Aren’t the services provided by the incumbents good enough?
No. Comcast claims to have an internet service, available to virtually all premises in Palo Alto, that is “up to” 1 Gbps for downloads. But it’s “up to” only 35 Mbps for uploads. Also, when the network is congested, you don’t get the “up to” speed. AT&T is beginning to offer 1-Gbps FTTP in a few neighborhoods, but in most neighborhoods, its service is copper-based and much slower than 1 Gbps. So, in most cases, if you want speed, Comcast has, in effect a monopoly, and can charge monopoly prices. The FCC currently defines “broadband” as anything faster than 25 Mbps down and 3 Mbps up. But we want something a lot faster than that kind of “broadband.”
Why don’t people who want internet service over fiber just become customers of the City’s existing dark fiber network?
The City’s dark fiber is a bargain for businesses that need the fastest speeds possible. But it’s too expensive for most household budgets. The customer would have to choose which two places the leased connection should connect — usually the customer’s premises and a service provider’s premises. The customer would have to pay up-front for both ends to be connected to the dark fiber network. (A “pricing overview” provided by the City says this might cost “$8,000 or more.” But I’ve heard of cases where it cost more than $20,000.) Then the customer and the service provider would have to install electronics to “light” the fiber at both ends. Then the customer would have to pay the service provider to provide the service, and pay the City to lease the fiber. (The City’s pricing overview gives examples of $1,585 and $2,600 for the total monthly cost.)
What if I don’t need a gigabit per second?
Municipalities often offer one or more slower services at lower prices. Palo Alto could do that. Most of Palo Alto’s costs would be for the infrastructure, which would be the same regardless of speed. So, for Palo Alto to recover its costs, the price of slower-speed services might have to be higher than you’d guess. Historically, how much bandwidth you need has risen exponentially over the years.
So if you think you don’t need 1 Gbps today, maybe you will sooner than you think.
What applications require a gigabit per second?
It’s the wrong question. Existing applications will go faster. And there will be enough bandwidth to support multiple applications for multiple people in a home or business. To avoid congestion, the network must operate at significantly less than its peak bandwidth.
What can a municipal fiber connection offer besides speed
Net neutrality (the guarantee that the websites you can go to won’t be limited). Privacy (the guarantee that the City won’t harvest and sell your personal data). Reliability.
What about wireless?
Wireless is really no alternative for a FTTP connection. It’s a lot slower. It’s less reliable. It’s more expensive per bit. Privacy is a problem. The incumbents’ wireless services often come with data caps and data throttling. The incumbents have been hyping “5G” wireless, but don’t believe the hype.
What about TV?
NextLight (Longmont, CO) has shown that a municipality doesn’t have to have a TV service in order to have a financially viable FTTP network. That’s good for municipalities, because offering a TV service is a hassle. “Cord-cutting” (dropping traditional TV service and getting video entertainment “over the top,” using the internet service) is becoming very popular. Ironically, after NextLight launched its FTTP network without a traditional TV service, a third party showed up that wanted to use the network to offer one.
What about landline phone service?
Landline phone service is becoming less popular, so a municipal FTTP network doesn’t have to provide it to be financially viable. Some municipalities outsource this service to a third party. If the service were more reasonably priced, maybe more people would sign up for it.
How much would a citywide municipal FTTP network cost?
A staff report from 2015 estimates $77.6 million. This assumes a much higher cost to build the network than most other cities have paid and assumes it would be built all at once. An incremental approach could reduce the costs and stretch it over a longer time horizon.
If the network is successful, subscribers would pay for all of it over time. The City has a Fiber Fund of about $26 million, generated by the City’s dark fiber network, which could be used for FTTP.
What’s the difference between FTTH and FTTP?
FTTP (fiber-to-the-premises) emphasizes that both home premises and business premises can be customers. FTTH (fiber-to-the-home) sounds like it might not include businesses, but in Palo Alto, that’s never been the intention. In other words, there’s no real difference.”
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Last updated 4/1/2021