What We can Accomplish in the Near Term
With an eye towards our end goal of a locally controlled and operated network, there are things we can get the City of Buffalo or Erie County to do that will ensure success in the future.
First of all: The Google Fiber Checklist
The Google Fiber Checklist is an easy starting place as Google took the time to create a publicly accessible document that outlines everything they feel they need ready before building out one of their fiber networks. That said the checklist isn't Google Fiber specific - pretty much everything on there is needed as a launching point for any area to get started on a fiber project. In fact, it's a pretty short checklist with only three header items: gather and provide information about existing infrastructure, gather and provide access to that infrastructure (existing state laws, etc., need to be clearly spelled out), and setup construction to be as speedy as possible (who wouldn't want that?). The document provides additional information as a basic "how to accomplish these tasks" as well.
There is no other objective we could accomplish that would go as far towards improving connectivity in our region as a commitment from the City or County to an open-access network. An open-access network means that just as our roads and highways are open to use for anyone who so desires, so should the infrastructure that undergirds the information superhighway be open to as many service providers as want to provide retail service to residents and businesses. As it stands, Time Warner and Verizon have closed-access networks and have exclusive use of the infrastructure that is used to connect you to the internet. No one would tolerate the inconvenience and exorbitant prices that a private entity would charge if they held a monopoly on all the roads in a city. So why do we tolerate the same thing with the twenty-first century's essential infrastructure? The City or County could very easily pass a resolution saying that however broadband expansion happens in our region, an open access network will be created.
A Commitment to Reinvest Savings
If the City or County develop their own resources and begin laying their own fiber, significant savings can accrue. If those savings are continually reinvested back into the network, this can ensure a continual expansion of the network.
A dig-once policy is just as it sounds--it ensures that the costs of burying fiber are greatly reduced by coordinating digs with other City or County projects. CTC Technology & Energy explains it this way:
"'Dig-once' strategies enable local communities to expand their own fiber and conduit assets, as well as those of private providers. Such policies open rights-of-way to fiber/conduit construction when other projects are underway, thus realizing efficiencies in network construction. Such policies also protect roads and sidewalks from life-shortening cuts and minimize disruption from construction. Even if private entities do not take advantage of the opportunity, the locality can use dig-once opportunities to inexpensively install its own conduit and fiber—which can be leased to private providers in the future."
Municipalities that do this can realize savings of up to 90% of what it could typically cost to lay fiber.
Inventory of Assets
To get a really good idea of what's viable, any municipality should collect as much data as possible regarding where there are assets, including:
- existing gas and electric lines
- telecom conduit
- traffic signal interconnect
- abandoned water mains
- abandoned sewers
- telephone poles
- streetlight conduit
- anchor institutions that might agree to get wired early on
And also assets more directly related to putting down fiber connections themselves:
- areas where street resurfacing is planned
- sidewalk repairs
- underground public works projects
- scheduled permits for contractors/telecom companies
Having as much of this data collected and overlaid on a map in layers will lead to a clearer picture of what is viable.
Providing Access to Rights-of-Way/Making the Permitting Process Easy
The Different Paths
There are many ways we can accomplish our goal of improving residential broadband connectivity in the City of Buffalo and across Erie County. We've been taking a look at different methods that have worked elsewhere and compared those situations with our own to see what method, or combination of methods, would have the best chance of success locally. This is not an exhaustive list, and creativity and imagination in a build-out will definitely be valuable. But these are a few of the ways we've seen that will bring us towards fiber-to-the-home and better broadband:
In our opinion the best way to begin expanding a local fiber network in the near term is for the City or County to develop their own internal resources and start wiring an institutional network. The City or County would discontinue leased lines from incumbent providers, often exorbitantly priced, and lay down their own fiber lines. These municipal lines would actually be significantly cheaper to operate than their leased counterparts, and would connect to city/county buildings such as local libraries, hospitals, businesses large and small, as well as other anchor institutions.
As we mentioned when we talked about Other Cities, this is exactly what the City of Santa Monica did. Straight to the point: Santa Monica was in the same boat as Buffalo with regards to lacking a public electric utility. However, though these public utilities are helpful in the development of fiber networks, they are not necessary:
"Committing to building a fiber network rather than continuing to lease from existing carriers can seem daunting, especially when those carriers frequently argue that the knowledge required to operate a network is too specialized for a local government. The Working Group disagreed with such claims, noting:
'The fiber ring itself will require virtually no maintenance. Emergency restoration is important, of course, even when the redundancy and safety of a ring is achieved in Phase III. Cities that do not own their own electric utility, like Santa Monica, should consider retaining an engineering firm to perform that function. There are firms that contract to provide similar services to CLEC's, institutional network operators and others.
The electronics should be covered by an on-going service contract with the manufacturer that specifies a response time. Four hour service is usually acceptable, particularly when the fiber ring is in place. The cost of this maintenance, based on current pricing, has been included in MCG's cost estimates. However, the City will need a trained individual to handle routine network administration and simple moves, adds and changes.
In addition, if the City decides to lease conduit and/or dark fiber to third parties, the manager should be responsible for administering the program. This would hold true even if the City hires an outside firm to provide network management services. The City needs a knowledgeable network manager who is employed directly by the City and responsible only to it.
The financial models used to cost the network assume that a manager is hired at a total annual salary of $75,000 (including benefits).'
[Jory] Wolf reflects on his results, 'Cities that have electric utilities already have the assets, equipment and skill sets necessary to build, manage, and maintain low voltage fiber-optic networks. Santa Monica has demonstrated that even cities without electric utilities can do the same by using a mix of internal and contracted resources.'"
As Santa Monica has amply demonstrated, a public electric utility is not necessary. In fact, Santa Monica was able to not only overcome their lack of a public utility, but surpass it by offering 100 gigabit per second service across their network. This is something only a few other areas worldwide, even those with public electric utilities, have been able to accomplish.
What also makes this route enticing is that it does not require much in the way of extra public dollars in order to begin the process. In fact, over time, very significant cost savings can accrue when compared with what the incumbents want to charge. This can be especially enticing for public officials wary of putting public dollars on the line.
Public Referendum/A Full Broadband Utility
A vote could be used to allocate funds to build out the fiber network, but the most visible drawback to this method is voter turnout. That said, if we as a community rally behind the idea of a city or county-wide fiber network, we could definitely make this happen!
This is a risky maneuver, though, and that is primarily the reason why it's not "the best" way to get fiber in our opinion: it's do-or-die. Working through getting enough awareness, let alone support, for people to decide they want to take the time to vote will be a long and drawn out process. The high payoff of course being that we'll start working on the fiber network full steam ahead.
Unfortunately, if the referendum does not pass, we'll almost go all the way back to square one. Putting it to a vote can also mean that the incumbents can (and will) dump lots of money in opposing the referendum, confusing the subject and obfuscating the reality that they've been providing sub-par service for far too long.
The winds definitely seem to be blowing in the right direction right now, as so far the public referendums all seem to be passing at the moment. So this may be an option we'll look at more as we watch the situation develop.
As a Niche Gigabit Provider
What often keeps municipalities and private providers out of the broadband marketplace is the knowledge that a significantly high take-rate must be met in order for the network to be profitable. Not only that, there are incumbent providers that have amassed a literal fortune that they can use to drive out smaller businesses looking to compete. In situations like these, when a small business tries to break into the scene anyway, the significantly larger existing provider can drop their rates within the target/competitive area for a time, while of course being able to raise prices in areas where they still maintain a monopoly. At the same time, the larger provider can (and in some cases already have) sue the competing network in order to slow their expansion, bogging down their competitor with legal fees and litigation, while simultaneously priming a marketing assault aimed at turning the public against the idea of a second service provider. Furthermore, in cases where a municipal network is working to be the second provider, public officials are dissuaded from taking part in this battle, as they are banking their political futures on the consent of the people. There is a potential workaround for this problem that was suggested by CTC Technology & Energy in Seattle, WA in their assessment of the viability of a broadband utility: have the municipality focus on only branching into the gigabit market, which has the least amount of competition:
"The Broadband Utility may not fare well by simply entering the market as a public provider offering service in a marketplace that is already served by private providers. The best approach is to strive to change the market structure by providing something that does not exist today—developing a specialized niche to fill a gap in currently available service.
"The goal of providing a 'niche service' is to identify gaps where the City is not already well served, and then focus the Broadband Utility’s efforts there to foster the greatest possibility of success. Based on our market assessment, we believe that the City’s primary gap is 1 Gbps data service, which we believe represents a market niche that the Broadband Utility might be able to successfully fill. We recommend that the Broadband Utility offer only a data service at a minimum of 1 Gbps.
This route is being advocated much more in recent years as a way for communities to develop better broadband. Public/private partnerships end up splitting the risks/rewards for a network build-out between a public institution and a private provider. A good example of this is between Ting and Westminster, Maryland. We use this example because Ting is a provider that is open to the idea of an open-access network. After two years of operating exclusively on the fiber infrastructure, Ting agreed to open up the lines to other providers. Though this means two years of little competition in the region, it also means that the end goal of a free marketplace is more reliably met down the line; Ting shares some of the costs of the build-out, thus reducing public officials to exposure if the network fails.
Verizon FiOS Build-out
The likelihood of Verizon extending FiOS into the city of Buffalo and the eastern suburbs seems highly unlikely. Despite intense pressure from public and private entities alike, Verizon still does not seem to be budging on their refusal to continue rolling out FiOS. Since they stopped any further commitments to FiOS back in 2012, relying on Verizon seems like a bad bet. However, if someone there did agree (or were forced) to build out FiOS further, this could mean FTTH for the city. And if the City and County can commit to open access, this might mean that Verizon would be obligated to open up its lines to competitors, as well. This would be ideal, however unlikely.
The Rocket Fiber Model
Rocket Fiber is a private, Detroit based startup that is blanketing the whole city of Detroit in access to Fiber-to-the-home. How were they able to do this? They received a large investment from a Pegula/Zemske-like Detroit business mogul: Dan Gilbert, the owner of Quicken Loans. The combination of his investment coupled with his political connectedness in the community paved the way for Rocket Fiber to quickly pass every home in Detroit.
Though this may also be a long shot, if Buffalo can get a similar investment from someone in the upper echelons of the local business community, all doors would be opened for FTTH in Buffalo.