Thursday, January 4, 2007

Municipal Broadband - Beware of Geeks bearing Gifts

In the past few weeks there have been several good reports on municipal broadband. Two from Reason magazine and one recently published by the Swedish Government - IT Policy Strategy Group - "Broadband for growth, innovation and competitiveness". I highly recommend the later report as it is a well articulated argument why governments (municipal and national) should focus on the build out of "passive" infrastructure to enable broadband for all. Passive infrastructure includes conduit, support structure on poles, and sometime the enabling of condominium dark fiber networks where government agencies, schools and hospitals act as anchor tenants.

Although there are many good examples of successful municipal broadband projects, particularly in smaller communities around the world, I worry that many of these in time will suffer the fate of iProvo as documented in the Reason report. Already we are starting to see companies offer free broadband services (up to 2 Mbps) such as Sky in the UK. I suspect, in the not too distant future you will see companies offering free fiber to the home. The companies offering these free services will make their money through innovative new business models. This will demonstrate once again that the private sector can be far more innovative than the public sector in delivering these types of services. I, for one, would not want to be the owner of a municipal broadband network competing against free broadband from the private sector.

However, I do believe municipalities and other levels of government can play a critical role in enabling the deployment of broadband by the private sector, especially the creation of a playing field. Two good examples I often cite is the CSEVM in Montreal where the city provides open conduit throughout the city to all telecommunication carriers. The other example is "@22" in Barcelona where the city has not only provided open conduit, but also open and secure equipment space in each city block where carriers can locate their equipment, etc.

But even if municipalities chose not to deploy such elaborate facilities they can still make a difference. There are many small things that municipalities and governments can do immediately to enable faster rollout of broadband and create level playing fields. They include:

(a) Placing open conduit under all freeways, overpasses, railway crossings, canals and bridges. These facilities are usually a costly roadblock for many fiber deployment companies.

(b) Allow overlashing of fiber on existing aerial fiber structures. Overlashing can dramatically reduce costs of fiber deployment.

(c) Forcing existing owners of conduit such as electrical companies, telephone companies, etc to make 100% of their conduit accessible to 3rd parties, especially that capacity supposedly reserved for future use, and then coordinate construction of new conduit between all parties when the spare capacity is truly all used up.

(d) Coordinate construction of all new conduit, especially building entrances to minimize the "serial rippers" and make all such conduit open to 3rd parties.

Thanks to Kevin Barron for the pointer to the Reason reports and Patrik Falstrom for the Swedish Government IT report -- BSA]

Swedish Government IT report:

The Reason reports:

The first Reason study is by Jerry Ellig, former deputy director and acting director of the Federal Trade Commission’s Office of Policy Planning. He warns city officials to “beware of geeks bearing gifts”

The second Reason study is on iProvo and claims that they are digging themselves in deeper every year.

>From recent study on broadband by City of Ottawa

"Montreal has the reputation across the carrier industry of "getting it right". All carriers that operate there praise the ease of access and the low cost of duct rental.

Montreal created an agency called the "Commission des Services Électriques de la Ville de Montreal" (CSEVM) in 1907 to emphasize urban design and to adapt to changing technological requirements as the city grew and to contribute to the beautification of the city's streets and public places.

The CSEVM has the mandate to operate the whole underground space. It builds, manages and operates the system of underground conduits.

Since that beginning the City now has 19.2 million metres of linear conduits, covering 623 of the city's 2,123 kilometres of streets. It provides direct accesses to 38,500 private and public buildings through more than 18,000 access facilities.

The City operates in the role of standardizing construction, consolidating demand from various sources and building additional space for the City to rent out to others. The City shares the capital cost with all and engineers additional capacity for resell. The City is also very active on retrofitting duct banks that are filled by adding additional internal ducts to be used. The primary advantage to the building partners is in cost reduction of duct construction.

The end result is that the carriers have only the highest of praise for Montreal as a territory in which they operate and the costs of duct rental are $3.65 per metre."