Muni Broadband Hits New Speed Bumps
Fibrant may be a cautionary tale for municipal broadband. The muni-owned organization out of Salisbury, N.C. earned bragging rights in 2015 when it announced broadband service with speeds up to 10 Gbit/s. But now a local newspaper is reporting that the City Council has agreed to look at options to offload Fibrant operations either through a leasing or management deal with third parties, or through the complete sale of the utility.
The negative turn for Fibrant is a sign that local lawmakers are growing tired of the annual debt payments required to keep Fibrant's network going. According to a report in the Salisbury Post, those payments amount to $3 million a year, and the city so far has little to show for its investment. While nothing has been decided yet about Fibrant's fate, the fact that the City Council is considering its options may mean that this muni broadband experiment is headed for an untimely end. (See Carolina Town Becomes First US 10-Gig City.)
Not far from Fibrant, the state of Virginia is facing a different but related broadband debate. Lawmakers in the Virginia House of Delegates have proposed legislation -- House Bill 2108 -- that would make it more difficult for municipalities in the state to operate their own broadband services. The move follows a court decision last year overturning an FCC ruling that would have made it illegal for states to put up barriers to municipally-owned broadband networks. (See Is Wheeler's FCC Legacy Now in Doubt?)
In the wake of that case, Virginia legislators now want it to be illegal for local governments to embark on municipal broadband projects if at least 90% of the service area already has access to Internet service with average speeds of at least 10 Mbit/s and 1 Mbit/s upstream. Republican delegate Kathy Byron has put forth the proposed broadband bill, and while no vote has been scheduled on it yet, Byron's fellow Republicans control both houses of the Virginia government.
Municipal broadband has an uneven history, with some disastrous failures countered by some spectacular successes. Owning and operating a broadband network is hard, and just as some private companies have crashed and burned in the business, so too have muni providers discovered that broadband is no get-rich-quick scheme – where "getting rich" means closing the digital divide, improving regional finances and transforming the economic development environment.
However, there are many experts who believe a longer view on municipal broadband is needed. While Fibrant in North Carolina may not be turning out the way its early champions had planned, former Fibrant broadband director Kent Winrich, who resigned from the position last August, says the utility's current predicament isn't a sign that communities should stop investing in their own broadband futures. Winrich argues that fiber networks are a tool. The model for financial success shouldn't be "build it and they will come," but rather build it with upfront buy-in from the community and tie the broadband blueprint to well articulated economic development policy.
"I don't know if they realize what they really have," says Winrich, referring to the city of Salisbury and Fibrant's network infrastructure assets.
Winrich also believes that in Fibrant's specific case, the utility unfortunately got caught in the middle of major technology changes as it deployed its network services. Initially he says Fibrant focused heavily on delivering traditional television... just as the online video revolution was getting underway. And Fibrant deployed all fiber when Winrich says it's becoming increasingly clear now that hybrid networks combining fiber and wireless technologies may make the most economic sense.
Since resigning from Fibrant last summer, Winrich has moved on to a new gig, but he's not leaving the broadband sector. Instead, Winrich is now CTO at a consulting firm called Open Broadband dedicated to helping both companies and communities "design, deploy and operate managed broadband networks." And he says business is picking up.
In particular, Open Broadband wants to bring more high-speed Internet access to underserved areas and help neighborhoods where students don't have the broadband connections they need to keep up in school.
"We're in this to make a difference," says Winrich.
Winrich also has some choice words for how commercial Internet service providers have controlled broadband access in the market. He notes that ISPs are "given billions of dollars to provide services to [citizens] and are just going backward" as a measure of progress through their efforts to block muni broadband while also not adequately serving certain communities.
In Virginia, meanwhile, there is growing backlash against the efforts of legislators to aid commercial ISPs in hampering municipal broadband builds. Numerous companies went on record last week to oppose bill 2108, stating in a letter to the state government that the bill would "impair economic and educational opportunities that contribute to a skilled workforce from which businesses across the state will benefit."
The authors also declared that, "Communities with data speeds limited to the HB 2108 target of 10/1 megabits cannot realistically hope to attract or retain modern businesses or provide their residents, particularly their young people, a reason to stay in them. These communities will be condemned to economic stagnation or worse – like the 'ghost towns' that died a century ago for lack of adequate electricity."
Organizations signing on to the letter include some big names. Among them are: the Fiber-to-the-Home (FTTH) Council , Google (Nasdaq: GOOG), Netflix Inc. (Nasdaq: NFLX), Nokia Corp. (NYSE: NOK), Ting (owned by Tucows ) and more.
The effort suggests that while municipal broadband may be hitting a rough patch, the fight to make it a viable option for communities with limited Internet access isn't over.
— Mari Silbey, Senior Editor, Cable/Video, Light Reading