As the Sixth Circuit Court of Appeals reviews the FCC's February decision to scale back state anti-muni laws in Tennessee, at least two munis in the Volunteer State are giving back by saving dollars. Networks are also contributing substantially to  public coffers via Payment in Lieu of Taxes.

Clarksville, Tennessee, Network Becomes Revenue Positive in 2015

As of June 2015, the city’s utility provider CDE Lightband paid off all outstanding expenses related to their fiber optic network. General manager Brian Taylor described how the network has improved the city’s utility services and overall economic picture:

Our fiber project has proven to be an investment that benefits the electric system, the customers and the community. It has allowed us to enhance our distribution system and improve our system reliability; provide customer choice in video, Internet and telephone services and offer another tool in economic development. Every year access to high speed Internet becomes more critical in the recruitment of new business. We are proud to be an integral part of the growth and development of our community.

In a recent press release, CDE Lightband said their 1,200 mile fiber optic network saves the City of Clarksville a total of $4.5 million annually through technological upgrades that have improved the overall safety, reliability, and speed of electrical maintenance and service. The city has also seen 27% growth in broadband service customers over the past year. The network’s cost savings, along with direct revenues from electrical and broadband services, spell major dividends for CDE Lightband coupled with continued optimism for future growth.

In October, the North Georgia Network (NGN) cooperative announced the formation of a new partnership with Georgia Public Web (GPW), a pairing that will conjoin two large fiber optic networks that together cover most of the State of Georgia. The newly announced partnership will enable the two organizations to more effectively confront their shared mission to improve broadband access across the state. Paul Belk, president and CEO of NGN, expressed his enthusiasm for the new partnership:

GPW is a great company for NGN to work with, as we have similar goals to serve communities challenged with ‘the digital divide.’ The companies are great links to each other because GPW serves most of the state with the exception of NGN’s footprint. Together we create a complete solution.

Two Networks Become One

This partnership connects GPW’s nearly 3,500 mile fiber optic network that stretches across most of the state to NGN’s 1,600 mile network. As Mr. Belk noted, a look at NGN’s network map shows that it covers one of the few remaining service areas in Georgia that GPW’s massive network map does not reach.

Out on Cape Cod, municipal networks are taking hold. Public buildings throughout the town of Falmouth, Massachusetts, experience great connectivity and the town saves $160,000 each year with its own Institutional network (I-Net).

Public Savings

The Falmouth Area Network, maintained by CapeNet, connects 17 buildings throughout the town for a total of $3,000 each month ($2,500 from the school; $500 from the town). Were the town to go through a private provider, it would cost $1,000 for each building every month or $17,000 per month. By saving $14,000 each month, Falmouth's annual savings add up to approximately $160,000 a year. That’s a lot of money to be reinvested in the community of 31,000.

Falmouth Area Network intends to reach even more institutional buildings in the next few years. The 17 that are connected now are the libraries, the schools, the town hall, the police stations, the fire stations, the harbormaster’s office, and a senior center. Soon the Gus Canty Community Center will also gain a connection. At the Annual Town Meeting last week, the town approved the Capital Improvement Plan which included $80,000 to upgrade the network, including hooking up the community center. There are also plans to add a new wastewater treatment plan to the network in 2017.

The Role of OpenCape

Reports have recently surfaced from The Detroit News and Patch.com that a town in Michigan is now fighting Comcast over who owns their network.

The Backstory

Fifteen years ago, West Bloomfield, Michigan, population about 65,000, wanted an Institutional Network (I-Net) to connect all the important services, like emergency response, police, fire, and water, with a dedicated high-speed network. The town entered into a franchise agreement in order to share the construction costs with the incumbent cable company, which at the time was MediaOne. According to the township, MediaOne offered to contribute $400,000 to the cost of construction as part of that agreement.

The agreement was transferred to Comcast in 2000; Comcast acquired MediaOne in 2002. MediaOne and successor Comcast have provided "free high-speed bandwidth transport as well as interconnectivity" during the life of the network claims Comcast in a letter submitted to the court. The cable giant also describes the practice as a "benefit not provided by Comcast's competitors" and wants it to stop. The franchise agreement expired on October 1 but was renewed until 2025.

To The Courts

Comcast and the town are now fighting over ownership of the infrastructure. With Comcast demanding new fees, the town is bringing a lawsuit. Comcast, however, maintains that it owns the I-Net that the town uses for all its important communications. The Detroit News reports that the township is coming out swinging:

The City Council of Upper Arlington, Ohio on Oct. 26 approved several contracts that will enable the community to build a municipal fiber-optic network to key anchor institutions for an estimated $2.5 million.

Upper Arlington’s project will provide high-speed Internet service for the city’s buildings, the Public Library, Upper Arlington city schools, and most city parks according to a news report from the Upper Arlington News. The 30-mile fiber network will serve about 40 locations around the boundaries of the city (population 34,000).

Besides establishing better connectivity between the three public partners’ buildings, the network is expected to provide opportunities for commercial companies to lease telecommunications services. The network would allow the city to lease some of the 288 fiber strands to commercial companies, such as other Internet Service Providers (ISPs).

Financing and Break Even

Under the cooperative arrangement, the library will contribute $17,616 annually, the city $68,484 per year and the school district $177,900 each year until the project is paid off. “These costs are derived from the amounts that each entity is currently paying for leased broadband connectivity between their facilities,” Upper Arlington Assistant City Manager Dan Ralley told us. 

The period anticipated to pay off the network construction is nine years with the school district and library able to extend the parties’ shared-services agreement for an additional 15 years after. The extensions would occur in three five-year segments.

Cost savings, broader bandwith

Ralley says the primary benefits of the new city fiber-optic network will be significantly lower long-term bandwidth and broadband access costs.  For example, the city of Upper Arlington expects to save about $1,280 a month for Internet service by building its own fiber network. Over 10 years, the city’s savings would total about $150,000.

And the municipal network will be a boon for the Upper Arlington public schools. In an Oct. 19, 2015 staff report, Ralley said:

Out on the coast of the great state of Washington, community networks are making waves. Orcas Island residents recently made headlines with their homegrown wireless network, and Mount Vernon’s fiber network previously appeared in the New York Times. Now, the city of Anacortes is considering its options.

Anacortes: Fiber-to-the-Home?

The city is negotiating with an engineering firm to develop a fiber network that best provides connectivity for the 16,000 residents. The engineering firm is expected to present to the city council next on November 16th.

Public Works Director Fred Buckenmeyer estimates the cost of fiber optic installation at about $15 million. The city of Anacortes has applied for a $375,000 grant from Skagit County to help pay for the construction, but the city would likely need a take-rate (homes to subscribe to the network) of 35 - 40% to break even on the project. 

Mount Vernon: Open Access

Anacortes’ plan is rather distinct from that of its neighboring community Mount Vernon. The network in Mount Vernon is an open access fiber available to government and local businesses, not residents, in Mount Vernon, Burlington, and the Port of Skagit. 

Plans for a fiber network collaboration between the city, school district, and county will save hundreds of thousands of dollars in Stormlake, Iowa. The school district recently voted to take advantage of significant savings for connectivity by switching to the publicly owned infrastrucutre as soon as the network is ready.

The Storm Lake Pilot recently reported that under the current contract with Vast Broadband, the district pays $7,500 per month to lease two strands of fiber. The new arrangement will allow the district to lease 12 fibers from the city-owned network for $14,000 per year or $1,167 per month - a reduction of approximately 85 percent. The city and the school district will enter into a 10-year agreement to ultimately save the district a total of $760,000 or approximately $6,333 per month during the term of the lease.

The school will still need to pay for Internet access and as part of the agreement will be responsible for purchasing its own equipment. The School Board voted unanimously to approve the agreement.

As we reported in July, the Stormlake project began as a way to better communication between water and wastewater utility facilities but then evolved into a public safety and cost saving initiative. All three entities - Storm Lake Community School District, the City of Storm Lake, and Buena Vista County - anticipate considerable savings and heightened reliability. We expect to report on more public savings as the community uses this valuable fiber asset.

Project costs for the system of conduit and fiber, which does not include hardware, are estimated at approximately $1,374,000 to be shared by all three entities. This first phase of the project is scheduled to be completed by December.

The Schools, Health & Libraries Broadband Coalition (SHLB) will present the first AnchorNETS Broadband Summit this November 16th & 17th in Mountainview, California. The event is designed to help leaders from anchor institutions such as schools, hospitals, and libraries connect and learn about solutions to help them achieve gigabit connectivity. The conference will be held at the Computer History Museum. Our own Christopher Mitchell will be there as well.

Keynote Speakers include:

• Evan Marwell, CEO & Founder, EductionSuperhighway
• Catherine Sandoval, Commissioner, California Public Utilities Commission (CPUC)
• Sunne Wright McPeak, CEO, California Emerging Technology Fund

Attend AnchorNETS to:

• Gain information and practical guidelines to access funding from Federal, State and Local government
• Learn about the economics of middle-mile fiber deployment and the role of next generation wireless technology
• Develop new community engagement practices and programs

More information is available on the web: www.anchornets.com, where you can check out the agenda, information on the speakers, and register online.

Download the flyer below for more information.

On July 6th and 7th, much of Steamboat Springs, Colorado, lost phone and Internet when a fiber line was cut, creating a public safety hazard. In order to aviod future massive outages and improve connectivity, Steamboat Springs has decided to develop a Carrier Neutral Location or CNL, much like a similar initiative in nearby Cortez.

In July a CenturyLink fiber optic line was accidentally cut by construction crews, disrupting the 911 emergency system for about 3 hours. No calls were missed, but it is a terrifying reminder of how small towns are dependent on incumbent providers like CenturyLink for basic services.

The community, located in the northwest corner of the state and home to about 12,000 people, is known as a popular ski destination in the winter months. Locations like Steamboat Springs have a natural beauty in the rugged terrain, but incumbent providers tend to see a poor return-on-investment rather than beauty.

The July incident was not the first. In October 2011, an 8-hour outage caused a potential $1 million loss to the economy. If the outage had taken place during peak tourist season, the estimated cost would have been $1 million per hour. In order to ensure their public safety and ability to attract economic development, leaders in Steamboat Springs have decided to end the possibility of massive outage caused by a single cut by investing in a place where multiple carriers can connect.

A CNL is a space owned and maintained by a neutral party where broadband providers can connect to each other to provide redundancy. Sometimes referred to as "meet-me rooms," CNLs are especially useful for middle- and last-mile providers to connect. The facility drives down the cost of bandwidth for community anchor institutions and service providers because they do not require a separate facility for connections and fees are typically reasonable. The CNL in Steamboat Springs went online on June 1st, 2014.

Almost ten years ago, Dan Gallagher, a technology director at Cape Cod Community College, could not get the bandwidth the college needed from incumbent service providers. After communicating with others in the areas, it soon became clear that a number of others shared the same experience.

“We asked anyone who thinks this is a problem for their business or entity here on the cape to come to cape cod community college to talk about it and a hundred people showed up.” - Dan Gallagher in eSTEAMers

The community formed non-profit OpenCape, and created a 350 mile fiber optic network and a colocation data center with $40 million in combined BTOP grants, state grants, and private funding. Completed in late 2012, the project proved to be well-worth the wait. Three large entities almost immediately became customers on the network: the Joint Base, the Woods Hole Oceanographic Institute, and Hydroid, Inc, a private company.

Now the senior consultant for OpenCape, Dan Gallagher describes the project in depth in this episode of eSTEAMers by Cape Cod Community Media Center.