Once again, restrictive state laws designed to help big ISPs maintain their monopolies have helped push a publicly owned network to privatization. Opelika, Alabama, recently announced that they will sell their OPS One fiber optic network to Point Broadband, headquartered in West Point, Georgia. They expect the deal to be finalized in early November.

The Road to Now

The city of Opelika installed the network to overcome poor services from Charter and to improve municipal electric services with smart grid applications. In 2010, Charter’s astroturf campaign to stop the network failed when local voters supported the ballot initiative to build the broadband infrastructure to allow the city to provide services. By 2014, Opelika Power Services (OPS) was making Fiber-to-the-Home (FTTH) available for residents and businesses; folks in the community were loving the service from Alabama’s “Gig City.”

Nearby communities still stuck with poor Internet access wanted OPS to serve them also and OPS wanted to add more subscribers, but state law prevents Opelika from expanding beyond their current coverage area. As in the case of Bristol, Virginia, when a state prevents a municipal network from growing and increasing revenue, the state makes it difficult for the network to remain sustainable.

Mayor Gary Fuller recently told WLTZ:

“We attempted on three occasions to get the legislature to [allow us to] expand beyond our city limits, into North Auburn and rural Lee County, Beauregard, and we could never do that because we couldn’t get the law changed.”

Huntsville, Alabama, already has high-speed Internet service through Google Fiber, but the surrounding rural areas must look to their local cooperative for better connectivity. Tombigbee Electric Cooperative has started an ambitious Fiber-to-the-Home (FTTH) project to eventually cover its entire service area over four counties in northwestern Alabama.

In a press release, Tombigbee Electric announced that their Freedom FIBER network will start providing Internet service in the towns of Hamilton and Winfield in September 2017. It’ll take about a year to get the new network to everyone in the designated build out area.

Much Needed Connectivity

Hamilton is the seat of Marion county with about 7,000 residents; 20 miles to the south, Winfield has a population of 5,000. As of June 2016, about 75 percent of the population in Marion County does not currently have access to FCC-defined 25 Megabits-per-second (Mbps) download speeds.

With Freedom FIBER, residents will have a choice between two tiers of Internet service: 100 Mbps for $49.95 per month or 1 gigabit (1,000 Mbps) for $79.95 per month. The co-op will also offer phone service for an additional $29.95 each month. The fiber network will be much more reliable than CenturyLink’s DSL network, which is currently the only choice in the towns.

An Incremental Plan

When Alabama State Sen. Tom Whatley from Auburn spoke with OANow in late March, he described his bill, SB 228, as a “go-to-war bill.” The bill would have allowed Opelika Power Services (OPS) to expand its Fiber-to-the-Home (FTTH) services to his community. On Wednesday, April 5th, his colleagues in the Senate Transportation and Energy Committee decided to end the conflict in favor of AT&T and its army of lobbyists.

The final vote, according to the committee legislative assistant, was 7 - 6 against the bill. She described the vote as bipartisan, although the roll call isn’t posted yet, so we have not been able to confirm.

According to Whatley:

“AT&T has hired 26 lobbyists to work against me on that bill. It really aggravates me because I have boiled one bill down to where it only allows Opelika to go into Lee County. It cuts out the other counties.”

Whatley has introduced several bills this session and in previous legislative sessions to allow OPS to expand beyond the state imposed barriers to offer services in Lee County. Alabama law doesn’t allow OPS, or any other municipal provider, to offer advanced telecommunications services outside city limits. SB 228 would allow Opelika and others (described as a “Class 6 municipalities”) to offer services throughout the counties in which they reside. A companion bill in the House, HB 375, is sitting in the House Commerce and Small Business Committee.

Rep. Joe Lovvorn, who introduced HB 375 agrees with Whatley:

“If it doesn't make sense for a large corporation to go there, that's OK that's their choice,” he said. “But they don't have the right to tell, in my opinion with my bill, the city of Opelika they can't serve them either.”

Mayor Gary Fuller won’t tolerate lies about his city. In a recent Opelika City News release titled, Setting the Record Straight - Response to Yellowhammer article, Mayor Fuller corrected the numerous misleading errors in a piece written by Jordan LaPorta. The Yellowhammer article covered a Taxpayer's Protection Alliance Foundation (TPA) report, filled with errors and misrepresentation about municipal Internet networks. TPA is one of the many front groups that describe themselves as "nonpartisan think tanks" but are actually funded by industry leaders with an agenda to advance policies that limit competition.

Mayor Fuller has seen untruths written about Opelika before, but this time he felt it was time to fight the flying monkeys.

Get Your Facts Right

Mayor Fuller corrected a number of brazen untruths LaPorta tossed out in his article, including:

• OPS ONE is not taxpayer-funded - No, LaPorta, there are no tax subsidies. Additionally, there have not been any federal or state grants used for the network.
• Expenditures grossly overstated - LaPorta incorrectly attributes the cost of an electric grid modernization ($20 million) to the cost of the FTTH network ($23 million). The two are not one and the same. Do your homework.
• Number of Gig subscribers - LaPorta reports that OPS has one Gigabit subscriber, but they actually have five residential customers who take the service. The city council has recently reduced the price to $94.99 for Gigabit service in some bundles.

This Is Why Opelika Is A Success

OPS ONE is generating annual gross revenues of around $5.5M after three years serving the community. There are more than 3,200 subscribers and testimonials of customers who appreciate obtaining service from a hometown Internet access provider. Even though OPS ONE is still young, states Mayor Fuller, it’s on track:

It’s no small feat to plan, deploy, and operate a municipal citywide Fiber-to-the-Home (FTTH) network, but communities are doing it. We’ve put together a Citywide Municipal FTTH Networks list and a map, with quick facts at your fingertips. If your community is considering such an investment, this list can offer a starting point on discovering similarly situated locations to study.

The list is divided by state and each state heading offers a description of any barriers that exist and a link to the statute in question. Under each community, we also included relevant links such as to the provider’s website, coverage on MuniNetworks.org, and reports or resources about the network.

We used four basic criteria to put a community on our list and map:

• The network must cover at least 80% of a city.
• A local government (city, town, or county) owns the infrastructure.
• It is a Fiber-to-the-Home network.
• It is in the United States. 

Share the list far and wide and if you know of a community network that meets our criteria that we missed, please let us know. Contact H. Trostle at htrostle@ilsr.org to suggest additions.

The imminent arrival of Google Fiber and two other Internet Service Providers offering Gigabit speeds (1,000 Megabits per second) to Huntsville, Alabama is expected to be a boon to subscribers, reports Alabama Tech. 

The tech publication predicts the three ISPs - Google Fiber, AT&T  and WOW! - will spur competition that will lower prices for residential and business subscribers. A newly-released report from Analysis Group and funded by the Fiber to the Home Council shows that direct competition in a designated market results in overall price drops for connectivity service of all speeds. 

“Research shows a 'Gig City' lowers the monthly standard price on plans with at least 100 Mbps down 25 percent, or $27 per month. When it directly compares markets with one Gigabit provider compared to two, the price of Gigabit services decreases approximately 34 to 37 percent, or $57 to $62 per month.”

The tech publication also stated a domino effect occurs when an ISP says it will offer Gigabit services:  

“The likelihood of other providers offering similar services increases in an effort to keep pace with its competition. This trend applies to Huntsville. WOW! and AT&T announced it had launched Gigabit-speed services for Huntsville customers in October 2016, which was less than a year after Google Fiber announced it would offer services to some Huntsville customers beginning in 2017.

From Alabama Tech:

“When Google Fiber enters the market, it will likely help lower prices in Huntsville...WOW! will likely offer gigabit speeds at $160 per month for customers after the conclusion of its $70 per month promotion, while AT&T Fiber is currently offering Huntsville customers a non-promotional rate of $90 per month for gigabit services. Google Fiber is expected to offer $70 per month services when it enters the market. AT&T Alabama president Fred McCallum wouldn't rule out price adjustments to compete with other providers.”

In early 2016, the city of Montgomery and Montgomery County, announced that they were entering into a unique partnership with the State and the Air Force to create Alabama’s first Internet Exchange.

The collaboration developed a neutral physical location where Internet Service Providers (ISPs) can meet to exchange traffic, rather than routing data 100 or more miles away to Birmingham or Atlanta. The Montgomery Internet Exchange (MIX), has already simplified operations and cut costs for ISPs doing business in Montgomery and attracted interest from new providers. For a relatively small monthly investment, the partners are already seeing results.

Montgomery: The Heart Of Alabama

Montgomery will forever be known as the Birthplace of the Civil Rights Movement - the town where Rosa Parks refused to surrender her seat on a bus for a white passenger. Rich in history, the city is also the capital of Alabama, the Montgomery County seat, and home to approximately 206,000.

In the past, agriculture played a large role in the community's economy, but now healthcare, government, and manufacturing employ a large sector of the population. A Hyundai plant, opened in 2002 added over 3,000 new manufacturing jobs to Montgomery's economy. As technology increasingly influences the economy, these sectors need access to fast, affordable, reliable connectivity.

Alabama State University, Troy University, and Auburn University at Montgomery all serve the community and need high-quality connectivity for students and staff. A number of private colleges, including Faulkner University, Thomas Goode Jones School of Law, and several other facilities, including two-year and technical colleges offer ample choices for students pursuing higher education.

The Problem Of The Future

Mayor Todd Strange has for several years expressed concern about the city losing ground as competing communities with better connectivity outpace Montgomery. Unlike Chattanooga, the city does not have its own municipal electric utility, which facilitates the deployment and operation of a municipal fiber network. Community leaders have known for some time they must consider the future and create an environment to encourage better connectivity and competition.

Alabama Republican State Senator Tom Whatley tried again this session to convince his colleagues that municipal utilities need the ability to expand beyond current coverage areas. Once again, his appeal to common sense for better connectivity fell on deaf ears.

Deja Vu

Whatley, representing the Auburn region, held fast to his promise to bring back a proposal like 2015’s SB 438. Early in February, he introduced SB 56, which stalled in the Senate Transportation and Energy Committee, unable to get a hearing. The bill eliminated limitations on both services offered and where municipal systems can offer those services.

In a January OANow article, Whatley explained that, once again, he was driven by the desire to improve economic development in Auburn:

On the local level, Sen. Tom Whatley, R-Auburn, is sponsoring two bills that he hopes will drive industry to and create jobs in Auburn and Opelika. An Internet availability bill would allow municipalities that offer their own high-speed [gigabit] Internet service, such as the city of Opelika, to expand and offer it in other areas, such as in Auburn and Russell or Tallapoosa counties, which are not eligible for [gigabit] service through private Internet companies.

“The [gigabit] service is something that businesses look for,” Whatley said, adding industries look at [gigabit] Internet the way they do school systems and water and sewer before moving their business into a city. “It’s an economic development tool.”

To Spread The Wealth