June 23, 2021—Municipal broadband networks can include open access provisions that allow internet service providers to sell services and allay competition fears, according to a some on a panel of experts hosted by Broadband Breakfast.
Over the past few months — and increasingly since President Joe Biden’s American Jobs Plan in March thrust the importance of municipal builds into the spotlight – there has been concern, specifically from Republicans, that municipal networks could cripple competition. Critics of those networks have sought to outlaw them as a result.
But allowing ISPs to use municipal networks to sell last-mile service to homes and business, cities can effectively reduce competition fears of critics, increase competition between providers, and ultimately reduce prices for consumers, said Ben Lewis-Ramirez, co-founder and chief marketing officer at Lit Communities, who was a panelist on last week on Broadband Breakfast’s live online event to discuss the intricacies of open access in the digital age.
Open access can thin margins, affect services
Some on the panel weren’t altogether convinced about the idea. Monica Webb, head of market development and strategic partnerships at Ting Internet, said on the panel that, in her experience, while dissatisfaction with cable and telco monopolies is often the driving force behind open access efforts, open access solutions will not necessarily yield better service to consumers.
“When it comes to competition in open access, prices generally do go down [for consumers],” Webb said. “However, the margins for ISPs can also be narrower, and sometimes service can be impacted.”
Webb and Lewis-Ramirez both agreed that the quality of service offered by telcos is not necessarily improved by open access models, and that municipalities that decide to pursue an open access solution must be sure to vet the companies that they decide to lease their infrastructure to, and establish strict standards for companies to adhere to.
Despite calling an open access a potential silver bullet, Lewis-Ramirez also agreed with Webb’s assessment that there are unique risks associated with open access. In an open access model, those who are deploying and leasing infrastructure assume the lion’s share of risk; ISPs that contract with those leasing infrastructure stand to lose very little, and must expend minimal capital to take advantage of said infrastructure.
Though open access might come with risk, both experts stated that in certain circumstances, open access infrastructure can provide significant value for both consumers and municipal bodies looking to improve network coverage.
The model is receiving attention at the federal level. Amy Klobuchar’s “Accessible, Affordable, Internet Act” would prioritize funding for projects that utilize an open access model.
The municipal network debate
The discussion comes at an interesting time: This month, Ohio’s Republican-controlled Senate passed a budget featuring an amendment that would essentially end municipal broadband in the State. The reason? Municipalities should not be allowed to compete against business for this essential service.
Ohio isn’t alone, either. If the budget passes Ohio’s House, it will be added to the list of more than a dozen states that outlaw municipal broadband services.
Our Broadband Breakfast Live Online events take place every Wednesday at 12 Noon ET. You can watch the June 16, 2021, event on this page. You can also PARTICIPATE in the current Broadband Breakfast Live Online event. REGISTER HERE.
Wednesday, June 16, 2021, 12 Noon ET — “Innovation in Broadband Business Models: Open Access Case Studies”
One of the areas of greatest innovations in digital infrastructure investment concerns open access networks, a growing space for innovation and investment. Join Broadband Breakfast for a session considering how multiple American open access networks — including players in the ownership, network operations, and services areas — have tackled the unique challenges in crafting a business that works for a network that serves multiple stakeholders.
- Monica Webb, Head of Market Development & Strategic Partnerships at Ting Internet
- Ben Lewis-Ramirez, Co-Founder and Chief Marketing Officer of Lit Communities
- Sean Buckley (moderator), Editor in Chief of Broadband Communities
Monica Webb is the head of market development & strategic partnerships at Ting Internet, working with local stakeholders in existing Ting towns and evaluates existing and prospective gigabit network locations and related business projects. Webb spent her early career working in marketing and management in the financial services industry, where she launched channel marketing platforms that continue to dominate channel strategy in the mutual fund industry today.
Ben Lewis-Ramirez is passionate about bridging the digital divide through building open application networks in under-served communities, and was one of the Lit Communities co-founders. He has over 10 years of executive management experience in the outside plant engineering and construction industries, with a focus in business development and strategic planning for the past 3 years. Ben is a vocal advocate for the open application business model, and has published numerous magazine articles and blog posts on the subject, in addition to speaking about it at conferences and other events around the country.
Sean Buckley is the Editor in Chief of Broadband Communities. Buckley comes to the magazine publishing and conference company after serving nine years as Senior Editor at FierceTelecom, a daily online newsletter. He also oversaw FierceInstaller, a weekly publication chronicling trends in network installation. Prior to coming to FierceTelecom, Sean spent eight years at Horizon House publications, serving as senior editor and later as Editor in Chief of Telecommunications Magazine and Telecom Engine.
As with all Broadband Breakfast Live Online events, the FREE webcasts will take place at 12 Noon ET on Wednesday.
UTOPIA’s Projects Proceeding in California and Montana, CEO Says
Both the GSCA and Yellowstone Fiber are using UTOPIA’s techniques to provide open access broadband over fiber.
HOUSTON, May 4, 2022 — UTOPIA Fiber’s open access model has found success in California, Montana, and Idaho as it continues to deploy across Utah, the company’s CEO said Wednesday.
“Right now, we are working with [Golden State Connect Authority] to identify various pilot areas for the project and have started preliminary engineering work to determine the initial project area,” Roger Timmerman said at the Broadband Communities Summit 2022.
During the press conference, Timmerman also pointed to UTOPIA’s expansion into Santa Clara, Utah, and its completion of its original 11 Utah cities by the end of 2022.
Timmerman was joined by partners Barbara Hayes of the Golden State Authority and Yellowstone Fiber CEO Greg Metzger as they delivered remarks on their joint ventures. The partnership will create the largest publicly owned fiber network in the US, and as it stands now, would span 38 of California’s 58 counties.
“California may be the world’s fifth-largest economy, but our state’s connectivity is decades behind,” Hayes said. “Investing in open access fiber will be transformative for California.”
Both Metzger and Hayes emphasized that their decision to partner with UTOPIA was largely informed by the company’s track record.
“We needed to have a partner who was successful and had done it before,” Metzger said. “For Montana, this is going to be a breath of fresh air.”
Yellowstone Fiber, formerly known as Bozeman Fiber, is a not-for-profit that will replicate UTOPIA’s open access model to provide broadband to the greater Bozeman region; it will own and operate the fiber but will rely on UTOPIA for assistance on the backend.
UTOPIA’s model of open access has long been a point of interest in the telecom industry. While some claim it will be a solution to the digital divide, other assert that it has merely created a “race to the bottom” where internet service providers are constantly pushed to undercut their completion. Timmerman and others have pushed back against the “race to the bottom” assertion, claiming that providers can find ways other than price to distinguish themselves from their competition, such as superior customer service. Additionally, they point to their recent track record as evidence that critics’ concerns that they can maintain a positive cash flow are unfounded.
Though UTOPIA, a sponsor of Broadband Breakfast, now has positive revenue and has served as a model for open access projects around the country, critics still point toward its more than $300 million in outstanding debt it accrued in its early days, before Timmerman was at the helm.
‘Worst Broadband City’ Brownsville Approves Open Access Fiber Project with Lit Communities
Lit Communities will operate the network, with subsidiary BTX Fiber as the last-mile provider. HMI Utilities is prime contractor.
BROWNSVILLE, Texas, April 1, 2022 — During a special city commission meeting on Wednesday, council members voted to approve a fiber project that will bring high-speed broadband to 100% of its citizens.
Elizabeth Walker, Brownsville assistant city manager, and Andres Carvallo, CEO and founder of CMG Consulting LLC, recommended that the council authorize two respondents, HMI Utilities with Lit Communities, for a combined proposal to maximize technical and financial capacity.
Brownsville, Texas, is a city of more than 182,000 people and is one of the cities with some have called the worst broadband city in the country. The National Digital Inclusion Alliance in 2018 listed Brownsville and a neighboring community as one of the top two worst connected cities in the country with a population of more than 65,000. For Brownsville, 47.1% of households do not have broadband of any type, NDIA found
Lit Communities, a fiber-builder that partners with municipal, county and other government entities, will operate the network, with HMI Utilities as the prime contractor. Lit Communities subsidiary BTX Fiber will be the last-mile provider on the network. However, the project will be an open network with multiple internet service providers.
Standard service on the network will be at least 100 Megabits per second (Mbps) symmetrical.
The research for this project began nearly a year ago in April 2021 when Walker and Carvallo looked at different business models, like public policy only, public services, open access, infrastructure, municipal retail (business only and residential). They looked at these models in similar projects in Texas and across the country, including in places like Knoxville and Santa Cruz County. Eventually, they decided on an open access model.
Specifics of the Brownsville network
All citizens will have access to this broadband. “It is eight middle-mile fiber rings to address the full geography of Brownsville,” said Walker.
The city will own 100% of the middle mile and will be able to license it out in private-public partnerships to create revenue, as well as revenue from the last mile connectivity. To ensure affordability, there will be a cap on what providers can charge.
Affordability “is very important,” said Walker. “The crux of the consideration is just to not deliver access, but to make it affordable.”
This infrastructure will have a life expectancy of 50 to 100 years, said Walker.
Walker said that “evidence suggests that broadband services have a net positive economic and social impact to communities by enhancing key functions such as economic competitiveness, workforce development, training, educational capabilities, municipal operations, and smart city developments.”
This is part of the private-public partnership model of Lit Communities. The company recently partnered with Ohio’s Lorain-Medina Rural Electric Cooperative to install fiber on existing utility poles. In these projects, the municipality in question provides the capital necessary to build a middle mile or backbone network.
“We are not stopping with these initial groups of towns that we are looking at and working into right now,” said Rene Gonzalez, Lit Communities’ chief strategy officer. “It is just the beginning.”
Construction of Yelllowstone Fiber Network in Montana Begins Ahead of Schedule
The project will be Montana’s first open-access fiber-to-the-home network.
WASHINGTON, March 24, 2022 – Montana fiber provider Yellowstone Fiber announced Wednesday that construction has begun on a $65-million network based in Bozeman, well ahead of anticipated pace.
The network, operated in partnership with large Utah-based open-access network UTOPIA Fiber (a sponsor of Broadband Breakfast), will be Montana’s first high-speed all-fiber internet network as well as its first open-access fiber-to-the-home network.
The start of construction for the privately-funded network comes only six months after initial announcement of the project.
Not only will the network connect every address in Bozeman, but it will also extend “deep into Gallatin County,” according to the developer.
Businesses are expected to receive speeds of up to 100 Gigabits per second and residential properties will experience up to 10 Gbps to create what the city of Bozeman has called “the first true gigabit city in the state of Montana.” Pricing plans are expected to be announced this spring.
The first six internet service providers to provide services on the network will be Blackfoot, Global Net, Hoplite Industries, Skynet, Tri-County Telephone Associates, and XMission.
Montana is one of the least-connected states in the U.S. About a third of residents in Gallatin County, in which Bozeman is a city, lacks internet access.
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