How Can America’s Communities Secure the Benefits of Fiber-Optic Infrastructure?
Wednesday, October 14, 2020
How Can America’s Communities Secure the Benefits of Fiber-Optic Infrastructure?
Broadband networks rank among the most important infrastructure assets of our time—for purposes of economic development and competitiveness, innovation, workforce preparedness, health care, education, and environmental sustainability. In the brief 25 years since the advent of the commercial internet, broadband access has become foundational to the American economy and participation of everyone in the U.S. in our democracy.
The criticality of broadband was illustrated when the COVID-19 pandemic shut down the U.S. economy. Households with fast connections were able to continue working and attending classes online. Unconnected households found themselves more cut off than ever. If there were ever any doubt about the centrality of broadband to the national interest, the devastating pandemic erased this doubt. Yet the United States faces persistent gaps in broadband availability and affordability—as well as a troublingly noncompetitive broadband ecosystem in which most communities are served by only one or, at best, two high-speed broadband providers.
The persistence of these gaps demonstrates that private-sector investment alone is not closing our digital gaps. In rural areas of the country, in particular, there exists insufficient return on investment for private capital; as a result, broadband deployment does not emerge absent some form of public support. In less rural areas, competition is rare because return-on-investment challenges deter new investors from competing against existing monopolies and duopolies.
Given these difficult economics, even the most optimistic estimates are that only a third of American homes have access to all-fiber-optic networks. Fiber represents the holy grail of communications infrastructure, recognized as a future-proof technology for facilitating the bandwidth needs of homes, businesses, schools, libraries, institutions, and government agencies—and a necessary platform for advanced wireless services that require fiber to deliver high speeds.
How, then, can America’s communities secure the benefits of fiber-optic infrastructure?
Our answer is that local governments need not accept a binary option of waiting for the private sector to solve the problem—which the private sector already would have done if it made business sense—or taking on the challenge entirely as a public enterprise. Rather, public-private collaboration can disrupt this binary and give communities options. Indeed, in recent months and years, a range of collaborative public-private models—involving various levels of risk-sharing—have emerged and proved worthy of emulation.
In some of the most promising of these partnerships, the public entity funds, builds, and owns the underlying communications infrastructure and the private entity does the rest: It provides the electronics and service over that infrastructure and deals with the complexities of running a broadband business. This Public Infrastructure/Private Service model puts the locality in the business of building infrastructure, a business cities and counties know well after a century of building roads, bridges, and utilities. The model leaves to the private sector most aspects of network operations, equipment provisioning, and service delivery.
The level of risk (and potential reward) can be calibrated under the partnership terms to suit local conditions and community goals.
The Public Infrastructure/Private Service Model
“Public Infrastructure/Private Service” is shorthand to describe this model, and in most cases the public infrastructure is dark fiber. But in some cases, the infrastructure might be conduit for housing the fiber; in others, fixed-wireless technologies might supplement the fiber if local conditions warrant. In rare cases, the public fiber infrastructure might include the electronics, forming a public “lit” network over which partners can provide services over virtual circuits.
And alternative emerging approaches among other kinds of entities confirm the model, demonstrating the wisdom of the separation of function according to the partners’ capabilities and the most efficient allocation of responsibilities. For example, the collaborators could be private-private, public-public, and even cooperative-cooperative—but playing the same basic roles, with one providing infrastructure and the other providing service.
The Public Infrastructure/Private Service model leverages the best capabilities of the public and private sectors. In this model, cities and counties do what they’ve always done: finance and build basic infrastructure, manage rights-of-way, and maintain that infrastructure over long periods of time—ensuring that the entire community benefits from the infrastructure and that government functions can happen over fiber that connects municipal offices, libraries, public safety agencies, and schools.
At the same time, private entities do what they traditionally do well: run a business, engage in sales and marketing, handle customer service, and adapt to changing technologies and customer preferences. In some cases, public or cooperative entities ably perform these service roles in a partnership with their infrastructure collaborators.
This emerging model presents a scalable option for communities that lack the expertise or interest to operate communications networks or act as internet service providers themselves but want to own and control the core communications assets in their community as a means of securing the benefits of the broadband internet.
It should always be the prerogative of local community leaders to make their own decisions about whether and how to address the need for broadband in their communities. The Public Infrastructure/Private Service model is an option to add to their menu of choices: a pragmatic, community-driven, pro-market, pro-business approach to advancing broadband in communities where solutions have not already emerged.
A new paper—authored by the Coalition For Local Internet Choice (CLIC) and published by the Benton Institute for Broadband & Society—defines and describes the model (and related variations, such as private-private and public-public) from both a business and a technical standpoint, and it summarizes case studies across the country of partnerships solving problems today. We provide a strategic overview of the basic Public Infrastructure/Private Service model and its variants, together with a framework for public-sector entities to consider as they evaluate potential technical approaches and levels of risk-sharing. And we address the key legal issues that arise in public-private partnership deals.
Fiber Now For America’s Future
Fiber optics represent the most scalable long-term broadband infrastructure option. For purposes of capacity, reliability, and scalability, fiber-to-the-premises is superior to all other broadband technologies. Despite some industry marketing claims, fiber-to-the-premises is superior to even the best of all theoretical wireless technologies. Fiber infrastructure represents a long-term, prudent investment for a public entity with significant potential use and impact.
But fiber will not reach everywhere unless communities actively pursue it. Rural regions, other low-density populated areas, and low-income areas of cities have seen far less investment in 21st-century broadband networks than have more densely populated, higher-income areas of the United States. This is part of the reason the economies of these areas can stagnate, young people depart for more promising locations, and communities decline.
We know that fiber is America’s future. Public Infrastructure/Private Service: A Shared-Risk Partnership Model for 21st Century Broadband Infrastructure is a guide for communities that are ready to start shaping their digital destiny.
Joanne Hovis is president of CTC Technology & Energy, where she heads the firm’s work in public broadband strategy, network business planning, market analysis, and policy. Joanne advises cities and states regarding how to build strategy and opportunity for public–private partnerships in broadband. She led the CTC teams that developed first-of-their-kind public-private broadband collaborations for the cities of Tacoma, WA, Westminster, MD, and Lexington, KY; the states of Alabama, Delaware, and Kentucky; and the Urbana-Champaign Big Broadband consortium. Joanne also serves as CEO of the Coalition for Local Internet Choice and on the boards of Consumer Reports, the Fiber Broadband Association, and the Benton Institute for Broadband & Society.
Jim Baller is president of Baller Stokes & Lide, PC, a national law firm based in Washington, D.C. He represents clients in a broad range of communications matters nationally and in more than 35 states. He was the founder and president of the US Broadband Coalition, a consortium of more than 160 organizations of all kinds that forged a national consensus on the need for a comprehensive national broadband strategy and recommended the framework reflected in the Federal Communications Commission’s National Broadband Plan. The Fiber to the Home Council has recognized Jim as “the nation’s most experienced and knowledgeable attorney on public broadband matters.
David Talbot, Principal Analyst & Researcher at CTC Technology & Energy, is an experienced researcher and analyst who conducts a range of analytical, research, and needs assessment tasks. Prior to coming to CTC he was a fellow at the Berkman Klein Center for Internet & Society at Harvard University, where he researched and wrote reports on municipal fiber and related topics. He previously worked as a senior editor and chief correspondent at MIT Technology Review, where he frequently covered internet, communications, and energy technologies and policies.
Cat Blake, Civic Technology Analyst at CTC Technology & Energy, works with clients to develop infrastructure and funding strategies to meet community needs and performs a range of research and writing tasks related to civic technology and digital equity. Cat is currently working with nonprofit Generation West Virginia to support communities in the state as they seek to expand access to broadband. Recently, she helped develop a new broadband funding plan for the Alabama Department of Economic and Community Affairs. A University of Virginia graduate, Cat came to CTC from Next Century Cities, where she was a Senior Program Manager.
The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.
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