Municipal broadband

Municipal broadband deployments are broadband Internet access service provided, either fully or partially, by local government. The means of connection include unlicensed wireless (Wi-Fi, wireless mesh network), licensed wireless (such as WiMAX), Line-of-Sight, and Fiber Optic technologies. The most widely used type of broadband is Wi-Fi, with reports of around 350 citywide projects in the U.S. being launched within the past few years.

How It Works

Rather than using the sometimes unreliable hub and spoke model of distribution, most municipal broadband networks use mesh networking. A series of radio transmitters throughout a city, with each transmitter connected to at least two other transmitters, relay radio signals through the whole city. This allows for a reliable connection for users. Mesh networks are also faster to build and less expensive to run than the hub and spoke model.

Two basic models for funding Wi-Fi networks have emerged. A city will either use tax money to pay for the service or find an outside company to provide the service with the understanding that the company will have control of the network in exchange for build-out and maintenance.

In Stockholm, Stokab provides network infrastructure; the city installed dark fiber and several hundred service providers lit the fiber and provided one service or another. The Utopia Project in Utah provides service at one network layer higher, creating a lit fiber network, the capacity of which it is wholesaling to four service providers that provide retail service in the market. A final model is to provide all layers of service, such as Chaska, Minnesota where the city has built and is operating a Wi-Fi Internet network and is providing email and web hosting applications. These different models involve different public-private partnership arrangements, and different levels of opportunity for private sector competition.

A few US states have banned municipal broadband, some states have restricted it, and other states have regulated it (requiring prudent business plans and studies). As of 2007, three bills are pending before the US Congress that touch on the issue; one would affirm municipal broadband, one would restrict it, and one would prohibit it.

Some incumbent telecommunications and cable companies complain that government competition is unfair while others have viewed it as an opportunity to expand their market. Other organizations such as Free Press, the Media Access Project, and the ACLU have come out in favor of municipal broadband.

The reconstruction of New Orleans was the impetus to build a metro-scale wireless broadband network to provide free public Internet service, and it also provided needed communications for government and emergency services. Bell South threatened the city with legal action if the New Orleans municipal network were continued to be run by the city. Consequently, the network was bought by an outside company.

Pros of Municipal Broadband

Municipal broadband offers many advantages to consumers and to the economy. First, it often provides high speed internet access for free or at least cheaper than other current broadband service providers. Different cities adopt different models to fit their needs. St. Cloud, Florida's municipal broadband network offers free access to everyone. Philadelphia, PA, on the other hand, does not provide free access, but it does offer discounted rates to its residents; it provides low-cost internet access to everyone and discounted access to low-income families.

Municipal broadband networks are intended to improve worker productivity by giving city officials (such as police officers and firefighters) remote access to information. Police officers can access security cameras, blueprints, criminal records and other necessary information. Networks can let officers show witnesses mug shots or “virtual lineups” at the scene of a crime, instead of at a police station. The Department of Homeland Security provides funding for cities that use municipal networks for these applications (Wilson).

It is hoped that municipal broadband networks will make cities more attractive to businesses, especially desirable high-tech and research companies, which are dependent on communication. Communication also enables small and home-based businesses to participate in international and regional commerce. Finally, it allows companies to recruit new employees without relocating them, for municipal broadband enables the workers to telecommute (Ellison).

The Federal Communications Commission, in the year 2000, endorsed municipal broadband as a "best practice" for bringing broadband to under served communities.

The FCC also addressed the issue when confronted with the question of whether a municipality was an "entity" under the Telecommunications Act. The Telecommunications Act states "No State or local statute or regulation, or other State or local legal requirement, may prohibit or have the effect of prohibiting the ability of any entity to provide any interstate or intrastate telecommunications service." 47 USC 253(a). The legal question presented was whether a state could prevent a municipality (its own subsidiary) from entering the telecommunication market. In the case Missouri Municipal League v. Nixon, the U.S. Supreme Court concluded that in fact a municipality was not an entity under the Telecommunications Act and that a state could determine what authority its own subordinate jurisdictions had.

Government, it is argued, can take a longer view and write off the investment over a longer period of time. Private companies, especially publicly traded ones, have to show profitability in a very short period. In many ways, government might be the best entity to create a broadband network—as infrastructure—and allow private companies to run it and deliver services (IPTV, telephony, Internet access) over it.

By setting up a network as infrastructure and remaining a passive owner, allowing private companies to run the network and deliver services over it, government might create a competitive environment where the network owner is not also the one who determines which services consumers can receive. "Structural separation or "functional separation" is the term often used for broadband as infrastructure that is OPEN to all service providers. Governments, which can take a longer view than publicly traded companies such as telephone companies, can write off these investments over a longer period of time. They may be driven by the desire to lay down critical broadband infrastructure that serves a larger constituency: individuals, small businesses, schools, government entities and service providers.

Cons of Municipal Broadband

Municipal networks vs. Private Companies

The harshest critics of municipal networks are the incumbent telecom operators and cable companies. They object that the government is an unfair competitor, given its expansive resources, and they will lose customers.

In 2007, private companies like EarthLink, which had committed to building networks in partnership with local governments, pulled back because the costs of deployment were significantly higher than expected and the return on investment was uncertain. A number of providers continued to build municipal networks although these projects nearly always had the local government as an anchor tenant. Certain municipalities are going ahead with deployments and paying for them directly because they use it for municipal purposes such as automated meter reading, public safety, and traffic management.

Critics of municipal networks claim that government wifi hampers innovation, a classic argument against governmental services. A private company has to compete with others by developing better products. This constant process leads to increasingly superior services. The government, since it doesn't have competitors, does not go through this process. Thus, taking over a market that would otherwise be privately provided will cause quality to stagnate. Some models of municipal broadband access attempt to avoid this problem; in the Stokab model only the base infrastructure, the dark fiber, is laid down by the government.

Even though municipal networks offer low cost internet access, some private companies are still able to offer wireless internet at a lower cost than the government. Because of this, some people choose to not use the government sponsored municipal network. Private companies are experienced in the wireless network field, and are aware of some of the unexpected setbacks and costs. The government is just entering the field, and may be surprised by the setbacks and costs they encounter. Finally, private companies can afford to take large investment risks, which the government can not afford with taxpayer money.

Time factor

Critics of municipal broadband do not want cities to set up networks because over time the networks could become outdated. If a city spends large amounts of tax money setting up a municipal network, but because of technological advances the network becomes obsolete, the city will be stuck with a less than optimal network. The city will have no way of getting back their initial investment, and will have to spend even more money to set up a better network. If the city cannot afford to revamp the network, it could become stuck in a period of technological lock with a less than optimal network. There is no way of knowing how municipal networks will interact with new technologies being developed, such as WiMax, or if an entirely new technology is on the brink of replacing municipal networks all together.

Government Role in Economics

When the government sets up a municipal network, it can lead to huge distortions of the market. If a city government gives a private company exclusive rights to set up a municipal network, the private company can gain an unfair advantage in the marketplace. This can lead to monopolies, and other market distortions. Municipal wireless is an immature marketplace, and some critics argue that the government does not belong in such a risky enterprise. Also, municipal networks often cost more than expected, which can lead to strain on an already tight tax budget.

Luxury vs. Necessity

Debate about whether or not cities should set up municipal networks brings up the question: Is the internet a luxury or a necessity? Proponents of municipal networks tend to believe that because of technology's huge impact on society, the internet can no longer be considered a luxury. People with this view suggest that everyone should have affordable or free access to the internet so as to bridge the "digital divide" between those who have access and those who do not. Economic and sociological studies suggest that using the internet boosts an individual's earnings significantly. Opponents tend to characterize the internet as a luxury, and maintain that tax money should be invested in more necessary enterprises. This view was exemplified by former FCC Chairman Michael Powell's observation that saying there is a digital divide is like saying there is a Mercedes divide, in that computers and internet connections are luxury items that many desire but few can afford.

Current Status of Municipal Projects Within the United States

Silicon Valley : Covad Communications announced on February 26, 2008, that it would become the main network provider on the delayed Silicon Valley Wireless project. Covad, a company based out of San Jose, California, provides high-speed wireless service to businesses in the Bay Area and other markets that use WiMax networks. Using the latest wireless equipment from Cisco to create a mesh network, the Silicon Valley Wireless Project, which has been discussed for the past few years, is focusing on the deployment of a wireless network that will include Santa Clara and San Mateo counties and the city of Santa Cruz, with the potential to reach 2.4 million people. Specifically, Covad wants to reach a larger number of smaller customers, including small businesses, with a service that can be implemented at lower prices and can carry lower monthly rates. Ultimately, the company wants to find out whether it can make money selling a Wi-Fi service on municipal broadband spectrum to small businesses, city governments, and public safety. “Our commitment is primarily to serve our own internal needs," said Alan Howe, Covad’s vice president of wireless strategy. “The grander vision of signing up cities across the region is attractive but too much to dive into now. We want to make sure we walk before we run."

Miami Dade County, Florida, had a large municipal wireless project planned, however, as of late January 2008, the county changed its plan from full coverage wireless service of over 2,000 miles to a few random hot spots. According to Miami mayor, Carlos Alvarez, the project changed because it was "economically and technically unfeasible."

Economic Success: Based on the status of some of the previously mentioned municipal broadband projects and companies, it appears that many of the projects are having economic issues that have caused municipalities or companies to change their plans, delay their plans, or completely back out. However, municipal broadband is not always an economic drawback; there are success stories. Lake County, Florida, for instance, has seen an economic increase compared to other Florida counties since implementing a municipal fiber-optic network. Also, according to the Economic Impact of Stimulating Broadband Nationally, "The U.S. could realize an economic impact of $134 billion annually by accelerating broadband availability and use across all states." . This economic study includes a virtual map that depicts the total economic impact for each of the 50 states.

Earthlink

Philadelphia: Philadelphia introduced its low-cost to free Wi-Fi program in September 2004. In the beginning the city proposed that a $10million plan to implement Wi-Fi coverage for the whole city. By late 2006 Philadelphia proposed that it would have Wi-Fi coverage reaching 135 square miles. According to EarthLink’s proposal “no city or taxpayer dollars will be used to fund the project. EarthLink will finance, build and manage the wireless network, and share revenue with the city's Wireless Philadelphia initiative.” In August 2007 EarthLink announced that they would be cutting half of their work force and thereby drawing out of its various plans to implement Wi-Fi coverage to cities such as San Francisco, Houston, Chicago as well as Philadelphia. This left Philadelphia with a 75% completed Wi-Fi network. So instead of having total Wi-Fi coverage in 2007, Philadelphia looked at completing the project in 2008. During this project many Philadelphians claimed that the Wi-Fi coverage was at times very unreliable and believe that “The costs and logistics of hardware, software and training seemed daunting…” Due to these set-backs not many Philadelphians signed-up for the city's Wi-Fi service. On June 17, 2008, Mayor Michael A. Nutter reached an agreement with a local investor group to take over operations for Philadelphia's Wireless Initiative from Earthlink.

San Francisco: San Francisco’s plan for a city-wide Wi-Fi Network was proposed in 2004 by Mayor Gavin Newsom. On April 5 of 2006, San Francisco chose both Google and EarthLink to work together in order to provide a free Wi-Fi access to the city of San Francisco. The project is looked upon by its Mayor as one that will “boost the city's technology credentials and help bridge the digital divide between the Internet haves and have-nots. In order to build the network both Google and EarthLink would split the $12 million cost to implement the necessary equipment. The Internet coverage offered would be faster than Dial-Up but slower than DSL, but if citizens wanted faster coverage Google and EarthLink would allow upgrades to the network for a little over $20 a month. On August 29, 2007 EarthLink backed out of the proposed agreement leaving San Francisco in search for another free Wi-Fi provider. Mayor Newsom was not pleased with this and blamed the Board of Supervisors for not acting quickly enough in accepting the proposal. Newsom states that if they had adopted the proposal sooner "EarthLink would have been legally obligated to fulfill its promises to San Francisco, and [San Francisco] would have had a functioning Wi-Fi system by now." On the other hand, San Francisco’s Board of Supervisor, Ross Mirkarimi, claims that it was indeed a smart choice not to accept the proposal because "EarthLink's meltdown confirms [their] concerns that the risks outweighed the benefits." On August 3 “Newsom and the president of the Board of Supervisors, [Aaron Peskin], put a measure on the November municipal ballot (earlier this month) asking voters to approve the concept of a citywide Wi-Fi network created with public and private resources.”³ Currently San Francisco is in the process of finding other companies who are willing to work with San Francisco in order to provide free Internet Access to all of the city.

EarthLink Inc.: EarthLink Inc., the company that took on the task of helping cities such as San Francisco and Philadelphia establish Municipal broadband networks, has backed out of its “no cost to the city business model.” On February 7, 2008, they announced that all $40 million of the company’s wireless broadband possessions are being sold due to an unexpected poor return.

Current Status of Municipal Projects Outside the United States

Toronto: Wednesday, September 6 of 2006: City of Toronto launched Wi-Fi network in financial district through Toronto Hydro Telecom called “One Zone.” The aim was to provide easy internet access for low cost. Access was to be free for 6 months, but citizens would later be charged hourly, daily, or monthly. The Wi-Fi area covers 6 square kilometers of the downtown region. According to a CBC article, a basic mesh network system mesh networking was implemented to connect Toronto Wi-Fi to Toronto hydro telecom fiber optic network to expand the system to 450 km which interconnected around 400 commercial buildings. In January 2008, “One Zone” went up for sale. To date, the company still charges daily and monthly rates.

See also

• Switched mesh
• Wireless community network
• Municipal wireless network

External links

• CNET Map of Municipal Broadband networks in the United States
• Cybertelecom: Municipal Broadband
• Panel discussion with Google about their project for San Francisco
• MuniWireless.com: the portal for the latest news and information about municipal wireless broadband projects around the world with a comprehensive summary of projects, market research reports, and conferences; set up by Esme Vos in 2003, updated list of US cities and counties with wireless networks
• W2i.com: a comprehensive best practices sharing portal that address all aspects of municipal wireless deployments including a searchable database of municipal deployments worldwide, videos, audios, expert zones addressing various aspects of deploying municipal wireless networks, expert blogs, daily headlines
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