Earlier this month, Chattanooga’s celebrated as municipal network EPB Fiber Optics announced that they now have more than 100,000 subscribers. The high numbers indicate that the network is serving more than 60 percent of premises in the EPB service area. EPB's success also attests to the popularity of publicly owned Internet infrastructure that is accountable and responsive to the community that both own and use the network.

An Expected Milestone, Big Benefits

Hitting six digit subscribership this fall was no surprise based on rapid growth and intense interest in EPB’s affordable, symmetrical 10 gigabit connectivity along with other available speeds. When the city began serving subscribers in 2009, they based initial figures on an estimate of 35,000 subscribers within five years to break even. Within 18 months, they had already surpassed those goals.

Having paid off remaining debt earlier this year, more revenue is now freed up for more investment back into the system or to put back into the community. The utility is now reinvesting around $42 million per year back into the electric system and power rates are lower for the entire community, regardless of whether or not electric customers are EPB Fiber Optic subscribers.

"Contrary to the fears some had about us spending power funds to pay for this service, our power rates are actually 7 percent lower than they otherwise would be because of our Fiber Optic network and the business it has generated for us," EPB President David Wade said.

In addition to significant savings on power rates, Chattanooga has experienced an influx of economic development as tech companies have come to the city specifically for the network. “Gig City” Mayor Andy Berke:

Consumer Reports (CR) has once again gone straight to the source to collect opinions on subscribers’ experiences with their Internet access, telephone, and pay TV services. Unsurprisingly, a vast majority of respondents to their survey of 176,000 people expressed dissatisfaction with the large national providers. Once again, municipal network Chattanooga EPB Fiber walked away as the only Internet service provider to receive top marks for value, speed, and reliability.

This isn’t the first time the Tennessee publicly owned network appeared at or near the top of the list in a customer satisfaction survey. In addition to consistent high scores on CR surveys, EPB Fiber has also earned kudos from J. D. Power.

After Chattanooga EPB Fiber, Google Fiber was the only private sector ISP to garner a positive rating from subscribers. Google Fiber also obtained a favorable score for value.

Bigger is Better (Not!)

The most recent survey from CR also underscored what many Internet access, pay TV, and telephone subscribers keep expressing year after year — that they despise the big, corporate behemoth providers. When it comes to Internet access, smaller cable ISPs fared a little better, but only Armstrong Cable Company, serving communities in Pennsylvania, Ohio, and four other states, received an “overall satisfaction” rating.

RCN, Hawaiian Telecom, and Grande Communications also did better than the large ISPs, including Comcast, Spectrum, and Cox Communications.

Hiding Fees in the Bundles

According to a CR article on their survey and analysis of the results, approximately 75 percent of subscribers answering the survey needed to bundle TV, Internet access, and telephone to obtain what they thought was the best deal. Subscribers reported that, even though they had to continually haggle for acceptable pricing, they still felt overcharged.

In May of 2017 we congratulated Chattanooga’s EPB Fiber for exceeding 90,000 subscribers and contributing to lower power rates for all (Electric Power Board) EPB customers. Now less than a year later, there is more to celebrate as EPB expects to reach 100,000 subscribers by Fall 2018 and is still lowering electricity costs for all customers. 

The city-owned electric utility launched its citywide fiber optic network in 2009 and never looked back. The original plan issued nearly a quarter of a billion dollars in debt for the utility and had an estimated forecast for only 35,000 subscribers. The city is now reaping the rewards from its investment; the utility paid off the last of its debt earlier this year, and now projected revenues for the fiscal year 2018-2019 from the telecom division sit at $169.1 million.

For a detailed, interesting history on EPB Fiber Optics, take some time to listen to Harold DePriest talk with Christopher in episode 230 of the Community Broadband Bits podcast. Before retiring, Harold was the tip of the spear in bringing the network to Chattanooga.

Major Savings

While EPB has long been recognized for its lightning fast Internet speeds and has repeatedly been ranked among the fastest in the U.S. (including this year’s fourth fastest ISP in the United States), the utility’s fiber optic lines also help lower power rates for all customers by eight percent. Whether Chattanoogans subscribe to EPB Fiber for Internet access or not, they still benefit from the infrastructure.

On June 18th, PCMag came out with its list of “The Fastest ISPs of 2018.” The analysis looks at ISP performance in several different ways and provides a range of different side-by-side comparisons. The results prove that publicly owned infrastructure has in important role in bringing high-quality Internet access to Americans.

The Dakotas' Co-ops Rock

When taking a wide angle lens view of the fastest U.S. states results, we noticed that two of the top four states with the fastest ISPs were North Dakota and South Dakota. Rural cooperatives in these two states have excelled at deploying high-quality Internet access via fiber optic infrastructure. As a result, North Dakota and South Dakota have some of the most complete coverage of Fiber-to-the-Home (FTTH) Internet access and gigabit FTTH in the country. Notice all the coverage on our cooperative map:

Check out a larger map here.

Like rural electrification in the 1930s, cooperatives are taking on the task of bringing high-speed Internet service to members in rural areas. They live and work in the areas they serve. Big ISPs don’t consider sparsely populated areas suitable investment opportunities, so electric and telephone co-ops are repeating the approach of the 1930s, but this time with fiber networks. Dickey Rural Telephone Cooperative in North Dakota and Venture Communications Cooperative in South Dakota are only a few that have worked to get their members connected.

FCC Chairman Alit Pai and Republican Commissioners earned big lumps of coal for holiday gifts this year when they shredded network neutrality protections on December 14th. They also raised interest in publicly owned Internet network infrastructure. Existing publicly owned networks are reaffirming their commitment to network neutrality, including EPB Fiber Optics in Chattanooga.

Online Q & A

In order to reassure their subscribers and help clarify their policy, EPB held a live session via the utility’s Facebook page on December 15th. To start off the conversation, CEO David Wade explained that nothing will change for EPB customers, regardless of the FCC decision. “For EPB fiber optics customers, [this ruling] means nothing,” Wade said. “We’re committed to having an open Internet.”

In an effort to better educate the community, EPB also asked legal counsel David DiBiase, marketing manager Beth Johnson, and Vice President of Marketing J.Ed. Marston to participate in the conversation and answer questions from viewers.

Customer Care Pledge

EPB has embraced network neutrality principles in its Customer Care Pledge, a simple and straight forward list of commitments to subscribers:

The best possible service delivered with the utmost respect. That's always been our commitment to our customers — and it always will be.

This is the transcript for Episode 257 of the Community Broadband Bits Podcast. Christopher Mitchell and Colman Keane discuss Chattanooga, Tennessee. The city's network has community support with a high number of subscribers. Listen to this episode here.

Colman Keane: When you look at Chattanooga, it was really the perfect time, and really a good place to launch this. When you're able to bring something like this to an engaged community, then you can get the benefits that Chattanooga sees.

Lisa Gonzalez: This is episode 257 of the Community Broadband Bits Podcast from the Institute for Local Self Reliance. I'm Lisa Gonzalez. Colman Keane is back on the show for an update on the situation in Chattanooga, Tennessee. In addition to surpassing expectations for subscribers, the municipal utility is doing very well financially. Electric rates have been kept in check for everyone in the EPB service area, regardless of whether or not they use the fiber to the home Internet service, and the infrastructure smart grid has kept expensive outages to a minimum. Colman and Christopher also talk about the Chattanooga community, and how it's culture has contributed to the success of the network, which has in turn provided multiple benefits.

First, we want to urge you to take a moment to help us out, by contributing at Muninetworks.org, or ILSR.org. Shows like this don't have commercial interruptions, and we like it that way. But they still cost money to produce. If you're already a donor, we want to thank you. Your contributions help spread the facts about municipal networks, so kudos to you for participating. Now, here's Christopher with Colman Keane from Chattanooga's EPB.

Christopher Mitchell: Welcome to another edition of the Community Broadband Bits Podcasts. I'm Chris Mitchell. Again, coming at you from Mountain Connect in Keystone, Colorado, a wonderful regional conference, one of the best in the nation. I'm here today with Colman Keane, the Director of Fiber Technology for EPB Chattanooga. Welcome back to the show.

Colman Keane: Thank you very much.

In addition to studying how and where local communities examine the potential for publicly owned Internet networks, we’ve looked at rates over time in select areas of the country. We recently put together a comparison of historical rates for municipal networks in Tennessee. Our findings are consistent with what we’ve seen all over the country - publicly owned networks don't hesitate to raise speeds while keeping rates affordable. We've documented the data on our fact sheet: Municipal Networks: Speed Increases & Affordable Prices.

Not Like The Big Guys

National providers make it a habit to periodically raise rates and over time those increases add up. They’ve done it so often, subscribers have come to expect it on a regular basis. Price increases don’t usually include a speed increase. With no need to appease shareholders, officials in charge of publicly owned networks can set rates at a level that allow a network to be sustainable rather than rates that maximize profits.

Publicly owned networks have increased speeds for subscribers, often with little or no fanfare other than quietly alerting subscribers to their improved service. Places Chattanooga’s EPB, Morristown’s FiberNET, and BET in Bristol are in a much different habit than Comcast or AT&T - they increase speeds with no increase in price. Other Tennessee communities have increased speeds significantly with only slight price increases over years of service.

Speeds, Rates Then And Now

On our fact sheet, we include prices for the basic tiers now and when the network began offering services. We also compare the basic speeds when the network began serving the community and today. The results reflect how publicly owned networks focus on providing fast, affordable connectivity to subscribers rather than collecting profit from customers.

Some results may surprise you:

For the second week in row, our staff has felt compelled to address a misleading report about municipal networks. In order to correct the errors and incorrect assumptions in yet another anti-muni publication, we’ve worked with Next Century Cities to publish Correcting Community Fiber Fallacies: Yoo Discredits U Penn, Not Municipal Networks.

Skewed Data = Skewed Results

Professor Christopher S. Yoo and Timothy Pfenninger from the Center for Technology, Innovation and Competition (CTIC) at the University of Pennsylvania Law School recently released "Municipal Fiber in the United States: An Empirical Assessment of Financial Performance." The report attempts to analyze the financial future of several citywide Fiber-to-the-Home (FTTH) municipal networks in the U.S. by applying a Net Present Value (NPV) calculation approach. They applied their method to some well-known networks, including Chattanooga's EPB Fiber Optics; Greenlight in Wilson, North Carolina; and Lafayette, Louisiana's LUS Fiber. Unfortunately, their initial data was flawed and incomplete, which yielded a report fraught with credibility issues.

So Many Problems 

In addition to compromising data validity, the authors of the study didn’t consider the wider context of municipal networks, which goes beyond the purpose of NPV, which is determining the promise of a financial investment.

Some of the more expansive problems with this report (from our Executive Summary):

Usually, we ignore the misinformation released by the Taxpayers Protection Alliance (TPA) but their latest efforts are so shady, we felt it was our responsibility to shine a light on its lack of validity and the organization's credibility. Our report, Correcting Community Fiber Fallacies: Taxpayers Protection Alliance Edition, takes a deeper look at the TAP's most recent attempt, which is filled with errors and a blatant disregard for the truth.

What Is A "Boondoggle" Anyway? This Map!

When we looked deeper, we discovered that TPA’s "Broadband Boondoggles: A Map of Failed Taxpayer-Funded Networks" is more misinformation than map. 

All of the basic errors in the map display a lack of attention to detail; our short report examines the deceitful characteristics of this resource. Our purpose in publishing this report is to caution community leaders and citizens who are investigating publicly owned infrastructure; the TPA is not a credible source.

One of the more obvious errors: Sandy, Oregon, appears in Utah.

The map is also visually deceiving because it includes 213 communities, but only provides information for 87. Of the 213 on the map, the TPA only label 14 as "failures," which means less than 10 percent of the networks they document fit their own definition of "failure."

Clearly, TPA has proven that it seeks to spread any and all information it can find to discredit municipal networks, regardless of accuracy. Communities, public officials, or staff that research the option of publicly owned networks should review our report if they have ever considered the data in the Boondoggles Map.

Consider the Source

If your community is seeking better connectivity, thorough research will be the foundation of how you proceed. As part of your research, be sure to review the organizations that offer information.

From our report: