Saturday, August 30, 2008

Municipal fibre - rising again

Muni fiber networks bounce back

Despite some high-profile failures, the deep-seated need for broadband keeps municipalities on the fiber-to-the-home-track.

The headlines surrounding municipally funded telecom networks have been dominated by bad news this year.

In addition to the outright collapse of muni Wi-Fi networks, there have been notable failures in the muni fiber market as well, namely the iProvo network, sold to Broadweave earlier this year, and Utopia, a network linking multiple municipalities that has struggled to sign up customers. A multicity fiber network in northeastern Minnesota that had been under study for years also was scrapped recently.

Anyone who thinks the municipal broadband market is headed south, however, needs to take a closer look. For every visible failure, there are multiple other cities, towns and villages either building or looking to build their own fiber-to-the-home (FTTH) networks, for the simple reason that they want broadband facilities they can't convince their local telco and cable incumbents to build.

These projects are being fueled by the falling cost of FTTH technology and the growing experience in deploying systems, due in no small part to the massive effort Verizon has launched, as well as that of other telcos. It is supremely ironic that one of the nation's more visible and contentious muni fiber projects, involving the city-owned Lafayette Utilities System in Lafayette, La., is now reaping the benefits of delays to its FTTH construction caused by lawsuits and legal actions launched by incumbent cable and telco operators.

“Not only is the technology cheaper than what we would have deployed, it's better,” said Terry Huvall, director for LUS. “We are using [Gigabit passive optical networks], not [broadband PON].”

In addition, in a few cases states are getting in on the act. North Carolina's e-NC Authority is seeking ways to stimulate broadband initiatives in rural areas of that state, while Massachusetts just passed a bill to create a Broadband Institute, using $40 million in state funding to bring broadband to western areas of the state still served only by dial-up.

What's different about today's municipal networks is that, while still intended to solve the problem of broadband access, they are more practically grounded in market realities.

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