Thursday, August 28, 2014

Telecom Plan Raises Questions About Future Internet Service | Vermont Public Radio

Telecom Plan Raises Questions About Future Internet Service | Vermont Public Radio: “It’s shortsighted to make that investment in technology that can’t go the whole nine yards,” says Irv Thomae, chairman of the governing board of ECFiber, which currently serves 800 customers in six central Vermont towns.

Thomae says the draft plan doesn’t represent a commitment to the Legislature’s goal.

“If the Telecom Plan says we aren’t to take the 100 Mbps seriously, then we aren’t going to take it seriously,” he says.

Thomae says state funded "dark fiber" projects constructed by the Vermont Telecommunications Authority should be the model for reaching the 2014 goal. These projects enable service providers to lease space and compete for customers.

Thomae says the state should raise money through the sale of bonds to finance an extensive dark fiber system.

Thomae raises a key issue on U.S. telecom infrastructure planning and financing policy. The nation is at an inflection point where the service line extensions of the legacy telephone and cable companies have gone about as far as they can within their business models in terms of making landline Internet service accessible to all American homes and businesses. And possessing the capacity to deliver the bandwidth that will be needed going forward as bandwidth demand doubles every couple of years or so, consistent with Moore's Law on microprocessor development.

Vermont's situation is a metaphor for the United States as a whole and points to the need for greatly expanded public sector financing capacity for this infrastructure that's as critical to the 21st century as highways and electricity were to the 20th.

How big telecom smothers city-run broadband | Center for Public Integrity

How big telecom smothers city-run broadband | Center for Public Integrity: “We don’t quarrel with the fact that AT&T has shareholders that it has to answer to,” Bowling said with a drawl while sitting in the spacious wood-paneled den of her log-cabin-style home. “That’s fine, and I believe in capitalism and the free market. But when they won’t come in, then Tennesseans have an obligation to do it themselves.” 

Republican Tennessee State Senator Janice Bowling puts this debate over the role of the public sector in financing or building telecommunications infrastructure into the proper perspective. It's not a contest over capitalism or any other economic philosophy. It's about the hard reality that markets aren't perfect and can and do fail. When that market is for a service like telecommunications that plays such a central role in the health of the economy as a whole, public sector involvement is entirely appropriate and the interests of a single sector of the economy must take a subordinate position.

At a meeting three weeks after Bowling introduced Senate Bill 2562, the state’s three largest telecommunications companies — AT&T, Charter, and Comcast Corp. — tried to convince Republican leaders to relegate the measure to so-called “summer study,” a black hole that effectively kills a bill. Bowling, described as “feisty” by her constituents, initially beat back the effort and thought she’d get a vote.

That’s when Joelle Phillips, president of AT&T’s Tennessee operations, leaned toward her across the table in a conference room next to the House caucus leader’s office and said tersely, “Well, I’d hate for this to end up in litigation,” Bowling recalls.

Actually, no. Legacy incumbent telephone and cable companies love litigation because it fits perfectly with their strategy of buying time and years of delay since they are unable to invest sufficient funds to upgrade their monopolistic and dupolistic telecommunications markets due the limitations of their business models.

Tuesday, August 26, 2014

Unpacking claims of “unfair competition” when the public sector finances or builds fiber to the premise infrastructure

Incumbent telephone and cable companies often cry “unfair competition” when the public sector invests in or builds fiber to the premise (FTTP) infrastructure. Let’s unpack that assertion. From the point of view of these companies, anyone who builds infrastructure they don’t own is a competitor. They really don’t compete to gain customers in a given geographical area. That’s because telecommunications infrastructure isn’t truly a competitive market characterized by many sellers and buyers. Rather than competing for customers, the incumbents’ true interest is in protecting their monopoly or duopoly status.

True competition occurs in a market where buyers and sellers are on a level playing field and buyers have relatively equal access to market players and information on their services, benefits, prices and value offered. That doesn’t happen in telecommunications infrastructure. Incumbents have the upper hand in deciding which neighborhoods they will serve, what services will be offered and at what price. And they don’t disclose where they plan to build FTTP infrastructure.

The public sector typically gets involved in investing in or building FTTP infrastructure not to compete with the incumbents, but to remedy the market failure they create given their power to pick winners and losers among the neighborhoods they opt to serve and those they choose to redline and not offer service.

Finally, since the public sector typically invests in open access infrastructure and provides wholesale access to Internet service providers (including the incumbents), that’s also not direct market competition with incumbent telephone and cable companies. It’s an entirely different playing field and certainly not the same one used by the incumbents who won’t play ball unless they own the field. Hence, there’s no direct competition, fair or unfair.

U.S. FTTP infrastructure projects falling into 2 categories


The construction of fiber to the premise (FTTP) Internet infrastructure in the United States is falling into two main categories:

  1. Projects in large and midsize metro centers such as those started or planned by Google Fiber, AT&T and Century Link as well as some cable companies. An article in the July 2014 issue of Broadband Communities magazine lists these deployments.
  2. Community or regional projects by local governments, utility cooperatives and public-private partnerships serving less densely populated areas not containing large cities such as those tracked by the Institute for Local Self Reliance.

The bifurcation of these infrastructure projects is distinguished by the economic health of their respective markets. Those in the first category undertaken by investor-owned providers that need a rapid return on investment are targeted to markets undergoing rapid economic growth, Broadband Communities editor Masha Zager writes in her article on large metro projects, citing the FTTP deployment strategy of Cox Communications:

Cox explicitly named rapid growth as one of its criteria for selecting cities for gigabit deployments. In contrast to municipalities, which often deploy fiber in an effort to jump-start lagging economies, large players favor localities that are healthier to begin with.

For the second category of projects, FTTP is clearly an economic development strategy to a far greater extent than the first. Unlike those in the first category financed by the impatient capital of telcos and cablecos burdened with high debt loads and large shareholder dividend obligations, community or regional projects will rely on patient capital. Sources include long term public bonds and creative public-private partnerships that blend public and private funding such as the Utah Telecommunications Open Infrastructure Agency (UTOPIA).

The second category is also distinguished from the first by the ownership and business models of the network infrastructure. In the first category of investor-owned projects, the network is a proprietary, closed access property. The telcos and cablecos that own the networks charge a retail monthly subscription fee to connecting premises.

By contrast, the second category is more likely to utilize an open access business model (such as UTOPIA) where fiber infrastructure is like a public works project such as a road or highway. Instead of selling individual subscriptions to customer premises, an open access model operates as a wholesaler selling network access to Internet service providers who provide services to customer premises. This model is a better option for the second category of projects because it removes the business risk of getting sufficient numbers of premises to sign up for service in order for the network deployment to be economically viable.

Sunday, August 24, 2014

AT&T falls short on California landline infrastructure upgrades




AT&T California has not met requirements for the build out of infrastructure to make Internet-based video services available to at least 50 percent of its California telephone service area as of year-end 2012. 

That’s according to the California Public Utilities Commission’s Sixth Annual DIVCA Report for the year ending December 31, 2012 (issued July 31, 2014). DIVCA – the Digital Infrastructure and Video Competition Act of 2006 – specifies a five-year build out period of 2008 through 2012. (The relevant reference is at page 9 of the report.)

AT&T California qualified for relief from the five-year infrastructure build out requirement under a DIVCA exception in cases where a provider has been unable to sell Internet video services to at least 30 percent of households in its telephone service area.

This in turn has resulted in a significant customer quality issue. Many households in AT&T California’s telephone service territory are unable to order landline-delivered Internet services since AT&T video services (branded as U-Verse and which includes bundled Internet access and voice service) are delivered over decades-old copper cable plant. Instead, these customers are offered only substandard, obsolete dialup Internet service that cannot support the delivery of video services.

Friday, August 15, 2014

Advocates of municipal broadband face resistance over high-speed access | GazetteNet.com

Advocates of municipal broadband face resistance over high-speed access | GazetteNet.com: Foes, including private Internet service providers such as Comcast, AT&T and Time Warner Cable, have a different view. They say they are spending hundreds of millions of dollars upgrading infrastructure to give high-speed access to every American, and that government shouldn’t compete against private companies, which must pay taxes and make a profit.
The assertion regarding "upgrading infrastructure to give high-speed access to every American" is a false statement. These providers segment their markets and redline neighborhoods deemed less profitable and have no plans to serve them, all the while making promises they cannot stand behind. The reason they cannot is they are constrained by inpatient shareholder investment capital and short term business models inappropriate for high cost capital infrastructure that can require decades to produce a return on investment.

The claim that government is unfairly competing with private sector telecommunications providers is also false in a strict economic sense. Competitive markets are characterized by many buyers and sellers. In telecommunications infrastructure, there are many buyers and users but few sellers, making the market a natural monopoly or duopoly. When the public sector steps in to build and/or finance telecommunications infrastructure, it does so because this market environment combined with the previously mentioned business model limitations of investor-owned telephone and cable companies produces market failure on the sell side. That failure has left millions of Americans unable to order modern Internet landline-delivered services at their homes and small businesses.

Monday, August 11, 2014

Latta ascribes wrong cause to constrained investment in last mile infrastructure

Rep. Bob Latta Weighs in on STELA, Title II & E-Rate | USTelecom: On the topic of Title II, net neutrality and broadband legislation, Latta said, “First of all, I believe in an open Internet — a free Internet without government intervention. When you look at where the Internet has come and where it’s going in the future, this has all been done on the private sector. It’s not been done because of what the Federal government has done.” According to Latta, by putting broadband under Title II to make it more like telecommunications using a law from 1935, “What we will see happen then is that the innovation out there that’s spurred about a trillion dollars in private investment is all of a sudden going to be tied up like it would be with a telephone company. We don’t want that. Because once you start that up, then all of a sudden innovation is going to slow up — not only innovation — the dollars put in it and the tens of thousands of jobs being created. So we don’t want that to happen. We want to make sure that it remains free, it stays open and it stays away from government control.”

The problem with this position is regulation isn't the cause of what the Federal Communications Commission estimates as nearly 20 million Americans who are not offered landline Internet connections to their homes. In addition, much of the nation remains served by outdated twisted pair copper plant built many decades ago for analog telephone service and not fiber to the premise needed today and in the future as bandwidth demand grows dramatically.

If legacy telephone and cable companies had innovative solutions to build that necessary infrastructure, they would have pursued them over the past two decades. They haven't been able to do so not because of regulatory burdens but rather market failure on the sell side. It's because their business models are oriented to gaining a return on infrastructure capital investment over time frames far shorter than what's needed given the high costs -- mostly labor -- of deploying that infrastructure. It is this economic consideration that stifles investment in last mile Internet infrastructure in the United States, not regulation.

Saturday, August 09, 2014

Roanoke Valley Broadband Authority, Internet providers disagree on state of broadband - Roanoke Times: Roanoke News

Roanoke Valley Broadband Authority, Internet providers disagree on state of broadband - Roanoke Times: Roanoke News

This story illustrates that local government officials are growing less inclined to rely on what incumbent legacy telephone and cable companies claim they have in place or will build when it comes to last mile Internet infrastructure.

Good for them. Other local governments should follow this example and create and fund special districts and authorities to build the infrastructure they need. Collectively, their doing so will help the United States bridge a persistent Internet infrastructure gap that leaves millions of Americans without adequate connectivity -- many of them still forced to use dialup connections that were state of the art 20 years ago.

Wednesday, July 30, 2014

Study finds Missoula city, county should spend $10M on broadband

Study finds Missoula city, county should spend $10M on broadband: As proposed, the city and county together would invest $10 million toward a $17 million system, with the local government funds leveraging other money, Copple said. The local money would be paid through user fees, not taxes, and it would build roughly 60 miles of an “open access” fiber-optic network.

“Everybody has the same chance to use it,” Copple said.

Thursday, July 24, 2014

Open access fiber telecom infrastructure funded in West Virginia over telco's objections

Competition in telecommunications infrastructure isn't really among major telcos and cable companies. They operate in market that due to the high cost barriers to entry functions as a natural monopoly or at best, a duopoly where service is available from just two landline providers: the phone company or the cable company. In much of the United States, the choice is only one of the two or sadly, neither because they have redlined parts of their service territories.

The real competition is between the business models for premise Internet connectivity: open access Internet infrastructure such as employed by the Utah Telecommunication Open Infrastructure Agency that regards it as a public asset like roads and highways or the proprietary, closed access infrastructure model of investor-owned telephone and cable companies.

This week in West Virginia, the debate tipped in favor of open access after the West Virginia Broadband Deployment Council voted 3-2 to provide $690,00 in funding to the West Virginia Network, a state agency that provides Internet service to schools, universities and other public facilities. The deciding factor was the state wanting more control over the infrastructure and not being subject to the whims of a monopoly provider.

“Frontier is the only provider in the region, and there is no open access to that infrastructure,” one of the council members noted. “You can’t really connect any of the dots [communities] together . . . . We can hopefully connect those rings and enable broadband expansion in the area.”

This is a notable development because it signals that public policy is shifting towards viewing Internet infrastructure as essential as public thoroughfares and thus not best controlled and operated as a hodge podge of private toll roads with high tolls and serving only some areas while leaving others disconnected from the Internet.

Click here for the story.


West Virginia Broadband Deployment Council voted 3-2 to award the money to West Virginia Network, or WVNET, a state agency that provides Internet service to schools, universities and other public facilities. WVNET would own the three-segment fiber network that would connect Snowshoe to Cass, Valley Head to Mill Creek, and Durbin to Green Bank. - See more at: http://www.wvgazette.com/article/20140723/GZ01/140729675/1419#sthash.ldOg1t7a.dpuf
West Virginia Broadband Deployment Council voted 3-2 to award the money to West Virginia Network, or WVNET, a state agency that provides Internet service to schools, universities and other public facilities. WVNET would own the three-segment fiber network that would connect Snowshoe to Cass, Valley Head to Mill Creek, and Durbin to Green Bank. - See more at: http://www.wvgazette.com/article/20140723/GZ01/140729675/1419#sthash.ldOg1t7a.dpuf
West Virginia Broadband Deployment Council voted 3-2 to award the money to West Virginia Network, or WVNET, a state agency that provides Internet service to schools, universities and other public facilities. WVNET would own the three-segment fiber network that would connect Snowshoe to Cass, Valley Head to Mill Creek, and Durbin to Green Bank. - See more at: http://www.wvgazette.com/article/20140723/GZ01/140729675/1419#sthash.ldOg1t7a.dpuf
West Virginia Broadband Deployment Council voted 3-2 to award the money to West Virginia Network, or WVNET, a state agency that provides Internet service to schools, universities and other public facilities. WVNET would own the three-segment fiber network that would connect Snowshoe to Cass, Valley Head to Mill Creek, and Durbin to Green Bank. - See more at: http://www.wvgazette.com/article/20140723/GZ01/140729675/1419#sthash.ldOg1t7a.dpuf

Sunday, July 20, 2014

The FCC wants to let cities build their own broadband. House Republicans disagree. - Vox

The FCC wants to let cities build their own broadband. House Republicans disagree. - Vox

House Republicans would be well advised to consult with or hire new, better economic advisors. They demonstrate a fundamental misapprehension of telecommunications infrastructure in viewing it as a competitive market when in fact it's a natural monopoly as Susan Crawford notes (see the embedded video interview).

Competitive markets (like retail grocery and furniture, for example) have many sellers and many buyers. Due to high cost barriers to entry, telecommunications infrastructure is not characterized by a multitude of sellers and will likely never be a competitive market. It's a utility like telephone service as Crawford correctly observes, and should be regulated accordingly.

Tuesday, July 15, 2014

Another public regional telecom infrastructure project may be ripe for PPP investment


In Utah, several cities are moving ahead with due diligence on a public-private partnership (PPP) to construct fiber to the premise (FTTP) telecom infrastructure.

Another public FTTP infrastructure project in the eastern United States might also be an attractive partner for private investment companies like Australia-based Macquarie Capital Group, which is looking at investing in Utah's UTOPIA regional network.

This one's in western Massachusetts and is a utility cooperative of 42 municipalities. According to a June 2014 update by the Wired West cooperative, it is hoping to obtain state funding to move forward with construction as people in western Massachusetts continue to be vexed by the lack of adequate internet service.

Given the scope of the Wired West project, it will likely need significantly greater funding from the private sector as part of a PPP like that under consideration in Utah.

Sunday, July 13, 2014

Gigabit over fiber altering telecom landscape

One word is exerting substantial influence over U.S. telecommunications infrastructure: gigabit. It is literally exponentially redefining what constitutes modern premises Internet connectivity from megabits per second (Mbs) range to gigabits per second (Gbs).

Gigabit is also aiding in a shift of market power to the demand side and away from legacy telephone and cable companies that supply megabit class service – often in the single digit Mbs range in the case of telcos -- over “last mile” metal wire or cable to customer premises. The limitations of this infrastructure versus fiber optic lines easily capable of delivering gigabit class service have led telephone and cable companies to ration bandwidth, selling it in various “bandwidth by the bucket” consumption tiers like electricity or natural gas. Gigabit over fiber to the premise will obsolete that business model at the same time premise bandwidth demand continues to rapidly accelerate. Drivers include more and higher definition video streams, multiple devices in the home and emerging Internet-enabled home services. Also, more knowledge workers working at home at least part of the work week.

Gigabit over premises fiber service will also obsolete the legacy telcos and cablecos themselves, burdened with decades-old twisted pair and coax cable infrastructure as well as high debt and shareholder dividend obligations. That will give advantage to agile and financially creative overbuilders connecting premises with fiber service.

Since telecommunications infrastructure is a natural monopoly, once fiber first movers have established a substantial market presence, the economics of challenging them with parallel infrastructure become very difficult. This same dynamic has historically deterred those who would overbuild the incumbent telcos and cablecos. But the shift toward gigabit class service delivered over fiber could reverse the advantage of incumbency the legacy telephone and cable companies have enjoyed for more than a decade.

The first mover advantage would be particularly high in parts of incumbent telephone and cable company service territories where the incumbents don’t offer landline Internet connections or very slow ones such as first generation DSL.

Tuesday, July 08, 2014

Telcos’ copper cable plants deteriorate with no clear plans to replace them with fiber




A crisis affecting Americans who obtain premises telecommunications services (Internet, voice, and video) from legacy telephone companies has been slowly unfolding over the past 10 years. 

These companies’ copper cable plants are growing very aged and nearing the end of their useful lives with no clear plan to replace them with fiber optic cables.

The problem has worsened in the past decade as telcos have concentrated their infrastructure investments on mobile wireless services while all but ignoring their deteriorating landline cable plants. Much of it is in such poor condition that it can’t deliver any Internet connectivity or only marginally at sluggish speeds.

One strategy going forward is to sell as AT&T is doing with its Connecticut residential landline unit. However, in parts of telcos’ service territories where the copper cable plant is ancient and a fully depreciated asset, it’s questionable as to what value any potential buyer would see in such a deal.

A possible path to resolution of this crisis could come later this year if the U.S. Federal Communications Commission opts to subject Internet protocol-based services to common carrier and universal service requirements under Title II of the Telecommunications Act of 1934.

Sunday, July 06, 2014

“Broadband” infrastructure subsidy programs falling behind in the gigabit world

As telecommunications becomes an Internet-based, fiber delivered service, programs aimed at subsidizing the cost of infrastructure construction are rapidly going out of date. For example, the U.S. federal government’s Connect America Fund helps underwrite the cost of building infrastructure in areas with service providing Internet connections of less than 3 Mbs down and 1 Mbs up. The California Advanced Services Fund targets areas with less than 6 Mbs down and 1.5 Mbs up.

Both definitions are now technologically obsolete in that they are purposed for “broadband" service and define "broadband" based on a moving and quickly obsoleted throughput target that only measures speed but not latency or jitter --  key components of throughput quality.

It's no longer a broadband environment where the term broadband was used to distinguish advanced services from 1990s "narrowband" dialup. It's now a "gigabit" world of fiber to the premise (FTTP) that can provide exponentially superior throughput with no near term threat of obsolescence.

In addition to using an outdated and incomplete measure of throughput, these programs are deeply flawed insofar as they aim to preserve the hegemony of the legacy metal wire-based legacy telephone and cable companies with eligibility standards based on the companies’ need to constrain bandwidth on their bandwidth-limited metal wire plants. Program subsidies are only available in areas deemed “underserved” and “unserved” relative to services provided – and not provided -- by the incumbents. 

This isn't a practical definition since the footprint of wireline-based services of the incumbents is highly granular at the network edge due to market segmentation and arbitrary redlining of discrete neighborhoods deemed undesirable and therefore unserviceable.

For the most part, the large first tier incumbent telcos and cablecos have spurned the subsidies, probably because they are far too limited to allow them to significantly upgrade their plants to FTTP. They also likely realize accepting subsidy funding would potentially increase pressure on them to provide service to all premises in their service territories as some advocate, urging the U.S. Federal Communications Commission to regulate the Internet under a common carrier scheme like that in place for decades for voice telephone service.

Thursday, July 03, 2014

Davis, California exploring FTTP options to address private market failure

Sacramento News & Review - Sacramento Internet is actually really slow - News - Local Stories - July 3, 2014: “It really comes down to market conditions,” said Rob White, chief innovation officer at the city of Davis (yes, that’s a real title). “Putting fiber in the ground or in poles costs money. Most don’t want to do it where there won’t be subscribers or users.”

White said that Davis is exploring a lot of options, one of which involves an international fiber-optics company that offered to install the cables so that it could charge ISPs (the main ones in Davis are Comcast and AT&T) to use its network.

Sacramento might be going the route of cities that have allowed Google or AT&T to build broadband infrastructure for them.
Other options allow cities to choose from either central or decentralized systems. What we have now is more decentralized, in that various companies claim the right to install their own cables in different parts of town and charge customers accordingly. In a centralized system, however, the city would build and control just one fiber-optic network itself and let ISPs use it.
One proposed state law, Assembly Bill 2292, would facilitate this by letting local governments issue bonds to construct broadband infrastructure.

The face of ISPs are companies like Verizon and CenturyLink, so Internet service is seen as a commercial product. But it differs from other commercial products like shoes and microwaves because there is a very tight limit on the space (roads and telephone poles) that makes it physically possible to offer Internet. That has sparked a national debate on whether to treat the Internet as a public utility.

White likened Internet service to firefighting, which used to be a private enterprise. But that meant that a city could have five different companies fighting fires, which made coordination difficult—until fire districts were municipalized as a public utility. Today, with different companies building disparate systems of copper (and now fiber-optic) cables, Internet infrastructure lacks uniformity.

As White put it, “I think we’re exhibiting a market failure in this world of broadband.”

Market failure indeed. It's most painfully evident in large portions of the four county Sacramento region where homes and small businesses have wanted to purchase modern, fast Internet service for the past 10 years but cannot because incumbent telephone and cable companies have redlined their neighborhoods and decline to sell it to them.

White's comparison of multiple commercial telecommunications providers competing to capture subscribers with their own proprietary infrastructure to private fire departments (the first type of fire insurance) is apt. However, the high costs White notes that come with deploying fiber to the premise (FTTP) telecommunications serve to keep out competitors and make the market a natural monopoly unlike private fire protection companies.

Davis has the right idea in regarding telecommunications infrastructure as public infrastructure like roads and highways -- another costly endeavor that doesn't lend itself to market competition -- that benefit everyone whether they drive on them or not. Under this model, access is provided to ISPs on a wholesale basis. The real competition is among the ISPs looking to sell communications and information services over that public infrastructure -- as it should be.

Tuesday, July 01, 2014

Two sharply divergent alternative business models for Internet infrastructure play out in Utah














For the past decade, much of the United States has been plagued by telecommunications infrastructure market failure. Many residences and small businesses need fast, reliable landline premise Internet connections but are unable to obtain them because legacy telephone and cable companies have opted not to upgrade and build out their networks to reach them. Alternative business models are thus urgently needed to ensure they don’t remain isolated from the Internet grid and effectively cut off from the many services it provides.

In Utah, two alternatives to construct and operate fiber to the premise (FTTP) infrastructure -- which is also being referred to as “gigabit broadband” in reference to fiber’s substantial carrying capacity that eliminates sluggishness and latency -- are playing out in close proximity.

One model is quasi-public, the other private. The first is the Utah Telecommunication Open Infrastructure Agency (UTOPIA), of which 6 of 11 member municipalities are moving forward with diligence on a partnership to bring in private investment capital. (Story here) UTOPIA’s model treats its fiber infrastructure as a public asset similar to roads and highways. 

By contrast in nearby Provo, Google’s Google Fiber unit is utilizing the subscription-based business model used by legacy telephone and cable companies to sign up residential (but not business) customers living in selected “fiberhoods.” Google Fiber is open only to Google whereas the UTOPIA model allows Internet Service Providers access to the network on a wholesale basis.

Since Google Fiber sells subscriptions like a magazine, it has to sell enough subscriptions to be economically viable. Being part of online advertising giant Google means Google Fiber is also motivated to get as many subscribers as possible in order to maximize eyeballs on Google-delivered content and ads. With the bill and keep subscription model, teaser and special rates are utilized to goose subscriptions such as Google Fiber’s announcement it is cutting its $300 flat rate, low cost subscription rate to only $30 for a limited time in Provo fiberhoods – similar to limited time magazine offers for new subscribers. (See this item from Google Fiber blog)

Of these two models, the UTOPIA model despite initial resistance to a modest public utility fee is best able to scale quickly enough to address America’s significant telecommunications infrastructure gaps short of a massive federal infrastructure program on the scale of the Federal Highway Act of 1956. The public-private partnership model being utilized by UTOPIA relieves network operators of the risk burden and uncertainly associated with having to sell subscriptions and avoid customer churn. It can also more easily attract the many billions of dollars necessary to build out fiber to nearly all Americans regardless of where they make their homes and businesses.

 
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