Thanks to the FCC, everyone’s talking about it. But building your own network is harder than it looks.
There are new opportunities to be found in the changing landscape of American broadband. The president is leading an abolition of state laws that impede competition against regional monopolies. The Federal Communications Commission reclassified Internet service as a Title II utility under the Communications Act of 1934, cementing the preservation of net neutrality. And the concept of municipal broadband has entered the mainstream consciousness thanks to media coverage of exceptional government-run initiatives like the gigabit network in Chattanooga, Tenn.
Chattanooga’s success was born from a unique culmination of timing, diligence and experience that should be studied but can scarcely be replicated. The city-owned utility that operates the fiber network, the Electric Power Board, has been in business for 80 years and started developing its gigabit network 16 years ago. The people who run the acclaimed business didn’t just start touching wires together a couple weeks before a New York Times reporter showed up to spread the good news. Success is hard-won, even for those predisposed to greatness. Launching a well run municipal network is possible, desirable and worth pursuing in many cases, but prudence prescribes tempered expectations.
Those who pursue a municipal network, however, won’t find themselves alone — there are more than 450 such networks operating around the nation. Whether a city wants to lay fiber to support its own facilities, find partners that can expand a network to serve an entire region, or just attract new competition, local government plays a growing role in the crucial task of building the nation’s digital infrastructure. Exceptional or otherwise, the cities that flourish tomorrow will be the ones that started building 16 years ago.
Chris Mitchell, director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance, has watched communities at every stage of broadband development and knows what challenges lie ahead for those starting the journey. Mitchell, also the policy director at Next Century Cities, a broadband support organization founded in 2014, has interviewed hundreds of government leaders around the nation who constitute the growing community of municipal network operators. (Some of those interviews can be heard on a weekly podcast hosted by Mitchell called Broadband Bits.)
The first step a community should take, Mitchell said, is to identify what problem is being solved by taking on broadband.
“You don’t just want better Internet access,” Mitchell said. “You want to know for whom and at what cost. Is your problem connecting low-income populations? That requires different thinking than if you’re just trying to attract some high-tech businesses to your town.”
Forming a plan starts with gathering information. Some communities contract an analyst, which can cost $25,000 to $125,000 depending on the size of the city and the depth of the study conducted. Once a community has a sense of what its resources are, it can begin to set goals and work toward them. But it’s important to be flexible, Mitchell said — rigid planning has cursed more than one broadband project.
One of the best ways to build a foundation for broadband is to evaluate upcoming capital projects and look for opportunities to lay fiber in the ground at a low cost, Mitchell said. Many cities do this as a matter of policy. Developing a solid plan can take a couple of years, but everyone who’s building new bridges or fixing roads can start laying fiber immediately, a cheap investment that holds its value, especially if the city keeps a detailed inventory of its fiber to reduce study costs later.
Big cities have broadband challenges too, but most municipal networks pop up in places like Ammon, Idaho, a city of more than 14,000 bordering Idaho Falls in the eastern corner of the state. Cities like Ammon circa 2005 represent the nation’s true digital divide — entire communities left behind by the market.
In 2006, however, city leaders began discussing how best to connect two municipal facilities with a 100 Mbps connection. They received two responses from vendors: One company said “no thanks,” and the other offered to take on the job for an $80,000 initial charge and a $1,000 monthly fee. Ammon Technology Director Bruce Patterson mulled it over and decided the city staff would do it themselves instead.
Ammon passed a resolution in 2008 and began working on a city-owned fiber-optic network in 2010. The project quickly drew interest from other parts of the city government. The Water Department asked for its own connections to 12 well sites where unreliable wireless connections were causing slow repair turnaround times. Next, the Sewer Department asked for connections, and parks and recreation followed. The city began leasing fiber to businesses and is now considering extending fiber to residential homes. Today, Ammon is in control of its operations and its own destiny, Patterson said.
“We spent a lot more and it will take us 30 years to pay it all back, but the reality is my operations and the quality of my ability to dictate what all of these IT pieces are doing and how well they function is dramatically different,” Patterson said. “I don’t spend anywhere near the time diagnosing problems and on the phone. ... My operations are simple and everything works so much better. I would say just from how much easier it is to do all of those things, it was worth it just for that. Way less frustration.”
The short version makes the story sound simple, but it wasn’t. Doing new things is fraught with strife unknown.
“I don’t think I understood what an exercise in political will this was going to be. It really is a huge exercise in determination and willpower,” said Patterson. “Every two years, I have the potential of certain members of my council leaving, and there’s a completely new re-education process of ‘Why are we into this? What does it cost? What are we doing?’ Be prepared for a longer road than you think, and be prepared to revisit these things and support your decisions. Part of that also means you’ve got to be willing to be flexible. You’ve got to be willing to readjust your course if that’s what’s required.”
It would have been easy to give up and hire out the work, Patterson said. He guessed that someone with less resolve would have jumped at that opportunity several times over the years.
“I really, really wrestled with saying, ‘I don’t know that we really want to do this, because what does our staff look like? How much energy are we going to put into maintaining and operating this? Can I really do this?’” Patterson said. “I had a few days of real self-examination.”
Even today, the future of Ammon’s network is unclear. The city wants to deliver fiber to homes, but Idaho is predominantly a Dillon’s Rule state, which means government needs explicit authority to do things, and the state doesn’t have municipal broadband rules. But the new stance of the FCC and the Obama administration could push things forward in places like Ammon.
“I think to some extent it does give us a little more courage to take further steps,” Patterson said, “because it starts to become evident that there are other people who are looking the same way, that they’re seeing our barriers to broadband investment.”
In 2011, Kansas City, Mo., was selected over 1,100 others to be the first Google Fiber city. It’s a major city with a lot of neat attractions, but Kansas City is also what many call “fly-over country,” and Assistant City Manager Rick Usher admitted as much. It’s not Milan, and after Kansas City was selected, a lot of other cities had the same thought. Google is a supermodel, they said — what is she doing with you?
Kansas City may be less alluring, but it knew the recipe to being attractive and successful: Give people what they want and never say no. Kansas City engaged its entrepreneurial community to show Google they shared common interests. The city submitted its initial response using Google Docs as a token of goodwill, and when Google asked where the relationship was going, Kansas City had an engagement ring ready.
Kansas City officials succeeded where others did not because they did what others couldn’t — they were flexible for selfish reasons. The city waived fees for street closures and traffic permits, and kept finding ways to say yes.
“Other cities couldn’t come to an agreement on free access to city facilities to locate [Google’s] fiber huts,” Usher explained. “And the way we agreed to that, it was mutually agreed-upon locations. We ensured they were sites where they were behind municipal facilities, not too close to the street.”
The Google Fiber City Checklist — which the company now uses as a road map for municipal deployments — was created from the transcripts of late-night phone calls between Google and Kansas City when they were first figuring things out. The city never kept Google waiting more than 48 hours for an answer to something, Usher said.
A lot of people say Kansas City rolled over and played dead for Google. Maybe that’s true, but look where it got the city. It’s dating a supermodel. And people who date supermodels get attention from other supermodels. A new generation of entrepreneurs is making homes there, and businesses are sprouting up in the city around the institution that Google created. Kansas City is now working with Cisco to become one of the company’s smart cities.
Committed to Broadband?
Cities looking to improve their connectivity options for government, education and citizen use fall into distinct categories depending on their goals and infrastructure. Here’s our take on what the municipal broadband continuum looks like.
Tier 1 These cities are unprepared or uninterested in building their own networks, but recognize that broadband market offerings don’t meet their needs. Kansas City, Mo., for example, attracted Google Fiber, which built a gigabit network for it. Not everyone can attract a Google, but cities can benefit by changing inefficient practices.
Tier 2 These cities build a fiber network for internal use to connect government buildings, schools and libraries. Though contracting a network’s installation and maintenance is easier than doing it in-house, many municipalities have found that this approach often pays for itself and opens economic development opportunities later.
Tier 3 Leasing dark fiber or unused fiber strands on an existing internal network. Many municipalities either already own or can start laying fiber in the ground at minimal cost and then lease the infrastructure to businesses and Internet service providers. Palo Alto, Calif., though an atypical case, has raised more than $20 million this way.
Tier 4 Expanding the city’s internal service to serve customers. Santa Monica, Calif., followed this model, first serving itself, then leasing dark fiber, followed by providing services to the public and businesses that didn’t have the technical expertise to lease dark fiber.
Tier 5 Building a municipally run network that serves an entire community or region with broadband. Chattanooga, Tenn., and Lafayette, La., represent the most successful and well known implementations of this option.
Seattle is among those cities that failed to entice Google Fiber. It also botched the development of a municipal network after its inexperienced project partner, Gigabit Squared, skipped out early. Seattle is the nation’s fastest-growing large city, home to Amazon, Microsoft, Boeing and a burgeoning entrepreneurial crowd, but it continues to be hampered by the same affliction that nags many other cities: inflexibility.
Former Seattle CIO Bill Schrier said unwillingness to change old rules hamstrings city efforts to boost broadband access. Schrier, now a senior policy analyst for the Washington State CIO’s Office, isn’t necessarily a municipal broadband advocate — it’s not the right choice for many cities, he said. But whether a city intends to pursue a municipal network, an investor who will build one for the city, or will simply foster fair competition in the market, sticking to old rules is a sure way to be left behind.
It’s common for cities to have regulations that are unfair or that don’t make sense. In Seattle, for instance, if someone wants to attach new equipment to a utility pole and that pole needs repairs, it’s the newcomer who foots the bill and everyone already attached to the pole doesn’t have to pay anything. This type of thinking is inconsistent with policy goals and it plagues the city, said Schrier, who was CIO there for nine years.
Seattle, like many other cities, also had cable franchise minimum build-out requirements that required companies to serve all residences in franchise zones, if they are allowed to serve anyone. Although such rules initially helped ensure that everyone had access to cable TV, they now prevent competitors from entering the market because the hurdle for entry is too high, meaning that the first company to a given market has a well protected monopoly.
The problem, Schrier said, is that regulations often are a knee-jerk reaction to complaints.
“The people who are most vocal are the complainers,” he explained. “Fifty-five percent of people may want something to happen, but they don’t feel passionate enough to actually make a statement to their city council member. I think the fact that we institute bureaucratic rules is often in response to perceived public input.” It takes leaders with vision and guts to challenge the status quo on these issues, Schrier said.
Seattle is changing, however, and that means other cities can change too. Newly elected Seattle Mayor Ed Murray is leading a new broadband strategy that lowered barriers to market entry, removed cable franchising minimum build-out requirements and sped up utility pole attachment times. Google isn’t yet clamoring for big municipalities like Seattle, but others, like CenturyLink, are expanding their networks in the city, with 4,500 homes now in reach of gigabit lines, and Comcast raised speeds to compete.
The city also has a new CTO, Michael Mattmiller, who started Seattle down a different path when he took office in June 2014. “I think what we want to be focused on is reducing regulatory barriers to competition,” Mattmiller said. “We want to have the conversation with both providers and the community to understand their concerns and figure out how we can have consistency in our regulatory approaches that still enable innovation while protecting our consumers.”
In addition, Seattle is working with companies interested in leasing its dark fiber. But the city remains ideologically challenged by Google’s strategy of building first where the take rate is highest.
Seattle’s plan requires equity in service. There need to be financial options for everyone, and the city’s broadband plan doesn’t include leaving anyone behind — and including everyone in the caravan often means moving slower. “Equal,” “affordable” and “competitive” are the keywords the city uses to rally around its broadband vision.
But Mattmiller said that Seattle has moved fast in the year he’s been with the city. And while calling Seattle flexible may be a step too far, Murray demonstrates how a commitment to innovation in technology can spur new competition to expand a broadband market.
“We know it’s not the entire city yet and we need to get there, but it’s definitely a start,” said Mattmiller. “[Seattle] can really think creatively about how to solve problems and engage the community, and that’s part of how the broadband strategy was formed — by listening to the community and looking at what we need as a region to be economically competitive and meet our equity ideals.”