“Fiber is the key to assuring Palo Alto's long-term position as the Leading Digital City of the Future"

That was Palo Alto Mayor Greg Scharff who was giving his State of the City Address at Tesla Motors in February.

Mayor Scharff described 2013 as "the year of the future" for Palo Alto, with technology and infrastructure as two of the city's most pressing priorities. Scharff called for developing a plan to expand and optimize the city's current 33 miles of fiber with the aim to bring that fiber to homes and businesses. Scharff echoed the recent Gigabit City Challenge, offered by FCC Chairman Genachowski, noting that Palo Alto users should be have access to 1 gig, minimum.

Jason Green of the Mercury News reported on Scharff's speech in which he referenced the city's long desire to provide high speed access to residents:

"Ultra-high-speed Internet has been a Palo Alto vision for a long time. Now is the time to fulfill that vision," Scharff said. "Google has recently deployed ultra-high-speed Internet in Kansas City. Palo Alto can do better and has all of the elements that will make this a success."

Scharff also referred to how the city is currently using its fiber and some of the benefits:

“In 1996, our city built a 33-mile optical fiber ring routed within Palo Alto to enable better Internet connections.  Since then, we have been licensing use of this fiber to businesses. For the past decade, this activity has shown substantial positive cash flow and is currently making in excess of $2 million a year for the city. We now have that money in the bank earmarked for more fiber investments."

We spoke with Josh Wallace, from Palo Alto's Fiber Optic Development, in episode 26 of the Broadband Bits podcast about how the city uses dark fiber to connect businesses. As we noted in the past, a thorn in the side of Palo Alto's plan to offer lit services is Comcast, which has been willing to engage in dirty tricks in other communities to stop community owned networks.

It looks like Palo Alto should move quickly on expanding its publicly owned fiber-based I-NET - as the city renegotiates the cable franchise with Comcast, the private cable company is trying to rip-off taxpayers with exorbitant prices for community anchor tenants. California is one of several states to recently take negotiating power on cable television franchises away from communities and grant it to the state. Historically, communities negotiated a free or reduced rate for connectivity to schools, public safety buildings and other key community anchors in return for access to community Right-of-Way - an essential permission necessary to build a cable network. However, as these agreements come up for review, the regulatory landscape is significantly different than it was when they were negotiated in the past. Federal and state decisions have limited the power of communities to gain concessions from cable companies as they continue to raise prices and post large profits. 

In response, many communities have embarked on smart efforts to build their own fiber-optic networks connecting key institutions. These networks often save money while greatly increasing available bandwidth, allowing local governments to be more efficient and use cutting-edge applications. In some communities, these Institutional Networks have formed the backbone of next-generation networks that extend full fiber-to-the-home network access to businesses and citizens. Palo Alto has not yet connected all the necessary buildings with its network and still depends on Comcast for bandwidth to those areas. Communities should beware - network ownership means power. The network owner can decide what price to charge schools - prices that must be paid with tax dollars. Communities building their own networks have slashed these prices and reduced pressure on the tax base. They don't have to worry as much when cable franchise negotiations are up again - like Palo Alto is now.