nextgenhandbook_tcm1045-269601Handbook
THe nexT GeneraTion
Blair Levin and Denise Linn
Gig.U: The Next Generation Network Innovation Project
Published by the Benton Foundation
neTwork ConneCTiviTy
A Guide for Community Leaders
Seeking Affordable, Abundant Bandwidth
Vol 2.0 December 2016
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dedication
This Handbook is dedicated to the hundreds of city and university officials, particularly participants in Gig.U,
who over the last five years, as we explored many routes, helped guide us to significant course corrections and
created the map for community-led broadband.
It is also dedicated to the thousands of citizens who attended scores of meetings with us on community-led
broadband, in cities large and small, in every part of the country, and who provided many insights we incorporated
into our work and into this Handbook. Many of their words were wise, but none were wiser than those offered
by a student at an event at the University of Maine, who, after noting all the specific reasons he was excited about
having access to abundant bandwidth then said, “But what is most exciting is what we don’t yet know.”
It is further dedicated to the memory of Charles Benton, a wonderful friend and coach to the Gig.U project, and
many others seeking to improve the capacity of communications networks to serve all. His energy and excitement
about discovering ‘what we don’t yet know’ served, and will continue to serve, as the most important type of fuel
for the work of bringing affordable, abundant bandwidth to our communities.
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About this Handbook
Overview: The Underlying Equation
Why Upgrade? Why Now?
The Economic Case for Faster Speeds
The Quality of Life Case for Faster Speeds
Why Not Wait for Google Fiber?
The Bottom Line: If Not Now, When?
What’s Been Done?
Community-Led Gigabit Fiber Success Stories
What About Cable?
City-Driven Wi-Fi Projects
An Overview of Models
Emerging Map, Including Cities to Watch
Cautionary Tales for Cities Seeking or Working with
Private Partners
Incumbent Push Back Against Cities Aiming to Own and
Operate a Network
State Laws Inhibiting Public Networks
How Should My City Approach the Challenge?
High Level Local Strategy Framework
The Spectrum of Strategies from Low to High Effort
What are the Preliminary Steps?
Unite Diverse Local Actors on a Common Mission
Take Inventory of Local Advantages, Strengths, and Barriers
Tackle the “Low-Hanging Fruit”
Understand the Economics: Orient First Steps Around
Lowering Costs and Risks
Public Messaging Points: Better, Faster, Cheaper Broadband
What are the Key Issues in Developing a
Public-Private Partnership?
Negotiating with Partners
Where to Build
How to Build
Access to Infrastructure and Rights-of-Way (ROW)
Permit Approvals
Personnel Commitments
Open Access
Free Network Services for the City
Revenue Sharing
Other Provisions
What are the Funding Issues and Opportunities
that Affect How the City Proceeds?
An Overview
Key Considerations: Financing
Funding Methods and Case Examples
Challenges to Expect Along the Way
Challenges during the Exploratory Phase
Challenges during the Decision-Making Phase
Challenges during Implementation and Build-Out
Agendas and Issues to Watch in the Next Administration
Top Ten Overall Lessons
Conclusion – Eliminating Bandwidth Constraints
Appendix: Tools, Resources, and Links for
Your Next Steps
Previous Reports from the Gig.U Project
Glossary
Related Cases, Studies, and Tools for Gigabit Cities and
Municipal Broadband
Public Documents of Interest
Organizations to Know and Follow
List of State Laws Inhibiting Public Broadband
Acknowledgements
About the Authors
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Contents
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about this Handbook
This is a handbook for city officials seeking the affordable, abundant bandwidth their communities will
need to thrive in the decades ahead. Designed for local decision makers, it reviews the current landscape of
broadband networks, including next generation, gigabit capable networks, outlines best practices, summarizes
existing models, and presents a framework through which community leaders might begin preliminary project
steps given their city’s specific strengths and circumstances. Our purpose is to lower the initial, daunting
information barrier that exists between cities already immersed in these Internet infrastructure issues and those
just beginning to navigate them.
The Handbook itself is an outgrowth of the many discussions between Gig.U and others deeply knowledgeable on
municipal issues, in which it became clear that cities would benefit from a guide to stimulating new investments in
21st century information infrastructure. One of the key insights city officials provided concerned the importance
of the many linkages between deploying such information networks and other municipal policies, including
those affecting construction, transportation, housing, and economic development. As a result, at the heart of the
Handbook are two critical and related tasks for the city: understanding how its practices affect the economics of
deploying and operating next generation networks, and organizing its assets, practices and people to improve its
ability to negotiate with third party providers or deploy a network itself.
Given the pace of change, this second edition of the Handbook provides a “snapshot” of information for city
leaders as of the end of 2016. We anticipate future updates in response to new products, evolving technology, new
lessons, and feedback from partners and readers. Our country is still early in its journey to assure that all have
access to next generation bandwidth. While cities have led in the efforts to date, most still have not yet started
down this path. As they do, we hope this Handbook helps them, and in turn, that their collective experiences will
improve this resource, and ultimately bring all closer to affordable, abundant bandwidth now and for generations
to come.
Gig.U is a coalition of research university communities seeking to accelerate the deployment of next generation
broadband networks to support economic growth and educational innovation. Since Gig.U was formed in 2011, over
two-dozen Gig.U communities have started or participated in next-generation network initiatives, in which over 50
additional cities have joined. Information about the project can be found at gig-u.org/the-handbook/.
Benton Foundation works to ensure that media and telecommunications serve the public interest and
enhance our democracy. It pursues this mission by: 1) seeking policy solutions that support the values of access,
diversity and equity; 2) demonstrating the value of media and telecommunications for improving the quality of life for
all; and 3) providing information resources to policymakers and advocates to inform communications policy debates.
For more information, visit benton.org.
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overview: The Underlying equation
Our conversations with city officials and community leaders always begin with the same question, “Are the
broadband networks in your city good enough for it to thrive ten years from now?”
The answer we always heard back was “no.” And then the work would begin, with city staff asking us a series of
questions designed to figure out how to accelerate the deployment of next generation networks and turn that “no”
into a “yes.”
This Handbook is organized along the lines of the questions Gig.U heard
most often as we worked with over 75 communities on about two dozen
projects. (See the Gig.U communities Project Status Chart on page
8.) Not everyone is interested in the same questions. For example, city
mayors might be most interested in the sections on why cities upgrade;
their staff might focus on what’s been done and first steps; and city
lawyers might focus on the issues involving public-private partnerships.
While we hope all communities can benefit, the Handbook is primarily
focused on community-led broadband. Such efforts are generally
achieved though some kind of public-private partnership, meaning, at its
most basic, an arrangement by which the city negotiates with a private
party to achieve some public purpose. In our case, the purpose could
include some or all of designing, deploying, maintaining, operating, and
providing a retail service on the network. The private party can take
many forms – including new entrants, incumbents, and nonprofits – and
the relationship between the city and the private party can operate in
many different ways. We acknowledge that some cities want to go it
alone. While we describe some of these efforts, we acknowledge such
efforts raise questions beyond the scope of this guide.
Whatever the nature of the partnership, and whatever the job of the person reading this, all readers should
understand the underlying core question of economics. Specifically, why are current market forces not producing
the affordable, abundant bandwidth that communities seek and that next generation networks can deliver?
In a way, the answer is simple. While the benefits to the community of constructing a gigabit or next generation
network may be great, the benefits to private providers are generally less than the cost. We have found it helpful to
break that simple cost-benefit idea into the following equation:
Figure 1: Broadband Cost-Benefit Equation
CapEx OpEx (1-risk) Revenues System
Benefits
Threat of
Losses Due to
Competition
What is Community-Led Broadband?
Many terms have been used to describe efforts
by communities to improve the options their
residents and enterprises have for broadband
services. One common term is “municipal
broadband,” though that generally means the
municipality deploying, operating, and offering
a broadband service. We prefer the phrase
“community-led broadband” to signify the
community taking an active role in accelerating
the deployment of next-generation networks,
and consciously making choices about how
those networks can best serve the public good,
as illustrated by the many examples presented
in this Handbook.
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That is, for all the current and potential providers, the sum of new or incremental capital expenditures and
operating expenses for a next generation network is greater than the new or incremental risk-adjusted revenues,
plus system benefits (the benefits to the service provider’s overall system beyond the local network), plus the threat
of competitive losses.
That equation, however, can be and has been reversed by many cities, much in the way that cities often negotiate
with private real estate developers and potential facilities locations to make an otherwise difficult investment
possible. At the heart of these negotiations, and indeed every business negotiation between partners, is a search
for asymmetric value creation. That is, the opening question is what can party A do that costs relatively little but
creates a larger benefit to party B, so that party B will act in a way to benefit both party A and party B.
Here, both the city and a potential provider want to improve the investment opportunity in next generation
broadband networks. The question is what can the city do, at a minimal cost to the city, that provides a larger
benefit to the partner, that in aggregate reverses that equation by reducing capital expenditures, operating expenses
and risk and increasing revenues, system benefits, and competition (Figure 2).
The first step, therefore, is for the city to understand how its policies and practices affect the economics of
deployment and what actions it can take, at minimal cost, to improve those economics.
This leads to a second, and related, step. The city needs to organize itself in a way that improves those economics
while also improving its own leverage in a negotiation. To attract any investment into next generation networks,
the city has to do a certain minimum in terms of improving the economics for the network. To maximize its
ability to negotiate certain terms, however, it has to have leverage in the negotiation. For example, many cities
want commitments to serve certain areas or facilities. The more the city has done to lower the costs of deployment
or organized demand for the new offerings, the more willing the private provider will be to agree to such requests.
Further, the more the city does to attract competitive offerings, the more likely it is that the city will be able to
further its own goals in the negotiation.
This Handbook provides numerous strategies and tactics that build on the economics and help create leverage.
No two cities will walk the precise same path. But all can benefit from learning how other cities have traveled up
this mountain. And all should understand this: actions taken today will affect what kind of broadband networks
the city has in ten years, and in ten years; whether it has faster, cheaper, better broadband networks will affect
everything that city does.
Figure 2: Revised Broadband Cost-Benefit Equation
CapEx OpEx (1-risk) Revenues System
Benefits
Threat of
Losses Due to
Competition
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Figure 3: Gig.U Status as of Spring 2015
Gig.U Status as of Spring 2015
UNIvERSITY COMMUNITY STATE METHOD STATUS
virgina Tech Blacksburg VA PPP Downtown Gig Zone
Michigan State East Lansing MI PPP Local ISP Offering
U of Florida Gainseville FL Local Utility Innovation Zone Network Built
U of Louisville Louisville KY RFP 3 New Entrants Building Gig Networks
U of Kentucky Lexington KY RFP Pending
Texas A&M College Station TX RFP Incumbent upgrade to Gig
U of NC Chapel Hill NC NCNGN AT&T and GF Deploying
NC State U Raleigh NC NCNGN AT&T and GF Deploying
Duke U Durham NC NCNGN AT&T, GF and Frontier Deploying
Wake U Wake-Forest NC NCNGN AT&T Deploying
ASU Phoenix AZ GF Negotiating with GF
Georgia Tech Atlanta GA GF AT&T and GF Deploying
U of Chicago Chicago IL Legal Reform Telco Upgrading Network
U of CT Storrs, New Haven, CT State RFP RFP in Process
44 other cities
U of Missouri Columbia MO RFP Developing RFP
U of Montana Missoula MT Study Study Complete; developing response
U of New Mexico Albuquerque NM RFP Developing RFP
U of Illinois Cham/Urbana IL RFP Local ISP Developing Network
Case Western Shaker Heights OH PPP Pilot Project with Non-profit
U of Wv Morgantown WV PPP Spectrum Based Pilot Operational
U of Washington Seattle WA Legal Reform Telco Upgrading Network
U of Maine Orono ME PPP In Discussions, Spin Off Projects
Colorado State Ft. Collins CO Study Council Authorized Study of Options
GF: Google Fiber
NCNGN: North Carolina Next Generation Network
PPP: Public Private Partnership
RFP: Request for Proposal
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why Upgrade? why now?
As noted earlier, the first question is always, “Does your
city have the broadband network it needs to thrive ten years
from now?”
If the answer is “Yes,” stop reading. If you think you have
everything you will need in the future, there is no need to act.
If the answer is “No,” however, then the time to begin
thinking about faster speeds, more competition, and better
service is now. Network upgrades do not happen overnight.
Many decisions your city will make over the next several years
will affect what kind of network -- and city -- you have a
decade hence.
When Google Fiber released its Request For Information
(RFI) in 2010, over 1,100 municipalities stepped up and
articulated their desire for next generation networks. In
doing so, leaders at the local level started to think about
how their community’s infrastructure was a catalyst for
economic, educational, and governmental innovation. Since
2010, growing numbers of communities have considered either investing in public networks or negotiating with
companies like Google Fiber, AT&T, CenturyLink, and many smaller players to achieve desired high-speed access.
Though these upgrades are happening city-by-city and slowly (for now), each new deployment pushes gigabit
networks from novelty to competitive necessity. How will your city compete for, or retain, investment and human
capital alongside Chattanooga, Kansas City, Austin, Leverett, Wilson, Nashville, Charlotte, Raleigh, Provo,
Atlanta, and others with world-leading networks?
The Economic Case for Faster Speeds
There have been a number of studies linking broadband networks and new investments in such networks
to improved economic performance. In September 2014, the Fiber to the Home Council released a study
demonstrating higher per capita gross domestic product (GDP) in communities where gigabit Internet was
available. Infrastructure investment, job creation, entrepreneurship, and companies relocating or expanding to
your city are all manifestations of this growth.
The Quality of Life Case for Faster Speeds
According to RVA Market Research & Consulting, residents with fiber-to-the-home work an average of 1.3
extra days at home each month and about 14% have home-based businesses resulting in over $10,000 in extra
income for the household. Given that the average consumer spends over five hours per day online at home and
has multiple online devices, this infrastructure is only growing more valuable and more necessary. In fact, RVA
found that high speed Internet capacity was often one of the highest or the highest consideration when residents
evaluated neighborhoods, households, and multi-dwelling units (MDUs).
The reasons to upgrade overlap
multiple sectors and policy areas:
• Economic Development
• Public Safety
• Telemedicine
• Technology
• e-government
• Distance Learning and Education
• Job Training
• Improved Pricing and
Competition-Driven Innovations
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In terms of a community’s quality of life, better, faster, cheaper networks also could mean great benefits for
community anchor institutions. New possibilities for learning and efficient service delivery would open up to
local schools and libraries, especially. The Schools, Health & Libraries Broadband (SHLB) Coalition is making
this exact case in their recently launched Grow2Gig+ campaign and Connecting Anchor Institutions: A Broadband
Action Plan, published by the Benton Foundation.
Why Not Wait for Google Fiber?
As proponents for communities having affordable, abundant broadband networks, we are happy for the eight
metro areas where Google has deployed fiber. For the sake of other communities, we also hope that Google
announces it will expand its fiber footprint both for the new option and the competitive response Google Fiber has
stimulated.
Hope, however, is not a strategy. We don’t know (and we suspect Google does not know) how extensive its
deployment will be. (For more on Google Fiber and its evolving strategy, see Box on page 16.) It does not take
inside knowledge (and we have none) to look at Google’s deployments to realize that it, like its competitors, looks
at a number of factors, including scale, regional growth rate, deployment costs, labor availability, density, pole
attachment opportunities and others, to determine whether and where to expand. While some have speculated on
‘if’ and, if so, ‘how’ Google moves forward, even those communities that believe they fit the pattern, would, in our
view, be making a mistake to rely on a future Google decision that may not happen.
Further, nothing in a community-led broadband effort is inconsistent with a future Google decision to invest in
your city. We admire Google’s transparency in telling communities how to make themselves “fiber ready” both
with a technical guide and a check-list. Nothing in this Handbook is inconsistent with the approaches of those
guides, and we have relied, both in Gig.U efforts and in writing this Handbook, on insights the guides have
provided. Indeed, having a number of cities move ahead in the ways detailed here probably increases the odds
of Google expanding as well as accelerating the competitive
response. So our advice plays off the Talmudic wisdom to
“pray as if everything depends on God; act as if everything
depends on man.” Hope for Google Fiber to continue its
efforts, but act as if your fate is in your own hands.
The Bottom Line: If Not Now, When?
The bottom line is this: ten years from now, many critical
things a city and its residents can do, and the attractiveness
of the city from many perspectives, will be affected by the
quality of its broadband networks. Every city will want the
affordable, abundant bandwidth that does not constrain
innovation, economic growth, or social progress.
It is also true that many things cities do today – in terms of
zoning, construction, permitting, rights-of-way management,
and other traditional municipal activities – will affect what
kind of broadband networks it will have in ten years. In this
light, the time to begin thinking about what a city can do to
assure that all its residents and enterprises will have affordable,
abundant bandwidth is now.
More Economic Studies on Broadband
The Broadband Bonus: Accounting for Broadband
Internet’s Impact on U.S. GDP
Shane Greenstein and Ryan McDevitt
The Substantial Consumer Benefits of Broadband
Connectivity for U.S. Households
Mark Dutz, Jonathan Orszag and Robert Willig
Broadband Investment
US Telecom
Where the Jobs Are: The App Economy
TechNet
The Impact of High-Speed Broadband Availability
on Real Estate values:
Evidence from the United States
Gabor Moinar, Scott Savage, Douglas Sicker
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what’s been done?
The following section summarizes the most notable work and trends in local next generation
networks as of the end of 2016. The first step to considering an upgrade for your city begins
with a general understanding of the best practices and wide variety of successful methods
that can be replicated. Although there is no one-size-fits-all solution to attracting or deploying
gigabit networks, becoming informed about the successes and failures in similar locations
can illuminate potential paths for your city.
Community-Led Gigabit Fiber Success Stories
Google Fiber has been an exciting narrative, but it is not the only gigabit story holding promise for bandwidth-
hungry communities. Many communities, rather than wait for an Internet service provider (ISP) to provide a
solution, have become pro-active and succeeded in stimulating new, largely private, investment into broadband
networks. The innovative, alternative models for building and operating gigabit networks are diverse in approach
and strategy, but, as we’ve learned, encounter similar issues along the way.
Models: Trading Off Risk and Control
Every network deployment involves a number of components – design, constructing (which itself can be broken
down into many subparts), operating, marketing, and financing, to name the major ones. And, while city efforts
to date reflect elements unique to specific circumstances, all nonetheless face a fundamental question: what roles
should the city play in the project?
As cities approach this question, the basic trade-off involves risk and control. The greater the roles, the greater the
control, but also, generally, the greater the risk. What we have seen in community-led efforts are a variety of ways
cities seek to balance the two factors, often reflecting local history and preferences, as well as opportunity.
But what is generally true may not be true for a specific city. For example, playing the primary role of designing
and building out a network may be high-risk for some communities, but much lower for those with municipally-
owned and -operated electrical utilities, or where a federal grant paid for an initial design and build. Similarly,
some cities that are highly attractive to private sector ISPs can have a high level of control, even if they play none
of the roles, by using various governmental levers in a competitive process. Others may have to give up all control
to attract a private entity willing to deploy a gigabit network.
While we see a spectrum of how cities approach the fundamental trade-off question, their “answers” typically fall
into one of three basic categories:
1. Primary: The city plays the primary role by using public facilities to invest in telecommunications as public
infrastructure;
2. Partial: The city plays a partial role, but relies heavily on a private partner, particularly for operations,
marketing, and financing; and
3. Facilitator: The city uses governmental and other levers to facilitate the ability by private sector partners to
play all the roles.
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Within each of these basic categories, there are other levels of common concern, the most significant of which are:
• Partnerships: With whom should the city partner – a local or national ISP or a nonprofit?
• Phasing: Should the city build-out incrementally or have a plan to build throughout the whole community from
the beginning?
• Scale: Should the city scale the project on a local, regional, or statewide basis?
We describe some of the initiatives below, organized by degree of “city role level” (Primary, Partial or Facilitator).
For additional analysis of these models, one can also read “Successful Strategies for Broadband Public-Private
Partnerships,” published by the Institute for Self-Reliance (available here), which provides a detailed explanation of
some of the most important models for next generation broadband deployment. The Coalition for Local Choice
wrote a report, The Emerging World of Broadband Public-Private Partnerships: A Business Strategy and Legal Guide,
published by the Benton Foundation.
PRIMARy: The City Plays the Primary Role by Using Public Facilities to Invest in Telecommunications as Public
Infrastructure
Some cities, particularly those with a municipal utility whose assets can be leveraged to build and operate a
network, choose to play a primary role in deploying and offering broadband services.
Investing in the Entire Community: Chattanooga, TN
In 2010, Chattanooga became the first city in the U.S. to have a gigabit network available to its homes and
businesses. The city did so by building its own fiber-to-the-premises network as part of a holistic smart grid
strategy. Chattanooga has had its network, EPB, long enough that other cities can look to it for evidence of the
qualitative and quantitative benefits of next generation speeds. Since service began, both Volkswagen and Amazon
have moved into Chattanooga. Also, initiatives like GigTank have developed to foster the city’s budding start-
up community. In his 2012 New York Times op-ed “Obama’s Moment,” columnist Tom Friedman pointed
to Chattanooga EPB’s innovative ripple effect: “That network was fully completed thanks to $111 million in
stimulus money. Imagine that we get a grand bargain in Washington that also includes a stimulus of just $20
billion to bring the 200 biggest urban areas in America up to Chattanooga’s standard. You’d see a ‘melt-up’ in the
U.S. economy.”
Following Chattanooga’s lead, other cities have also invested in a telecommunications utility model, such as in
Leverett, MA, and Wilson, NC.
Ammon, ID
The small community of Ammon, Idaho, has joined the ranks of communities with the fastest broadband in the
United States with a city-built fiber network. It follows in the Stockholm model of providing the underlying
fiber, but offering residents the ability to choose and switch ISPs instantly on a city website. As is often the case
with rural municipal projects, the community decided to go ahead with its own deployment when it could not get
the commitment of the incumbent telco to upgrade its network. The city projected it would need a 50% market
share to be economically viable and it has obtained a 70% share.
Huntsville, AL
In February 2016, the city of Huntsville, Alabama, announced that its municipally-owned electric utility, after
planning a fiber network for its own purposes, will lease its fiber lines to Google, and possibly other third parties.
Huntsville could constitute the real deal and represent a new model for Google Fiber expansion and a potential
model for other communities.
The Huntsville model changes Google’s path to scale as it potentially decentralizes construction efforts to multiple
cities. Further, it represents the first effort by a major company to decouple ownership of the fiber network from
providing Internet services.
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The model also provides cities a new tool to accelerate the delivery of abundant bandwidth to their residents. One
can see a number of forces—cities, construction companies, finance companies—joining together to construct
and, in many places, complete dark fiber networks far faster than Google Fiber has been doing with its current
model. The new model also allows a city to address a number of city-specific policy objectives, such as establishing
enterprise zones and closing the digital divide, along the way. This path resembles how America built out its
electric grid; through local rather than national efforts.
Some may argue Huntsville is unwisely investing in a “municipal broadband” project in which public money
is unfairly competing with private. That characterization misses the point. Whatever one’s view of whether
cities should be in any business that private sector players enter, as a practical matter, it is a rare city that can be
successful, as successful broadband network enterprises usually have to take on financial and marketing risk, as well
as attract human resources and scale, all undertakings outside the core competency of cities.
The Huntsville model, however, does not require the city to take on those risks and tasks. Rather, it requires the
city to do something it does well: civil engineering. Building a dark fiber network is similar to building a water or
sewer system. It is in adding electronics, and operating, marketing, and servicing a fiber network, however, where
most cities’ skills will be sorely tested.
Further, the Huntsville deal furnishes any provider with the ability to lease the fiber. By applying the utility’s
standard terms and rates to different provider types, the fairness test is met and barriers to competition are
lowered. Finally, the economics are compelling as the incremental cost of the dark fiber to be leased to Google and
others is very small, in the context of the larger and necessary utility deployment.
Investing Incrementally: Gainesville, FL and Santa Monica, CA
Even if a city explores a public option for gigabit service, it doesn’t have to go all in right away. Gainesville
Regional Utilities (GRU) has connected businesses, community anchor institutions, and large apartment
complexes around the University of Florida to 1 gigabit, 100 Mbps, and 10 Mbps speeds. Recently GRU extended
its gigabit offering to all of the student apartments (37 complexes – roughly 6,000 ethernet ports) that it provides
service to throughout the Gainesville area.
Santa Monica’s City Net is another example of this incremental approach. The city built-out a fiber network
without a municipal electric department (as was used in Chattanooga) and without issuing debt. The project
started by connecting public facilities and then slowly expanded through a citywide “dig once” policy, meaning
that as other construction or capital projects occurred, the city would lay conduit and fiber. According to
City Net’s website, the network now covers downtown Santa Monica as well as a “majority of multiple tenant
commercial buildings.” For more about Santa Monica’s fiber story, see the case study written by the Institute for
Local Self-Reliance.
PARTIAL: The City Plays a Partial Role but Relies Heavily on a Private Partner, particularly for Operations,
Marketing, and Financing
While all models carry some level of risk for all parties, some cities have pioneered new ways of sharing risk so that
the city focuses on what it does well and the private party takes on the risks and responsibilities more consistent
with its own skill set.
Developing, then Finding, a Partner: Champaign-Urbana, IL, Westminster, MD, and Santa Cruz, CA
At the end of May 2014, UC2B – a nonprofit consortium led by the university communities of Champaign and
Urbana and the University of Illinois – announced a new model for gigabit connectivity through a public-private
partnership with a local ISP, iTV-3. Several years earlier, UC2B leveraged various federal and state grants and
local matching funds to construct a high-speed fiber network – first building out in low-income and low-adoption
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areas. The new public-private partnership means that iTV-3 will now operate the existing UC2B network and
extend its service to even more residents, institutions, and businesses. Although the cities will not have control
over the network or collect the revenue, the partnership succeeded in its goal of eliminating ongoing operating risk
to the cities. In August 2016, UC2B released a request for proposal expressing interest in working with a partner
to expand the existing network.
Another example is in Westminster, Maryland, a rural community about equidistant from Washington, DC, and
Baltimore, but not located on any major highway that connects to those major metropolitan areas. Years ago,
the city identified a fiber broadband network as a key strategic initiative and last year funded two fiber-to-the-
premises pilots. Building on that experience, in 2015, the city adopted a plan to install fiber that it will fund, own,
and maintain throughout the city. It has also entered into an agreement with Ting, a small but innovative ISP,
by which Ting will pay to lease the fiber, bring in its own equipment, and offer gigabit service to residents and
business. The city essentially treats the fiber as it does roads and bridges—having the responsibility for building
and maintaining—while Ting focuses on operations and customer service. The structure reduces the city’s risk
while increasing its control.
In December 2015, Santa Cruz, California, struck a deal with a local ISP, Cruzio, forming a partnership in which
the city would provide some dark fiber that the ISP could use to offer a gigabit-to-the-home service. In less than
six months, Cruzio lit up its network and began offering service. Cruzio was able to offer the service in far less
time than other gigabit projects by virtue of utilizing a millimeter wave fixed wireless solution.
Serving as the Anchor Tenant and Limited Partner: South Portland, ME
South Portland, Maine, held a competition in 2014, in which it agreed to be an anchor tenant for a next
generation gigabit capable network, in exchange for a private party agreeing to build, maintain, and operate
the network throughout the city. Under the agreement, the company would receive almost half of the nearly
$300,000 municipal investment in fiber and associated equipment through a $150,000 up-front payment by the
city for 20 years of service. The city would also share about 5% of the revenues of the network. South Portland
awarded the contract to GWI, a Maine ISP. As part of the contract, GWI committed to an open access model.
GWI is working with other cities in Maine to build networks with a similar financial structure.
Using a Nonprofit: Cleveland, OH
Cleveland benefits from the existence of OneCommunity, a nonprofit fiber network spanning 2,460 miles and
connecting about 1,800 facilities. Started in 2003 and now run by former Case Western University CIO Lev
Gonick, OneCommunity services the key anchor institutions in northeastern Ohio (government offices, schools,
universities, hospitals, etc.) and collaborates with the local community on broadband adoption projects and digital
literacy trainings. Currently, city officials in Shaker Heights are considering a partnership with OneCommunity
to extend fiber into the city’s commercial districts and attract more economic development. OneCommunity
has also formed a for-profit subsidiary, Everstream, which will provide high-speed Internet to businesses – the
revenue from which will be available to support the organization’s nonprofit programming. In November 2014,
OneCommunity announced plans to build a gigabit network to connect a three-mile Health-Tech Corridor in
Cleveland. Other cities should note that this expansion is partially supported by a U.S. Economic Development
Administration (EDA) Grant – another federal resource that can be leveraged for these kinds of projects.
FACILITATOR: The City Uses Governmental and other Levers to Facilitate Interest by Private Sector Partners to
Play All Roles
Other cities choose to adjust their policies in ways that change the economics of deployment, facilitating private
actors who then undertake the deployment and operations of the network.
15
Adopting Best Practices that Assist Local ISPs: East Lansing, MI
Uniting a diverse group of stakeholders under its “Gigabit Ready” effort, Lansing created an attractive
environment for its existing ISPs to upgrade. The Lansing Economic Area Partnership (LEAP), Michigan State
University, nonprofits, and commercial property managers came together in 2012 to lower barriers to high-speed
broadband deployment. To align incentives and capitalize on their unique partnership with local development
companies, the Gigabit Ready Coalition created a Gigabit Certified Building Program operating similarly to the
well-known LEED program. Now, local ISP Spartan-Net, and property manager DTN Management Co., have
partnered to bring gigabit speeds to residences and apartment complexes in East Lansing.
Using the Competitive Process to Stimulate an Upgrade in a City: Louisville, Ky, and College Station, Texas
Initial demand for faster speeds was fostered and articulated by Louisville’s residents, academics, and the business
community. To translate those voices into action, local advocates launched Louisville Fiber — a web-based tool
that allowed residents who wanted a gigabit fiber network to input their address. The resulting heat map was
informative for policymakers and also visualized demand for prospective vendors.
The city government released an RFI in November 2013 and received six responses. The RFI pushed Louisville
to confront its fiber-readiness. It made adjustments to its plans in order to attract vendors, such as increasing the
proposed franchise period from 15 to 20 years and reducing the bonding requirement, and issued an RFP. In
July 2014, Louisville approved three new 20-year franchise agreements for fiber network build-outs — one with
Louisville-based BGN Networks, one with London-based SiFi and another with New York-based FiberTech. It
is also worth noting that Louisville has been flagged as a potential Google Fiber city as well, though, as discussed
below in the sidebar on Google Fiber’s Evolving Plans, there is some uncertainty as to how Google will proceed.
Similarly, College Station, Texas, home of Texas A&M, used a Request For Proposal (RFP) to test the market.
In this case, the process stimulated an incumbent cable provider, Suddenlink, to respond by announcing it would
spend $250 million to upgrade its company-wide network to make it gigabit capable. College Station will be the
first Suddenlink market to see the upgrade, providing the community with what it believes it needs to keep, and
attract, bandwidth-hungry businesses and residents.
Using the Competitive Process to Stimulate an Upgrade in a Region: North Carolina
The North Carolina Next Generation Network (NCNGN) project is a collection of four universities (Wake
Forest, University of North Carolina-Chapel Hill, Duke, and North Carolina State) and six municipalities
(Carrboro, Cary, Winston-Salem, Chapel Hill, Durham, and Raleigh) which shared knowledge and resources
to release a single RFP. It articulated the region’s objectives and sought vendors to build and operate a gigabit
fiber network. The RFP was released in February 2013 and attracted eight responses. Since then, several of the
NCNGN cities have caught the attention of major national providers. During the summer of 2014, Chapel Hill,
Raleigh, Cary, Winston-Salem, Carrboro, and Durham finalized agreements with AT&T, which has begun to
deploy. Further, Frontier Communications has launched a gigabit network in parts of Durham and a start-up,
RST Fiber, has also announced plans to enter with a fiber offering. In January 2015, Google announced it would
deploy fiber to the Research Triangle Park areas, which also prompted an announcement of additional hiring by
AT&T to compete with Google and Time Warner Cable tripling its speeds.
Using the Competitive Process to Stimulate an Upgrade in a State: Connecticut
Connecticut is just beginning its upgrade journey, but the way it created a statewide conversation about faster
speeds makes it a case worth following. In April 2014, the state hosted a conference on gigabit networks for
municipal leaders. Then, in September, the mayors of West Hartford, New Haven, and Stamford announced the
release of a joint RFQ (“Request for Qualifications”), inviting other cities to likewise express interest and share
information. By December, 46 cities, constituting half the population of the state, had joined in the effort. In
January 2015, the RFQ received 11 bids, which are now being reviewed. The intentional interaction between
state and city-level officials is not only facilitating a conversation, it’s creating a powerful network of stakeholders
with a shared goal: that Connecticut be the first “gigabit state.”
16
More to Come, and New Players Emerge
A few years ago, cities had limited, if any, models to consider if they wished
to accelerate a next generation broadband network deployment. Now, they
have many – and the age of experimentation is far from over. We are already
in discussions with various communities who are considering tying together
elements of different models to best meet their own needs.
Further, while Google Fiber and some large incumbent telephone companies
are expanding their own fiber efforts, a number of smaller players are also
experimenting with new ways to deploy next generation networks. As noted
above, Ting, an innovative ISP with roots in both mobile and Internet services, is
bringing gigabit networks to several smaller communities, including Westminster,
Maryland, through a shared-risk model, and Charlottesville, Virginia, by buying
an existing ISP and upgrading its network. Sonic.net, an ISP based in California,
has plans to deploy gigabit-capable networks to ten communities in Northern
California. C-Spire, a Mississippi-based Competitive Local Exchange Carrier
(CLEC), ran a gigabit competition in that state and now is deploying to the six
winners. Monkey Brains, an ISP in San Francisco, uses an advanced wireless
radio, provided by a company named Siklu, to offer gigabit connectivity to
residents in San Francisco. Brooklyn Fiber, a three-year-old startup, started
rolling out a gigabit broadband service in early 2015 in Industry City, the
Brooklyn complex of former warehouse buildings.
While cities should follow developments of community-led broadband, they
should also note the private efforts of companies big and small, as they can
provide insight into new technologies and business models to best address a city’s
future bandwidth needs.
What About Cable?
Most of the examples of community-led broadband in this Handbook involve the
community working with a new provider, such as Google Fiber, a smaller ISP,
or the incumbent telephone company. This raises an obvious, and important
question: what about cable operators?
Cable provides a broadband service in all the communities discussed in this
Handbook and Gig.U’s philosophy was always to be business model and
service provider agnostic. That is, we did not favor a particular model or type
of provider; we simply wanted to create paths for communities to accelerate
achieving the affordable, abundant bandwidth necessary to thrive. We
approached all providers, including cable operators, about working with our
communities to experiment with various paths forward.
Early on, we thought cable might be the most interested in such experiments as
cable operators generally had the advantage of both faster networks and cheaper
upgrade paths. In that light, we theorized, cable might welcome efforts that
accelerated the demand for next generation bandwidth.
The theory proved to be wrong. Indeed, in a way we found ironic for enterprises
that marketed a service based on the superior performance of its bandwidth, cable
operators were generally dismissive of any need for more abundant bandwidth.
Google Fiber’s Evolving Plans
Recently, Google Fiber announced it was
postponing the deployment of fiber in
some of its targeted cities as it explores
opportunities to offer Gigabit services
through a fixed-wireless alternative.
(Google Fiber also announced some job
cuts and a leadership change.) These
announcements come on the heels of 1)
the FCC approving a Google-supported
plan to share spectrum in the 3.5 GHz
band; 2) Google’s announcement that
it would offer a high-speed service to
multiple dwelling unit buildings (MDUs)
in some large cities -- including Chicago,
San Francisco, and Los Angeles; and 3) its
purchase of Webpass, an ISP that offers
high-speed fixed wireless services in a
number of communities, including San
Francisco, Miami, and Chicago.
From this set of announcements, two
different narratives have emerged. One
view is that Google is slowly retreating
from the access business and is looking
for a face-saving way to provide some
service to limited communities in a way
that is significantly less expensive than
a full fiber build-out. The other is that
Google is putting a temporary pause
on a limited number of communities
but is, in fact, expanding the number of
communities it can reach by developing
a strategy that combines fiber with new
wireless opportunities.
As of this writing, we cannot be sure
which narrative is more accurate, though
it is possible that both contain some truth.
It is likely that the situation will clarify
in 2017, as Google’s testing in the 3.5
GHz band in 24 cities should be complete
sometime in the middle of the year.
In either case, however, cities should
still be proceeding with fiber-friendly
policies, as such policies will be important
for attracting affordable, abundant
bandwidth, whether from Google, a telco
upgrade, another fiber-based ISP, or a new
generation of wireless providers. (See
section on New Services that Benefit from
Fiber, below.)
17
For example, in 2013, the Wall Street Journal reported that the then Time Warner Cable CEO said having fiber
with gigabit speeds “ends up being more about publicity and bragging.”
We don’t question the sincerity of those views as stated at the time. But we also understood those views to reflect
cable’s comfort with a market structure in which it believed it had a clear advantage over its wireline broadband
competition and that that advantage would allow cable to charge a premium for the scarcity value of abundant
bandwidth. Given that comfort, we rethought our strategy to reflect the likelihood that cable would not move
forward with deploying its own next generation networks until it faced competitive forces compelling it to do so.
While we always welcomed cable’s participation with our efforts, we focused on finding ways to either improve the
position of the current bandwidth runner-up or bring in a new provider.
Subsequent events have reinforced that course correction. While cable has never been the first mover with a gigabit
network, it has always responded to community-led efforts with significant speed increases. Comcast’s emerging
gigabit offerings across the U.S. have, through no coincidence, mirrored the geographic choices of Google Fiber’s
deployments and interest. Also, Comcast’s more competitive gigabit pricing ($70 per month with a 3-year contract
as of August 2016) has also mainly overlapped with Google Fiber’s footprint.
We welcome this announcement and believe it confirms the fundamental equation and the role of the threat of
competitive losses in improving the economics of next generation network deployments.
How Communities, Not Individuals, Buy Broadband
Cable’s responsiveness also demonstrates something else at the core of community-led broadband efforts:
Broadband is bought as a community. While individuals think they make a choice, the choice is bounded by
choices the community makes.
To illustrate this, consider how at a Gig.U meeting several years ago, a cable company representative said the company
could sell consumers in our communities a gigabit service for $7,000 a month, with a two year commitment. That
company is now facing potential competition that will sell a similar product at $70 a month and what do you
know? That cable provider now has announced it will soon sell a gigabit product at that price point now too.
What caused the difference? Was it some new technology or some other brilliant innovation by a company
engineer? No. Rather, the difference lay in how a group of communities approached how they bought bandwidth
by improving the math for the deployment of next generation networks. By making it possible for cable’s
competitors to deploy and operate a network more economically, it caused cable to respond, giving its residents
faster, better, and cheaper options for broadband. Individual consumers may make the ultimate buying decision,
but those choices are circumscribed by decisions made at the community level. Consumers in Durham, North
Carolina, get the benefit of Durham’s decision to participate in the NCNGN, but those options are not available
to consumers in communities without such efforts.
That cable is now reacting to the efforts of Google Fiber, AT&T Gigapower, Century Link, and others with
their own next-generation network offering is a welcome dynamic, putting communities in a stronger position to
achieve affordable, abundant bandwidth. Still, we suspect to take advantage of that dynamic, communities will
have to be proactive in changing the status quo.
City-Driven Wi-Fi Projects
Despite some high-profile failures in citywide municipal Wi-Fi several years ago (such as in Seattle and Philadelphia),
recently, several smaller-scale projects have found their footing. Providing public Wi-Fi hotspots is not in any way
equivalent to rolling out fiber-to-the-home gigabit service, but it can be part of any city’s incremental connectivity
plan – either as a stepping-stone to future, more robust offerings, or a complementary service to other offerings.
18
Partnering with Neighboring Cities: San Francisco and San Jose, CA
San Francisco and San Jose have partnered to allow citizens to securely access each city’s public Wi-Fi networks.
They jointly facilitated access to this seamless wireless access by using Hotspot 2.0 (also referred to as Passpoint),
a technology that allows citizens to roam from one Wi-Fi hotspot to the other the same way cell phone users do
with their mobile networks.
Leveraging City-Owned Fiber Assets: Boston, MA
In 2014, Boston launched the “Wicked Free Wi-Fi” project. The first site was the neighborhood of Grove Hall
because of its concentration of low-income communities and its lack of Wi-Fi. The network spans 1.5 miles and
serves about 10,000 individual users per day. Designed to supplement mobile use, rather than replace in-home
broadband, the project connects users to the Web via the city’s own high-speed fiber-optic network.
Creating a Pilot Innovation Zone: Blacksburg, VA
Blacksburg, home of the Virginia Tech Hokies, is also home to a free gigabit Wi-Fi network that covers about 40%
of the downtown area. Initial funding to install the fiber at two locations was modest – just about $90,000 – and
was collected through a crowdfunding campaign started by TechPad, a local co-working and hacking community.
The network went live in the fall of 2013. The organizers intend to use the first few years of the project to gauge
local demand for faster speeds and, with that knowledge, to transition to a sustainable funding model.
Using Advertising to Support Widespread Wi-Fi Deployments: New york, Ny
In 2014, New York City announced an ambitious plan to erect 10,000 free public Wi-Fi hotspots on top of the
city’s old network of payphones. The LinkNYC kiosks, which started going live in January 2016, provide free
high-speed Wi-Fi with a range of 150 feet (1); a touch screen for advertisements and local information (2); the
ability to make free phone calls anywhere in the United States (3); a button
to connect to 911 (4); and outlets for device charging (5). The kiosks
design is Americans with Disabilities Act-compliant (6). The showcased
advertisements are projected to subsidize LinkNYC (7) and bring in $500
million in revenue over the next 12-15 years. The initiative is a partnership
between CityBridge (in which Google’s city-oriented advisory business,
Sidewalk, plays a major role) and the Mayor’s Office of Technology and
Innovation. Some questions have been raised about privacy, but design
measures have been taken to address these concerns. For instance, the USB
ports on LinkNYC kiosks can only be used for charging, not transferring
data.
As of August 2016, LinkNYC had 300 kiosks in Manhattan and the Bronx,
with Queens, Brooklyn, and Staten Island to follow. Generally, the project
has been met with positive reviews and now other cities are exploring
whether to follow this model with similar projects as both the economic
and quality of life advantages of such an approach appear compelling.
New York City has a number of other broadband initiatives, including
initiatives related to Wi-Fi in parks, Wi-Fi in Harlem, connectivity
through community and senior centers, and the New York Public
Library’s Library HotSpot program, designed for patrons without home
Internet. In a recent report on One New York City (pages 54-57) the City
discusses these and other initiatives, such as investments in broadband in
targeted broadband deserts.
7
6
1
2
3
4
5
19
Focusing on Tourist Areas Using Advanced Technology: Baltimore, MD
In February 2015, the City of Baltimore announced it would provide free Wi-Fi to the city’s main tourist area, the
Inner Harbor. While the City owns and operates its own fiber backbone, that network would not cover the entire
area. Further, the City did not want to create any further construction disruption to the area so an additional fiber
build-out was not an option. The City, working with a local ISP, turned to a high frequency radio solution built
by an Israeli company named Siklu.
Turning Unused Spectrum into City Wi-Fi: Seattle, WA
In the Spring of 2015, Seattle’s mayor announced a new Wi-Fi network in the city’s site of the 1962 World’s Fair.
The network will use TV White Space technology to create a large, powerful wireless network for citizen use –
reportedly capable of serving 25,000 users at once. The city is partnering with Microsoft to make this happen.
An Overview of Models
There is no silver bullet model when it comes to improving the infrastructure of your city to meet the demands of
the Digital Age. Each approach comes with its own risks and rewards. What will work for your city?
Figure 4: Overview of Network Models
CATEGORY
Primary
Partial
Partial
Facilitator
Facilitator
Preserve
Status Quo
MODEL
1. Build and run a
public network
2. Build and run a
public network
to businesses,
innovation districts
and/or community
anchor institutions
3. Build and lease out
public infrastructure
to the private sector
4. Facilitate a public-
private partnership
5. Adopt one, many or
several incremental
approaches to gigabit
fiber-readiness
6. Do Nothing
BENEFITS TO CITY
• Local control
• Universal coverage
• Customer service
and community
accountability
• Local control
• Leaves the door open
for future expansion
• Potential increased
competition
• Little public investment
or risk
• Shared risk and reward
across sectors and
community stakeholders
• Leaves options open for
city unwilling to commit
to public buildout or still
seeking a private partner
• Little public investment
• Zero public investment
and financial risk
RISKS TO CITY
• Financial return
• Operational
sustainability
• Pushback from
incumbents
• Financial risks
• Operational sustainability
• Pushback from
incumbents
• Financial risks depending
on vendor interest and
city investment
• Uneven coverage
• Lack of local control
• Partnership conflicts
going forward
• Incremental investment
can be risky and unwise
if it paves a path to
nowhere– ex: a future
private partner does not
invest and the city has
no plans to act alone
• Comparative disadvantage
in the long-run
RELEvANT CASES
• Wilson, NC
• Chattanooga, TN
• Bristol, VA
• Lafayette, LA
• Arlington, VA
• Gainsville, FL
• St. Louis, MO
• Huntsville, AL
• Mesa, AZ
• Santa Fe, NM
• Westminister, MD
• Kansas City, MO
• Raleigh, Cary,
Chapel Hill and
Durham, NC
(NCNGN)
• Champaign-
Urbana, IL
• Louisville, KY
• South Portland, ME
• Santa Monica, CA
• San Francisco, CA
• Boston, MA
• NYC, NY
• Los Angeles, CA
• Bozeman, MT
• Blacksburg, VA
• Baltimore, MD
• Too many to count...
20
Emerging Map, Including Cities to Watch
Figure 5: Maps of Cities to Watch
While the previous section summarized activities by cities fairly far along with their efforts, this section summarizes
a variety of efforts that are at earlier stages, with the thought that communities using this Handbook can review
the efforts of communities whose characteristics most closely match their own and benefit from learning how those
efforts have progressed. We have also mapped those efforts with efforts already discussed to provide an overall
view of community-led broadband efforts.
The cities in red, listed in the chart on page 21, are just beginning their upgrade journey. All are in the
preliminary phase – whether seeking a private vendor or planning to build their own municipal broadband
system. In the coming months and years, it will be interesting to see the different methods, models, and
partnerships unfold.
21Figure 6: Cities Beginning Gigabit Fiber Journeys
City Details
In 2013, Baltimore hired broadband consultant Magellen to explore the city’s options for improving competition
and speed. The city and community groups are still reviewing options.
In July 2014, Boston released an RFI to expand its fiber network. The city is still reviewing responses. Neighboring
Cambridge, MA, has also expressed interest in building public fiber infrastructure.
In 2014, 83% of Boulder voters voted to allow the city to pursue a municipal broadband network and the council is
currently reviewing its options, including how best to leverage the 100 miles of fiber optic cables the city already owns
and operates. In July 2015, Boulder released an RFP seeking a consultant to conduct a broadband feasibility study.
Bozeman began the master planning phase of the Bozeman Broadband Initiative in 2014. At the beginning of 2015,
Bozeman’s Commissioners approved the city’s master plan for the development of an open access fiber network.
The major player in the revitalization of Detroit, Dan Gilbert, has also backed a local ISP that is building out a
gigabit service in downtown and midtown. The ISP is also “setting up line-of-site rooftop-based systems that
would use antennas to deliver wireless gigabit-paced Internet to community centers and schools in the city in
advance of any citywide rollout out of fiber-optic service.”
The Ohio community announced in February 2015, and issued a RFP, that it was seeking partners to create and
implement a new municipal broadband utility with the goal of the utility offering a gigabit connection throughout
the community. The RFP can be found here.
In early 2015, the city set aside $300,000 to create a strategic plan designed to deliver, among other benefits, a
gigabit capable broadband network. The city hopes to have a recommended path by the end of the year.
Hudson is at the very beginning of its fiber journey. The city just released an RFP for the creation of a feasibility
study for fiber-to-the-home Internet.
In February 2016, the city of Huntsville, Alabama announced that its municipally-owned electric utility will lease
its fiber lines to Google. Huntsville could constitute the real deal and will be a city to watch, as it presents a new
model for Google Fiber-city collaboration. Read more about this case on page 12.
This city, in addition to Huntsville, has been flagged as an “upcoming” Google Fiber city, but it is uncertain whether
Google will proceed here.
Leverett, MA, released an RFP in June 2016 seeking a partner Internet service provider for its existing community
network, LeverettNet.
After a six-month planning period, which included following the Google Checklist, the city in early 2015 put out an
RFI, available here, to upgrade service throughout the city.
At the end of 2013, LA released an RFI for citywide gigabit connectivity. In response, Time Warner Cable (TWC),
the incumbent provider, promised gigabit speeds by 2016, but it will be interesting to see to what extent TWC’s
vision aligns with the city’s original RFI wish list. Other vendors, like Dutch start-up Angie Communications, have
expressed interest in building-out as well. In June, Los Angeles released an RFP for a gigabit network.
In February 2015, the Mayor’s Economic Development Office hired the University of Hawaii to study how to
upgrade the island’s broadband network, with the aspiration of a gigabit throughout the island. The study should
be completed by this summer.
The city released a broadband feasibility study with several key public policy recommendations regarding
information sharing, streamlined permitting, increasing demand through education and adoption programs, and
taking advantage of available loan and grant programs.
These cities, in addition to Huntsville, have been flagged as “upcoming” Google Fiber cities but it is unclear how
the pause in Google’s plans will affect these communities.
In 2016, Sandpoint released an RFP seeking a partner to assist it in strategizing ways to leverage its existing dark
fiber assets.
In the summer of 2014, Sanford completed a study concluding that fiber optic communications in the area would
have economic potential.
In 2014, Santa Fe announced a $1 million municipal broadband project to increase local connectivity and
competition and attract more technology companies to the region. The plan involves building a city-owned fiber
network, “SF Fiber,” and leasing it out to local ISP Cyber Mesa for its first four years of operation.
Baltimore, MD
Boston, MA
Boulder, CO
Bozeman, MT
Detroit, MI
Fairlawn, OH
Fort Collins, CO
Hudson, OH
Huntsville, AL
Irvine, CA
Leverett, MA
Lexington, KY
Los Angeles, CA
Maui, HI
Missoula, MT
Raleigh-Durham, NC
San Antonio, TX
San Francisco, CA
Sandpoint, ID
Sanford, ME
Santa Fe, NM
22
Kansas City, Austin, Charlotte, Salt Lake City, Provo, Nashville, Atlanta, Wilson, Lafayette, Chattanooga and
Sandy have already deployed residential gigabit service. With their residential service on or almost on (courtesy
of Google Fiber, EPB Fiber, and LUS Fiber), all these cities are worth watching for how they identify and unlock
the potential of gigabit connectivity. Prospective gigabit cities can analyze how these cities’ economies expand,
how their city governments change or improve online services, how their anchor institutions leverage improved
connectivity, and how broadband adoption changes.
Cautionary Tales for Cities Seeking or Working with Private Partners
Gigabit Squared in Chicago and Seattle
In 2011, a new entrant, Gigabit Squared, reached agreements with Chicago and Seattle to build out gigabit
networks. The company failed to do so and that failure suggests many lessons. The most important is that
partnering with unproven new entrants is risky – especially when there is no existing stake in the local community.
The importance of having “skin in the game” cannot be overestimated. When an additional incentive to deliver
in that community, beyond the specific gigabit project, exists, then there is higher probability for the city that
a partnership will be productive. This is why smaller but already operating ISPs in cities like Cleveland and
Champaign-Urbana have proven successful so far, despite the fact that they were not large or had never provided
gigabit service on the proposed scale before. Both OneCommunity and iTV-3 had preexisting relationships
with the community (Cleveland and Champaign-Urbana respectively). They had a stake in the success of the
communities in which they pledged to build. For established national providers like AT&T and Google, that
extra assurance comes in the form of both their secure funding and their interest in promoting the brand. To these
established companies, the cost of not meeting their obligations to the city, and thereby creating problems for their
existing business lines, is greater than for new entrants.
Bottom Line? While new entrants always carry risk, it would also be a mistake to discount them completely.
Instead, communities should be aware of the additional risks and protect themselves accordingly at the beginning
of any agreement. Indeed, both Seattle and Chicago, prior to entering into agreements with Gigabit Squared, did
due diligence and included contract provisions to minimize the communities’ risk. As a result, the financial losses
to each were relatively circumscribed, with the biggest loss being one of staff time and lost time to having a next
generation network.
Public-Private Partnership Pushback in Utah
In 2014, Australia-based Macquaire Capital expressed interest in partnering with the partially built, financially
struggling fiber network in Utah, UTOPIA. Macquarie is not a traditional ISP. Rather, it is a financing company,
interested in assuming UTOPIA’s existing operating deficit and then building out, upgrading, and managing
the whole network over a 30-year term. Macquarie’s build-out would be partially funded by a utility fee of about
$18-20 per household per month. The utility fee would cover the cost of constructing, operating, and maintaining
the network over the long-term. Payment of this utility fee would entitle consumers access to a basic level of
connectivity, competitive with entry-level offerings of current providers. The deal also includes waivers in cases
where customers cannot afford to pay the fee.
This effort is still progressing, but is in the midst of complications. Five of UTOPIA’s eleven member cities
voted not to continue to participate in the project, making it uncertain whether the utility fees will have to
increase because of higher per capita project costs. Underlying this difficulty in securing regional buy-in is the
ambitious nature of the per-household utility fee model – especially in a market where other providers still exist.
Pushback has also been organized by the campaign “Unopia” launched by the Utah Taxpayers Association. Not
surprisingly, Free Utopia, a Utah blog that favors municipal broadband, claims the Unopia campaign has spread
misinformation about the deal.
Bottom Line? The developing Macquarie Capital/UTOPIA deal shows the uncertainty presented by regional,
multi-city projects and models that, while having scale advantages, have coordination and financial hurdles.
23
Incumbent Push Back Against Cities Aiming to Own and Operate a Network
Incumbent Short-Term Pricing Strategies in Monticello, MN
Investing in a city-owned and operated service in areas with one or several existing providers comes with risks, as
evidenced by the case of Monticello, Minnesota. In 2010, Monticello built its own fiber network, Fibernet, to
spark increased competition in the area. The incumbent telephone and broadband provider, TDS, fought the
city’s network in court. When that proved unsuccessful, TDS built its own fiber network to compete with the
city. The incumbent cable operator, Charter, did not build a new network but cut its prices dramatically, offering
30 Mbps speeds and cable television for just $60/month for two years – a package priced substantially below
comparable service in its other nearby markets. Unlike Fibernet, Charter had the ability to take a temporary loss in
Monticello to secure its customer base because revenue was coming in through other, less competitive, markets.
Bottom Line? You can expect incumbent competitors to a municipal broadband network to take a variety of
legal, political and anti-competitive business steps to defend their customer base and revenues. The worst-case
scenario? The public network will be run out of business and the incumbent raises prices to the level prior to the
competition.
The Attacks on LUS in Lafayette, LA
Even after a community-owned network is built and fully operational, you can expect critics to attack. A primary
tactic is to use private sector metrics, which, while probative on some issues, nonetheless cannot capture the public
benefits that likely spurred the city to act. For example, the network finances of the Lafayette Utility System (LUS
Fiber) in Lafayette, Louisiana, have been criticized by the Reason Foundation and defended by the Institute for
Local Self Reliance. The critics point to the implicit subsidies while defenders note that LUS Fiber has brought
Lafayette into the limelight, marking it as an innovative city. In 2013, Lafayette made Foreign Direct Investment
Magazine’s list of Top 10 Small American Cities of the Future, coming in at #7.
Bottom line? Any city looking to invest in a publicly-owned and run network for long-term change should be
prepared to handle constant political and financial scrutiny both locally and nationally.
Other Problematic Initiatives
We don’t mean to suggest these are the only cautionary tales. One notable failure was in Burlington, Vermont,
for which there are thorough analyses of the lessons learned. As is often true in policy debates in which where you
stand depends on where you sit, the analysis of such projects often depends on one’s general view. Parties opposed
find significant fatal flaws; parties in support acknowledge flaws but don’t see them as fatal. The New York Law
School wrote a critical report with lessons learned. The Institute for Local Self-Reliance was more supportive.
State Laws Inhibiting Public Networks
As cities consider how to proceed, they need to consider how state law may limit their options. Nineteen states
have adopted laws constraining how cities may either operate their own networks or even partner with private
entities in stimulating deployments. A list of the laws can be found at Broadbandnow.com.
State laws inhibiting public networks vary in scope. For example, the North Carolina law did not prohibit cities from
partnering with Google Fiber, but the Colorado law kept Colorado cities from being considered for Google Fiber.
In the last election, however, seven Colorado communities held a referendum on whether their community should be
allowed to proceed with a municipal broadband initiative. Each passed with an overwhelmingly positive vote.
These laws are controversial. In February 2015, the Federal Communications Commission (FCC) acted
on petitions by Chattanooga, Tennessee, and Wilson, North Carolina, and held that the laws in those states
constraining municipal network expansion violated federal law. That ruling was challenged and, in 2016, the
Sixth Circuit Court of Appeals overturned the FCC order, leaving the laws in place. The FCC is not appealing
24
the Court decision. In that light, while we think it will be difficult for the FCC to formally overturn such laws, we
also think the FCC’s advocacy about the problems with state’s inhibiting local efforts has led to other states taking
such laws off the agenda. Further, we think the more such efforts prove successful, the more pressure there will be
in those states with such laws to repeal existing legal barriers.
Two groups have formed to
advocate for municipal rights
and provide resources for cities
wishing to follow the policy and
legal process. The Coalition For
Local Internet Choice is organized
to support the authority of local
communities to make independent
broadband Internet choices. Next
Century Cities is an organization
of municipalities helping all cities
realize the full power of affordable
and abundant broadband. Both
have information about the current
state of play of the litigation
and legislative efforts and can
assist cities in understanding the
constraints they may face.
States with Limitations:
Alabama
Arkansas
California
Colorado
Florida
Louisiana
Michigan
Minnesota
Missouri
Nebraska
Nevada
North Carolina
Pennsylvania
South Carolina
Tennessee
Texas
Utah
Virginia
Washington
Wisconsin
For links to specific
state laws, see page 65
in the Appendix.
25
How Should My City approach the Challenge?
The previous section provided numerous examples of how other cities have been able to
accelerate the deployment of a next generation broadband network. The section after this
one details tactics that cities can use to begin the process. In between, however, we have
found that it is helpful for cities to think about a general approach, and then course-correct
as the process unfolds. The following section offers several tools and frameworks that cities
can use when they begin forming their upgrade strategy. As mentioned before, there is no
one-size-fits-all solution for next generation networks. What has worked for others might not
work well in your city. It is important to consider the level of commitment city officials and
community leaders are willing to undertake and define your city’s short- and long-term goals
in light of those levels of commitment.
High Level Local Strategy Framework
As an initial matter, we have found it helpful if a group of community leaders gathers to discuss how the city
should proceed with its effort to upgrade its broadband options. In the chart below, we provide a set of questions
and options that have guided such conversations and have been instrumental in building consensus for action.
Figure 7: Local Strategy Formation Framework
Answer the Question...
Gather Information and Support
Define City Priorities
Choose a Strategy
Adjust Strategy
Based on Local
Assets/Strengths/
Challenges
“Will your city’s network meet your needs ten years from now?”
NO Between state/municipal
government, business community,
education, and leadership, does
sufficient support exist for an
upgrade project?
DON’T KNOW Diagnose
the situation through an asset
inventory, public engagement,
and data collection.
YES Focus on broadband
adoption, digital readiness,
and complimentary economic
development.
YES Define your city’s priorities
as well as your desired timeline
for an upgrade.
NO Strengthen support by
forming a local coalition.
Primary Strategy if
HIGH PRIORITIES: faster speeds,
universal upgrade, local control
and ownership
+ LOW PRIORITIES: public
financial risk
+ DESIRED TIMELINE: 3-7 years
Facilitator Strategy if
HIGH PRIORITIES: faster speeds,
low public financial
and operational risk
+ LOW PRIORITIES: universal
upgrade, local control
+ DESIRED TIMELINE: uncertain
Partial Strategy if
PRIORITIES: faster speeds,
low public financial risk
+ LOW PRIORITIES: universal
upgrade
+ DESIRED TIMELINE: 5-10 years
Build on BTOP networks, existing
fiber assets, etc. If financial
options are limited and the
timeline is flexible, start small
(connecting Innovation Districts
or anchor institutions).
Unite stakeholders to understand
the city’s preferred type of
partnership and the city’s list
of needs from a private vendor
relationship.
Depending on financial resources,
political feasibility, and local
preference, begin with one or
several incremental tactics.
26
The Spectrum of Strategies from Low to High Effort
Once the group has come to some initial agreement on a general framework for approaching the effort, we have
found it useful for the same group to discuss how much the community wishes to commit to the effort. As
described in the graph below, there is a spectrum of strategies, from a low level of effort, involving a variety of
tactical steps to improve the economics of fiber deployment, to the highest level of effort, involving the city as the
entity responsible for designing, deploying, maintaining, and operating a network.
Once the community leadership has developed a rough consensus on the framework and the level of effort for how
it wishes to proceed, there are a series of incremental steps to be taken consistent with that general strategy. Again,
as illustrated below, these steps represent a spectrum of efforts, from relatively simple and with minimal costs, such
as having a committee or outside expert provide recommendations, to more difficult but with a significant return
on investment. One such example is instituting a dark fiber strategy, in which the city installs unlit fiber whenever
it engages in certain kinds of construction projects, such as those digging up streets, parking lots, or other
activities, in which the incremental cost to the project of laying the fiber is very low. This creates a valuable asset
that can then be lit by putting electronics at the edges and then used to provide a service, either by the city or by
an entity to which the city leases the fiber. Some cities, such as Seattle, have used this approach for decades and,
over time, have built out networks reaching a significant portion of the city, dramatically improving the economics
of deploying a next generation network.
With these initial discussions, and with a consensus that hopefully develops from them, the city is ready to proceed
with preliminary steps as discussed in the next section.
Adopt one,
many or several
incremental
approaches to
gigabit fiber-
readiness
Seek out and
cooperate
with a private
upgrader
Form a
public-private
partnership or
similar hybrid
model
Build a
network and
lease out use
to the private
sector
Build
and run
a public
network to
businesses
and anchor
institutions
Build
and run
a public
network
Figure 8: Strategies from Low to High Effort
Do exploratory
research
and seek expert
consultation
Institute an open
data/information
sharing policy
Institute
fiber-friendly
policies, such
as “dig-once”
for the city
Publish an
RFP/RFI to
outline a city
or regional
fiber plan
and attract
necessary
partners
Adopt a dark fiber
strategy
Figure 9: Incremental Tactics from Low to High Effort
27
Other Issues to Consider in the Process
As communities consider publishing an RFI and/or RFP to stimulate next generation network build-outs, they should
also consider how such build-outs could also serve as the foundation for two other next generation communications
initiatives, Fifth Generation (5G) Wireless and the Civic Internet of Things, discussed herein.
5G Wireless
While many Americans enjoy fourth generation (4G) wireless services, the wireless industry has suggested that the
next generation (fifth generation or 5G) will provide a massive increase in performance and throughput. 5G holds great
promise for basic communication needs, advanced new communication services like two-way 4K video, advanced
security and privacy controls, and many other services.
While the promise of 5G is great, so are the challenges to deployment. While a number of technology advances have
made 5G possible, 5G will also depend on a different network architecture than 4G. 4G customers received their data
from a macro-cell, a large tower that serves a broad area and many customers. 5G customers will receive their data
from many small cells that serve a smaller area and many fewer customers. 5G radio deployments will be exponentially
larger in number and, more importantly, more densely distributed in order to support the 30 to 50 times faster bandwidth
enabled by 5G in comparison to 4G. 5G service providers will need to be able to build or lease wireline networks that
extend much closer to the customers than the wireline networks on which wireless customers currently depend.
This, however, leads to challenging economics. While 5G plans are still nascent, it appears likely that the network costs
will be significantly higher than any previous wireless network deployment. Indeed, it may be cost prohibitive for the
major carriers or any new carriers to overbuild end-to-end wireline networks.
Further, as was true in deploying all communications networks, state and local governments have to play a role in
overseeing deployment through zoning, permitting, and other regulations. It is critical that government entities protect
the public interest, but also embrace policies and processes that reduce delays and costs. Those policies will be similar
to the fiber-friendly policies discussed in this Handbook, but will also include policies related to small cell siting.
The Civic Internet of Things
The Internet of Things itself refers to the ability of devices, equipped with far greater computing power and connected
to the Cloud and each other through far greater bandwidth, to provide a greater awareness of a situation and to act to
improve outcomes. These developments are already having a dramatic impact on how we manufacture goods, in what is
generally referred to as the industrial Internet of Things.
The Civic Internet of Things is, at one level, simply adding intelligent devices to a number of infrastructure systems
generally run by cities, including, but not limited to, water, sewer, power, and transportation. It also creates new
opportunities to improve the data on which decisions are made in areas such as public safety, public health, and social
services. For example, while numerous cities already have security cameras and gunshot recognition sensors, developing
technologies are enabling such cameras and sensors to automatically detect unusual activities and to enable a rapid
response, resulting in a 10% to 30% decrease in crime. The Civic Internet of Things can reduce electrical outages and
water losses, improving resource management. Another big use is adaptive traffic management, which can improve
traffic flow and dramatically reduce time spent in cars looking for parking spaces.
All in all, McKinsey estimates that the global economic impact of state and local government use of the Internet of Things
would be between $930 billion and $1.7 trillion by 2025. Beyond the financial savings, cities are using such technology
to better inform residents of the “state of the city” and thereby improve the public dialogue as to what a city should
prioritize in terms of civic improvements. In short, the Civic Internet of Things represents an opportunity to do for the
basic civic infrastructure of the early 20th Century what smart phones have done for communications compared to the
standard black dial tone phones of fifty years ago.
28
Civic Internet of Things initiatives are emerging across the U.S. – in both gigabit and non-gigabit communities. Like 5G,
the Civic Internet of Things will also depend on ubiquitous, fast, and affordable communications networks; the sheer
amount of data and information collected by interconnected, smart sensors can only be strengthened by the presence
of high-speed Internet infrastructure. Thus, communities contemplating how best to deploy a Civic Internet of Things
initiative should integrate their plans with policies to attract next generation network deployments.
A Civic Internet of Things Case: A “Fit Bit” for Chicago
The Array of Things is perhaps one of the highest profile ongoing Civic Internet of Things initiatives in the country.
Supported by a $3 million dollar grant from the National Science Foundation, and operated by the Urban Center for
Computation and Data in partnership with the City of Chicago, the Array of Things will deploy 500 sensors across
Chicago by the end of 2018. About 50 sensors are expected to go up in 2016. Network connectivity will be provided
by AT&T. The model adopted for this project was collaborative, involving national partners in the crafting of privacy
policies, and community partners in the design and manufacturing of the sensors and the civic engagement process.
The sensors themselves will measure environmental conditions in the city — congestion, air quality, temperature,
standing water, and noise pollution. Information collected could have major implications for public health research and
improve service delivery. Data will eventually be open and available to researchers and residents on the City’s Open
Data Portal. The resulting work and innovation from the open data will be worth following as the project progresses.
Federal Support for the Civic Internet of Things
As part of the larger White House Smart Cities Initiative, two federal agencies, the National Institute for Standards and
Technology (NIST) and the National Telecommunications & Information Administration (NTIA), are hosting workshops
and facilitating working groups for creating best practices for emerging IoT projects. In May 2016, NIST’s Cyber-
physical Systems (CPS) Public Working group has already published a framework inventorying the elements of IoT and
articulating a shared understanding of the foundational concepts that shape the design of these types of projects.
More resources from these ongoing efforts from NIST and NTIA will likely be future guiding lights for communities
deploying sensors and connected devices.
29
what are the Preliminary Steps?
This section provides information about the preliminary organization of stakeholders and the
process – who to rally within and outside of city government, ways to achieve quick wins and
the low-risk “low-hanging fruit” that can be tackled first when setting the foundation for a
larger scale upgrade project – no matter the model.
Unite Diverse Local Actors on a Common Mission
One of the hurdles that has arisen in nearly every project we have worked with is that the traditional organization
of the city, as an enterprise, is not designed to take on the challenge of accelerating a next generation deployment.
While there is often a department that works with the cable franchisee, cable regulation is not designed to
facilitate competition or construction. While there is always a group that manages rights-of-way and construction
permitting, the nature of citywide network construction is different than construction in discrete areas. While
there is usually a group designated to do public outreach, the nature of this kind of project is quite different
than the typical public outreach involving well-defined, ongoing constituency groups. Thus, the first job is
organizing city officials to understand and adopt their role in the mission of accelerating next generation network
deployment. This involves uniting a number of different players within the city’s organization to work together for
the common mission, as illustrated in Figure 10 below.
Figure 10: Uniting City Officials on a Common Mission
Coordinate between offices to centralize data, mapping, and
information on current fiber assets.
Research plans that similar cities have adopted and gather best practices.
Start an educational campaign to engage the average citizen on the
city’s gigabit strategy or plan.
Work with the city council or governing body to identify
and fix regulatory roadblocks or inefficiencies standing
in the way of private build-out.
Institute fiber-friendly policies, such as “dig-once.”
Institute regulatory reforms to simplify permitting, pole attachments, and
environmental review processes for new telecommunications entrants.
If working with a private partner, create a detailed development
agreement to protect city interests and meet shared goals.
If it seems advantageous for your city, pursue a regional
strategy by engaging with the county or neighboring
municipalities.
Perform preparatory work on city utility poles for new
telecommunications entrants.
Assist other city workers in performing a local mapping and
fiber asset inventory.
If applicable, work with the city council or governing body to
implement an informed dig-once strategy.
If applicable, work with the city council or governing body
to craft the technical aspects of a development
agreement with a private partner.
Create, publicize, and provide broadband adoption and digital
literacy resources for residents.
Assist in measuring and increasing neighborhood demand through
multiple efforts including going door-to-door.
Build relationships among the diverse pool of stakeholders in the
community that would contribute to, and benefit from, a gigabit
connection: schools, universities, hospitals,
businesses, etc.
The InformATIon roLe:
What should city workers/administrators do?
The LeGAL roLe:
What should a city council or
governing authority do?
The enGIneerInG roLe:
What should city engineers do?
The CommunITy roLe:
What should local political groups,
community members, and non-profits do?
30
The next job is organizing the public to adopt the same mission. One important document that lays out how
to do this is The Kansas City Playbook (published by the Mayors’ Bi-state Innovation Team). An outgrowth of
the cities’ desire to take advantage of the Google Fiber network, it details plans for maximizing the opportunities
by outlining pilot projects and strategies touching on digital inclusion, education, universal coverage, Wi-Fi
hotspots, healthcare, arts and culture, and local government. While it was written after Google had committed
to building a network, the Playbook provides a great blueprint for how to organize and excite the community
about the opportunities such a network creates. Excitement in a community is also useful in creating leverage in
negotiations with potential providers while providing community leadership with input into what community
members believe would be the critical elements in any negotiation.
Take Inventory of Local Advantages, Strengths, and Barriers
A first step in evaluating how to proceed is to take an inventory of relevant assets. Gig.U has prepared “A
Community Assessment Worksheet,” primarily designed for city administrators, that provides a comprehensive list
of assets and opportunities for cities to improve the conditions for investment in networks. We have condensed
some of the tasks from the full worksheet in the graphic below.
Build Local Support
from...
• Research universities
• Hospitals
• Major foundations
• Start-up communities
• Corporations
• Local ISPs
• Incumbent ISPs
• Complimentary policy
organizations or local
advocates in education,
energy, etc.
• Public utility system
or company
• Developers
• Surrounding municipalities
(for a regional approach,
if applicable)
Centralize Information
on Existing Fiber
Assets from...
• Public safety
• Hospitals
• Research universities
• Transportation authorities
• Other parts of the city
government with maps
of fiber holdings
Be Aware of History...
• Has there been previous
Broadband Technology
Opportunity Program
funding in your area–
either through adoption
or infrastructure work?
• What does connectivity look
like in your city? What is the
nature of your digital divide?
• Have there been
previous successful
connectivity projects?
• Have there been previous
failed connectivity projects?
• Has your state passed
legislation banning or
limiting new public or
partially public networks?
Leverage External
Resources...
• CLIC - The Coalition for
Local Internet Choice
• Next Century Cities
• U.S. Economic Development
Administration
• National
Telecommunications &
Information Administration
• Fiber to the Home Council
• State-level political
champions
• State Broadband
Initiative (SBI)
• Federal connectivity grants
(e.g. NTIA, Department
of Agriculture’s Rural
Utilities Service)
• Private grant programs
(e.g. One Community’s
Big Gig Challenge)
Figure 11: Inventory of Strengths, Weaknesses, and Assets
31
Tackle the “Low-Hanging Fruit”
If a gigabit connection is in the long-term strategic plan for your city, there are steps to take now to align you with
private investment, public build-out, or the myriad of models in between.
Exploratory Research and Information Gathering
Look to cities that have succeeded or stumbled – especially cities of a similar size, geography, and political
structure. Factors such as population density, existing competition, the cooperation of incumbents, politics,
and the presence of local ISPs will also help determine which lessons are relevant to your city. It is important to
remember that, though cases can be informative, no two cities are the same. At the same time, as noted in the
Overview at the top of this Handbook and discussed further in the next section, the fundamental economics for all
cities are the same.
Regulatory Reform
If you are looking to attract private investment from a local ISP, a nonprofit provider, or a project like Google
Fiber, improving and streamlining regulatory processes will make your city a more attractive place to build.
Specific changes can be found in the Google checklist; others may come to light during an RFI process.
Information Sharing
Any existing mapping and data on the city’s current
fiber holdings can be either published online for
anyone to view or shared with a private partner
to ease the planning process and avoid creating
duplicative infrastructure. As noted in the section
below on challenges, there are security concerns that
should be addressed before public dissemination of
information.
Strategic Partnerships that Play to Local Strengths
Does your city have one or several large research
institutions with their own networks? Does your
city have existing broadband adoption/access
nonprofits or projects that can be leveraged to increase public awareness and demand for faster speeds? Are there
businesses or start-ups in the area that would benefit from gigabit speeds? Strengthening these key relationships
and building trust between these institutions will maximize the city’s leverage in negotiations with potential
providers.
Be Firm in Declaring your City’s Interest in being on the Gigabit Map
Napoleon famously advised, “If you start to take Vienna, take Vienna.” That is, don’t undertake such a project
with a half-hearted commitment. A statement of strong intent will both wake up the incumbent providers as well
as attract non-incumbents. Be both loud and clear in your announcement to the world that you are interested in
an upgrade, that there is demand in your area, and you are willing to work with those who can make it happen.
All the cities that have used RFPs have depended on significant publicity to attract potential vendors. Further,
every city that we have worked with has attracted new concessions by incumbents upon announcing their intent
to consider new alternatives. In the case of College Park Station in Texas, for example, releasing an RFP led the
incumbent cable provider to suddenly announce it would upgrade its old plant to make it gigabit capable.
Spotlight: Regulatory Reforms
Louisville lowered its bonding requirements and
extended its franchise agreement period.
North Carolina cities involved with the NCNGN project
agreed to allow ISPs to e-file their construction-related
documents.
South Portland made it easier for telecommunications
entrants to install utility cabinets along city sidewalks.
32
CASES: Different Approaches to “Dig Once” Policies
BRENTWOOD, CA - Brentwood’s Municipal Code contains provisions requiring all “utility distribution
facilities,” including communications systems, to be installed underground (waivers are permitted under
extraordinary circumstances). Among these provisions, under the title “Advanced Technology Systems,” is
the following: “The developer shall design, install, test and dedicate to the city two advanced technology
system conduits… within the public right-of-way.” One of the conduits contains a fiber optic system
for use by the city or one of its franchisees. The other conduit is to remain empty and available for
future franchisees who prefer to run their own cables instead of using the city’s. Under this policy, the
city expands its own network incrementally while extra capacity is installed to facilitate future fiber
deployments by private providers.
SANTA MONICA, CA - Santa Monica adds an important feature to its “dig once” policy - requiring all
utility operators to submit maps of all “antennas, pipelines, conduits, cables, vaults, pedestals, and all
other associated facilities” located in public rights-of-way (ROW). These maps must be submitted on a
yearly basis, unless no changes have occurred. This reporting activity streamlines future uses of these
ROW assets that, in turn, lower costs for future network builders.
MOUNT vERNON, WA - The city of Mount Vernon, Washington, has implemented a “dig once” conduit
policy that specifically applies to “the construction of improvements such as buildings, homes, subdivisions,
streets, and utilities.” All such projects are required to “construct and install telecommunications conduit
on all streets that are affected, disturbed, constructed and/or improved by development unless otherwise
approved, pending a review by the city engineer.” By spelling out a range of “improvements” covered, this
policy appears to specify a highly incremental fashion for installing conduit which can help reduce overall
costs in the long run.
POULSBO, WA - Poulsbo, Washington, adopted a policy that applies to all road construction, whether
done by the city or any other entity. Poulsbo’s policy further distinguishes between different types of
roadways, requiring higher capacity conduit along “all new collector or arterial public streets serving
or abutting residential development, and in all new public streets serving or abutting nonresidential
development.” This tailoring of conduit capacity to roadway capacity can lower overall “dig once” costs
by allowing lower capacity conduit to be installed where appropriate.
SEATTLE, WA - Seattle has a similar “dig once” policy, but in contrast to all the others listed here, it
specifies that the city will cover the incremental cost of the extra conduit. One can speculate this generous
policy is due to the larger resources of a city the size of Seattle and a high prioritization by the city to
ensure its conduit policy achieves its objective.
33
Understand the Economics: Orient First Steps Around Lowering Costs and Risks
As discussed in the Overview, while all cities face different challenges to success, all face a similar economic
challenge. In other words, as we laid out in Figure 1, and again here, the current math doesn’t work.
Figure 12: Broadband Cost-Benefit Equation (Revisited)
That is, the new or incremental capital and operating expenses of a next generation network are greater than the
risk adjusted new or incremental revenues, plus the benefits to the system, plus the risk of lost revenues due to
competition.
The path forward is to change that math, causing, where possible, cap ex, op ex and risk to go down and revenues,
system benefits and competition to go up. What every successful project has in common is that the city has acted
in a variety of ways to lower some or all of the first three factors and raise some or all of the last three factors:
Figure 13: Revised Broadband Cost-Benefit Equation (Revisited)
Changing the equation does one of two things. It can make a public or public-private model more feasible to
undertake or it can make your community more attractive to private partners.
Over the last several years, we have seen the equation changed by cities through three basic strategies. These are:
1. Asset utilization and improvement. The key inquiry is, ‘What assets does the city have that can be provided
at no or little incremental cost that improve the economics of deployment and operations?’ This can include:
physical assets, like rights-of-ways (ROWs), utility poles, conduit, buildings, etc.; information assets, like
information regarding conduit, ducts, and other ROWs; and processes to improve current assets, such as
ensuring that make-ready work is done expeditiously, coordinating with new providers to save costs or allowing
them to perform work themselves through approved contractors.
2. Regulatory flexibility to accommodate new business models. The key inquiry here is what rules does the city
have that may have made sense in a different time and with a different market structure that in today’s market
creates a barrier to an upgrade or new deployment. For example, all the projects with national ISPs, including
CapEx OpEx (1-risk) Revenues System
Benefits
Threat of
Losses Due to
Competition
CapEx OpEx (1-risk) Revenues System
Benefits
Threat of
Losses Due to
Competition
34
Google Fiber, have allowed neighborhood-by-neighborhood builds, which significantly reduces capital
expenditures and risk through a pre-commitment strategy. This is not without controversy (see section below
on “Addressing Equity, Broadband Adoption and Digital Readiness”), but nonetheless, has proven essential to
facilitating new investment.
3. Demand aggregation. The key inquiry here is how to aggregate demand to demonstrate to existing players the
value of an upgrade and to potential new entrants the opportunity in the community. This can be done on
both the institutional and residential level. The greater the demand aggregation before the negotiation begins,
the greater the leverage of the city in the negotiation.
These strategies lead to multiple tactics that have the desired effect on the core equation, as illustrated in the graph
below, and discussed in more detail in the next section on forming public-private partnerships.
Public Messaging Points: Better, Faster, Cheaper Broadband
At the beginning of every project, cities need to develop a message to the public about why the city is taking the
initiative to improve something believed by some to be a private sector function. Developing a communications
strategy becomes easier when city officials look at the project as one with the mission of providing fundamental
infrastructure. After all, communications around infrastructure projects by city officials is a well-travelled path.
Through campaigns around general obligation bonds to economic development efforts like sports or arts facilities,
Figure 14: How to Change the Broadband Cost-Benefit Equation
reduce Capex
reduce opex
reduce risk
Increase
revenues
Increase System Benefits
Increase Competition
• Build to Demand Model
• Access to ROWs, Facilities
• Reduce Regulatory Time
• Access Payments
• Reduce Ongoing Regulatory Costs
• Utilize Existing Billing Platforms
• Build to Demand
• Standardize Functions Across Areas
• Vendors
• Demand Aggregation
• Marketing Platform
• New Services
• Stimulate Innovations that Increase Demand and New ARPU Opportunities in Other Markets
• Seeding Long-Term Growth
• Use RFI/RFP Process to Encourage New Entry or Threat of Entry
35
we have found that there is a great deal of expertise within most communities about how to advocate for investing
in infrastructure today to improve the community’s prospects for tomorrow.
Several years ago, the novelty of gigabit networks made the task more difficult for broadband projects. Now, we
have found (and the record of popular referenda on the issue confirms) that the necessary messages already have
significant wind in the sails. While all politics is local, and the precise messaging should reflect local context and
concerns, in our experience, there are three, primary, public messaging points that support the initiative for city
broadband adoption that will resonate with the public. These are:
1. A world-leading broadband network is necessary for a community to thrive in the future. No matter what the
community’s major economic forces or demographics, we have found a broad and deep understanding that
better broadband has both specific benefits for economic sectors and broad benefits for all. McKinsey, in a
paper on “Making the Consumer Case for Major Infrastructure,” urges leaders to think big by focusing on
the “catalytic” benefits to the economy. That message applies here. As noted in the earlier section on “The
Economic Case for Faster Speeds,” there is substantial evidence supporting the argument that faster broadband
leads to economic gains throughout the community. Moreover, the public, having experienced the impact of
broadband in their own lives, is predisposed to understand the value of next generation broadband in their lives
and throughout the community.
2. The broadband status quo is unacceptable. We have visited many communities in the last four years but have
yet to find one satisfied with its broadband choices. This is confirmed by consumer feedback. The University
of Michigan Consumer Satisfaction Index ranks Time Warner Cable and Comcast as the lowest ranking
companies in their survey. Telephone broadband providers do better but are far from loved. One can argue
about whether the companies deserve those rankings, but from a messaging perspective, advocating for the city
to ensure its citizens have faster, better, and cheaper broadband has proven consistently attractive.
3. Our community needs to have the kind of broadband that other communities have. Several years ago, many
communities seemed resigned to a static fate of incumbents providing broadband over existing networks, built
decades earlier for voice and video services, without a hope of a world-leading network. That has begun to
change. With each new announcement from a Google Fiber, AT&T Gigapower, Century Link and others,
support for efforts to bring one’s own community into the club of gigabit cities has grown and is likely to grow
even more. Of course, no public policy debate moves in a straight line. There are likely to be moments where
the movement hits some setbacks, but the overall trend is likely to be that such networks will go from novelty,
to “good to have” to “must have.”
Potential Pushback
Two issues generally prove more complicated in terms of communications. One is, what is the role of the city
in the project? As noted in the sections on models, cities can play a number of roles or limit their roles and
risk. From a messaging perspective, the greater the role, particularly in terms of financial liability, the greater the
controversy, and the more important it will be to tailor messages that justify the city’s effort.
The second is the issue of whether the project will deepen the digital divide. That issue is discussed in greater
detail in a later section of this handbook: “Addressing Equity, Broadband Adoption, and Digital Readiness.” The
bottom line, however, is that such concerns have never derailed a project; every city we have evaluated has worked
out a path to accommodate the interested parties, by, for example, negotiating for free or low-cost connections to
relevant anchor institutions.
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what are the key issues in developing
a Public-Private Partnership?
For cities that have chosen a public-private partnership model, this section provides an
introduction to the diverse issues that are likely to arise in network negotiations. Gig.U
has also prepared links to public documents, RFPs, RFIs, development agreements and
feasibility studies that can be found in the Appendix. This summary is not exhaustive, as
every municipality will have unique challenges to sort through, but much can be gained by
knowing how others have approached these arrangements. The Coalition for Local Choice, in
partnership with the Benton Foundation, collaborated on a publication providing a business
strategy and legal guide for the emerging world of broadband public-private partnerships.
Negotiating with Partners
The Kansas City/Google Fiber negotiations created a new model for how cities can facilitate an upgrade to next
generation networks -- a model that has now been advanced by further Google Fiber negotiations, as well as by
negotiations involving other cities and providers. These negotiations can become very complex, with provisions
affecting city operations, personnel, property, and, most importantly, finances. The key to these negotiations is for
the parties to recognize the relative costs and values of trade-offs, for the cities to maximize the asymmetric value
creation discussed in the Overview, and for the cities to build on that recognition to obtain greater leverage in the
negotiation. There are assets and levers city officials can use at little or no cost to improve network construction
economics for the provider. Understanding these negotiating positions helps parties reach win-win positions more
efficiently.
In this section, we discuss how different cities have approached some of the key negotiating points. But first, we
provide examples of levers and requests that can be found in the agreements.
Where to Build
One primary concern of all parties when planning a network deployment is what geographic areas the network
will cover. The competing factors are construction costs and risk of recouping those costs for the network
builder against economic development and spillovers for the community. The builder will naturally lean towards
deploying first (or exclusively if the municipality will allow that) to areas where risk of recovering upfront costs
is lowest (and potential for profitability is highest). The municipality likely will want to bring access to as many
residents and businesses as possible, perhaps even prioritizing certain areas where the city believes the economic
and social benefits to the entire city are the greatest. The parties can resolve these divergent interests in a number
of ways as discussed below.
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Cities have requested from ISPs... This can be seen in...
Los Angeles RFI
Macquarie-UTOPIA, iTV3-UC2B, Los Angeles RFI
Los Angeles RFI
Los Angeles RFI, Google Fiber in Kansas City, Macquarie-UTOPIA, NCNGN RFP,
Portland-Google franchise agreement
Portland-Google franchise agreement, Los Angeles RFI
Austin, TX
Macquarie-UTOPIA, SiFi-Louisville franchise agreement
Portland-Google franchise agreement
Google Fiber in Kansas City
NCNGN RFP
NCNGN RFP
Egremont, MA RFP (MassBroadband 123)
Philadelphia, PA Comcast franchise agreement
Philadelphia, PA Comcast franchise agreement
Philadelphia, PA Comcast franchise agreement
Philadelphia, PA Comcast franchise agreement
Philadelphia, PA Comcast franchise agreement
Universal coverage
Open access, wholesale network
Connected anchor institutions
A free tier of basic service
Free public Wi-Fi hotspots
Subsidized connections to public housing
Ownership of the network
A designated franchise fee
Funding/program support for digital literacy
Geographic priorities/schedules for build-out
A flexible menu of service options
Connection to existing state or regional fiber
Increased funding/support for public, educational,
and government access programs
Technology upgrades in city buildings at no cost
Specific, agreed upon customer service
improvements and standards
ISP compliance with local living-wage ordinances
ISP will provide career and technical training &
entry-level opportunities to youth
Figure 15: Key Development Agreement Negotiating Points 1
Cities have offered to... This can be seen in...
Los Angeles RFI
Google Fiber in Kansas City, Los Angeles RFI, NCNGN RFP
Los Angeles RFI , NCNGN RFP
San Antonio-AT&T lease agreement, San Antonio-Google fiber lease agreement
Google Fiber in Kansas City, NCNGN RFP
Google Fiber in Kansas City, Los Angeles RFI, NCNGN RFP
Los Angeles RFI
Google Fiber in Kansas City
Google Fiber in Kansas City
Macquarie-UTOPIA
Google Fiber in Kansas City, Portland-Google franchise agreement
Leverett, MA RFP
Be an “anchor tenant” of the service
Provide space and power
Provide their partner with data and asset inventory
House fiber huts on city property
Provide a single point of contact (SPOC)
Streamline communication/permitting
Give the partner access to city dark fiber and/or
conduit
Designate a team within the local government to
work specifically with the partner
Conduct a consumer outreach/marketing campaign
Provide funding through a utility fee
Give the partner sole discretion over build out plan
and schedule
Designate the ISP as the exclusive partner
Figure 16: Key Development Agreement Negotiating Points 2
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Mutual Consultation
Google and Kansas City dealt with this issue by leaving
the question of initial build sites open to continuing
negotiation, with Google retaining the right to base future
build locations on purely economic calculations. As a
matter of practice, Google agrees to build-out in the entire
city but the actual construction obligation only kicks
in when a certain percentage of a “fiberhood” (with the
boundaries of the fiberhood and the minimum percentage
set at Google’s sole discretion) signs up for the service.
This approach can be viewed as a win-win from the
perspective that the city has a voice in negotiating initial
build locations and the ISP retains control over expansion
locations thereafter. However, if the city falls short of
getting agreement on its planned network sites during initial negotiations, turning over control of expansion planning
to the ISP can end up resulting in a build-out to fewer areas than the city may have wished.
Need-based Quotas
In contrast to the negotiation model above, Raleigh agreed upfront to let AT&T base its build locations purely on
cost-recovery calculations in return for a quota of additional locations that the city could choose based on need.
The trade-off here is that the city may not get the network to reach all of its need-based sites initially, but it can
ensure the network eventually expands to cover some of its highest priority areas.
Competitive Response
In addressing this issue of where to build, the city should consider the likely response from competitive network
providers. So long as the new network reaches a critical mass of the city, it is likely to drive a competitive
response. For example, the deployment of fiber by the incumbent telco or a new entrant with significant
resources, like Google, will likely compel responses by the cable provider. The cable upgrade will be done system-
by-system, rather than the fiber build-out neighborhood-by-neighborhood. In that way, facilitating an upgrade
or new entrant can result in a broader geographic upgrade through third party providers who are not involved in
the initial agreement. Further, as pricing is generally consistent throughout the entire jurisdiction, the competitive
response will likely mean that all residents receive the benefits of price competition, even if the new network does
not extend to every area.
How to Build
Network construction methods are largely standardized, so the primary decision is whether to build above- or
below-ground (or whether to use a combination of both approaches). Making this determination can involve
considerable cost calculations and complex policy issues, such as pole attachment rights and equipment placement.
Above-ground vs. Underground Construction
Above-ground network construction tends to be less expensive from a labor and equipment cost perspective, so
it is most commonly used. Above-ground construction also minimizes digging up roadways and the consequent
impact on traffic.
On the other hand, the main benefit of underground construction is weatherproofing the network, protecting it
from wind and ice, which are known to topple utility lines and poles. So it is in the city’s interest to assess these
costs and risks while planning and negotiating a network construction partnership.
Where to Build: Key Considerations
• Are there areas of the city we insist on connecting
to the new network and, if so, on what timetable?
• Are there public facilities we insist on connecting
to the new network? How many and on what
timetable?
• Is there a minimum coverage area that a provider
must commit to as part of the agreement?
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Pole Attachment Access and Costs
Labor and equipment costs are not the only costs
to consider when deciding between above- and
below-ground construction. Pole attachment
costs can potentially dominate the calculation.
For municipalities that lack a public utility or
other means for easily accessing poles, the costs of
negotiating and accessing privately-owned poles
can quickly make above-ground construction
more costly than running fiber underground. This
was the situation with Champaign-Urbana, which
decided to build completely underground to avoid
pole attachment costs and headaches.
Next Battlefield in the Game of Gigs: Cities and Poles
One of the biggest costs to deploying a fiber network is preparing utility poles to carry a new fiber line. This process,
known as “Make Ready,” has become the next policy battleground in the fiber-dependant Game of Gigs.
In early 2016, for example, the City of Louisville/Jefferson County adopted a “One Touch Make Ready” proposal that
would allow new providers to perform all the required work in the Make Ready process themselves — meaning they
would be moving equipment owned by competitors — provided they use a skilled contractor. Shortly thereafter,
AT&T, which has its wires on poles -- and controls a number of the poles -- in Louisville, sued the city, alleging the
city has no jurisdiction under federal or state law to regulate pole attachments. Not surprisingly, Google, which is a
new entrant and could be among the first to benefit from faster pole access fiber deployment, stood up in support of
the city. AT&T countered that the proposal raised safety concerns and that Google could have access under terms it
has agreed to in other locations.
The question, however, is not just about access, but how to balance legitimate safety, cost, and competitive concerns.
In that effort, Louisville is at the vanguard of a growing movement. San Antonio’s municipal utility, CPS Energy, has
put in place a similar policy. North Carolina’s state broadband plan noted that “‘[O]ne touch’ policy . . . promotes safety
and limits disruptions to the ROW [rights-of-way].” And the Tennessee Department of Economic and Community
Development’s recent broadband report called out ‘one touch’ as a best practice.
Subsequently, Nashville introduced an ordinance similar to Louisville’s. As in Louisville, Google Fiber is seen as the
primary beneficiary and incumbent providers have opposed the measure, in this case arguing “(j)ust because you spell
your name with eight different colors doesn’t mean you can’t play by the rules that everybody else has to f*****g
play by.” The FCC has weighed in on the side of the city, saying that federal law did not pre-empt the city. The FCC
did not weigh in on whether state law pre-empts the city effort.
As noted throughout this Handbook, for communities to obtain next generation broadband, they will have to change
the math of deployment, taking a number of steps to lower the costs and risks of deployment in a way that enables
capital to flow to new fiber. One Touch Make Ready proposals fit right into that effort. If implemented, it would
cut both the time and cost for deployments, translating into more affordable, abundant bandwidth. What’s more, it
reduces disruption and improves safety on city streets, reducing the number of times that people need to drive a truck
down a street and climb up a pole.
The opposition is not without merit, but it is important to break down different kinds of opposition. Of course,
incumbents always have an incentive to delay new competitors and regulators and legislators should always question
such efforts. The jurisdictional question, however, is a valid one, but that does not go to the core economic benefit of
more efficient make-ready work. Safety is also a critical issue. There are a number of ways to address it -- such as
with bonding, certification, and notice -- without giving competitors tools for delay.
How to Build: Key Considerations
• If there is no municipal pole ownership, are the private
pole owners supportive of the project?
• How many different parties must your city negotiate with
to gain access to the pole space needed for this project?
Does the city have a history of negotiating with them?
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The fairness issue is important as well, but the ordinance would apply to anyone building a new network or improving
an existing one, not just Google Fiber. Further, cities that have granted Google Fiber certain rights have generally
granted those same rights to incumbent telecom players, like AT&T, to lower the costs of upgrading their cooper
networks to fiber.
Access to certain private facilities to encourage network deployment is nothing new. Without the 1978 pole attachment
law, we would not have had a robust cable infrastructure, just as without the 1992 program access rules, we would not
have had a viable cable competitor in direct-broadcast satellite. Cities do not need to wait to revisit the relationship
between access to poles and multiple dwelling units and the deployment of next generation networks. They should
carefully follow the pioneering efforts of Louisville and Nashville to enable more efficient pole access. Moreover, to
the extent they have jurisdiction, all cities should be exploring all methods that can lower the cost of deploying and
operating future-proof broadband networks.
This issue was addressed in part through the FCC’s recent order on the classification of broadband. The
Commission held that ISPs should be entitled to fair access to poles and conduits under Section 224 of the
Telecommunications Act of 1996. The long-term value of that decision depends, in part, on how court challenges
and potential congressional legislation plays out. Another way of addressing this issue is having a single pole
administrator. Connecticut recently implemented a single administrator through state legislation. Google
addressed the issue in its first project by initially going to Kansas City, Kansas, which had a municipal electric
company, and then leveraging the public reaction to strike a deal with private pole providers in Kansas City,
Missouri, who did not want to be seen as obstacles to Google Fiber expansion in their city.
Access to Infrastructure and Rights-of-Way (ROW)
Infrastructure and ROW access is a big lever for a city
during negotiations. Great care and diplomacy, however,
must be used in order to not scare potential partners
away. While cities have the economic leverage to charge
fees beyond their costs for the use of the ROWs, as well
as existing ducting or conduit, the value of such fees
must be compared to the value of the economic benefits
that a next generation network is likely to bring. Again,
there are multiple ways to address this issue.
Use a Fee Schedule
Google’s contract with Kansas City includes a separate
“Fee Schedule” detailing which infrastructure and
ROW activities require a fee. The activities that do
not require a fee include: collocation space, office space, pole attachments (in utility/power space), conduit use,
existing fiber, access to Geographic Information Systems (GIS) data, access to computer tools, permit processing,
and inspections. The activities that do require a fee are: pole attachments (in telecom space), traffic control, and
access to city rights-of-way for construction and installation of outdoor network equipment. While the city has
considerable discretion to impose, or forbear from imposing, a fee, the key consideration is whether the reduction
in fees can lead to a network that will increase the economic activity within, and attractiveness of, the city.
Further, the city should distinguish between those fees that reflect an incremental cost to the city and those that
reflect the ability of the city to charge a fee for use of the rights-of-way or other municipal assets, which by their
nature are both scarce and essential to certain kinds of projects.
Infrastructure and ROW Acess: Key Considerations
• What parts of the fees reflect actual costs to the
city and what parts reflect an implicit charge for
scarcity value of the use?
• What is the impact on prior agreements with
others of changing the fee schedule for one
provider?
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Ensure Equal Treatment of All Providers
AT&T’s contract with Raleigh contains language that generally ensures AT&T is treated like any other third party
seeking access to such infrastructure and rights-of-way. It states: “Such access will be provided in accordance with
all applicable regulations and ordinances and the City’s standard processes and practices generally made available
to all third parties. . . .” In addition, the contract contains a “Most Favored Nation” (“MFN”) clause providing
“the City will… license AT&T to utilize such space for those purposes at rates or fees and other terms no less
favorable than those granted to any other similar commercial service provider.” Such MFN clauses are frequently
requested by incumbents, and new entrants alike, to guarantee a level playing field on fees and rates.
Permit Approvals
Any network builder will need to obtain permits for construction tasks as the project progresses (which can
take months and even years). Cities should work with network partners to ensure these permits are processed as
efficiently and quickly as possible to reduce construction costs and time.
Setting Timelines
While permitting approval timelines benefit
the network builder by providing certainty and
expediency, the city should retain flexibility so it
is not on the hook for every permitting delay. For
example, the AT&T/Raleigh contract reads:
“The City will provide diligent and expeditious
review and determinations of all applications for
permits submitted by AT&T and will attempt…to
approve or respond within one week from the date
of the submission of the request.”
Similarly, Google’s contract in Kansas City called for “quick, diligent review of all applications for permits”
followed by “a commitment to review and respond to any subsequent modifications or similar documents that
may require approval by City within five (5) working days of submission by Google.”
Waiving Permit Fees
Another way to streamline the permitting process is to waive fees, although the obvious financial implications of
this tactic should not be overlooked. The Google contract reflects this approach, as seen in the Fee Schedule that
sets a fee of “none” for “permits.” Before adopting this approach, city officials should review internally how its
payment processing affects permit process timing. If the effect is negligible, so too will be the benefit.
Personnel Commitments
Another way to streamline the permitting process and network deployment, more generally, is identifying specific
city personnel who can focus partially or primarily on network-related issues. Having such a dedicated team will
speed up not only permit processing, but also the resolution of the numerous diverse issues that inevitably come
up throughout long and complex construction projects. The level of specificity in personnel provisions can vary.
The contract between AT&T and Raleigh uses general language:
“The City shall designate staff that will facilitate communications between AT&T and City staff and officials, and
will coordinate between municipal departments…City will designate inspectors and supervisors with the collective
authority to inspect all construction for the Network, maintenance, and related work in connection with each
applicable permit to be issued by the City to AT&T.”
Permit Approvals: Key Considerations
• Has your city internally reviewed its permitting process?
• Can the city’s permitting be improved or streamlined
through digital processing?
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In contrast, Google’s contract with Kansas City spells
out personnel requirements in more detail, going as far
as creating new job roles. For example, Google’s contract
requires the creation of an “Executive Sponsor for the
Project at the most senior level of City” and a “Single
Point of Contact (SPOC)... responsible for addressing
all issues related to the Project.” The Google contract
further requires “a City team dedicated to the Project…
the full cooperation of all City departments…[the City] participate in regular status meetings (at least weekly)...
a dedicated inspection team as part of the City Project team… [and] consulting assistance to Google on planning
and build of the Project.”
Open Access
The term “open access” refers to a network management policy by which multiple service providers can offer
services over the same physical network. This objective is reached by requiring the network owner to offer access
to its physical network on non-discriminatory terms to any requesting service provider who can plug their own
equipment into the network and begin offering services to customers. Stockholm, Sweden, is the most notable
example of an open access fiber network. The South Portland, Maine, and Champaign-Urbana, Illinois, efforts
include open access requirements.
From the city’s perspective, an open access policy has the advantage of promoting competition at the service level
because it prevents the owner of the physical network from dominating the market for network services. From
the network builder/owner’s perspective, open access may reduce profits because competition will likely lower
market prices for network services. This means it will take the network owner longer to recover its costs and turn
a profit, which could mean no new build-out ever occurs. But if a party is willing to invest in a next generation
network even with an open access requirement, such a
policy could, in the long run, result in more innovative
services, lower prices, and greater access for residents and
businesses.
When Google announced its Kansas City fiber
deployment, it initially suggested the network would
be open access. Later, however, it reversed its position,
saying that as the company had studied the economics
of deployment and consumer behavior, the advantages
of open access were not sufficient to justify the increased
costs and risks of that business model. Google has
talked about how the costs of obtaining traditional
programming packages, and the need to offer a multi-channel video package, make an open access model non-
viable from an economic perspective. In contrast, Champaign-Urbana’s fiber network embraces the open access
ideal. This distinction stems from the fact that Champaign-Urbana’s network originated under a federal BTOP
grant that came with an open access requirement. As the network operator evolved into a nonprofit (UC2B), and
then a partnership between UC2B and private service provider, iTV-3, open access remained a core principle
throughout. The BTOP grant made open access a precondition to negotiation with private ISPs when UC2B
went looking for an expansion partner.
While still untested, one potential compromise is to allow the network builder a limited grace period during
which it can be the sole service provider, allowing it to recoup upfront costs more quickly. This grace period
can be followed by an open access policy thereafter and can be negotiated as a number of years or pegged
directly to cost recoupment. Currently, a theoretical approach, some cities have debated whether to try to
obtain such a commitment.
Personnel Commitments: Key Consideration
• How will dedicating such a team affect city
resources and other high priority construction
processes?
Open Access: Key Considerations
• Does the city want to try an open access model?
• Have ISPs expressed initial interest in working
with the city to implement an open access
network policy?
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Free Network Services for the City
All the contracts we analyzed contain provisions by which the ISP provides some form of free service for the city
and/or other public facilities. This is often an important negotiating point for city officials because free network
services can add up to major cost savings for the city or can otherwise serve some other policy objective. City
officials should examine their existing IT costs and either try to minimize them by procuring as many free services
as possible through the negotiations, as discussed below in the Kansas City and Raleigh cases, or leverage them to
stimulate the build-out of the network, as was done in South Portland, Maine, also addressed here.
Google’s contract with Kansas City allots free Internet connection service, of the same kind offered to the general
public, through a quota of 130 locations within the city including city facilities, public utility sites, and school
districts. One caveat is that such free service facilities will only be connected as they are passed by the natural
progression of the network’s construction. Another caveat is that Google will cover the cost of connection, but only if
it is “commercially reasonable.” Otherwise, “Google and Kansas City will discuss options to address that issue.” Most
importantly, following such connection, these locations will receive Internet connection services free of charge.
AT&T’s contract with Raleigh similarly uses a quota to provide “Community Broadband Service” to “public or
non-profit facilities that provide access and services directly to citizens.” The agreement specifies that 100 sites can
be chosen collectively across all six municipalities that form the North Carolina Next Generation Network. The
agreement also stipulates that the relevant city must pay for the cost of connection (estimated in the contract to be
$300-$500) and that schools and libraries would not be included unless they qualify for funding through E-rate,
the federal program administered by the FCC, which subsidizes broadband connections for low-income schools
and libraries.
Another type of free service which can be negotiated, particularly in the case of a dark fiber network, such as
GWI is providing in South Portland, Maine, is an Internet point of presence. Without this, the city could still
end up paying a significant sum of money to connect its facilities to the Internet despite having high-speed fiber
connections internally. GWI’s contract stipulates that it will provide an Internet connection at a termination point
designated by the city, capable of at least 100Mb/sec symmetrical, free of charge for the remainder of the contract
term. Thus, while the South Portland model does not focus on free services, it does enable the city to enjoy lower
costs over time while accelerating the deployment of a next generation network.
Revenue Sharing
Depending on the financial model or models under consideration, revenue sharing is another topic worth
exploring during negotiations. Some network models do not make room for such provisions (e.g., Google/Kansas
City; AT&T/Raleigh). Other models make revenue sharing a central provision, such as the deal between South
Portland and GWI. In return for becoming an anchor tenant of the new network and paying for 20 years of
service upfront (approximately $150,000), South Portland is entitled to a share of revenues generated from retail
services provided by GWI.
The important note here is how to define the profits from which to calculate the city’s share, because the network
provider must account for numerous costs. Accordingly, the GWI contract starts by defining “Retail Revenues”
as “revenues received by GWI from retail business or residential customers for Internet and data transport services
connected directly to the Fiber Optic Cable Network, exclusive of any applicable taxes or surcharges.” From
there, the contract specifically defines the “Connection Costs” which must be recouped by GWI from each retail
customer’s revenue stream before the city begins to receive a 5% share of all future revenues from that customer.
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Other Provisions
Not surprisingly, there are a number of other topics that have been the subject of negotiations. A quick
summary includes:
ACCESS TO CITy FACILITIES FOR NETWORK NODE EQUIPMENT: The network builder will want access to city facilities
for locating network equipment. This is particularly valuable in areas where appropriate facilities are scarce.
CUSTOMER SERVICE: Cities have asked service providers to hold to specific standards of responsiveness for outages
and issues.
DIGITAL LITERACy: Cities have asked for assistance with digital literacy efforts.
EDUCATION/MARKETING: Service providers have asked for certain kinds of assistance in making educational and
marketing materials available to relevant segments of the public.
INTERCONNECTIONS: Service providers have requested settlement-free interconnections with anchor institutions
within cities that have existing fiber connections.
MAKE-READy WORK: The network builder will want the city to commit to doing most or all of the make-ready
work on city facilities (such as on poles) in order to lower the cost of the build-out.
PUBLIC WI-FI: The fiber build-out also improves the economics for deploying a robust, cost-effective Wi-Fi
network. Cities can negotiate for some of the Wi-Fi hotspots to be available for public consumption, instead of
just for service providers.
SERVICE TO LOW-INCOME HOUSING: Cities can ask for a minimum number of connections to low-income
housing facilities.
SERVICES TO CITy, SCHOOLS, AND OTHER ANCHOR INSTITUTIONS: In both the Kansas City Google Fiber and North
Carolina AT&T agreements, the cities were able to negotiate for fiber connections to certain public facilities.
SERVING SMALL/MEDIUM BUSINESSES: In the same way, cities can ask for a minimum number of connections, or
geographic coverage, in areas with small and medium-sized businesses.
SMART GRID SUPPORT: Cities have asked service providers to make efforts to ensure that the new network
supports the city’s “Smart Grid” program. Additional provisions might request that the parties negotiate an
agreement in which the city agrees to reinvest any resulting cost savings back into the network.
UPGRADING TECHNOLOGy IN CITy BUILDINGS: Cities have asked service providers to update equipment and
technology at a certain number of public or government buildings.
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what are the Funding issues
and opportunities that affect
How the City Proceeds?
This section summarizes funding issues and resources for cities seeking private partnerships
or public funding.
An Overview
If a city obtains a national partner like Google, AT&T, CenturyLink, or Cox, it does not have to “worry”
significantly about funding issues. In the deals to date, these kinds of large private parties have carried the financial
risk. If, at the opposite end of the spectrum, cities decide to proceed without a private partner, there are a myriad
of financing issues beyond the scope of this Handbook. For cities pursuing some type of public-private model with
more public control and more public risk, they should consider a number of financial questions addressed here.
Like traditional municipal projects, there are
numerous financing options available for a public
broadband initiative. However, it’s best to recognize
upfront that this is not a conventional publicly
funded endeavor, nor one that a municipality and
its traditional lending partners will be familiar
with, or experienced in, utilizing. Nonetheless,
as demonstrated in successful community-led
broadband projects, there are numerous funding
models available to support various network
deployment strategies.
Whichever path a municipality chooses to pursue,
it is imperative to ensure the financial inputs
and outputs are fully understood and properly
presented to any potential private partner and/or
source of financing.
As financing methods are considered, municipalities
must have an understanding of, and answers to, the
questions and financial return metrics any sources
of financing will consider when evaluating the project. There are both financial and legal mechanics that can be
designed to protect everyone involved and that, if properly presented, could generate significant interest from
investment sources.
Any public or private proposal must have a credible
strategy that addresses standard questions:
• Return on Investment (ROI)?
• Internal Rate of Return (IRR)?
• Point of Breakeven?
• Point of Profitability?
• Point of Positive Cash Flow?
• Is this a 5 year lifespan? 10 year? 30 year?
• Preferred funding source – public or private?
Debt or equity? Corporate or municipal?
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The technical design, construction, and operating complexities of the telecommunications business must be fully
grasped by any municipality pursuing sources of funds. It is often the case that a traditional lending institution,
while acknowledging the intangible economic development benefits of a community broadband network, will likely
focus on how funds will specifically be used, how they flow, and how debt will be serviced, while ultimately testing
the metrics to ensure returns. In that light, here are some key questions cities and their partners must evaluate.
Key Considerations: Financing
Who will ultimately take the risk when financing the network?
There are a number of different risks to consider, such as the risk that deployment costs will be greater than
anticipated, or revenues will be less than expected. In many community-led broadband projects, the municipality
has moved all financial risk to the private party (as is true in the Google Fiber and fiber by incumbent projects),
but that generally leads to less control by the municipality on a number of issues, such as the extent of the build-
out. This raises a host of related questions, including: What does the current competitive landscape look like?
What is the anticipated reaction from incumbents? Will this present a formidable hurdle related to network
returns? Again, while the answers cannot be known with certainty, the question of who bears the risk has to be
addressed before any actual deployment can proceed.
Would the municipality support the network with other internal sources of revenue, such as legacy utility service
fees, or existing or new taxes? Will this be purely a stand-alone revenue pledge?
These questions are always core to the analysis if the city intends to operate the network. They may also be relevant if
the city wishes to control certain outcomes as well, as we saw in the South Portland and Westminster examples.
Is the municipality willing to pledge resources or collateral or offer concessions to mitigate risks for a funding
partner?
Again, the city can, as we’re seeing in Utah with the Macquarie initiative, facilitate both a build-out and a
preferred business model for the operation.
What are the long-term costs/benefits of pursuing a public broadband network in deference to future or
alternative uses of funds and resources?
If city officials wish to participate, they will have to justify expenses with projections demonstrating benefits like cost
savings (such as in Santa Monica and South Portland), or new economic growth (such as the Westminster project).
What are the legal requirements, limits, or barriers to entry in pursuing a public broadband network?
As noted in an earlier section in this Handbook, many states have constraints on cities participating in broadband
networks, particularly in terms of financial support. In short, a firm grasp of the initiatives’ financial inputs will go
hand-in-hand with the development of a defined network architecture and management planning for the project.
A thorough understanding of the financial inputs and outcomes demonstrates a foundational understanding and
coordination between the financing, technology, and operational imperatives paramount to the long-term success
of any community-led broadband project.
Funding Methods and Case Examples
There are a wide variety of funding approaches that communities have adopted to support the phases of network
deployment – whether exploratory work (writing a request for information, taking an asset inventory, measuring
demand, etc.), capital expenditures (the cost of actually building the network), or ongoing operating expenses
(the cost of maintaining service over time). See below for common and sometimes creative takes on funding.
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Note that these methods are not mutually exclusive. For example, the original network in Champaign-Urbana
was built using a NTIA Broadband Technology Opportunity Program infrastructure grant. While the original
plan called for the network to be expanded through a public-private agreement between the cities of Champaign-
Urbana and a local ISP, ITV-3, ITV-3 was recently purchased by another private company. The cities are now
considering their options for completing and continuing to operate the network.
Innovative Financing: Westfield, Indiana
This section does not exhaust the innovative ways cities and private parties can work together to meet both their
needs and provide the capital necessary to deploy a new network. The opportunities vary according to state law.
One of the best examples of an innovative way to finance a network was that employed by Westfield, Indiana.
The city employed an innovative form of Tax Increment Financing (TIF) in its effort to have a private ISP bring
gigabit broadband to town. TIF is a public financing model which aims to capture future gains in property taxes
from a specified “tax district” to subsidize current improvements; improvements which the city and bondholders
expect to be the main cause of the subsequent tax gains. Because Indiana state law allows TIFs to be defined
narrowly, Westfield is able to offer a TIF bond based on specific assets as opposed to an entire geographic area.
Figure 17: Financing Methods
CATEGORY
Federal Grants
State Grants
Municipal Bonds
Private Funding
Cooperative Funding Model
Crowdfunding
Utility Fee
Infrastructure Financing
Districts (IFD) or Tax
Incremental Financing
Districts (TIF)
RISKS TO CITY
To partially off-set costs of a network or lay
middle mile or dark fiber for future expansion
(either public or private).
To partially off-set costs of a network or lay
middle mile or dark fiber for future expansion
(either public or private).
For full-scale, ambitious city-wide deployment
where there is projected revenue from a public
model or there are private parties interested in
leasing the project infrastructure.
For full-scale, ambitious city-wide deployment.
When residential service is demanded, but
there is little to no private investment interest.
For incremental, scalable projects with visible
effects for civic investors (public Wi-Fi,
Innovation Zones/Districts); or for exploratory
costs in cases of widespread citizen demand
and slow government action.
For full-scale citywide deployment funded
publicly or through a partnership in an area
without competition. Caveat: given the
sensitivity of public funding, high levels of
political and public support are needed.
In states where such districts are set up or
politically supported and where projected
future gains/value from infrastructure projects
are reliable.
RELEvANT CASES
Chattanooga, TN
Georgia
Minnesota
Illinois
Lafayette, LA
Cities with Google Fiber, AT&T Gigapower,
CenturyLink, and other such efforts
Sibley County, MN
Blacksburg, VA
Macquarie in Utah
Wabash County, Indiana
California
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With Indiana’s unique TIF flexibility, Westfield was able to offer a private provider, Metronet, a TIF bond based
solely on the network assets to be built. This bond effectively acts as a 25-year tax abatement instrument, where
state law would normally limit tax abatement plans at 10 years.
Here’s how it works: Westfield offers TIF bonds that cover the very assets Metronet plans to install for its
Westfield fiber-to-the-premises network. Metronet then purchases those bonds from the city, which entitles
Metronet to the future property taxes that will be assessed on its network assets going forward. Westfield then
releases the bond sale proceeds back to Metronet to build out the network. As a result, Metronet has effectively
abated its property taxes due on the new network in a way that does not affect the pre-existing tax base of the city.
It’s a true win-win: Westfield gets a new high-speed fiber network and Metronet gets long-term tax abatement
without impacting Westfield’s existing tax base.
Most states have a different law on tax abatements and TIF financings, but we believe there are similar
opportunities in most states for the parties to share the upside of the benefits such networks bring and, thereby,
improve the economics of deployment.
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Challenges to expect along the way
In this section, we outline the expected roadblocks, trade-offs, and criticisms a city will likely
encounter, both during the preliminary decision-making process and after it has chosen, and
begun to pursue, a specific upgrade strategy.
Challenges During the Exploratory Phase
Assessing a City’s Current Status and Demand for Next Generation Speeds
Depending on the city, taking an inventory of existing local fiber assets can be a complicated undertaking
involving coordination on many fronts. Does your city have a public safety network? Between private industry,
public entities, universities, and hospitals, what does the existing fiber infrastructure look like? To the extent
possible, information about existing fiber assets should be centralized by a single local government agency charged
with freeing this information from silos and then mapping it.
Measuring local demand for higher speeds is another challenge. Do you have anecdotal or quantitative
information about dissatisfaction with current service offerings in your community? Do you have the resources to
survey residents, schools, and businesses to capture and express this level of demand? A number of resources are
available to capture community demand, including this Demand Identification Website created by Gig.U. These
tools are designed to assist those in charge of local outreach efforts by making it easy to assess interest in upgraded
networks.
Finding Champions, Creating Accountability
Ensuring “better, faster, cheaper” broadband is not explicitly written in anyone’s job description. As a result, many
of the successful or developing cases have come about because local leaders took the initiative to step out of their
traditional or expected duties to adopt this cause. The need for champions creates a local governance challenge.
Who in City Hall is accountable? Who is in charge? Who is pushing the project ahead? The answer depends on
the particulars of each city, but if the answer is, “We don’t know,” the project is unlikely to succeed.
Recently, we’ve seen cities explicitly create and embed positions that would be the local “champion” for broadband
access and upgrades. One example of this was Boston’s new “Broadband & Digital Equity Advocate” position in
city government, created in early 2016 and presently held by Anne Schwieger.
Pushback from Incumbents
If an incumbent ISP is not involved in the local gigabit project as a partner, it could become a major obstacle
– even before the network has been built. If a local broadband plan threatens existing revenue streams, as it
inevitably will, incumbent companies will react to protect the status quo. They might use a combination of
political, public relations, and legal tools to challenge any action they believe hurts their interests. Pushback could
come in the form of misinformation campaigns, “astroturf” organizations, legal barriers, and lobbying on the
city or state level. Almost all of these tactics were used to try to block the network in Longmont, Colorado, so it
provides a comprehensive case study for city officials.
While all the communities discussed in this Handbook have experienced some form of pushback, to a remarkable
degree that pushback has been muted by the desire of communities for improved broadband. What we have
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found is that if communities run an open process, with a clear statement of goals, and gain the support of key
community and economic interests early on, the incumbents generally decide that overt opposition hurts their
brand. They instead focus on improving their product and price, which benefits the community and its citizens.
Challenges during the Decision-Making Phase
Understanding the Trade-Offs
As your city moves forward with its gigabit strategy, there are important trade-offs that need to be understood
and addressed in choosing the most appropriate network model. Is it more important for the city to have a quick
roll out to certain locations, like business districts, innovation zones, and anchor institutions, or a slower, but
potentially more comprehensive, roll-out? Is it more important to have as broad a coverage as economically viable,
or to have less coverage but potentially lower prices that may trigger a competitive response by incumbents? Is the
aggregated demand and scale of a regional approach worth the extra time and coordination? Embracing a private
partner means reducing financial burdens for the city, but it also means sacrificing future operational control.
An incremental approach means less immediate risk, but also likely means a longer wait for the benefits from
widespread availability of gigabit speeds. Some of the key trade-offs are illustrated in the figure below.
Figure 18: Trade-Offs
Ensuring
ROI
Quick
Decision-
Making
Attracting
National
Private
Partners
Operational
Responsibility
A Universal
Network
The Scale of
a Regional
Approach
An Open
Access,
Wholesale
Network
City Control/
Accountability
over Network
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Challenges during Implementation and Build-Out
Managing Community Expectations
While educating the community on the project will be a challenge, so will managing expectations. This will be
important to do in regard to the project’s timing and construction – especially since this is an investment with
mostly long-term benefits. To retain momentum, cities must create and meet public milestones (sign-up deadlines,
announcements of institutional support, etc.) that translate into quick wins.
Addressing Equity, Broadband Adoption, and Digital Readiness
The economic and educational benefits of higher speeds are undeniable, but they do not solve the “Digital
Divide.” While the rewards of a gigabit network might cause multiplier effects in the city and possibly impact the
lives of those not directly connected, many residents will not directly benefit from gigabit connectivity without
complimentary community adoption, digital literacy programs, and access to hardware. The challenge for any
prospective gigabit city will be to understand the nature of the local digital divide and to create tailored, targeted
solutions to roll out alongside the gigabit upgrade. For instance, future gigabit city Austin, Texas, just announced
that Google Fiber would be connecting residents of 18 HACA properties (public properties operated by the
Housing Authority of the City of Austin) with free 5 Mpbs service for a $10 pre-registration fee.
Getting over barriers to adoption – whether those of access, cost, or relevance – is arguably just the start. Achieving
a certain threshold of digital and technical know-how is becoming a de facto requirement as more job applications,
government services, and informational resources shift exclusively online. Cities can no longer be thinking of
broadband adoption as a binary question of whether someone is online or not. There is a compelling case that
the new framework should be what Pew Research Center researcher and leading expert on these issues, Dr. John
Horrigan, calls “Digital Readiness,” which measures how skilled and prepared new adopters are for next generation
applications and online services.
While broadband adoption or digital readiness is a problem most cities share, those pursuing gigabit upgrades will
have added pressure to address and correct them. In 2014, a Wall Street Journal article surveyed how some argue
that gigabit efforts contribute to the digital divide. On further examination, however, most of those arguments
fall apart, as can be seen in a report by Aaron Deacon, one of the community leaders involved with the Kansas
City gigabit deployments. The report provides six arguments for how Google Fiber has narrowed the digital divide
in Kansas City. Wired also ran a piece providing a further discussion of how digital divide-based attacks on next
generation deployments are factually and logically flawed. This analysis from co-author Denise Linn begins to
explore the question of how the digital divide in high-speed Internet cities might look inherently different than in
other municipalities.
Winners of the National Digital Inclusion Leaderships Awards
Philadelphia, PA Seattle, WA Davidson, NC Austin, TX Chattanooga, TN Washington, D.C.
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Fortunately, the list of national resources available to communities seeking to increase speeds and bridge divides
is growing. The new national mayoral coalition, Next Century Cities, exists at the nexus of digital inclusion and
city upgrades, compiling resources and incentivizing cities through digital inclusion and civic technology awards.
The National Telecommunication & Information Administration also has an emerging Community Connectivity
Initiative that will feature an assessment and recommendation tool for cities seeking to improve their community
information ecosystem.
Recognizing that a Good Network is Only Part of a Successful Digital City
Asking, “How do we get a gigabit network in my city?” is not the same as asking, “How do we become a
gigabit city?”
While a gigabit network is the starting point for many innovative possibilities, it is important to keep in mind
that it is just that – a starting point. For example, Mayor Andy Berke of Chattanooga leads a city with gigabit
connectivity, but is also still seeking ways to unlock the potential of those high speeds. Recently, Mayor Berke
was at the Brookings Institute discussing ways to foster the creation of Innovation Districts, geographic areas
described by Brookings urban experts as “where leading-edge anchor institutions and companies cluster and
connect with start-ups, business incubators and accelerators. They are also physically compact, transit-accessible,
and technically-wired and offer mixed-use housing, office, and retail. Such areas have the unique potential to
spur productive, inclusive and sustainable economic development.” Such areas also depend on robust broadband
networks.
In addition, initiatives like US Ignite and the Mozilla Gigabit Community Fund have encouraged the
development of applications and projects for next generation, high-speed networks. Even cities that lack the
infrastructure right now are taking steps to bolster civic technology and e-government. The Boston Mayor’s
Office of New Urban Mechanics is a model government project when it comes to leveraging technological tools
and city data to make citizen services more efficient. As noted earlier, The Kansas City Playbook (published
by the Mayors’ Bi-state Innovation Team) details the cities’ plans for maximizing the opportunities created by
their gigabit network. It outlines pilot projects and strategies touching on digital inclusion, education, universal
coverage, Wi-Fi hotspots, healthcare, arts and culture, and local government.
Agendas and Issues to Watch in the Next Administration
Although Donald Trump will be our next President, we are not sure who will occupy key positions in broadband
policy. We can, however, know what some of the agendas and issues will be and their potential direction. As
discussed below, several can impact the economics and options related to network deployments.
Municipal Broadband
As noted earlier, the FCC lost its effort to pre-empt state laws restricting municipal broadband efforts. The
FCC declined to appeal the case to the Supreme Court. So the FCC’s ability to legally undercut such laws is
likely to remain limited. We note that a number of efforts have proceeded in states with such laws, and as more
communities obtain next generation broadband through their own efforts, and as such broadband becomes more
important from an economic development perspective, the ability for incumbents to convince legislatures to pass
such laws will likely weaken.
An Access Agenda
As we look back at the history of communications networks, the deployment of networks capable of offering
faster, better, and cheaper services always requires a new capital allocation decision. This is generally done by
a private-sector party, but often follows government decisions that lower the cost of deployment or operations
and/or increase potential revenue and competition. The 1978 Pole Attachment Act, for example, sparked an
investment wave into cable systems by allowing cable to attach to utility poles. More recently, the fiber network
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deployments and upgrades by Google, AT&T, and CenturyLink were stimulated by a variety of agreements
between cities and the providers, as discussed in this Handbook, that improve the economics of the investments.
A continuing challenge, however, lies in assuring access to essential facilities. There are three basic categories:
government-controlled inputs, such as spectrum at the federal level and rights of way at the local level; quasi-public
essential facilities, such as utility poles and certain kinds of intellectual property developed through standards-
setting bodies; and private assets that have become essential. Examples of these include the cable programming
regulated under the 1992 Cable Act, the unbundled network elements at the heart of the Telecommunications
Act of 1996, and the business data services facilities currently being debated by the Federal Communications
Commission.
This is not a simple task. Nonetheless, Congress specifically told the FCC that it was responsible for the
deployment of advanced communications networks and that it should “take immediate action to accelerate
deployment of such capability by removing barriers to infrastructure investment.” In other words, if the FCC
thinks such deployment is too slow—and the current commission clearly believes it is—it ought to inquire
whether there are barriers that ought to be removed.
As competitors try to deploy next generation networks, they have pointed to two places where they see significant
barriers: utility poles and entry to multiple-dwelling units (MDUs).
As to poles, there is some existing federal regulation and, as discussed on page 39, new efforts by cities to lower
the cost of pole access. Depending on the outcome of those local efforts, but particularly if the courts determine
jurisdiction for regulation lies at the state and federal level, we could see the federal government ask why the
current rules often require multiple construction crews to do what one crew could do. Just as both national and
local governments are wisely adopting “dig once” policies for deploying below streets, we would expect the FCC
and some states to explore a similar vision of “climb once” or “one touch” policies.
With MDUs, the law already bans exclusive access agreements, but there are still many MDUs where, as a
practical matter, the residents cannot exercise free choice. We might expect the FCC to consider whether the
failure to provide residents choice creates a barrier to broadband deployment, in violation of Congress’ mandate.
This would affect how cities approach their own plans, as cities often have a high percentage of their residents
living in MDUs.
An Infrastructure Agenda
One of the few areas of agreement between the Democratic candidate, Hillary Clinton, and the President-elect,
Donald Trump, is that both agreed there was a need for the country to spend more on infrastructure. While
Trump has not yet laid out his technology-related agenda, cities making plans for upgrading their networks should
pay close attention to policy debates in the first part of 2017 to determine if there are new resources to be utilized
in upgrading networks for these future needs.
A Digital Inclusion Agenda
The FCC recently reformed its Lifeline program, which provides support for low-income individuals to stay on
critical information networks. But this was not just about helping low-income people. It helps everyone. As a
group of 44 mayors and city officials wrote in support of the reforms, “Getting more low-income households
online will help modernize delivery of public services—facilitating more responsive and effective governance while
lowering overheads for local government.” The same would be true for federal government. A high-tech CEO
group estimated the savings of transitioning the federal government to a more efficient digital platform to be $1
trillion over ten years. In short, many in government understand moving to the digital platform can save billions
but that movement requires all to be on that digital platform. As an initial policy question, the government will
have to consider whether the Lifeline reforms are sufficient to make complete the transition to digital delivery of
public services.
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But this is not just a function of traditional government services. When the mass market Internet emerged 20
years ago, many hoped it would lead to increased social equity. It was not irrational for us to believe that a medium
in which the cost of distribution is zero could lead to a world in which the best products become available to all.
After all, the Silicon Valley billionaire and any impoverished child with Internet access probably use the same
search engine and same apps. As Wired magazine noted, refugees fleeing Syria often have the same smartphone as
those in the 1 percent.
But we would have to be blind to believe social equity has improved in the last 20 years. As others have noted,
venture capital has largely focused on addressing the pain points of the most well off, not the least well off.
Further, as the White House has noted, algorithm-based services may lead to new forms of exclusion and
discrimination.
In the last few years, there have been increasing calls for the government to adopt policies that enable all to
participate in what we might think of as digital life, particularly for such services as health care, education, job
training, and public safety. Again, we cannot know what the precise policies will be for improving inclusion in
digital life. We can know that greater efforts at inclusion increase the value of, and the percentage of, adoption in
traditionally low-adoption communities. Both have the impact of improving the economics of new deployments,
as they bring new customers, and a greater willingness to pay, to the platform.
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Top Ten overall Lessons
Throughout this Handbook, we have identified the most important considerations for cities
seeking to accelerate the deployment of next generation networks in their communities.
This section distills these even further to a “Top Ten” list that provides lessons for all
communities—regardless of size, density, or demographics—pursuing improved bandwidth
for their businesses and residents.
Lesson 1: Organizing community resources and stakeholders is essential for
making gigabit projects economically viable.
While different cities have different demographics, construction costs, and other variable factors that affect
the feasibility of a gigabit capable network, communities that have moved forward share one driving force: a
commitment to improving broadband availability. Any community has the ability to organize its resources and
regulatory processes to lower capital expenditures, operating expenditures and risk, and raise revenues – the key to
making gigabit projects economically viable. Also, any community with a vibrant tech or start-up community can
leverage that energy to produce project support. These stakeholders are first adopters and already understand the
“why” of gigabit speeds.
Lesson 2: Start with a clear understanding of how your city’s rules and assets
affect deployment costs.
The organizing effort starts with a detailed understanding of how communities’ policies and assets affect the
economics of network deployments. Gig.U, the Fiber to the Home Council, and others have developed tools for
this exercise and public documents from the Google Fiber project also provide a roadmap for how cities should
think about the impact of their rules and assets on network economics.
Lesson 3: Because it takes a long time to plan and deploy a network – and it
always takes longer than you think – the right time to start thinking about how
to improve the economics is today.
Every day, cities make decisions that can affect the cost of deployment. Every time a street is dug up, every time an
area is developed or redeveloped, there is an opportunity to lower the cost of future deployment. Every time such
actions occur without an eye toward lowering the cost of next generation broadband facilities, the future cost of
such a network increases.
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Lesson 4: Incumbents only respond to a potential change in the status quo.
Inaction by a city leads to inertia in the market.
In every community we have worked with, action by the city has always led to a response by incumbent providers.
Generally, that response is in the nature of an incremental bandwidth increase or some other kind of improvement
designed to forestall a broader, community-led broadband upgrade. This is not to criticize the incumbents; it is
simply to suggest that when it comes to cities and their broadband networks, the old saying, “The squeaky wheel
gets the grease,” turns out to be true. For example, without its RFP, it is doubtful that Los Angeles would have
received a proposal by Time Warner Cable to accelerate its upgrade throughout the city. Similarly, Time Warner
Cable’s upgrade in North Carolina only occurred after the community-led efforts in that state.
Lesson 5: Cities who act will have to choose between the quick, short-term
win and the harder, longer-term win.
When cities become “the squeaky wheel,” they often have an opportunity to obtain some quick concessions from
incumbents in exchange for stopping a process that opens the door to new providers. There is no general rule
for responding. Some cities may best be served by taking what is in front of them, while others have the potential
for far greater gains. What is certain is that cities should be prepared to analyze the short-term and long-term
risks and opportunities so as not to be pressured into making a decision based solely on a desire for a “quick
win.” Rather, they should be looking toward the “art of the possible” by maximizing the long-term prospects for
broadband abundance.
Lesson 6: While success depends upon broad support, it also depends on
nimble decision-making.
One reason Google chose Kansas City as its initial project site was that the existing unified government structure
gave Google confidence it would receive decisive responses on a variety of issues as the project proceeded. Other
projects have not gone as smoothly because decision-making was diffuse across a number of constituencies. For a
project to be successful, there must be a broad coalition of interests supporting it. At the same time, that coalition
must have confidence local leadership will act quickly on behalf of all. Otherwise, there will be delays that
ultimately raise costs and could injure the project’s long-term prospects. Further, it is often difficult, within the
existing local government structure, to find a high-level executive to “own” the project and assure its completion.
Empowering such a person, and making sure the project is not an orphan, has been critical to the success of
projects to date.
Lesson 7: There is no one-size-fits-all solution. There are multiple solutions to
multiple community needs with multiple trade-offs. But all efforts improve the
situation relative to the status quo.
As evidenced by the multiple ways in which Gig.U communities have approached the opportunities, there
are many different ways to accelerate the deployment of a next generation network. Each has advantages and
disadvantages. What is common to all, however, is that the cost to the community of such efforts is negligible
and the benefits are significant. There is no cost to asking questions. Indeed, simply asking the right questions can
cause incumbent providers to become more interested in how the city is thinking and more responsive to future
needs. Competition – even the threat of competition – tends to improve the performance and the offerings of
incumbents.
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Lesson 8: Experiments don’t always work the first time. That’s why they are
called experiments. Make sure the community leadership understands this
and uses “lessons learned” to improve performance in successive iterations.
Pioneers don’t have the advantage of a clear and certain map. In each of the efforts to date, mistakes were made.
The key is not to let the mistake determine the fate of the project, but rather to figure out how to correct the error
and continue to move forward. A good example of the right way to approach the long-term objective is the work
of the Seattle Citizens Telecommunications and Technology Advisory Board. As a letter from the organization
notes, the disappointment in the inability of Gigabit Squared to deliver on its promises did not diminish the
centrality of world-class broadband to the economic future of the city, nor the citizens’ interest in accelerating
the deployment of a gigabit network. Indeed, as the Board stated, “Though we are disappointed in light of recent
news that the Gigabit Squared initiative with Seattle no longer seems viable, the Citizens Telecommunications and
Technology Advisory Board (CTTAB) wants to be clear in reaffirming our earlier position on broadband for the
City… the Board (CTTAB) urges the Mayor and the Council to move forward without further delay to bring a
Fiber-to-the-Premise network to Seattle… State-of-the-art Internet access is essential to Seattle’s ability to compete
and lead in the 21st Century global economy.” The city continues to explore other options, with a recent study
that provides a thorough review of the costs of deploying a next generation network.
Lesson 9: Scale matters.
As these projects are not cookie-cutters, there are significant start-up costs. In that light, scale is an advantage. The
larger the ultimate addressable market, the more a provider is willing to risk those start-up costs. It is unlikely, for
example, the eight respondents to the NCNGN project would have been willing to respond to six different RFPs.
While the regional approach appears to be working there, it is important to remember the prior rule that quick
decision-making also matters. So leaders of multi-community efforts must make sure the desire for scale does not
result in complicated and lengthy decision-making.
Lesson 10: Above all, local leadership is the single most important ingredient
for success. If there are local leaders who put this at the top of their agenda, it
can happen. If not, it won’t.
Gig.U is proud of how it created a national platform for communities to help each other chart a path whereby
every member community benefits from the efforts of others. But the single most critical variable for success is
not in Gig.U or any national organization. It has been, and always will be, local leadership. In every community
where an effort has moved forward, there has been strong local political, business, and civic leadership that has
made it a priority.
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Conclusion – eliminating bandwidth
Constraints
Each city brings its own set of challenges and advantages to this issue, but all cities serve to benefit from the
presence of future-proof, next generation connections and the multiplier effects that come with them – distance
learning, innovation districts, telemedicine opportunities, and a tech-friendly environment for business
development (to name a few).
As costs, business models, norms, average speeds, and prices evolve, this Handbook will evolve with them. The
fundamental idea of Gig.U, as well as this Handbook, is to create a roadmap of different approaches, so that all
cities can benefit from what those communities, and others, have done. As Nassim Nicholas Taleb reminds us in
his book, Antifragile, “Like Britain in the Industrial Revolution, America’s asset is, simply, risk-taking and the use
of optionality, this remarkable ability to engage in rational forms of trial and error, with no comparative shame
in failing, starting again, and repeating failure.” At its core, this Handbook is a recounting of the many ways
communities have capitalized on that asset to engage in thoughtful risk-taking and trial and error for the sake of
developing new models for creating bandwidth abundance.
With fiber deployments in 2016 on pace to have their highest level of year-over-year growth since 2008, we are
optimistic that the next edition of this Handbook will showcase additional best practices and new innovative
models, as well as more cautionary tales in the wake of new roll-outs and major market changes. Our prediction?
More companies will announce city projects and more cities will experiment with community-led, innovative
models. Then, as gigabit speed is pushed further from “exception” to “norm” through the next few years, the U.S.
will see even more cities step up to publicly announce their interest in a network upgrade to stay competitive in the
global information economy.
We began this Handbook by suggesting that all communities should want the kind of affordable, abundant
bandwidth that insures that bandwidth is never a constraint on innovation, economic growth, or social progress.
When we began several years ago, companies suggested they could provide abundant bandwidth, but at prices few,
if any, could afford. Further, because of the huge incremental cost of building new, or upgrading old, networks,
there was no pricing pressure on offerings of abundant bandwidth. What we have begun to see, however, is that if
two or more providers deploy networks where the marginal cost of additional bandwidth is basically zero, the price
for next generation services drops dramatically and bandwidth constraints become a thing of the past.
In that light, we encourage all prospective gigabit cities to take advantage of the variety of tools, resources, and
institutions at their disposal (see Appendix) and to think creatively about how best to accelerate the deployment
of a gigabit capable network. Smart experimentation benefits your own city and the lessons learned will benefit
others. In the long run, this will improve how all communities can best take advantage of affordable, abundant
bandwidth.
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appendix: Tools, resources, and Links
for your next Steps
Previous Reports from the Gig.U Project
“Upgrading America: The One Year Anniversary of Gig.U” July 2012
“Upgrading America: The Semi-Annual Report of Gig.U” February 2013
“Gig.U Y2” July 2013
“A Gigabit Garden Begins to Grow: Lessons from the First Planting” December 2013
“From Gigabit Testbeds to the Game of Gigs” August 2014
Glossary
“Astroturf” Organizations – Fake grassroots organizations that present themselves as non-profit or ground-up public interest
organizations, but are primarily funded by private corporations.
Broadband Technology Opportunity Program (BTOP) – A grant program run by the National Telecommunications and Information
Association (NTIA). BTOP was created in response to the American Reinvestment and Recovery Act (ARRA) as a way of boosting
broadband adoption, improving infrastructure, and creating jobs.
Competitive Local Exchange Carrier (CLEC) – Telecommunications providers competing with existing established providers aka
“incumbent local exchange carriers” (ILECs).
Dark Fiber – Fiber that is in place (aka in the ground), but not being used. Communities and business often deploy dark fiber during
a construction project for other purposes, such as fixing sewer lines, as the incremental cost of such deployment is low, compared to
the significant cost of construction solely for the sake of deploying the fiber. The fiber can be “lit” at such time as the demand justifies
providing a service over the fiber.
Digital Divide – The gap that exists between people that have access to broadband services and know how to use the Internet and
those that do not have such access or knowledge.
Digital Equity – According to the National Digital Inclusion Alliance, “Digital Equity ensures all individuals and communities have the
information technology capacity needed for full participation in society, democracy, and economy. Digital equity is necesssary for civic
and cultural participation, employment, lifelong learning, and access to essential services.”
Digital Inclusion – According to the National Digital Inclusion Alliance, “Digital Inclusion is the activities necessary to ensure
that all individuals and communities, including the most disadvantaged, have access to, and use of, information and communication
technologies (ICTs). This includes 5 elements: 1) affordable, robust broadband Internet service; 2) Internet-enabled devices that meet
the needs of the user; 3) access to digital literacy training; 4) quality technical support; and 5) applications and online content designed
to enable and encourage self-sufficiency, participation, and collaboration. Digital inclusion must evolve as technology advances and
recognizes that access to, and use of, ICTs are an essential element for participation in our society, democracy, and economy.”
Fiber-Ready – When a community has fiber-friendly conditions including, but not limited to: a willing/interested local government, an
engaged local community, streamlined permitting, measured broadband demand, and a dig once policy.
60
Fiber-to-the-Premises (FTTP)/Fiber-to-the-Home (FTTH) – High-speed Internet infrastructure that connects directly to residents’
homes. By comparison, some communities have fiber infrastructure that connects business districts or community anchor institutions
such as schools and hospitals.
Geographic Information System (GIS) – Mapping and data visualization tool to assist planners and policymakers in taking inventory
of infrastructure assets, including assets essential to broadband deployment, and in analyzing local demographics – among other things.
Gigabit - Gigabit speeds are roughly 100x faster than average residential Internet download speeds in the U.S. today
(approximately 10 Mpbs).
Google Fiber – Google’s recent gigabit-capable Internet service business first launched in Kansas City (MO and KS), Provo, and Austin.
Google Fiber is now expanding into Nashville, Atlanta, Charlotte, the Research Triangle Park communities in North Carolina, and Salt
Lake City.
Infrastructure Financing District – A local policy lever allowing cities to use property tax increment financing in a district to support
public infrastructure projects.
Innovation Zones/Districts – An innovation zone or district is a designated area in a city for start-ups, economic development, and/
or civic technology. They can come about through bottom-up business activity or through top-down policies from the city governments to
incentivize investment, new research, or new industries in a neighborhood.
Internet of Things (IoT) – The network of physical devices, vehicles, buildings, and other items—embedded with electronics,
software, sensors, and network connectivity that enables these objects to collect and exchange data.
Middle Mile – The wire line infrastructure that runs between the Internet service provider central office and Internet point of presence.
Middle mile infrastructure connects places or communities to infrastructure, but doesn’t connect individual homes or buildings.
Open Access Network – When the Internet service provision and infrastructure functions of a telecommunications network can
operate separately. In other words – the company (or companies) who provide the Internet service do not own the infrastructure.
Instead, the infrastructure can be used on a wholesale basis amongst several providers.
Point of Presence – A physical location that serves as an access point to the Internet. The location will usually have servers and routers.
Public-Private Partnership (PPP) – A term referring to any agreement or project jointly pursued by a public entity (i.e.: a city
government) and a private entity.
Request for Information (RFI) – A public information gathering process – usually preceding an RFP. The purpose of an RFI is to collect
information about the capabilities of potential project vendors/suppliers.
Request for Proposal (RFP) – A public bidding mechanism. When funding is available for a project, an RFP document is released to
specify project goals. Then, vendors put forth bids in response to the RFP and one vendor is ultimately chosen to get the funding and
complete the project.
Request for Qualifications (RFQ) – A public information gathering process similar to an RFI – usually preceding an RFP.
Right-of-Way – This term refers to the legal right that telecommunications providers need to set up their infrastructure. Rights-of-way
can refer to the right for infrastructure to be connected to publically owned utility poles or cabinets.
Single Point of Contact – A consistent liaison between the public and private partners in a project. For instance, this means that, if
the private company needs to know something quickly from a partnered city government, they can always contact the same person or
office.
Smart Grid – An updated electrical grid that has a capability – either through analog or digital communications – to gather data and
respond to it for cost saving or efficiency purposes.
Tax Incremental Financing (TIF) Districts – A public financing method that allows a city or county to use future gains in taxes
projected from an improvement project to fund that improvement project.
61
Related Cases, Studies, and Tools for Gigabit Cities and Municipal Broadband
Resources Summary
“Digital Inclusion and Meaningful Broadband Adoption Initiatives,” written by
Dr. Colin Rhinesmith, presents findings from a national study of digital inclusion
organizations that help low-income individuals and families adopt high-speed
Internet service.
Detailed narratives of successes, challenges, and lessons learned from each fiber
project.
A resource outlining preparatory work for communities pursuing gigabit strategies.
An overview of dark fiber pricing, pricing models, and customer identification.
A guide to fiber readiness.
“Technical Strategies for Facilitating Public or Private Broadband Construction in
Your Community.”
An overview of different network ownership and governance models, and
broadband technologies to help potential stakeholders understand the advantages
and disadvantages of each technology.
“The Emerging World of Broadband Public-Private Parnerships: A Business
Strategy and Legal Guide” explores how emerging models present an alternative
for communities that lack the capital or expertise to deploy and operate fiber
networks, or to act as ISPs, on their own. Published by Benton Foundation.
A report for the banking community outlining why and how banks can invest in
improved Internet access and adoption projects in the communities they serve.
A study found that gigabit cities had per capita GDPs 1.1% higher than non-
adopters.
A centralized list of federal grants, agencies, and programs that might assist a
community’s upgrade.
A useful reference for non-expert decision-makers seeking to understand the
policies behind fiber upgrades.
A centralized list of state grants, agencies, and programs that might assist a
community’s upgrade.
From the 2013 Broadband Summit, a great report answering the “why?” of gigabit
fiber networks.
Downloadable Excel Workbook assisting with initial community assessment.
Downloadable, generic templates for different network models.
An online radio show hosted by Craig Settles featuring municipal broadband
projects and community leaders.
A collection of best practices to assist cities and fiber providers – whether they
are future Google cities or not.
Benton Foundation, Digital Inclusion Initiatives
Study
Berkman Center Case Studies: Leverett, MA, and
Washington D.C., San Francisco, CA, and Seattle, WA
CTC Technology & Energy, Broadband Strategies
Checklist
CTC Technology & Energy, Dark Fiber Lease
Considerations
CTC Technology & Energy, Facilitating Broadband
Construction
CTC Technology & Energy, Gigabit Communities
Report
CTC Technology & Energy and New America’s
Open Technology Institute, The Art of the Possible:
Overview of Public Broadband Options
Coalition for Local Internet Choice, Broadband
Public-Private Partnership Guide
Dallas Federal Reserve Bank, Closing the Digital
Divide: A Framework for Meeting CRA Obligations
FTTH Council, Early Evidence Suggests Gigabit
Broadband Drives GDP
FTTH Council, Federal Resource Listing
FTTH Council, Glossary
FTTH Council, State Resource Listing
FTTH Council and Broadband Communities,
What Fiber Can Do for Your Community - 2013
FTTH Council and Gig.U, Asset Inventory Worksheet
FTTH Council and Gig.U, RFP Templates
Gigabit Nation
Google Fiber City Checklist
Figure 19: Cases, Studies, and Tools (continued on page 62)
62
Figure 19: Cases, Studies, and Tools (continued from page 61)
A mixed-method study, “A Data-Driven Digital Inclusion Strategy for Gigabit
Cities,” examines how the digital divide looks systemically different in gigabit
cities and how gigabit cities and aspiring gigabit cities can move forward to
address equity.
In “SandyNet Goes Gig: A Model for Anytown USA,” ILSR outlines the case of a
community network which pioneered a low-risk incremental strategy to build its
telecommunications utility.
Case studies of Chattanooga, TN, Lafayette, LA, and Bristol, VA, and how they built
next-generation networks.
A publication by Kansas City, KS, and Kansas City, MO, about capitalizing on their
newly-acquired next generation speeds.
A centralized, practical guide for fostering innovation in local government
workers, projects and services.
A website with articles, reports, podcasts, maps, and other resources to assist
communities seeking to build public broadband networks.
NTEN, which runs the National Digital Inclusion Fellowship in partnership with
Google Fiber, provides a toolkit of resources and case studies that build on
knowledge of that fellowship program.
A resource for local network planners – includes both U.S. and international cases.
A case study on Philadelphia’s wireless network – how it was developed and the
lessons to glean.
Best practices and lessons learned from the Broadband Technology Opportunities
Program.
More tools, information, and news on broadband access and federal support.
A summary of cases and lessons gleaned from BTOP infrastructure grantees.
This map shows Broadband Technology Opportunity Project funded middle mile
networks that communities can leverage or expand.
An overview of steps and tools for communities interested in pursuing a publicly
built and run network.
“Connecting Anchor Institutions: A Broadband Action Plan,” developed by
the SHLB Coalition and published by Benton Foundation, provides ideas and
actionable policy recommendations for government leaders to address anchor
institutions’ broadband needs.
A list of SBI-funded projects and studies by state.
Harvard Kennedy School study by Denise K. Linn
Institute for Local Self-Reliance, SandyNet case
Institute for Local Self-Reliance and Benton
Foundation, Broadband at the Speed of Light
Kansas Cities’ Mayors’ Bi-state Innovation Team,
Playing to Win in America’s Digital Crossroads
Living Cities, City Accelerator Guide for Embedding
Innovation in Local Government
MuniNetworks.org
NTEN, Digital Inclusion Toolkit
New America, Building Broadband Commons
New America, The Philadelphia Story: Learning
from a Municipal Wireless Pioneer
NTIA, Broadband Adoption Toolkit 2013
NTIA, Broadband USA
NTIA, Broadband USA: An Introduction to Effective
Public-Private Partnerships in Broadband Investments
NTIA, BTOP Map
NTIA, Community Connectivity Toolkit
SHLB Coalition, Anchor Institution Broadband
Action Plan
State Broadband Initiative
Resources Summary
63
City / State City Report, Study, or Memo
Public Documents of Interest
City / State RFP / RFI / RFQ
RFI – Expansion of Boston Fiber Network
RFQ – Broadband Infrastructure Expansion
RFI – Statewide Middle Mile Fiber Optic Infrastructure
RFI – Los Angeles Community Broadband Network
RFP – Next Generation Network
Invitation to Bid – City Dark Fiber Infrastructure
Boston
Chicago
Commonwealth of Kentucky
Los Angeles
North Carolina – NCNGN
South Portland
City / State Agreement
Development Agreement – Google Fiber
Franchise Agreement – SiFi Networks
Franchise Agreement – Google Fiber Oregon, LLC
Comcast Franchise Agreement
Master Network Development Agreement with AT&T
Dark Fiber Use Agreement with GWI
Kansas City
Louisville
Oregon
Philadelphia
Raleigh
South Portland
Figure 20: Agreements Between Cities and ISPs
Figure 21: RFIs, RFPs, and RFQs
Next-Generation Broadband Feasibility Study for the BitterRoot Economic
Development District
Memorandum to Utility Advisory Commission Re: Feedback on the Development
of a Business Plan for the Citywide Ultra High-Speed Broadband System Project
Google Fiber Feasibility Study
Memo – Status of Google Fiber in San Jose as of May 2014
Benefits Beyond the Balance Sheet: Quantifying the Business Case for Fiber-to-
the-Premises in Seattle – City of Seattle Broadband Study
Utopia Network PPP: Milestone One Report
City of Missoula, Missoula County
Palo Alto
Salt Lake City
San Jose
Seattle
Utah
Figure 22: Misc. Public Reports and Studies
64
Organizations to Know and Follow
Figure 23: Organizations to Know and Follow
Organization Website Twitter
benton.org
cyber.law.harvard.edu
bbcmag.com
localnetchoice.org
Ctcnet.us
ftthcouncil.org
Google.com/fiber
Ash.harvard.edu
muninetworks.org
Livingcities.org
Blog.mozilla.org/gigabit
natoa.org
ntia.doc.gov
Newamerica.org/oti
wirelessfuture.newamerica.net
Nextcenturycities.org
Rvallc.com
Shlb.org
eda.gov/grants/
Us-ignite.org
Benton Foundation
Berkman Center
Broadband Communities
Coalition for Local Internet
Choice (CLIC)
CTC Technology & Energy
Fiber to the Home Council
Google Fiber
Harvard Ash Center’s Project on
Municipal Innovation
Institute for Local Self-Reliance
Community Broadband Networks
Living Cities
Mozilla Gigabit Fund
National Association of
Telecommunications Officers
and Advisors (NATOA)
National Telecommunications &
Information Administration (NTIA)
New America’s
Open Technology Institute
New America’s
Wireless Future Project
Next Century Cities
RvA Market Research &
Consulting
Schools, Health & Libraries
Broadband (SHLB) Coalition
U.S. Economic Development
Administration Grants
US Ignite
@benton_fdn
@berkmancenter
@bbcmag
@localnetchoice
@ctc_technology
@FTTHCouncil
@googlefiber
@HarvardAsh
@communitynets
@LivingCities
@MozillaGigabit
@NATOA
@NTIAgov
@oti
@NextCentCities
@SHLBCoalition
@US_EDA
@US_Ignite
65
List of State Laws Inhibiting Public Broadband
Figure 24: State Laws Inhibiting Public Broadband
States Law(s)
Alabama Code § 11-50B-1 et seq.
Arkansas Code § 23-17-409
California Government Code § 61100 (af)
Colorado Revised Statutes Annotated 29-27-201 et seq.
Florida Statutes § 350.81
Louisiana Revised Statutes Annotated § 45:484.41 et seq.
Michigan Compiled Laws Annotated § 484.2252
Minnesota Statutes Annotated § 429.021
Missouri Revised Statutes § 392.410 (7)
Nebraska Revised Statute Annotated § 86-575 and § 86-594
Nevada Statutes § 268.086 and § 710.147
North Carolina Statutes Chapter 160A, Article 16A
66 Pennsylvania Consolidated Statute Annotated § 3014(h)
South Carolina Code Annotated § 58-9-2600 et seq.
Tennessee Code Annotated § 7-52-601 et seq.
Texas Utilities Code, § 54.201 et seq.
Utah Code Annotated § 10-18-201 et seq. and § 11-14-103 (4)
Virginia Code § 15.2-2108.6 and Virginia Codes § § 56-265.4:4, 56-484.7:1
Washington Revised Code Annotated § 54.16.330
Wisconsin Statute Annotated § 66.0422
Alabama
Arkansas
California
Colorado
Florida
Louisiana
Michigan
Minnesota
Missouri
Nebraska
Nevada
North Carolina
Pennsylvania
South Carolina
Tennessee
Texas
Utah
virginia
Washington
Wisconsin
66
Acknowledgements
Many thanks should be given to the Handbook’s supporters and second readers:
Ellen Satterwhite and Elise Kohn, former Gig.U staffers, who continue to assist in a myriad of ways, including
with this Handbook. Elise, who left Gig.U to run the North Carolina Next Generation Network (NCNGN),
successfully created the most competitive environment for next generation networks in the country, something all
communities should look to. Ellen now works with the Glen Echo Group.
Assistant Secretary for Communications and Information, and Administrator, National Telecommunications
and Information Administration, Larry Strickling, and all our many friends and collaborators at the National
Telecommunications and Information Administration.
Mark Del Bianco, private telecommunications attorney, who has provided expert second opinions on a number
of Gig.U projects and extensively reviewed this Handbook.
David Collado, law student, who put together the spreadsheet and summary comparing the deal terms of
different approaches by cities and private providers.
Eric Garr, extraordinary colleague from the National Broadband Plan, who helped launch Gig.U and provided
insight into the opportunity and economics.
Kevin Taglang of the Benton Foundation, whose Headlines, a daily digest of communications news, kept Gig.U
up-to-date and who also lent his expertise to reviewing this Handbook.
The Glen Echo Group, who provided pro bono services to Gig.U and helped us understand how to get others
to understand what we were trying to do, in addition to their work with many private and non-profit entities
working toward similar goals.
Joanne Hovis of CTC Technology & Energy, who among many things, was an outside consultant on some of the
most important municipal next generation network projects and wrote the definitive technical work on how cities
can prepare to be fiber ready.
Jeff Reiman and our friends at The Broadband Group, who reviewed this Handbook and particularly helped
with the financing section.
Our friends at the service providers, including Google Fiber, AT&T Gigapower, CenturyLink, Ting, C-Spire,
GWI, and others who helped us understand where the asymmetric value creation could occur.
Deb Socia, Sam Gill, and the Next Century Cities Project, an organization of mayors with a vision similar to
Gig.U, and doing work that will take Gig.U’s work to the next level.
Our friends at the Aspen Institute Communications and Society Program, who provided a platform for Gig.U
to incubate and grow.
Our friends at the Brookings Metropolitan Policy Program, who share our interest in making sure cities have
the resources they need to thrive in the 21st century information economy.
About the Authors
Blair Levin is the Executive Director of Gig.U. He also serves as a Non-resident Senior Fellow of the
Metropolitan Policy Project of the Brookings Institute. From 2009-2010, Mr. Levin oversaw the development
of the FCC’s National Broadband Plan. FCC Chairman Tom Wheeler cited Mr. Levin’s work, noting “no one’s
done more to advance broadband expansion and competition through the vision of the National Broadband Plan
and Gig.U.” Prior to his work on the National Broadband Plan, Mr. Levin worked as an analyst at Legg Mason
and Stifel Nicolaus. Barron’s Magazine noted that in his work, he “has always been on top of developing trends
and policy shifts in media and telecommunications … and has proved visionary in getting out in front of many
of today’s headline-making events.” From 1993-1997, Levin served as Chief of Staff to FCC Chairman Reed
Hundt. Previously, Mr. Levin had practiced law in North Carolina, where he represented new communications
ventures, as well as local governments. He is a graduate of Yale College and Yale Law School.
Denise Linn is a Program Analyst for the Smart Chicago Collaborative and a recent graduate of the Harvard
Kennedy School. Her professional experience, thus far, has revolved around closing the digital divide, increasing
broadband competition, and implementing city-level Internet access projects. Throughout 2014 as an Ash Fellow
with the Gig.U project, and as a member of the Berkman Center Fiber Team, she assisted local leaders seeking to
build or extend next generation fiber-optic networks to spur economic development. Before graduate school, she
was an Economics Research Assistant for the Auctions and Spectrum Access Division of the FCC. She is also an
alumna of the AmeriCorps VISTA program and spent a year of service working on broadband access and digital
literacy projects with One Economy in North Carolina. She is a graduate of the University of Virginia.