Community Broadband? It’s Working In Minnesota

I have generally believed, and expressed here, that government help is needed for this nation to become a leader once again in the area of information access and transfer. I happen to subscribe to the theory that there are certain things too large for the individual to undertake, and that the nation sometimes needs the government to act as coordinator, because companies all have their own way of doing things, and that a force must be there to keep all parties in line.

The idea of the internet backbone being cared for by the government, and flowing along the major highways of the nation seems logical to me, requiring no further thought. The last mile problem is one that ultimately must be solved, and it does not seem that competition is doing much to solve it. All the big players seem to be walking away from many of those ‘last miles’, leaving many with nothing better than standard dial-up, something that many of us in the more populated areas left behind years ago. We were told that we were going to have an ‘information economy’ in the 21st century, yet we have done little to train people for it, nor have we done much in the preparation for all the information flow.

A story in  Ars Technica tells us about a community in Minnesota, which has decided to ‘roll their own’ and seems to have a workable plan.

Regional telco TDS Telecommunications last week issued a press release announcing a major milestone for the company: 50Mbps service over fiber optic cable to residents of Monticello, Minnesota. The Minneapolis suburb became one of the few non-FiOS communities in the country to experience full fiber-to-the-home deployment, and subscribers will all receive a free upgrade from 25Mbps service to the new 50Mbps tier.

Even better is the price, which starts at $49.95 a month for 50Mbps fiber service without the need to buy other services.

I live in Southern California, a very densely populated area of the country, yet I am definitely located in what used to be called the exurbs. I don’t have FiOS just yet, only having been told it was finally available here a month ago, because I live in an older area of town, while the newest build areas have had FiOS availability from the start.

Verizon has no 50 Mb/s tier in my area, and 25 Mb/s service is $99 per month, when bundled with at least one other service, phone or television. Admittedly, we know it is less expensive to live in the Midwest, but a 4 to 1 cost differential is ridiculous. We need some of this ‘Yankee ingenuity’ here!

TDS is thrilled. “This is a huge first for TDS,” said market manager Tom Ollig. “TDS is working incredibly hard to deliver the faster speeds customers want.”

But the entire congratulatory press release glosses over a key fact: the reason that Monticello received a fiber network was the town’s decision to install a municipal-owned fiber network to every home in town… spawning a set of TDS lawsuits that went all the way to the Minnesota Supreme Court, which ruled in favor of the town.

Clearly this is a case where government (local government) can do something that the large telcos, and cable providers, were unable, or more likely, unwilling to do. The push given by the city was what was needed to light the fire under TDS.

Screaming to be heard

The saga began in 2007, when the town passed a referendum approving the city-owned fiber network. The city says that it had approached TDS and was told that no such system would be installed in town in the near future, so it went ahead with its own plans.

monticello_map.jpg

After the referendum, the city was sued by the telco just before groundbreaking began. The suit didn’t seem to have much of a chance under Minnesota law, and indeed judges at multiple levels ruled for Monticello. But in the meantime, TDS rolled into town with nine crews of its own and began installing—you guessed it—fiber to the home.

Monticello had just become one of the only US cities in which twin, parallel fiber networks were being built at the same time. Backers of the muni fiber plan were outraged; not only could TDS build a modern fiber network on a moment’s notice when it wanted to do so, but the lawsuits prevented the city from doing much of its installation even as TDS moved ahead.

This shows how certain parts of government can get in the way, and that some laws should be eliminated. There is as much work to be done in reviewing laws, to see which ones should be eliminated as the work of making new laws. Perhaps commercial entities should not be allowed to sue the government, but only citizens having that power…

We spoke to TDS about the situation last year, and its director of legislative and public relations told us that TDS didn’t act earlier because it didn’t actually know that people really, really wanted fiber; once the referendum was a success, the company moved quickly to give people what it now knew they wanted.

After delaying the town’s deployment through lawsuits and rolling out fiber service of its own, TDS issued a statement in June 2009 in which it then called the whole rationale for the government project into question.

“In view of TDS’ development of a robust broadband platform in Monticello during the past year, it is questionable whether or not the City’s feasibility study supporting its own fiber project, which was premised on no broadband competitors and on which the revenue bond purchasers relied when they secured the bonds more than a year ago, is still accurate, and whether the city fiber project is feasible today.”

How easily big business can twist the story, and carefully guide  what it supports as truth!

Now, it has upped the ante by doubling everyone’s speeds. The moves all seemed designed to keep the idea of a muni-owned fiber network from spreading, but they might well have the opposite effect; one takeaway from the entire saga is that trying to build a muni fiber network is an excellent way to “encourage” investment and innovation from regional or national companies that might not otherwise have your town’s own best interests at heart.

Such stories aren’t limited to Minnesota suburbs, either. Just last month Telephony Online ran a piece on how Cox cable prices had “dropped considerably” since Lafeyette, Louisiana lit up a fiber system of its own.

“Cox froze the cable rates in Lafayette, and they didn’t freeze the rates in other areas,” said Terry Huval, director of the muni project. “We figured our citizens saved over $3 million in cable rates even before we could offer them service.”

It is sad that citizen, or municipal action was needed to change an obviously unfair pricing structure. Cable companies, in my experience, always seem to have an inflated sense of how much their services should cost, and yet they are much less reliable than service by the telcos.

Competition

This shouldn’t be a surprise, as it’s really just a classic case of direct competition—something not seen often enough in the wired broadband market. Unfortunately, getting high-speed Internet to your town isn’t always as simple as threatening to start a municipal network. Many times, incumbent providers simply file lawsuits while keeping speeds the same.

If your town is really unlucky, the incumbent will just head right to the state legislature, seeking to pass laws constraining the practice. That’s what happened to Wilson, North Carolina, which runs a moderately famous 100Mbps system known as Greenlight (which just happens to be the fastest ISP in the entire state).

When Time Warner Cable (which still tops out at 10Mbps and no DOCSIS 3.0) was asked why it had not stepped up to meet the city’s demand for faster access, a company rep told TechJournal South that it hadn’t actually heard a citizen outcry over the issue—or it would have acted.

Wilson’s Internet manager is having none of it. “We don’t want to run anyone out of business,” he said, “but we also don’t want to take the leftover table scraps. If they had offered us what we were asking for, next generation good service, we would have happily stepped aside.”

After reading those last three paragraphs, you might ask yourself what it takes, exactly, to bring this want to a company serving an area. In my experience, unless there is another choice, nothing works, including the possibility of shaming the current provider into change.

Also, the way that our government works, in many instances, is a distinct brake on change. When speaking of popular revolt with weapons, that may be fine, but when the change is determined to be for the good of the entire public, all braking mechanisms should be removed.

Perhaps we should also do our best to use what bandwidth we already have to acquire more – look at what was accomplished by the President, regarded by all politicians as being the first  to truly harness the power of electronic information transfer.

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My doctor gave me six months to live, but when I couldn’t pay the bill he gave me six months more.

Walter Matthau

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