Herman Wagter has published an informative article about the last-mile economics of fiber networks on Ars Technica.

A Utility Infrastructure Law commonly quoted by engineers says, "The closer you get to the home, the more investment is needed, averaged per home connected." This law applies to all parts of the physical network, like water pipes, sewage pipes, and electricity cables. What are the applicable numbers for telecom cables?

The large expensive of building fiber networks has little to do with the technology:

In dense cities, the bill of materials is as low as 20 percent. The cost of labor per meter exceeds by far the cost of a fiber cable or a coaxial cable per meter. Deploying fiber or coax or copper wires would not make much of a difference. The phrase “it’s the backhoe, stupid” even applies in areas like Uganda.

This is why incumbents have such tremendous advantages and why policies predicated on encouraging facilities-based (as in, everyone builds their own network) have failed (and will continue to).

Given the fact that almost all costs in the access network are sunk, it is hard to envision two or more new fiber access networks being deployed in parallel to each home, leading to a stable competitive environment over time. (Unless the ISP’s or network's owners are allowed to divide the market and raise prices to compensate for the underutilization of the networks). If the medium is no longer limited and the access network is the expensive part of the investment, why duplicate the cables? We not do duplicate cables for electricity or other utilities either, for the same reasons.

As we tend toward a single fiber line (wireless is a complement for wired, not a substitute), who owns that line is tremendously important. Private companies want to monopolize the line to maximize their profits -- that is their job. Public ownership offers democratic accountability and a much greater potential for open access, creating robust competition in a sector almost entirely lacking it.

The second page of the article offers more in-depth analysis of various FTTH technologies that communities would be wise to understand before picking what model they want for their community.

Tim Nulty describes the "most rural" FTTH project in America - a large multi-community build in Vermont, the state with the largest percentage of people living outside metropolitan statistical areas. This is more of a technical article, explaining why the network is necessary, who they have contracted with, and the topology of the network.

Beginning in early 2008, ECFiber developed a project to bring fiber to every single premises in its area: “universal service -- no exceptions, no excuses” without any assistance from the State. This project was completely self-sustaining from the revenues of subscribers alone. A public offering of $90 million of Certificates of Participation, fully compliant with SEC requirements, was prepared by Oppenheimer Company and was on the verge of closing when Lehman Brothers collapsed and with it the entire municipal debt market.

ECFiber had to start again from scratch. Fortunately, the Stimulus Bill passed about this time and ECFiber redirected its financing efforts to that source. It was not a difficult matter to recast its Public Offering documents into an application for a BIP loan. No grants are needed by the ECFiber project and none are asked for. Vermonters generally don’t approve of free taxpayer handouts except in extreme circumstances. ECFiber is completely viable and requesting grants would be, in our view, unnecessary and, hence, improper.

We continue hoping the RUS will stop wasting time with lesser projects and direct a loan to these folks in Vermont.

In two articles, Jesse Harris offers some insight as to how one can evaluate UTOPIA as a success or failure. In the first article, "Defining UTOPIA's Success," he looks at some of the indirect benefits from the network.

Financial success is the most obvious kind. It’s very easy to look at expenditures and revenues and come up with a bottom line figure. I don’t mean to discount the importance of coming up with a positive number at the end of that statement, but it really isn’t the entire financial picture. (Take a look at my breakdown of Provo’s real and potential savings from iProvo for a good example.) Orem, for example, is saving somewhere in the neighborhood of $600K per year in telecommunications costs by using UTOPIA fiber in their city. None of the other cities have released similar figures (at least not that I am aware of), but I think it safe to say that they are experiencing similar savings. Such an approach also fails to recognize that incumbent providers are forced to offer better service and pricing to attract and retain customers. Based on national figures, a UTOPIA-served neighborhood is likely to save 25% or more off of telecommunications costs.

In the second and longer article, "FUD Alert: Utah Taxpayers Association Continues to Bend and Cherry-Pick the Truth," he directly answers one of the fiercest critics of UTOPIA - the UTA.

His response is well worth a read as a model example of how to respond to these ignorant attacks. We cannot allow lies against community broadband to go unchecked - thank you Jesse for your strong response.

This article summarizes the "Public Ownership is Good Business" Panel from the 2008 Broadband Properties Summit. Panelists included Christopher Mitchell from muninetworks.org, Andrew Cohill of Design Nine, Monticello City Administrator Jeff O'Neill, Mary Farley of Steeplechase Networks, and John St. Julien from Lafayette.