been decreasing year over year. It will take at least 3 years from start to finish with luck if you know what you are doing, have capable contractors, have no fiber/equipment backlogs and work your way through the signup process. Along the way, to get to reasonable service costs per drop/premises, you will face opposition from state regulations, the local competition, and from the taxpayers who don't like paying and having to wait. And since most munis need to borrow to do capital projects like this, some approval by the bond watchdogs. Take rate will be a key because you need enough users per mile to pay back the bonds taken out to build and run the system. Competition, since they are already in place, can out price you and out wait you because operation is very inexpensive as is maintenance at ~1% yearly, assuming no natural disasters. And you need folks in town to oversee all the contractors running the various aspects of the network. The bottom line is that municipal networks are very good for citizens. But it is a slog to get to it. It is not a 'kingdom' for a pol and his/her buddies or it will fail. It will be vastly less expensive for users, even users that stay with the incumbents (cf. competition). What is the threshold of 'shit' that your citizens need to put in the effort and investment? There are numerous failures of munis, but they all had one thing in common: they spent on stuff that did not matter before they had a real business, like new maintenance trucks and new buildings. This can be done. Chattanooga was one; Leverett was another. Both had 'potholes' along the way.
Re: 'Leave it to the professionals'
Leverett is fortunate to have had the skills in an all-volunteer committee to make this happen. It is a testament to the self-reliance of small town New England. It is a model for moving forward but it is not an easy or short road in MA. http://leverett.ma.us/content/broadband-committee Presently there are more than two dozen other towns trying to follow their lead in one form or another.
Some more detail on Leverett: Leverett turned on its fiber last Spring and is providing service for all its customers. The data service is not throttled but depends on backhaul limits coming into town. It is a FTTH Active Ethernet P2P system with a fiber homerun from the premise to the hub. Their ultimate bandwidth is determined by the fiscal limits. As of Summer 2015, Leverett had a take rate of 89%, getting to that level in less than a year.
The Reinvestment Act, funded by the feds and the state, did great 2 things for unserved Western and Central MA towns including Leverett: 1) provided a backbone to the Internet, in this case, in Springfield MA, and 2) provided middle-mile backhaul, 4-8 fibers, to one or more Community access points in each of the 45 unserved towns. Leveret's network would have been much more difficult logistically and more expensive without that. Then, Leverett took it upon itself to fund a a network build.
MBI, the state agency cited above, has been funded to assist these 45 towns with partial grants. I do not believe that Leverett has yet seen much if any of that money. The money allocated for them, when they receive it in full, would amount to only about 1/3 of the total cost for the build. http://broadband.masstech.org/building-networks/last-mile/program-unserved-towns The difficulty is that many of these small towns do not have the wealth or income to afford the remaining cost. Leverett has about 42 miles of roads and a little more than 800 premises and is one of the larger towns being helped by the Commonwealth. It had no internet other than dial-up, some satellite and some cell service. Cell access in town was spotty and wireline copper phone service often had noise on the line in inclement weather. This is typical of the other 44 towns interested in participating in the MBI project/funding. ( I add this as most folks do not consider MA as being at all rural and remote.) But Leverett's multi-million dollar investment, even after help from the state, will bring its citizens into a telecomm environment that most in our country take for granted.
They started a movement
This week at Harvard Law, the Berkman Center for Internet and Society sponsored a symposium to introduce municipal fiber network success stories to other municipalities in Massachusetts. Google did kick start a lot of independent effort in our state, most notably South Hadley and Leverret. However, that was their only contribution.
The summary is as follows: The Feds and State built a backbone and middle mile; The laws of Mass. for telecomm are somewhat arcane; here are a list of folks to get you started navigating the politics and technology; the biggest problem is how to fund the infrastructure.
A very large percentage of Mass. towns were bypassed by the incumbents and there are several towns which the incumbents would like to abandon.
Many municipalities are moving forward using general obligation bonds.
The pointer to the handout: cyber.law.harvard.edu/research/broadband
The bottom line, in my opinion, is that the tactics used by the Rural Electrification Act in the early 1900s should be applied here. Estimates abound that suggest a federal stimulus of $150Billion ( a couple F35s ) would hook everybody up with fiber. The incumbents have bent the wording and the laws, most recently in NYC, to take subsidy and not deliver. My town is moving forward, one hurdle at a time and are especially happy to be in a state that allows this.