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After Decades Of Talk, Palo Alto Drives Forward On Municipal Fiber Build

For over 20 years, the city of Palo Alto, the "Birthplace of Silicon Valley,” has flirted with the idea of building a city-owned municipal fiber network. Now after years of debate, numerous studies, several false starts, and many unfulfilled RFPs, city officials say they’re finally moving forward with a city-owned fiber network they hope will transform affordable broadband connectivity citywide.

Palo Alto officials tell ILSR that the project will be spearheaded by the city-utility, and deployed in coordination with a major upgrade of the city’s electrical systems. Phase One of the city’s planned fiber deployment should begin later this year, delivering fiber access to around 20 percent of the city–or 6,500 homes and businesses.

Phase One will be funded entirely from the utility’s existing cash reserves. Profits from that deployment will then be used to expand affordable, multi-gigabit fiber access to all of the city’s 63,210 residents. Though no shortage of challenges remain.

A Long Time Coming

That Palo Alto residents have been clamoring for better, more affordable alternatives to regional telecom monopolies for 25 straight years speaks for itself. The high costs, slow speeds, and abysmal customer service of regional telecom giants AT&T and Comcast have long driven the public’s unflagging interest in better, cheaper connectivity options.

Cambridge City Manager is Case Study of Willful Muni Broadband Ignorance

I have been tracking from afar local grassroots efforts in Cambridge, Massachusetts, to start a municipal broadband network for years. I've visited them locally and spoken to various people from citizens to elected officials about the different options. The following are my observations. I'm not trying to channel their thoughts on how to move forward.

Cambridge is a high-tech city with nearly ubiquitous coverage from Comcast, delivering more or less the same services they offer to millions of homes — which is too say mostly reliable and high-cost Internet access (that will be still higher cost next year and the next after that). In the case of Comcast, it comes with crippled upload speeds compared to fast download capacity. Customer service is . . . well, you do your best to never have to use it.

But with MIT and Harvard within its confines, many in Cambridge are well aware that Internet access can get so much better and not be mediated by a company willing to spend millions in D.C. to preserve its right to set up tollbooths for certain kinds of content if they so choose.

However, Cambridge is remarkably similar to Palo Alto, which is also home to high tech households that mostly use Comcast cable and sometimes have the option of AT&T fiber. And in both instances, there is a strong case for some kind of municipal network that would create more local Internet choice. Both appear to have significant support in the community for a public option. But both also have city staff that have decided to prevent any meaningful investment.

They have run into the challenge that Seattle also wrestled with. These high profile cities have refused to consider creative, incremental, and targeted efforts. Instead, they have focused almost entirely on the costs of duplicating Chattanooga or Wilson, where the community built the entire citywide at once with debt-financed capital.

In Cambridge, the city council is rebelling after having been stymied by a city manager that has successful resisted efforts to study municipal broadband for years.

Palo Alto Residents Meet with Christopher to Learn About Possibilities: Video

For years, Palo Alto residents have patiently waited for the city to move forward on building a citywide municipal Fiber-to-the-Premises (FTTP) network. In recent months, local supporters have started pushing harder for progress, noting recent successes in other communities, and by launching Muni Fiber Palo Alto.   

In early July, they invited Christopher to give a presentation on municipal broadband and answer questions from community members. Christopher discussed the importance of high quality connectivity, different network models available, and success stories from communities around the country. He shared the many potential benefits of municipal broadband in Palo Alto and addressed some of the challenges cities can face when pursuing broadband projects, including competing with incumbent providers: 

“When I hear people in Palo Alto sometimes being concerned about AT&T and Comcast, it’s a good concern to have. You have to have a good business plan, you have to take marketing very seriously, but you should not be intimidated from going into business against them, because frankly, sometimes I hear people say… there’s nothing better than competing against Comcast. Because people really don’t like having Comcast as their provider.”  

He also gave an overview of how the Institute for Local Self-Reliance Community Broadband Networks Initiative works to champion community broadband projects, and pointed attendees toward the many resources available on MuniNetworks.org. 

Watch Christopher’s presentation in full here: 

Learn more about the movement in Palo Alto at MuniFiberPaloAlto.org, and show your support by signing the online petition in favor of a municipal fiber optic network.

Christopher to Talk at Muni Fiber Palo Alto Informational Event July 9th

On July 9th, Christopher will be in Palo Alto, California, for a talk on municipal networks and the possibilities as the city searches for better connectivity. Organizers from Muni Fiber Palo Alto will also host a screening of the documentary "Do Not Pass Go." Attendees will have the opportunity to ask questions at the end of the presentation.

Details for the event:

Muni Fiber Palo Alto - How and Why

July 9, 2019 at 7 p.m.

Mitchell Park Community Center

3700 Middlefield Road

El Palo Alto Room West

Palo Alto, California

Google map to the event location

Long Road to Change

For about two decades, Palo Alto has contemplated the possibilities of a municipal fiber optic network. We recently shared an opinion piece by Jeff Hoel, who moved to Palo Alto years ago, in part because he thought the community was sure to invest in citywide Fiber-to-the-Premise (FTTP) infrastructure. As a retired electrical engineer, the ability to get the best connectivity has always been a priority for Jeff. He's still waiting for the city to deploy fiber citywide.

Palo Alto currently leases out dark fiber, generating revenue that goes into a fiber optic fund. With approximately $26 million stashed away so far, Jeff and others are asking Palo Alto to move beyond feasibility studies or private sector partner searches, and build a municipal network. Launching Muni Fiber Palo Alto was one of the first steps to stirring local support; public information meetings like the one on July 9th will also help grow interest.

"We Can Do This," Says Palo Alto Muni Fiber Leader

During the 20-year on-again-off-again relationship between Palo Alto and a possible fiber optic municipal network, the people of the community have waited while plans have changed, leadership has shifted, and city staff has researched potential infrastructure plans. For the people of the city, it’s a long time to be patient. In a recent opinion piece, resident Jeff Hoel described his long wait and expressed why his city needs to finally move forward and create a citywide municipal Fiber-to-the-Premises (FTTP) network.

Knows of What He Speaks

As a retired electrical engineer who has intimate knowledge of technology and networking, Jeff writes in his piece that one of the reasons he moved to Palo Alto in 1998 was because the city was considering deploying a community network. At the time, Palo Alto had already invested in dark fiber, which they have used to generate approximately $2.1 million per year through leases. The revenue has been held in a fiber optic fund, which has grown to around $26 million.

Over the years, the city has commissioned studies and community leaders have publicly advocated for an expansion of the network to a citywide utility for residents and businesses. Palo Alto’s residents have supported the idea, but stumbles in securing funding, difficulties locating private sector partners for a P3, and a failed bid to bring Google to town, have all left the city with no fiber optic network.

Neighborly Announces 35 Communities Joining Accelerator Program

Earlier this summer, we talked with Jase Wilson and Lindsey Brannon from Neighborly, the investment firm that uses online investing to allow individuals to invest in publicly owned infrastructure projects, including broadband networks. Jase and Lindsey described a program they had just launched, the Neighborly Community Broadband Accelerator. 

A Boost for Local Broadband

The program is designed to help local communities with necessary tools and financing from the start of their project planning. The Accelerator will provide mapping and community engagement tools, help from experts who will share best practices, and access to industry partners, such as ISPs and engineers. In addition to these and other information perks, communities accepted to the program will have the benefit of Neighborly financing at a competitive, below industry rate cost.

Applications were due by September 28th and more than 100 applications indicate that, more than ever, local communities are interested in taking action to improve connectivity. These 35 communities were accepted into the Broadband Accelerator Program:

Our "Open Access Networks" Resources Page Now Available

When communities decide to proceed with publicly owned infrastructure, they often aim for open access models. Open access allows more than one service provider to offer services via the same infrastructure. The desire is to increase competition, which will lower prices, improve services, and encourage innovation.

It seems straight forward, but open access can be more complex than one might expect. In addition to varying models, there are special challenges and financing considerations that communities need to consider.

In order to centralize our information on open access, we’ve created the new Open Access Networks resource page. We’ve gathered together some of our best reference material, including links to previous MuniNetworks.org stories, articles from other resources, relevant Community Broadband Bits podcast episodes, case studies, helpful illustrations, and more.

We cover: 

  • Open Access Arrangements
  • Financing Open Access Networks
  • Challenges for Open Access Networks
  • U.S. Open Access Networks
  • Planned Open Access Networks

Check it out and share the link. Bookmark it!

Palo Alto, CA, and Pikeville, KY, Release RFIs

Two new Requests for Information (RFI) were recently released in Palo Alto, California, and Pikeville, Kentucky. 

Pikeville, Kentucky

Pikeville is open to both public ownership and Gigabit service via privately owned infrastructure. This community of approximately 7,000 residents wants Fiber-to-the-Premises (FTTP) for businesses, community anchor institutions, municipal facilities, and residents. The regional Appalachian Mountain community, with many jobs lost due to the shrinking coal industry, is turning to connectivity as a way to spur economic development.

Pikeville’s RFI describes how service from existing providers is expensive and "sporadic." This RFI calls for a partner that will help the community develop an open access, affordable, financially sustainable network. In drafting the RFI, Pikeville’s officials made sure to note that low-income residents will not be left behind; bringing this asset to disadvantaged residents is a priority.

The city is the county seat of Pike County and home to a number of colleges as well as several large healthcare facilities. City, county, and federal government facilities are also located in Pikeville and need better connectivity. In 2015, the city obtained a $5 million grant for technology-based training and degree programs for residents in the area. A $1 million grant supplied funding for a Broadband Technology Center in Pikeville. Now the city needs fast, affordable, reliable Internet network infrastructure to complement the Center and to move the local workforce toward more information based industries.

Important Dates:

  • Letter of Intent Due: May 23, 2016
  • Questions Due: May 25, 2016
  • Final RFI Submissions Due: June 3, 2016

The city’s website has more information and details.

Palo Alto, California

Palo Alto is a Silicon Valley city of 67,000 residents; daytime workers coming into the community swell the population to approximately 125,000. Incumbents include Comcast and AT&T who have intimated they might be interested in bringing fiber to the city, but have yet to act. Community leaders are exploring all options with this RFI.

Consultant Argues Never Used Financing Mechanism Also Won't Work in Palo Alto

I was troubled to see Broadband Communities publish an odd and misleading story about Palo Alto in the May-June issue [pdf]. Authored by Stephen Blum of Tellus Venture Associates, a consultant that has been hired by Palo Alto in the past, it showed a remarkable level of ignorance about community owned fiber networks and broadband more generally. The title alone, "Can FTTP Work in Palo Alto?" is just odd. Why exactly would FTTP not work in Palo Alto? It works in hundreds of other cities and towns, most of whom are less well positioned than Palo Alto for such a venture. A more honest title would have been "Consultant Argues Never Used Financing Mechanism Also Won't Work in Palo Alto." Blum made a very good case for that narrow argument but fails to lay out any convincing evidence that a variety of other models are doomed. Parts of the article can only be called cable and DSL boosterism - such as repeating the talking point that AT&T's U-Verse and Comcast already offer "high levels of service at competitive rates." Competitive to what? Neither can deliver the speeds offered by modern fiber networks and are only "competitive" if one ignores the much slower upstream speeds, higher prices, lesser reliability, problems of oversubscription, and poor customer service one gets from those providers. Reminds me of "Slick Sam" from Lafayette and the "functional equivalence" between DSL and FTTH.
Blum apparently knows better - that Palo Alto residents are "happy" with the existing services because they have not spontaneously marched down El Camino Real demanding faster speeds at lower prices. This is the wrong measure - reminiscent of the now oft-quoted Henry Ford line that if he asked people what they wanted, they would have said "faster horses." The number of specific errors in this piece are many, and have been well documented by those familiar with the history of Palo Alto's studies. I want to focus on just a few. Let's start here:
Overall, 79 percent of households would have to pay $3,000 apiece to fully fund FTTP construction costs.
YIKES! Cue the foreboding music! Palo Alto has something like 25,000 households.

Palo Alto Dark Fiber Brings $2.1 Million Per Year, Expansion Plans Developing

The city owned dark fiber network in Palo Alto is bringing in a steady stream of revenue that may lead to better connectivity for the entire community. According to a Gennady Sheyner Palo Alto Online article, the Utilities Department recently reported to the City Finance Committee that the city Fiber Fund yields $2.1 million per year. The revenue comes from dark fiber leases to approximately 80 commercial customers. From the article: 

Viewed as a risky investment two decades ago, the fund has in recent years become a plump cash cow. According to a new report from the Utilities Department, its reserves stand at $14.6 million in the current fiscal year and are expected to nearly double by 2018. [emphasis ours]

Commissioners want to get back to the idea of a city-wide FTTP network to serve residents and spur economic development. The city is now working with the school district on a possible expansion to all local schools. 

In his February March State of the City address, Mayor Greg Scharff declared 2013 as the "year of the future," describing fiber as "the key to assuring Palo Alto's long-term position as the Leading Digital City of the Future."  This year the City Council made "technology and the connected city" a priority.  Also from the article:

Commissioner Jonathan Foster noted that the idea of a citywide fiber network has been floating around Palo Alto for many years and said his views on the project have changed since last year, partly because of the council's new attitude about fiber. Before, when economics were the main driver of the conversation, he was more or less neutral, Foster said.

"Now, my approach is -- let's find a way to make this happen," Foster said. "I'm not sure we'll get there but let's come back with the best proposal we can," Foster said.

Commission Chair James Cook voiced a similar sentiment.

"I think this is probably a good idea whose time has finally come," Cook said. "Maybe now it's just gotten the right kind of momentum."