By Cathy Swirlbul
Municipal utilities are expanding into offering broadband service for a variety of reasons. Some communities have a history of providing utility services through public ownership. Other areas pursue community broadband when the incumbent cable and telecommunications companies fail to provide the service. What these projects have in common is the need for financing. The reality of financing in today’s market, though, may be different from commonly held perceptions.
By Florida Municipal Electric Association
Why barriers to entry stifle economic development, disadvantage school children, and worsen health care.
By Jeffrey R. Lee, Medill News Service
Two years ago Princeton, a town of about 7,500 two hours west of Chicago, was staring at a potentially grim future. One of the community’s largest employers had just moved its manufacturing facilities to Chattanooga, Tenn.
LCN, a division of Ingersoll Rand Co. Ltd., had just hired a new plant manager for its Princeton factory, and he had a wake-up call for the town’s industrial board.
“He said that if Ingersoll Rand was looking to relocate a new facility, Princeton would not be on the list,” recalled Jason Bird, superintendent of the town’s electric and telecommunications utility. The town simply did not have the communications capacity that modern companies need.
That conversation was enough to scare the town council and the mayor into action. Last October, the town started construction of a $400,000, 12-mile fiber optic network, and on Dec. 15, it announced it would take the fiber optic cable to any customer that wanted it.
As peer-to-peer applications become popular, an unprecedented increase in user-to-user traffic has been observed worldwide, particularly in Japan due to its high penetration rate of broadband access.
In the decade since the enactment of the Telecommunications Act of 1996, hundreds of localities, dissatisfied with the offerings of private cable and telephone companies, have deployed advanced telecommunications systems of their own.
Economic impacts and the business case for broadband by Strategic Networks Group
Lafayette, La., is on the leading edge of the broadband revolution. Or at least it could be if BellSouth would just step out of the way, says Joey Durel, president of the city-parish.
A Heartland Institute study challenging the financial viability of municipal broadband networks is rife with “mistakes, misinterpretations, unsupported and insupportable claims, irrelevancies, innuendos, key omissions and obvious untruths,” according to Jim Baller of The Baller Herbst Law Group, the attorney for both of the municipal networks profiled in the study.
In its latest “study” entitled Municipal Broadband: Optimistic Plan, Disappointing Reality (June 20, 2005), the Heartland Institute attempts to achieve two purposes simultaneously: (1) attack the municipal fiber project in Bristol, Virginia, and (2) use its criticism of the Bristol system to undermine the Lafayette fiber project. Heartland’s paper contains so many mistakes, misinterpretations, unsupported and insupportable claims, irrelevancies, innuendos, key omissions, and obvious untruths in Heartland’s latest harangue against municipal broadband that it would take a paper many times the length of this one to respond to them all.
By Jim Baller
In October and November of 1906, when electrification was the must-have new technology of the era, Moody’s Magazine invited the leading advocates and opponents of municipal electric utilities to write chapters for a special issue. The opponents contributed the following chapters: “Municipal Ownership Costly and Dangerous,” “Municipal Ownership a Delusion,” “Municipal Ownership Uneconomic,” “Why Municipal Service is Expensive,” and “Municipal Ownership Always a Failure.”
With the benefit of hindsight, we know that everyone on of these claims was wrong.