The essence of the objection to municipal involved in communications is that public intervention will undermine the private sector due to the cost advantages uniquely available to governmental entities, thus creating a barrier to public entry. As we have shown, however, this objection fails in two ways: First, municipalities tend not to become involved in communications in markets characterized by effective competition; and second, where municipalities do become communications providers, private entry into the market tends to be stimulated rather than suppressed.
Lafayette's Community Fiber Video Discusses Local Benefits From Network
The LUS Fiber network owned by the city of Lafayette, Louisiana, was profiled in this nine minute video from the FTTH Council Conference. LUS Fiber has been an inspiring network - overcoming tremendous opposition from Cox cable and AT&T (formerly BellSouth). It has long offered what I consider to be the best deal in broadband in the nation - $28/month for 10Mbps symmetrical.
And it has been incredibly innovative -- offering 100Mbps to all in-network transfers. So if my buddy and I are on opposite sides of town and only pay for the most basic connection, we can transfer files between each other as though we were on the same local network in our houses. This idea is being copied by other communities as well.
Finally, this LUS Fiber network was one of the three we profiled in our Broadband at the Speed of Light report on gigabit municipal networks.