Learning Curves on Open Access Networks: ISP Spotlight

WASHINGTON, May 22, 2024 - Representatives from open access internet service providers on Wednesday expressed optimism about the widespread adoption of open access networks, but they also cautioned that ISPs on these networks face considerable risks that need to be evaluated.

The comments came on a webinar hosted by the Fiber Broadband Association, a trade association in Washington committed to the deployment of all-fiber communications networks.

While the webinar centered on the myriad benefits from open access networks - which allow multiple ISPs to share the same broadband infrastructure – David Burr, president of the ISP Sumofiber, took a moment to warn against possible pitfalls, including the potential harm of market saturation.

Although hosting multiple providers on a single network brings the fruits of competition to users, too many ISPs of different scales have at times caused prices to drop to an unsustainable level, Burr observed. Some ISPs have driven prices down by offering very poor-quality services at a low cost, hurting the established providers that require a higher charge to maintain their services. Too many providers have been a cause of “confusion” and have made it difficult for distinction, according to Burr. 

Burr pointed to the open access network, UTOPIA Fiber, which hosts around 18 ISPs – including Sumofiber – as an example of oversaturation. Burr emphasized the importance of limiting the number of ISPs according to the size of the community covered by the network's infrastructure.

Another learning curve has arisen from an unclear demarcation between the network provider and ISPs. Sumofiber has had to adapt its customer service teams to handle users requesting troubleshooting for issues that fall under the responsibility of the network operator, such as problems with Wi-Fi speed. Burr has found that defining the responsibilities of the two infrastructures has helped clear up confusions, and Sumofiber’s customer service reps have been able to escalate calls up to the network providers as needed.

As a selling feature, many open access networks  do not provide contracts for users. That can be damaging for, Burr acknowledged, because the potential for easy switching, enabled by the absence of contracts and other restrictions, can be financially damaging.

“Most of them are not exactly easy to switch over, but there are open access networks [where] you log onto a webpage, you click a button and you switch… ISP just that fast,” said Burr.

Burr also recommended prospective ISPs to have an effective marketing strategy to distinguish themselves in the marketplace. If ISPs rely on marketing by the open access network, it will be difficult to capture customers' attention, Burr argued. Therefore, ISPs must take into consideration how strong their brand is when deciding to use open access networks.

One other concern with the roll out of open access has been unfair practices by network providers with secondary ISP companies. Burr said Sumofiber has joined networks, only to find out later the network provider has an undisclosed ISP, receiving special treatment.

The future of open access networks

Heavyweights in the telecommunications industry have recently increased their investment in open access networks. AT&T CEO John Stankey said during a Tuesday conference that he is expecting open access networks to increase across the United States. AT&T's joint venture with the investment firm BlackRock, called Gigapower, has suggested using grants from Broadband Equity, Access and Deployment to build open access infrastructure and maximize the allocated funds.

T-Mobile has also acquired Lumos’s fiber network with the intention of converting it into an open access model.

George Templeman, president of Network Access Partnerships at SiFi Networks, joined the Wednesday webinar and echoed expectations within the industry for the future of open access markets.

“With the popularity of open access networks now rising,I’m sure it won't be too long before government funding mandates open access networks,” Templeman said. Templeman praised open access for their lower environmental impact and cost efficiency.