The community of Sebewaing, located in the "thumb" of Michigan is moving closer to its own FTTH network, which will be the first new municipal FTTH project in the state.

Because of a state law impinging on local authority in Michigan, local governments must first issue an RFP and can build a telecommunications network themselves if they receive fewer than three qualified bids. If the community builds the network themselves, it probably must adhere to the RFP as if it were a private entity. This approach ignores the fact that a community operates a network with different incentives than a private company, so the two are not interchangeable. 

We wanted to know more about this effort, so we contacted Melanie McCoy, Superintendent of the municipal utility Sebewaing Light and Water. We discovered that the town of 1,700 residents, known for its beet farming, has several factors going for it. 

Communities with their own utilities already in place have personnel, equipment, and expertise which saves money and time. And because they already own the utility poles, they are often able to get started quickly rather than waiting for other firms to do "make-ready," which can take months as wires are shifted on poles. Sebewaing has a municipal fiber loop currently in place - another plus. McCoy tells us the fiber was installed in 2001 and 2002 at a cost of about $50,000.

Private Internet choices were limited to dial-up for about $20 per month or a T1 connection for around $1,000 to $1,500 per month. At the time, Sebewaing Light and Water shared a T1 connection with local businesses.

Residents, business and government needed better connectivity and community leaders also realized the need to boost economic development. Sebewaing Light and Water leadership also wanted to increase efficiency with a SCADA system and considered a telecommunications utility a good investment. And looking toward the future, they knew installation of the fiber would position them favorabley for future investment. 

Community members in Princeton, Massachusetts, voted on May 14th to proceed with planning for a next-generation fiber network. The picturesque New England community voted to spend $10,000 on a system design and to establish an entity to operate the network in the future, if the community decides to proceed with the investment.

According to News Telegram story, the question passed by more than the required two-thirds majority at 274-61.

Earlier this year, the Princeton Broadband Committee distributed a survey to residents. Results showed the people of Princeton desperately want something better than existing DSL, satellite, wireless or dial-up. School's must now connect with expensive T1 connections and property values suffer due to the lack of broadband. Telecommuting is not an option in Princeton.

The design should be completed this summer, opening the way for the next step in the process. Voters will need to approve by a two-thirds majority a request to borrow funds and the establishment of the town broadband entity.

Longmont, Colorado, will move ahead with plans to offer fiber connectivity to the entire community. After presenting this business plan to the City Council, members voted unanimously on May 14th to support the measure. Scott Rochat from the Times-Call attended the meeting.

Residents stepped forward to express their opinions and all but one urged the council to "get it done."

From the Rochat article:

The plan projects a four-tier price structure. For residential rates, that's proposed to range from $39.95 a month for 10 megabit-per-second upload and download, to $99.95 for 100 mbps.

The study estimates that 35 percent of homes would choose to get their Internet service from the city, still leaving plenty of the field for the existing providers.

"Competition is good," Councilman Alex Sammoury said. "Just because we're a government entity doesn't mean the free market doesn't apply to us. If someone can do it better, more power to them."

The plan proposes to have the city provide Internet directly and work with a private partner for phone service.

Video service would not be provided, Roiniotis and the Uptown consultants said, because Internet video has eroded the market for traditional television.

Vince Jordan, LPC Manager, began the presentation and stressed economic development, education, and lifestyle.

Representatives from Uptown Services reviewed recommendations and the business plan. They answered about 3 hours of questions from council members, including skeptical members who want to avoid becoming the next Provo, Utah. Neil Shaw and Dave Stockton from Uptown Services provided some perspective between the two communities. They pointed out the large number of successful networks in states across the country.

Longmont had been prepared to incrementally expand the network using the cash on hand from the many years of dark fiber leasing. Such an expansion could be done without borrowing but would take a long time (more than ten years, likely) to get to everyone. This is the approach Danville, Virginia, has been using.

We look forward to the next issue of Broadband Communities magazine, due on June 15th. This upcoming edition is titled "Fiber Nation: Are We At The Tipping Point?" and focuses completely on local communities that created their own networks.

Broadband Communities puts on the annual Broadband Communities Summit, which we just attended in Dallas in April. The magazine is free and features a lot of information useful to those thinking about building networks.

According to the announcement, you can subscribe now and have the issue delivered to your door and/or your inbox. The issue will include:

• Annual Census and Analysis of Muni Networks
• FTTH Deployments with Case Studies
• Best Practices for Broadband Adoption
• Deployment of Advanced Broadband on University Campus
• Financial Modeling for Rural FTTH Builds
• Economic Development and Broadband
• Gigabit Communities - The Fast Few

Joanne Hovis, President of CTC Technology and Energy, recently published a must-read article in Broadband Properties Magazine. Whether you are a community leader investigating the possibility of a publicly owned network or an engaged citizen looking for pros and cons, this piece explains practical benefits succinctly. In her article, The Business Case For Government Fiber Networks [PDF], Hovis looks at life beyond stimulus funding. She points out how we should evaluate municipal networks in an environment where shareholder profit is not the first consideration.

Hovis gives a brief history of how local communities reached this point of need. As many of our readers know, local communities used to be able to negotiate with cable providers for franchise opportunities and rights-of-way. Often cable providers would construct broadband infrastructure in exchange for a franchise to operate in a given community, creating I-Nets for local government, schools and libraries. Once states inserted themselves into the process with state-wide franchising, local negotiating power evaporated. Many of those franchise agreements are ending and local leaders are considering municipal fiber optic networks.

Hovis stresses that municipalities do not function in the same environment as the private sector. While they still have a fiscal responsibility to their shareholders (the taxpayers) the main function is providing public safety, encouraging economic development, offering education, and using tax dollars to better the quality of life. Hovis describes how redefining return on investment (ROI) needs to go beyond the balance sheet bottom line. 

These benefits have nothing to do 
with traditional financial measures. Rather, they represent the return 
to the community in terms of such largely intangible societal benefits 
as enhancing health care quality, narrowing the digital divide, providing enhanced educational opportunities to school children, delivering job search and placement opportunities at public computer centers and helping isolated senior citizens make virtual social connections.

In January, Longmont Power and Communications (LPC) announced they would begin connecting businesses located within 500 feet of the existing network. As we reported, local businesses were chomping at the bit to get hooked up and enjoy the high-speed next generation network. Even without efforts at marketing or advertising, more businesses have added themselves to the queue. LPC will present the formal business plan for expanding the network to the City Council on May 14th. Tony Kindelspire recently reported on the race to get on LPC's network in the Longmont Times-Call:

"We are bringing to council a business plan to build out all of Longmont," [Vince] Jordan, [Broadband Services Manager], said. "It's the whole enchilada."

The fact that there has so far been only limited rollout is due to economics. Currently, the installations are being paid for from a reserve fund that Longmont Power has built up over the years leasing portions of its fiber-optic loop to entities such as Longmont United Hospital and a third-party provider that services the school district. Those leases bring in about $250,000 annually, Jordan said.

For 2013, the Longmont City Council authorized LPC to use $375,000 of that reserve fund to begin connecting businesses and residents to the loop.

This model works, but does not connect everyone fast enough for their liking:

To expedite the build-out, extra up-front dollars will have to be allocated, but where those dollars will come from is yet to be determined, Jordan said, adding that ultimately, the decision will lie with City Council.

Yet the challenge remains: monopolies have a high instinct for self-preservation. And more than half a dozen states have passed legislation limiting municipalities from building public broadband networks in competition with private businesses. South Carolina passed its version last year. A similar bill narrowly failed in Georgia. Supporting these bills, of course, are the nation’s cable and telephone companies.

According to the F.C.C.’s latest calculation, under one-third of American homes are in areas where at least two wireline companies offer broadband speeds of 10 Mbps or higher.

We recently learned about Aztec, New Mexico's, free downtown Wi-Fi  so we decided to contact Wallace Begay, the IT Director, to find out more. This desert community of about 6,600 people not only offers the free service, but uses its fiber to serve government, schools, and even four-legged residents.

Begay tells us that in 1998 the city and school system coordinated to install the original fiber and the entities share ownership. The school wanted better, affordable connectivity for students while the city wanted economic development opportunities. Community leaders used E-rate funding and a Gates Foundation grant to construct the original fiber aerial route.

The town provides water, wastewater, and electric services through municipal utilities with its SCADA system. The public library and all ten Aztec Municipal School facilities connect to the fiber network. Municipal government facilities also use the network.

Even though the city is a co-owner, it took several years for municipal offices to get on the fiber network. Aztec City Council originally decided to install the fiber network as a way to bring in revenue by leasing dark fiber, not as a way to connect offices. When Begay started at the city in 2001, administrative offices still used dial-up connections. Twenty dial-up accounts (and the crawling speeds associated with them) added up to $500 each month.

At the time, Qwest (not CenturyLink) was the provider in Aztec and could only offer microwave or copper connections. Connecting 13 facilities at 1.4 Mbps would have cost the city $1,200 each month. Begay used $500 from the electrical enterprise fund to purchase equipment and pay for tech labor to move municipal offices on to the existing network. The city electrical enterprise fund pays for expansions and updates. The network is now about 12 miles.

In 2008, the Tullahoma Utilities Board in Tennessee, created LighTUBe. In addition to attracting employers, the FTTH network connects residents and provides smart meter capability. The network now offers 1 gig service to business and residential customers.

Andrea Agardy, from the Tullahoma News, covered the story. Residential customers who now purchase the highest tier, 300 Mbps, will be automatically upgraded at the same $300 monthly rate. LighTUBe will provide 1 gig business connectivity on a case-by-case basis.

Brian Skelton, General Manager, said:

“It shows that we can provide anything they want,” he said. “The TUB board made the decision to build a fiber to the premise system for economic development reasons, and it is paying off for our community. We want to make Tullahoma a much more desirable location for technology companies to locate, due to our ultra-high speed Internet and our highly skilled workforce. Tullahoma is light years ahead of most cities in the United States with the ability to offer these incredibly fast Internet speeds, and we look forward to the benefits this will bring to our city.”

Kudos to LighTUBe and the community of Tullahoma!