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Indianola's Fiber Optic Network To Soon Serve Residents

We told you earlier this year about Indianola, Iowa's network, filling the gap for businesses where private providers had failed. At that time, the network only served local businesses and community anchor institutions, but plans to provide fiber-to-the-home in their community of 15,000 are now unfolding. The town passed a referendum back in 1998 to build a fiber ring which was used first by the local Indianola Municipal Utilities (IMU) for SCADA and for public safety. The goal was to expand incrementally. It later partnered with Mahaska Communications Group (MCG), located in Oskaloosa, Iowa, about 50 miles west of Indianola. 

According to the IMU website, residential retail services will be available from MCG after October 1, 2012. 

Monthly rates will include triple play at $99.95, double play packages between $49.95 and $94.95, and 25 Mbps symmetrical Internet at $39.95. Residents can upgrade to 50 Mbps for $5 extra or 100 Mbps for an additional $10.00. Home Wi-fi is only and additional $5.95 per month. For complete details, check out their rate sheet PDF.

The network also leases fiber that connects community anchor institutions to the Iowa Communications Network, which provides video to K-12 schools, higher education, hospitals, state and federal government, National Guard armories, and libraries. The network also connects to BroadNet Connect, which is the network used by Iowa Health Systems for telemedicine in rural Iowa.

ILSR Examines Iowa Rule Authorizing Municipal Networks

The Institute for Local Self-Reliance has recently posted an examination of 1999 Iowa Act Chapter 63, which expressly allows municipal networks:

Section 1. LEGISLATIVE INTENT. It is the intent of the general assembly to specifically provide that cities of Iowa which create city utilities in the manner provided by law are authorized to provide on a competitively neutral basis with existing local exchange carriers separate or combined cable communications or television, telephone, telecommunications systems or services, including wireless systems or services, through the ownership of systems or offering of the services.

Sec. 2. Section 362.2, subsection 6, Code 1999, is amended to read as follows:
6. “City utility” means all or part of a waterworks, gasworks, sanitary sewage system, storm water drainage system, electric light and power plant and system, heating plant, cable communication or television system, telephone or telecommunications systems or services offered separately or combined with any system or service specified in this subsection or authorized by other law, any of which are owned by a city, including all land, easements, rights of way, fixtures, equipment, accessories, improvements, appurtenances, and other property necessary or useful for the operation of the utility.

The 1999 legislation opened the door for Iowa communities wanting to provide broadband access in areas that had been overlooked by the private sector. Since 1999, however, lobbyists for the telecommunications industry have found ways to increase regulation of community networks that does not apply to the private sector.

In addition to an analysis of how this rule changed Iowa's approach to networks, ILSR summarizes detailed changes in the original legislation. The analysis includes pros and cons and how the telecom lobby has influenced the Iowa law since its inception.

Read more here in the ILSR Rules Library.

In Iowa, Indianola Networks Helps Local Businesses

The latest addition to our Community Broadband Network Map is Indianola, Iowa. The Indianola Municipal Utilities own a network that a private partner, MCG, presently uses to offer services to commercial companies. Come summer, the network will begin serving residents also. Indianola is the county seat of Warren County and has a population pushing 15,000. Back in 1998, the city had a referendum before building a fiber ring. The utility first used its telecommunications capacity for SCADA applications and public safety communications but began using spare capacity to benefit local businesses after 2005. Indianola describes its network as open access but the network only has one provider. Nonetheless, it serves 70 commercial customers and is presently expanding. It is not available on citywide basis yet and further rollout will be on an incremental basis over many years. In the open access arragement, service providers have to come to an agreement with the utility on pricing and adequate levels of customer support. The utility entered the broadband space because incumbent providers Qwest (now CenturyLink) and Mediacom were not meeting local business needs, a familiar story we hear from communities around the country. Contrary to the common claims of big cable and DSL companies, the city was still willing to work with its telecom competitors -- but it was Mediacom that said it was uninterested in using utility ducts created when parts of town were transitioned from aerial utility service to buried. In reaction to the competition, Mediacom dropped its business pricing for customers that agreed to long-term contract offerings. IMU (and partner MCG) once had a considerable advantage in pricing but Mediacom's new packages have eroded some of that difference. Fortunately, IMU has a better reputation for service and does not require long term contracts. Indianola, Iowa One of the biggest benefits to the community is the high-capacity connections at schools, libraries, and public buildings. Schools connect to each other at a gigabit, allowing them to centralize network operations and cut costs. The municipal and county governments gain the same benefits.

Cedar Falls Utilities Videos - Building a Community Fiber Network in Iowa

Cedar Falls Utilities, an incredibly successful publicly owned cable network in Iowa, is upgrading to FTTH.  In these videos, they explain some basics of their system.  The final video interviews some subscribers.  

Their web site has more information, including a fact sheet and price sheet - they have decided to continue offering asymmetrical connections, unlike most of the modern community fiber networks.

Cedar Falls Utilities Expands Broadband to Unserved Areas

A community-owned network, infused with broadband stimulus dollars, is bringing broadband to people stuck on long-distance dial-up for Internet access. Cedar Falls Utilities, which recently announced an upgrade to FTTH from HFC, announced more good news last week: they have received an RUS stimulus grant (PDF, scroll down) to expand their broadband services to nearby unserved areas. CFU is a public power and telecom utility in Iowa with an electrical footprint that roams outside Cedar Falls muni boundary. For years, CFU has wanted to offer broadband to its whole electrical territory but could not justify the capital expense outside the city because the rural areas would not produce enough revenues to run the network in the black. With this 50% grant ($873,000) from the Rural Utilities Services, CFU is expanding and will offer broadband to their whole electrical territory. Serving broadband to these areas will be a sustainable enterprise -- the building of broadband is what costs so much money (one of the very good reasons networks should be accountable to the communities -- the "market" will not make the appropriate investment by itself). Some folks will get fiber services and others will get WiMAX, a welcome change from dial-up (for some, long distance dial-up is the only option to connect to the Internet!). I asked CFU if people in the area had access to broadband and was told that some had access to satellite services… to which I responded, "So no one has access to broadband?" Satellite is a last ditch option, not a viable competitor to services that deliver actual broadband. Some also have access to some very slow cellular speeds - again, not really broadband but it is better than dial-up. We salute Cedar Falls for requesting a 50% grant from the Feds rather than the full 80% they could have gone with. Self-reliance means taking responsibility for the community, not maximizing the "free money" available from the Feds. Though we at MuniNetworks.org believe in a future with everyone connected with both mobile and reliable wired access, we do not expect it to happen tomorrow. We hope that over time, CFU is able to expand the reach of their fiber to everyone.

Cedar Falls, Iowa, Upgrading Cable Network to FTTH

Cedar Falls, Iowa, is the latest of a number of publicly owned cable networks that are upgrading to FTTH. Cedar Falls has been planning this for some time, squirreling away net income over the years as it ran surpluses to help afford the costly upgrade. A story in the WCF Courier notes it will cost $17 million and is expected to be completed in 2012. The bonds used to finance the project will be repaid over 10 years. When I last spoke to folks in Cedar Falls, they had massive take rates - bolstered by local service that Mediacom could not compete with. Cedar Falls Utilities (CFU) had already been offering fiber services to local businesses and will be expanding that to the entire area. According to an article in the Cedar Falls Times, the utility had already been installing FTTH capability into greenfield developments, so they have certainly planned for this transition. Motivation for the upgrade seems to be the faster broadband speeds and more capacity for HD channels. The Utility also noted that needed bandwidth has been doubling every year -- a likely reason they opted for FTTH rather than a cheaper DOCSIS3 upgrade that would not offer the same scalability as FTTH (and DOCSIS3 is much more constrained in upstream capacity). The Cedar Falls Times article explains the benefits of FTTH over HFC:
An HFC plant uses thousands of active devices (such as amplifiers) to keep data flowing between the customer and the service provider. Any one of these devices can fail, interrupting service. In contrast, the all-fiber plant will be a passive optical network, with no active components between the distribution center and the end user. Fewer “moving parts” means fewer points of failure and a more reliable system.
CFU puts community needs first:
“We know from experience that economic growth comes to cities that keep their infrastructure up to date, whether it’s roads, water, electricity or broadband,” said Krieg [CFU General Manager]. “CFU is going to do what it takes to make sure Cedar Falls has leading-edge communications technology, and maintain economical rates for internet and video services.”
The network was launched in 1996, one of the first communities with citywide broadband access.

Dubuque Considers Its Telecom Options

I caught an interesting article asking whether Dubuque, Iowa, should build a publicly owned broadband network. Iowa already has a number of publicly owned networks, mostly cable HFC networks, that serve communities. The article starts with some history, noting that the small community of Hawarden, Iowa, was the first to build a public cable system in the state and had to defend its rights to do so in court.
The northwest Iowa community of about 2,500 people more than a decade ago built a $4 million cable system, only to be temporarily shut down by an Iowa Supreme Court injunction. Hawarden survived the court's order prohibiting municipalities from being in the telecommunications business, and in many respects blazed the trail for publicly run cable, Internet and phone service in Iowa.
More communities may be considering building their own networks (though they will build now with fiber rather than HFC) following Iowa's statewide franchising rules that preempt local authority, giving greater power to private cable companies. The way it was written, existing franchise agreements may be nullified if a competitor announces plans to serve the community. Fortunately, many Iowa communities voted to formed telecommunications utilities back in 2005, though few have yet exercised that authority. Unfortunately, the article's author was clearly misled by either Qwest or Mediacom's public relations flacks because he wrote about UTOPIA, as though the problems of a purely open access model under a different regulatory environment poses important lessons for communities in Iowa that may build their own networks. The successes and failures of UTOPIA teach us very little about how Iowa communities should move forward. Smaller Iowa communities do have a serious disadvantage - building modern networks is very difficult the smaller they get. Below 5,000 subscribers, it can be difficult to make the network pay for itself (though exceptions exist) - suggesting to me that joint efforts combining communities could be a good option. Unfortunately, though the technology has no problems crossing political boundaries, the politics are much more difficult.

A Study of the Economic and Community Benefits of Cedar Falls, Iowa's Municipal Telecommunications Network

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Doris Kelley takes a look at one of the early citywide publicly owned broadband systems - Cybernet in Cedar Falls, Iowa. Cybernet is run by CFU and is an HFC (cable) network that also offers some fiber-optic connections for businesses. In this paper, Kelley takes a look at some of the benefits the network has brought to the community. From the start of the paper:
Cedar Falls Utilities, the largest municipally owned four-service utility in Iowa, provides electric, natural gas, water and communications services to a community of over 36,000 people. The citizens of Cedar Falls have been and continue to be the driving force behind Cedar Falls Utilities. Because of citizen demand and involvement, what once began as an unreliable water supply from “Big Springs,” a small light plant built with discarded bricks and an outdated manufactured gas system, has grown into an organization that is recognized nation-wide in the utility industry for outstanding performance management and some of the most favorable utility rates in the country. Cedar Falls Utilities (CFU) is a strong supporter of economic development. Through the years, the Cedar Falls community has directly benefited by the operation of its municipally owned utilities through direct customer rate savings, free or special customer service programs and fund transfers to the City’s general fund. CFU has made great strides to further its commitment to economic development. In 1994, a new horizon was encouraged through visionary thinking. Considerable strategic planning and analysis preceded the decision to design, construct and operate a Broadband Fiber Optic Communications System. The Cedar Falls Board of Trustees spent approximately 24 months studying the technical and financial feasibility of constructing and operating such a network. Finally, on October 24, 1994, the Cedar Falls City Council adopted ordinance No. 2072 forming the country’s second Municipal Communications Utility and transferring authority to the Cedar Falls Utilities Board of Trustees.

The Case for Public Fiber-to-the-User Systems

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Jim Baller and Casey Lide are two of the foremost experts on municipal broadband systems in the United States. This report offers a clear and rational defense of publicly owned broadband systems. The discussion takes on philosophical, economic, and pragmatic arguments and comes to the conclusion that communities should not be prevented from building their own networks. From the Intro:
The Tennessee Broadband Coalition has asked the Baller Herbst Law Group to respond to the main criticisms that opponents of public Fiber-to-the-User (FTTU) initiatives have raised in Tennessee and elsewhere. The Coalition would like to know whether any of these criticisms is valid, and, if so, what lessons the Coalition can learn from them to avoid or mitigate similar problems in Tennessee. Over the last decade, Baller Herbst has been involved in most of the leading public communications projects in the United States. In almost all of these projects, the incumbent telephone and cable companies have rejected or ignored the locality’s invitation to join in cooperative efforts that would benefit all concerned and have instead mounted massive media and lobbying campaigns in opposition to the proposed public network. Often, the incumbents have funded support from industry “experts” and artificial “grassroots” groups (which have come to be known as “Astroturf”). In their campaigns, the incumbents and their allies have typically included emotional appeals to private-enterprise ideology; flawed statistics; complaints about supposedly unfair advantages that municipalities have over the private sector; attacks on the motives and competency of public officials; and false or incomplete, misleading and irrelevant examples. In many cases, these arguments have mirrored the unsuccessful arguments that the major electric power companies and their allies made against municipal ownership a century ago, when electric power was the must-have technology of the day, and thousands of unserved or underserved communities established their own electric utilities to avoid being left behind in obtaining the benefits of electrification.

Telco Lies and the Truth about Municipal Broadband Networks

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From the Executive Summary (stats from 2005): The attention of policymakers in both parties is now focused on the question of how to promote competitive broadband markets that will deliver high-speed Internet access to all Americans at affordable rates. It is a difficult problem. Present estimates are that around 30% of US households subscribe to DSL or cable modem service. This compares to over 70% in countries like South Korea. Virtually every rural state remains underserved and uncompetitive. In urban areas, many families are priced out of the market. The telecom and cable kings of the broadband industry have failed to bridge the digital divide and opted to serve the most lucrative markets at the expense of universal, affordable access. As a result, local governments and community groups across the country have started building their own broadband networks, sometimes in a purely public service and more often through public-private partnerships. The incumbents have responded with an aggressive lobbying and misinformation campaign. Advocates of cable and DSL providers have been activated in several state capitols to push new laws prohibiting or severely restricting municipalities from serving their communities. Earlier this year, Verizon circulated a “fact sheet” to lawmakers, journalists and opinion leaders proclaiming the so-called “failures” of public broadband. Many of the statistics come from a widely discredited study of municipal cable TV networks published in 1998. This paper debunks these lies case by case, juxtaposing information direct from the city networks with quotations from the telco propaganda. The results are unequivocal and damning.