For more than two years, the prospect of expanding to two nearby communities has been on the LUS Fiber to-do list in Lafayette. Now that the municipal fiber optic network has achieved at least a 40 percent take rate, the time is right to reach Youngsville and Broussard.

In 2016, the utility generated $36 million in revenue, according to Director of Utilities Terry Huval. The triple-play network has been generating profits since 2013; this will be the first expansion outside of Lafayette city limits.

Poised Pretty, Prudent Planning

Within the next few weeks, LUS plans to begin installing fiber in one subdivision in Broussard and one subdivision in Youngsville. The expansion will progress in “measured steps,” said Huval, so LUS Fiber can evaluate interest in the new areas. "Like any business," he said, "we have to be prudent in how we expand."

Back in 2015, we reported on potential expansion plans that would have required the two communities to pay for the cost of expansion. At the time, Brossard and Youngsville weren’t keen on the idea, but now LUS Fiber is in a position to tackle the project without financial assistance from the two towns. The network has still not reached every premise in Lafayette, but Huval looks at the opportunity to reach Youngsville and Broussard as a way to solidify the utility’s financial position to complete the city deployment.

Some subdivisions were developed in the city after LUS Fiber's first bond sale, so they have not been serviced yet, Huval said. But LUS Fiber will be extended to those areas in the city at the same time fiber is extended to some areas of Youngsville and Broussard, he said.

"Every home (in the city of Lafayette) will have access to fiber," Huval said. "That's the intention."

Huval stated:

Community networks are hyper-local movements. As we have researched these networks, we have often uncovered the work of grassroots activists trying to make a difference in their cities. Today, we've gathered together a collection to show how small groups of local people can make a big difference.

Virginia Friends of Municipal Broadband -- This statewide organization of citizens and activists quickly formed in opposition to the proposed Broadband Deployment Act of 2017 in Virginia. They collected statements  on why the proposed law would be sour for community networks and published a press kit to help people talk about the issue.

Yellow Springs Community Fiber -- This group formed in Yellow Springs, Ohio, to have the city consider building a community network. They hosted a public forum and created a survey to gauge residents' interest in such a project. They even published a white paper about their proposal, and the city issued an RFP to explore the option.

Upgrade Seattle -- This campaign for equitable Internet access encourages folks to support a municipal network in Washington state's largest city. The Upgrade Seattle group hosts neighborhood study sessions and encourages residents to learn more and attend city council meetings.

Holland Fiber -- Holland, Michigan, has been incrementally building a fiber network, and much of the impetus came from the Holland Fiber group. Local entrepreneurs, business owners, and residents realized that high-speed connectivity would be an asset to this lakeside tourist town. 

The City and Parish of Baton Rouge recently released a Request for Information (RFI) as a way to seek out partners interested in helping them improve local connectivity. Responses are due August 4.

Vulnerable Residents A Priority

According to the RFI, reliable connectivity is not consistent or affordable in many areas of the community where populations need it most. Unemployment is higher than the national average and the community has approximately 26 percent of city residents and 18 percent of parish residents living in poverty. Community leaders want to use the network infrastructure to bring more opportunity to people living in the most poverty-stricken areas of the City-Parish. Economic development, better educational opportunities, and better connectivity at home are only a few of the goals Baton Rouge intends to meet.

As part of the vision described in the RFI, City-Parish officials point out that they want a tool that will enable citizens to be participants in an updated economy, not just consumers of a new data product. Some of the factors they prioritize for their network is that it be community-wide, open access, financially sustainable, and offer an affordable base-level service.  The network must offer gigabit capacity.

Baton Rouge intends to ensure lower income residents participate in the benefits that will flow from the investment; they are not interested in working with partner who doesn’t share that vision. From the RFI:

The City-Parish intends to offset service costs for its most vulnerable residents through a subsidy program that will allow certain portions of the population to purchase service at a discounted rate. We expect respondents to this RFI to be prepared to build to and support those customers—many of who may never previously have had a broadband connection. This initiative may also entail the Partner(s) sharing cost and risk associated with providing low-cost or no-charge service to some customers.

Baton Rouge

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):

S&P Global Market Intelligence - May 26, 2017

Hard Data on Municipal Broadband Networks

Written by Sarah Barry James

There is a dearth of good data around municipal broadband networks, and the data that is available raises some tough questions.

A new study from University of Pennsylvania Law School Professor Christopher Yoo and co-author Timothy Pfenninger, a law student, identified 88 municipal fiber projects across the country, 20 of which report the financial results of their broadband operations separately from the results of their electric power operations. Municipal broadband networks are owned and operated by localities, often in connection with the local utility.

...

Yet Christopher Mitchell, director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance, argued that Yoo's study did not present an entirely accurate or up-to-date picture of U.S. municipal networks.

"When I looked at the 20 communities that he studied — and his methodology for picking those is totally reasonable and he did not cherry pick them — I was not surprised at his results because many of those networks are either in very small communities … and the others were often in the early years of a buildout during a period of deep recession," Mitchell said.

As an example, Mitchell pointed to Electric Power Board's municipal broadband network in Chattanooga, Tenn. — one of the five networks Yoo identified as having positive cash flow but at such a low level that it would take more than 100 years to recover project costs.

...

In fact, without the revenue generated by the fiber-optics business, EPB estimated it would have had to raise electric rates by 7% this year.

According to Mitchell, Yoo's study captured the Chattanooga network when it was still "small and growing," but misses "what's going to happen for the rest of the life of the network, which I think is the more important part."

...

Telecompetitor - May 25, 2017

Municipal broadband networks do not have a strong financial track record, according to an analysis conducted by the University of Pennsylvania’s Center for Technology, Innovation and Competition. The municipal broadband financial analysis, which looked at 20 municipal fiber projects, found that only nine were cash-flow positive and that of those, seven would need more than 60 years to break even.

...

An Opposing View

Municipal network advocate Christopher Mitchell, director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance, pointed to several flaws in the Penn Law municipal broadband financial analysis.

He noted, for example that a substantial portion of the 20 networks studied were “early in the process and very small.” He also argued that the 2010-2014 study period may have biased the results, as that period included a recession and subscribership for some of the networks has increased substantially since 2014. He noted, for example, that EPB’s broadband network in Chattanooga had about 50,000 to 55,000 subscribers in 2014 but has now hit the 90,000 mark.

The Penn Law authors’ approach was “not the proper way to measure these networks,” said Mitchell in a phone call with Telecompetitor. The analysis “doesn’t take into account jobs created or the impact on the municipal budget,” he said.

He argued, for example, that a municipality that previously paid $1 million annually for connectivity might instead pay itself $500,000 for connectivity on the municipal network.

...

Read the full story here.

In 2014, Mozilla and the National Science Foundation (NSF) created the Gigabit Community Fund to help local communities test new gigabit technologies. This year, projects in Eugene, Oregon, and Lafayette, Louisiana, will receive awards from the fund. Each community will receive $150,000 $300,000. Organizations that want to apply for the funding with their project ideas need to submit applications by July 14, 2017.

Learn more about the application process and the award at the Gigabit Communities website.

The recent announcement described the reasons for adding these cities to the list of past winners - Chattanooga, Kansas City, and Austin:

Why Eugene and Lafayette? Mozilla Community Gigabit Fund cities are selected based on a range of criteria, including a widely deployed high-speed fiber network; a developing conversation about digital literacy, access, and innovation; a critical mass of community anchor organizations, including arts and educational organizations; an evolving entrepreneurial community; and opportunities to engage K-12 school systems. (emphasis ours)

Check out this video on Mozilla and the Gigabit Community Fund:

Update: After publishing this story, we received the official news release from the city of Eugene and the Technology Association of Oregon, which provided a little more information. Specifcally that grants usually range from $5,000 - $30,000 and that the pilot period is typically 16 weeks. You can read the news release here.

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.

Acadiana, the southern region of Louisiana, is seeing a resurgence of industry thanks in large part to it publicly owned fast, affordable, reliable network. Years ago, the city of Lafayette, Louisiana, built the LUS Fiber network to connect homes and business.

Now, LUS Fiber is helping to diversify Acadiana’s economy, which once almost exclusively relied on the oil industry. Fiber networks offer much potential for economic development. 

“The State of Business” in the Silicon Bayou

The October-November issue of the Acadiana Profile at MyNewOrleans.com ran an article on the changing landscape of Acadiana’s businesses. Author Kimberly Singletary provides an overview of three growing industries: technology, manufacturing, and healthcare. All three need access to reliable, high-speed connections.

Singletary spoke with One Acadiana, an economic development organization in Lafayette:

“We’ve had a long history of innovation in IT and software,” says Jason El Koubi, CEO of One Acadiana. “But it's still very much an emerging field.”

Due to what El Koubi describes as “almost a grassroots movement in cultivating IT over the years,” the Acadiana region enjoys a robust offering of internet services resulting in a competitive, cheap and extremely fast LUS Fiber network.

LUS Fiber offers affordable, high-speed connectivity to several software developers that have made Acadiana their new home. The network offers speeds of up to 2 Gigabits (2,000 Megabits per second). In 2014, LUS Fiber attracted three companies, bringing almost 1,000 jobs to the “Silicon Bayou.” Another company, Waitr, an Uber-like food delivery service, is planning to add an operations center to Lafayette, which will bring another 100 jobs to the community.

More Than Tech: Industries Need Connectivity

Google Fiber has finally announced its plans for the future after weeks of dramatic speculation that it will lay off half its workforce and give up on fiber-optics entirely. Google has now confirmed our expectations: they are pausing new Google Fiber cities, continuing to expand within those where they have a presence, and focusing on approaches that will offer a better return on investment in the short term.

Nothing Worth Doing Is Easy

In short, Google has found it more difficult than they anticipated to deploy rapidly and at low cost. And in discussions with various people, we think it can be summed up in this way: building fiber-optic networks is challenging and incumbents have an arsenal of dirty tricks to make it even more so, especially by slowing down access to poles.

That said, Google is not abandoning its efforts to drive better Internet access across the country. In the short term, people living in modern apartment buildings and condos will be the greatest beneficiary as Google takes the Webpass model and expands it to more cities. But those that hoped (or feared) Google would rapidly build Fiber-to-the-Home (FTTH) across the country are likely disappointed (or slightly relieved, if they happen to be big incumbent providers). 

This is a good moment to talk about the lessons learned from Google Fiber and what we think communities should be thinking about. 

Let's start by noting something we have often said: Google Fiber and its larger "access" approach have been incredibly beneficial for everyone except the big monopolists. Its investments led to far more media coverage of Internet access issues and made local leaders better understand what would be possible after we dismantle the cable broadband monopoly. 

Benoit Felton, a sharp international telecommunications analyst wrote a very good summary of Google Fiber titled Salvaging Google Fiber's Achievements. Some of my thoughts below overlap his - but his piece touches on matters I won’t address, so please check out his analysis.

I want to focus on a few key points.