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UTOPIA Fiber: A Model Open-Access Network

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Photo of Ty Bailey, Morgan city manager, talks about a UTOPIA Fiber hut under construction in fall 2019, by Drew Clark

The largest open-access network in the United States has been a boon to its 11 member cities and is expanding to make broadband accessible even in sparsely populated rural areas.

If you mention UTOPIA Fiber to a broadband network operator outside Utah, he or she is likely to say, “We don’t want our project to be the next failed UTOPIA.”

If you mention UTOPIA Fiber to a resident in one of the 11 Utah cities in which the open-access broadband network operates, he or she is likely to say: “My neighbors love UTOPIA, and I can’t wait until I get it to my home!”

The term “failed UTOPIA” has been bandied about excessively over the past decade. As a result, even advocates for municipal broadband occasionally distance themselves from this robust open-access network officially known as the Utah Telecommunications Open Infrastructure Agency. It is the largest open-access network in the United States.

The on-the-ground reality in Utah reveals a completely different picture about the fiber network. It has been a boon to its 11 city members, including West Valley City, Orem and Layton – the second, fifth and ninth largest cities in the state.

Now, many more communities in the intermountain West, including Idaho Falls, Idaho (population 61,000), and the small Utah communities of Morgan (population 4,200), West Point (population 9,511) and Woodland Hills (population 1,300), are seeking and getting UTOPIA Fiber.

UTOPIA Fiber is deploying different models depending on the setting. It has a consulting arrangement with Idaho Falls, and has built and operates a city-owned network for Woodland Hills. In Morgan and West Point, UTOPIA Fiber is in the process of financing, building and operating a network in communities outside the state’s more-urban core. This model enables new communities to join the network.

With this expanding footprint, UTOPIA Fiber already has begun to exert a more significant influence on a U.S. broadband market that is gradually waking up to the enormous civic and competitive benefits of open access. Equally significant is the flexible approach UTOPIA Fiber has taken in working with cities, recognizing that each one is unique and that community broadband providers need to be flexible to make a fiber-to-the-home project work.

Thriving, Not Failing

UTOPIA Fiber’s customer service ratings are substantially better than those of other major ISPs in Utah, including Comcast and CenturyLink. Consider the Net Promoter Score, an industry-accepted index measuring the willingness of customers to recommend a company’s products or services to others. The metric ranges from -100 to 100, and is seen as a proxy for gauging customers’ overall satisfaction and loyalty. UTOPIA Fiber’s Net Promoter Score of 64 contrasts very favorably with Comcast’s -3 and CenturyLink’s -6.

As an open-access network operator, UTOPIA Fiber’s typical model is to own and operate the fiber middle-mile and last-mile network, with residential customers purchasing service from one of 10 competitive internet service providers. About 30 ISPs offer business services on UTOPIA’s network.

UTOPIA charges a flat fee of $30 per month for its infrastructure, and providers offer internet services for prices that are generally $35 per month for 250 Mbps download and upload or $48 per month for 1 Gbps symmetrical service, for a total of between $65 and $78 per month.

UTOPIA welcomes any provider that meets service level guarantees and would allow Comcast and CenturyLink to sell service through its infrastructure. So far, these incumbents haven’t been interested in doing so.

UTOPIA Fiber has earned the respect and business of other service providers, however, including Beehive Broadband, SumoFiber, Veracity Networks and XMission. Some of these ISPs are local exchange carriers that own their networks and offer exclusive internet services within given geographical footprints. For UTOPIA Fiber, they are willing to sell monthly service for less revenue on the collective infrastructure that the 11 cities originally paid to build.

Turning a Corner Financially

UTOPIA Fiber has turned an important corner in its financial performance. “There was a period where many considered UTOPIA a failure,” says UTOPIA Fiber CEO Roger Timmerman. “The city leaders were visionaries and always believed in the benefits a community-owned network would provide, even if the original build didn’t meet the expected financial benchmarks.”

But, Timmerman adds, “For the past nine years, UTOPIA Fiber has had a successful track record. The second phase of the project (from 2010) has been hugely successful. We have expanded the system with new bonds totaling more than $125 million, and with these projects paying for all of the debt and operating expenses from subscriber revenues, there’s no cost to the participating cities.”

UTOPIA Fiber’s net revenues have begun to pay down the infrastructure debt that the 11 cities incurred to build the network. The UTOPIA board, as well as that of its sister entity, the Utah Infrastructure Agency, are led by mayors, councilmembers and city managers of the 11 cities that joined together in an interlocal entity to create UTOPIA in 2002.

Now, the biggest complaint about UTOPIA has been limited service availability. In 2014, of residences within the 11 cities, 52 percent were built out. Today, 80 percent of those residences are built out. That equals 94,000 residents and businesses now able to obtain gigabit-level symmetrical fiber internet service. Everyone on the network is also able to get 10 gigabit symmetrical service.

In a further show of confidence, earlier this year UTOPIA Fiber published precinct-level maps showing availability dates for service in the 11 cities in the next three years, as well as in expansion cities.

“UTOPIA now uses a self-sustaining model to expand the network,” Orem City Council member Sam Lentz recently wrote about UTOPIA’s progress. “We are connecting neighborhoods at an unprecedented rate, and the growing popularity of the network generates more subscriber revenue, reducing the debt burden of Orem and other member cities.”

A Model Network

Now that multiple open-access networks (e.g., SiFi Networks, Lit Communities, Next Level Networks) are gaining momentum in the United States, UTOPIA Fiber is more than just a touchstone and a model – it’s an active competitor for the municipal business.

“The demand for municipally owned fiber has skyrocketed, and we are excited to be a leader in the industry,” says Timmerman. “Over the past four years, UTOPIA Fiber has doubled the number of subscribers on its fiber network and has entered into partnerships with several additional communities.”

In addition to the 11 cities that are voting members of UTOPIA Fiber – including Murray, Brigham City, Centerville and Lindon, as well as the larger ones mentioned above – UTOPIA Fiber has expanded to new communities, each of which offers something new for UTOPIA Fiber.

Expanding to Idaho

Idaho Falls is UTOPIA Fiber’s first out-of-state initiative. There, the network serves as a consultant and “back office” manager for Idaho Falls Power, which launched its own fiber network, Idaho Falls Fiber, in March 2019. In October, the city council unanimously voted to continue with the fiber expansion throughout the entire city.

The Idaho Falls broadband experience began in 2000, when it built a dark fiber network for the use of the city and its electric utility. By leasing fiber to the Idaho National Laboratory and businesses, the city paid off all its debt in 2012, “a lot faster than we expected,” according to Bear Prairie, Idaho Falls Power and Idaho Falls Fiber general manager.

As the city began to consider ways to bring fiber to the home, it focused heavily on open access. “We had a fair amount of infrastructure in place,” said Prairie. “I wanted to focus on what we do well as a city and as a utility. We are really good at maintaining infrastructure – on poles, underground – and keeping wires connected. We are probably not as good in the competitive retail space.”

That led the city to model the open-access approach, in which Idaho Falls would bring the infrastructure, and allow other entities to compete to be the ISP.

“We are using UTOPIA’s software and network architecture to set up the network, manage the network, and provide consulting service,” Prairie said in an interview. He points out that the Idaho Falls Power municipal utility owns and operates the network, including the optical network terminal at the home.

Once Idaho Falls determined that it wanted an open-access network, the city decided to tap into the broadband expertise of UTOPIA Fiber, its neighbor to the south.

Of the four ISPs offering service on the Idaho Falls Fiber network, three are Idaho Falls-based (Qwk.net, SilverStar, and Direct Communications), with SumoFiber from Utah, although it was active on the Idaho Falls dark fiber network before the UTOPIA Fiber partnership. The basic price point for service is $30 per month to Idaho Falls Fiber, then $35 per month for 250 megabits symmetrical service, and $43 a month for gigabit symmetrical service, a total customer price of $65 for 250 Mbps and $73 for 1 Gbps.

UTOPIA in Woodland Hills

Woodland Hills is a small and low-density but affluent community on the periphery of Utah County. The community badly wanted broadband infrastructure for more than eight years, says Kari Malkovich, a city council member.

Building lots are at least 1 acre in Woodland Hills, which nestles up against Santaquin Peak and other mountains, so most citizens’ options were limited to satellite. It was difficult to find any provider who would come in, said Malkovich. “Most of the service that we were getting before was satellite service. There were a few, such as CenturyLink, that came up to the edge” of the community.

After years of consideration, the city began to save its taxes in a dedicated fund with an eye toward building its own municipal fiber network. The
most attractive model was partnering with an open-access provider, such as UTOPIA Fiber.

“If we are going to put taxpayer dollars into the network, we want to make sure it allows for competition,” says Malkovich. “We did a lot of homework, and it came to the point where we said, ‘If we own the system, then we have control and can let someone else manage it.’”

After a bid, UTOPIA came in with the best offer.

The $1 million that the city had saved funded a 400-home buildout of fiber throughout the community, averaging $2,500 per home. Then there was an additional cost of $1,500 per household for the drop to individual residences, which was homeowners’ responsibility.

Malkovich says that the city’s revolving broadband fund will finance the construction for $25 per month, which is tacked on to the $65 to $78 per month combined bill for UTOPIA Fiber’s infrastructure operations and the ISP’s internet services.

In anticipation of the city’s building its own network, many households constructed their own drops through an ad-hoc infrastructure of local fiber installers. Now those homes have been hooking up to the UTOPIA Fiber network.

Open Access In Rural Areas

The rural community of Morgan, Utah (and more recently in West Point, Utah), is where UTOPIA Fiber’s vision for gradual community-by-community network expansion is most fully realized.

A rural community without even a stoplight, Morgan is on the least-populated side of the Wasatch Mountains. It was left in the lurch when Comcast left town and stopped providing service. (CenturyLink’s DSL was unreliable.) But with a municipal power system, Morgan felt comfortable managing lines and poles. The community began exploring options to bring a new broadband provider to town.

“The more we researched it, the more comfortable we felt about it,” says Ty Bailey, Morgan city manager. “More than economic development, this is just basic service” that the city needs to offer if no one else will. UTOPIA Fiber’s willingness to bring the open-access model to Morgan became “a really good solution for us.”

As with any fiber-to-the-home network, UTOPIA Fiber’s costs are a mixture of one-time infrastructure costs and ongoing costs for backhaul transport, network operation and internet services. People associated with the UTOPIA Fiber network speak of the 30 percent penetration rate as an important threshold for profitability, even in rural communities such as Morgan.

When times were tougher for UTOPIA, the 11 cities with voting membership bickered among themselves about which city would be the next to get construction. In that era, expansion plans were never part of the discussion.

But with continual growth in subscriber base and revenues, operating revenue at UTOPIA Fiber has been more than sufficient to cover the $125 million in new bonds. That has allowed new construction in small communities such as Morgan and West Point to get service – even when they needed UTOPIA Fiber to bring in the financing and even as bigger cities were being built out, says Timmerman.

In the case of Morgan, the $2.6 million is funded by UTOPIA Fiber, but the city guaranteed 30 percent coverage. The city needs to fund any shortfall if the subscribership level falls below the 30 percent benchmark. That, in turn, makes it possible for the city and UTOPIA Fiber to agree on a whole-city build. Construction started in November and will be completed by early 2020.

“We are thrilled to bring UTOPIA Fiber to our growing community,” says Ray Little, Morgan’s mayor. “Our residents and businesses have been in dire need of better, faster and more reliable options for internet, and UTOPIA Fiber will be providing the best possible solution for our city.”

About Drew Clark:

Drew Clark, the editor and publisher of BroadbandBreakfast.com, is also a telecommunications attorney at a D.C.-area boutique firm, Marashlian & Donahue, PLLC, The CommLaw Group. He is president of the Rural Telecommunications Congress, which advocates for better broadband data and planning, next-generation infrastructure investments, and digital literacy education. This article originally appeared in Broadband Communities, and is republished with permission.

Drew Clark is the Editor and Publisher of BroadbandBreakfast.com and a nationally-respected telecommunications attorney at The CommLaw Group. He has closely tracked the trends in and mechanics of digital infrastructure for 20 years, and has helped fiber-based and fixed wireless providers navigate coverage, identify markets, broker infrastructure, and operate in the public right of way. The articles and posts on Broadband Breakfast and affiliated social media, including the BroadbandCensus Twitter feed, are not legal advice or legal services, do not constitute the creation of an attorney-client privilege, and represent the views of their respective authors.

Open Access

British Telecoms Are Aligning with Emerging U.S. Position on Open RAN Adoption

Open RAN adoption is said to save telecoms money and boost security, as providers are forced to move off Huawei.

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Howard Watson, chief technology officer of BT Group

October 18, 2021 – Howard Watson, chief technology officer of telecommunications company BT Group, spoke on Wednesday at the Broadband World Forum about the future of the UK’s network infrastructure, including removing Huawei’s equipment from their networks and developing open radio access networks for wider use.

Speaking at the opening session titled “Building an innovative converged network infrastructure for the UK,” Watson discussed the challenges and possibilities for offering fast, secure broadband and offered O-RAN as a solution for wider connectivity.

Watson discussed utilizing open RAN to facilitate greater interoperability between vendors’ equipment, as it opens the market to more technologies due to its open configuration. The concept advocates for a more open radio access network than provided today, which is held by fewer vendors.

The Federal Communications Commission has pushed for ways to develop open RAN to minimize network security risk, as the movement has gained significant momentum since Huawei was banned over the past 18 months. FCC Acting Commissioner Jessica Rosenworcel has described open RAN as having “extraordinary potential for our economy and national security.”

“When customers go back into the office, the infrastructure they left behind must have key growth” Watson said, referencing the shift in office culture toward remote work during the COVID-19 pandemic.

“Expectations of customers change,” Watson said, adding that “they expect broadband to be always on, they expect high bandwidth.” Above all, “they expect investment no matter the cost.”

BT is seeking to deploy to 90 percent coverage in the UK by 2028.

On the sidelines of his keynote address, Watson noted BT’s progress in limiting Huawei products to 35 percent of an operator’s fiber access footprint by 2023. The UK government requires that Huawei’s equipment must be removed entirely by the end of 2027. The UK considers Huawei a “high risk” vendor for its network infrastructure.

However, BT is waiting for Huawei’s equipment to grow old before replacing it, Watson said. “Our intention is to ensure that we get the full economic life out of the Huawei [products] that we have deployed,” he said. He said BT believes the products can be used until 2031 or later.

“We’re in talks with government about that timeline” Watson said.

Panel discussion about European fiber investment

Watson said that “densification” happens in areas that are fiber rich, so “providing fiber to smaller cell sites is naturally an evolution.”

He said that BT is looking at a range of alternatives including Wi-Fi solutions to getting 1 Gigabit per second (Gbps) capability to household through open architecture-based solutions.

In addition to Watson, a panel focused on the investment parameters for fiber investment featuring officials from Macquarie Group and Eurofiber.

The panel focused on investment challenges and strategies for broadband infrastructure investment and  discussed an opportunistic vision for broadband deployment. Speaking of more mature market with a history of broadband adoption, Macquarie Managing Director Oliver Bradley asked how providers could transition to more efficiency and maximizing the value of an existing network.

Among the principal drivers for investment include co-investing and deregulation, he said.

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Open Access

UTOPIA Fiber Goes to Court in Utah Over American Fork’s Build Permit Refusals

Fiber builder says it has been denied permits that have harmed it and its customers, despite an existing city agreement.

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Photo of Twin Peaks in American Fork, Utah, by Bryant Olsen used with permission

October 13, 2021 – UTOPIA Fiber filed a lawsuit Wednesday against the city of American Fork in Utah for breach of contract after the city allegedly denied build permits to the fiber builder despite there being an existing contract between the two parties.

The fiber provider, which runs an open network on which private telecoms rent space on to provide services, alleges the city had approved some permits that only allowed it to construct backbone transport lines through the city connecting other cities, but denied it key permits that would have allowed it to extend services to UTOPIA Fiber customers inside the city. Those services include connections to American Fork’s public schools.

In July 2020, the city allegedly terminated the 2018 rights-of-way agreement with no explanation, the lawsuit claims. It also alleges that the city specifically discriminated against UTOPIA Fiber by adding additional scrutiny to its permit requests when it believed no such scrutiny existed for other providers.

Broadband Breakfast attempted to make contact with the city, but a phone call was not answered and a voicemail message was not returned by the time of publication.

“American Fork’s refusal to approve permit requests by or for UTOPIA for service laterals for customers within American Fork has harmed UTOPIA, its customers, and the private ISPs who wish to offer services within American Fork using UTOPIA’s Network,” the lawsuit said. “In some cases, UTOPIA has been forced to buy capacity from other network providers that are allowed to install infrastructure in American Fork, so that UTOPIA can fulfill existing contracts with its customers.

“In other cases, UTOPIA has been forced to cancel existing customer orders for connections within American Fork and has lost significant revenues as a result,” the suit added. “UTOPIA has also recently been forced to cancel or reject over a dozen additional customer orders because UTOPIA is unable, due to American Fork’s conduct, to obtain the permits needed to fulfill those orders, and again lost significant revenues as a result.”

In a press release, UTOPIA’s executive director Roger Timmerman said the lawsuit was a “last resort and not an easy decision to make.

“It is our hope that with judicial review, American Fork City will reverse its policies, work within the boundaries of the law, and ultimately, act in the best interest of the people and businesses in American Fork City by allowing them access to the increased options UTOPIA Fiber provides,” Timmerman added.

UTOPIA Fiber is asking the U.S. District Court for the District of Utah to force the city to pay the company damages sustained as a result of the alleged actions, to find the city violated the law with respect to its actions, and to force the city to cease the alleged “discriminatory and preferential actions” against the company.

UTOPIA Fiber, a sponsor of Broadband Breakfast, has designed, built, and operated more than $330 million worth of fiber projects in the state since 2009.

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Expert Opinion

Mike Harris: Investing in Open Access Fiber Optics is Investing in the Future

Chattanooga’s municipal broadband network has delivered $2.7 billion in social and economic benefits during its first decade.

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The author of this Expert Opinion is Mike Harris, the co-founder of SiFi Networks.

In the United States, most Internet Service Providers are privately owned companies who have established copper network infrastructure exclusively for their own use, forcing customers into often unreliable, unsustainable internet package deals. But in 2010, the small city of Chattanooga, Tennessee invested in an early publicly owned fiber optic network.

As the co-founder of open-access telecom company SiFi Networks, I believe that investments in similar open-access infrastructure will help bridge community divides and futureproof a city’s economic and social prosperity.

According to a study by Bento Lobo, department head of finance and economics at the University of Tennessee, Chattanooga’s municipal broadband has delivered over $2.69 billion worth of social and economic benefits during its first decade. With a population of just 185,000, imagine the potential savings for a city the size of New York.

So, how did Chattanooga achieve this and what were the city’s motivations?

Motives behind the madness

In 1969, Chattanooga was dubbed America’s dirtiest city. A post-industrial wasteland, it entered the late twentieth century with a stagnant economy, declining population and high levels of unemployment following the closure of its large manufacturing factories. It’s not surprising that decades later publicly owned utility company, EPB, chose to invest in its residents’ future.

EPB began replacing the underground copper wiring — originally established to exclusively handle telephone calls — with fiber optic cables feeding connectivity to the entire community. Fiber optic networks are vastly superior to copper because they can transport data using photons travelling at the speed of light. Previous infrastructure uses electrons capable of less than one per cent of that speed.

Where before Chattanooga was perceived as an underdeveloped, low-income area, suddenly businesses were moving in, employment was growing, and more adolescents were graduating from high school. Is it about time for other cities to follow suit?

Why other cities should follow suit

Internet connectivity is a human right much like water, electricity and gas utilities. Yet 21 million U.S. citizens are still living without reliable broadband according to the Pew Charitable Trusts. Research also shows that 40 percent of schools and 60 percent of healthcare facilities outside metropolitan regions lack internet download speeds of at least 25 Megabits per second (Mbps) and upload speeds of at least 3 Mbps. This is the acceptable speed defining a reliable broadband connection.

As the Chattanooga model demonstrates, the solution is the establishment of fiber optic infrastructure. With fiber networks, EPB offers residents and businesses gigabit speeds of up to 1,000 Mbps, or 1 Gigabit per second. In hindsight, with this capacity Hamilton County was well equipped to deal with the 75 percent increase in total volume of bandwidth being used per day during the pandemic, with residents being forced to work and educate from their homes.

These gigabit speeds also allow for a high degree of network responsiveness necessary for establishing a smart grid system. Most US cities use standard grid systems, which rely on consumers informing a service when they have a power outage or system failure.

Smart grids establish a two-way communication network using digital devices and automation so that service providers are notified immediately when problems occur. EPB’s Hamilton County smart grid, for example, can quickly re-route power around storm damage decreasing outages by 40 per cent in minutes, according to Lobo’s study. He estimates Chattanooga’s consumers will save $20.6 million per annum simply from avoiding spoilage and loss of productivity due to power outages.

Saving money, saving livelihoods

EPB has more than proven that fiber networks are a socioeconomic investment benefitting everyone, not just those lucky enough to live in a fiber area. Better, faster connectivity will enable businesses in all neighbourhoods to thrive, creating job opportunities. During the ‘gig decade’ (2011-2020), EPB’s fiber network directly supported the creation or retention of approximately 9,500 jobs in Hamilton County, luring the migration of global corporations like Volkswagen. The U.S. Bureau of Labor Statistics has reflected this, stating Hamilton County’s unemployment rate being 4.7 percent as of November 2020, compared to the U.S. overall percentage of 6.7.

Chattanooga at night

The social benefits don’t stop here. A study by South Australia’s premier, Jay Weatherill, correlated gigabit networks with improved support for police and fire communications, wastewater management, traffic control and medical diagnostics. These are all features of SiFi Networks’ FiberCity and if Chattanooga has demonstrated anything, it is that fiber networks improve residents’ quality of living above all else.

FiberCity — the next step?

Chattanooga has demonstrated the importance of staying connected. To this end, becoming a SiFi Networks FiberCity could be the next step for cities across the US.

Privately financed networks, like SiFi Networks’, are often the best option to guarantee necessary funding for construction, maintenance and expansion of fiber infrastructure. Municipalities wouldn’t have to rely on taxpayer’s dollars, which can instead be diverted to healthcare, education and other social entities. During a period of continuous technological evolution, FiberCities have one simple mission: to combine advantages of Chattanooga’s gigabit speeds with futureproofed smart city services across the U.S.

Mike Harris is a successful entrepreneur and technologist, having previously founded Total Network Solutions Ltd in 1989, which he later sold to UK telecoms giant British Telecom in 2005. He subsequently co-founded SiFi Networks and is a current investor in the company. He is also the chairman and owner of the New Saints Football Club in Wales, UK. This piece is exclusive to Broadband Breakfast.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

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