"Did the chicken or the egg come first?" (Municipal Fiber Deployment Playbook)

Jeff Bezos walks into Town Hall and offers to fully fund and operate a FTTP network in Portsmouth, RI. 

Could he do it on his own?  Rewind back to the 1980s and early 1990s, did cable companies just pull up in their utility trucks and just start installing coaxial cable?  A private company would not be able to perform an installation unless there was a minimum level of cooperation from the host municipality.

Public subsidies should never be assumed but should and can be incorporated in the financial modeling. For example:

  • Government grants.
    • American Rescue Plan Act (ARPA) funds, Broadband Equity Access and Deployment (BEAD) program, Coronavirus Capital Projects (CPF) Fund and congressional earmarks.
  • Philanthropic grants.
    • van Beuren Charitable Foundation, RI Foundation, etc.
  • In-kind contributions.
    • For example, Open Cape received a $1M in-kind contribution from Barnstable County, MA for use of an empty county building.
    • Additional municipal in-kind contributions could include:
      • ROWs/easements, police detail during construction, utilization of municipal gain space (established in CT) and reserved conduit space, equipment co-location, utility pole/structure attachment points, and vegetation removal near utilities poles and conduit access points/man holes in the local right-of-way.

The level of support typically required from a municipality to facilitate a FTTP deployment is as follows:

  • Town/City Council:
    • Award contract(s) to the most qualified bidder(s) in the RFP process (if applicable).
    • "In-kind" contributions of land or structure(s).
      • Determine if space in municipal facilities (or on municipal property) for a small and secure telecom space (2 racks of equipment).
      • Town of Portsmouth's charter allows for land to be used for purposes of a utility.
    • Participate in identifying stakeholders and governing structure.
      • Designate an official liaison with other entities and vendors (serving on behalf of municipality).
      • Apply on behalf of municipality for Universal Service Fund monies, and if applicable unlock any additional state and USDA funds.  https://www.usac.org/
        • E-rate (school ring network).
  • Zoning Board/Building Official(s):
    • Require primary and secondary (buried) open access electrical conduit for all new developments (similar to requiring stormwater management, etc.).
    • Provide tailored building code requirements for telecom field huts.
      • As only hosting ruggedized field equipment which are generally unoccupied and remotely monitored, tailor out wastewater system requirement.
  • Town Administrator/Mayor et al.:
    • MOU with RIDOT (for fiber swaps, if applicable).
  • Town Finance Director:
    • RFP calls (if applicable):
      • Physical construction.
      • Middle mile provider.
      • Break-fix.
    • Collaborate with Tax Assessor for any mail-outs (to save on postage).
  • Town Solicitor:
    • Establish rights of way agreements:
      • PWFD buried.
      • Municipal gain space (utility poles) and "right of way" (ROW) in conduit.
      • Streetlight fixture attachments.
  • Town/City Planner:
    • Coordinate ROW buried under/alongside town roads.
    • Share GIS database (ESRI shapefile) that catalogs:
      • Number of utility poles/streetlights, and ownership data.
        • All utility poles, not just poles with Town-owned streetlights.
        • Utility pole owner(s) will provide this information upon request.
      • Electrical manholes (such as for traffic and crosswalk signals), especially if linked to conduit, etc.
    • Provide total count of street miles served by aerial utilities and underground utilities.
    • Furnish distance of all Town/State roads.
    • Vegetation trimming of all ROW and ensure cut well back from utility poles.
    • Coordinate microtrenching across town roads and/or directional boring under town roads.
  • Police (if needed):
    • Coordinate traffic control and provide detail.

Is closed or open access right for my community?

Closed Access (single operator):

Due to full ownership and control, typically enjoys stronger overall financials as controls all revenue streams from ownership, operation, and provisioning of services on fiber network.  Operator should commit to the doctrine of community benefit (as a community stakeholder) and demonstrate an ongoing commitment to engineering competency, customer service. Lastly, the operator should exhibit an industry disruptive level transparency regarding operations, financial performance (including subscriber count), and network operational status (slowdowns and rolling outages, and/or usage throttling) and truthfully disclosing terms of services via "Broadband Nutrition Label", provide symmetric high-speed service without data caps, and no tracking of users or tie-ins with advertising platforms.

Open Access (multiple operators): 

Financial model will require more backstops as only partial revenue available to support overall network operations, as initial portion of revenue is diverted to repay construction bonds. Requires economies of scale (~15K subscribers) to make the economics work for participating ISPs. There can be unknown financial strength of applicant ISPs if a privately held company, and the performance of the various ISPs reflect directly on the overall network. Could be "race to the bottom" for participating ISPs if lack of differentiation and/or consumers are price sensitive (effectively replicating the cut-rate airline experience). Would likely require an operational partnership with an experienced company in this space (such as UTOPIA), TBD the scope of the Memorandum of Agreement (MOA) and loss of overall control and diversion of revenue streams.