Colo. Town Approves Public Networks

When corporations failed to invest adequately in better broadband service for Montrose, residents of the Colorado city decided the service was too important to leave to chance. They voted 3 to 1 to allow the city to play a bigger role in financing and building critical elements of a faster, more accessible network. Their goal is to become one of a handful of gigabit cities in the U.S.

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My little San Juan Mountains town in western Colorado on April Fool’s Day voted by an overwhelming 74% to reclaim the right to provide our own broadband, cable, phone and other telecommunication services.

In 2005 that right was taken away by corporate Internet giant lobbyists who persuaded the state legislators it would be unfair competition to allow rural areas like mine to provide their own gigabit Internet speeds if the giants refused to do so.

Supporters are already dreaming that tech savvy-young ones who develop Apple and Google apps and like to kayak, mountain climb, bike, hike, ski and live in safe, livable small cities will start a migration to Montrose. The city’s ambition is that every business and premises in the city will have the broadband capacity of Chattanooga and the dozen cities that are getting the same capacity through Google Fiber.

Montrose, a city of 19,000 about 65 miles from the Utah border, is a typically conservative rural area, overwhelmingly Republican but with a populist bent. Like all of the Western Slope of the state, it is not participating in the robust economic recovery seen in the Front Slope cities of Denver, Ft. Collins and Colorado Springs.

Internet service here is currently a hodgepodge. Some of us depend on broadcast towers, some on DSL from CenturyLink and some on cable service from Charter. Service is generally at less than 10MB. It’s expensive, and customer service is erratic.

It became clear to the city leadership that none of the large corporate providers were ever going to invest in high-speed broadband for the area. And while some enterprising local startups have moved to provide high-speed fiber and tower broadcast, they are capital-limited and have to charge high fees to get even a modest return on investment.

Thanks to some forward-looking city staff that began to study options for change, the city council began to look at gigabit cities like Chattanooga, Tennessee, as examples of what can be done if leaders take the bulls by the horn. Earlier this year, the council voted unanimously to put Measure A up for a vote, and it passed by 3,969 to 1,396 votes. There was no organized opposition, though the local entrepreneurs justifiably questioned how the city would help them recover their existing investment in fiber and towers.

It used to be that if a town wanted to prosper, it needed a river, then a railroad, then an Eisenhower Interstate highway, and then a cell phone tower. Today it needs to be a “gigabit city.”

One of the amazing things about technology is how it enables communities and countries that are tied to legacy systems to leapfrog their neighbors by adopting the latest tech gadgetry. For example, Bulgaria has faster Internet service than the U.S. Masai tribesmen in Kenya and Tanzania do their banking on cell phones while they tend their cows.

Chattanooga, Tennessee, was one of the first cities in America to offer a city-run gigabit Internet option to its residents.

The fastest Internet city in the U.S. is Chattanooga. The “slowest” Internet speed offered to businesses and residential customers there is 100 MB per second for $58 per month or $70 per month for one gigabit, which is 1000 MB per second.

Chattanooga is on a curve in the Tennessee River and has three Eisenhower interstates, but only a decade or so ago looked like an old industrial city that had no chance against Atlanta to the south and Nashville to the northwest.

Chattanooga is thriving today thanks to a refurbished riverfront in downtown, a Volkswagen auto assembly plant, and its pioneering leadership in becoming the first “gigabit city” in the U.S. It frequently makes the lists of best places in the country to live and locate a business.

Montrose’s dream is to be a little Chattanooga. Businesses that relocate or are looking for startup locations take fast and high-capacity broadband as a given. “Cloud” services that store massive amounts of data could be located here, the city says. Current Internet providers here could vastly expand their telecommunications offerings to include cable, phone and security services.

A lot of business planning will still have to be done now that Measure A has passed. Virgil Turner, the city’s innovation guru, envisions the city being the fiber infrastructure provider, with Internet service providers competing to gain the right to provide service to businesses and residences. That model is called “carrier neutral.”

The other model that is being implemented in some of the other 300 areas that are frustrated that the giant corporate providers are behaving like the electric utilities of old and cherry picking the best customers is to have the cities and counties control the entire business. That would be not a dream, but a nightmare to local entrepreneurs like Doug Seacat , owner of Deeply Digital, and Lillian Cook, owner of One Track Communications. Last year they formed Clearnetworx to lay fiber cable in our central business district.

Sandy Head, executive director of the Montrose Economic Development Corporation, told me, “ We need some assurances these companies and jobs will not be threatened, and they will continue to have the ability to grow their business and reap a return on their investment.”

Turner told me the city is “service motivated…not profit motivated” and wants the current providers to feel that they have a level playing field in which to compete. He noted that the private businesses would have a much larger potential customer base. Revenue bonds, in which the bond investors take the business risk, not the taxpayers, are apt to be the prime funding vehicle. Grants may also be available.

In addition to ensuring that local businesses are in a position to compete with any large corporations that might attempt to establish a major share of the market, Turner said the city also wanted measures to enable lower income households to benefit from the advantages of gigabit speeds and capacity. “We don’t want to create two levels of society here, those who are connected and those who are not,” he said.

The extension of fiber to the city limits would likely also benefit county residents because that would enable broadcast tower providers to increase their Internet speeds and range. In addition, Delta-Montrose Electric Association, our progressive local electric cooperative, plans to cable its substations as part of its advanced metering program. Broadcast capabilities could be added at those substations.

If you don’t understand gigabits and all that stuff, just think of the ability to stream movies real time in your home without buffering. Imagine speeds so high all the teens in the home playing online games can’t slow it down. Think of cable service to homes in the city that current providers won’t serve because the customer density is not high enough to make it profitable.

Think, “Faster than a speeding bullet. More powerful than a locomotive. Able to leap tall buildings in a single bound!” Well, not Superman, but superfast anyway. It’s a democratizing technology that lets those who live 70 miles from an Eisenhower interstate, as we in Montrose do, and where the train only visits when the Russell Stover candy factory needs sugar and chocolate, feel that they are not disenfranchised.

I tell my friends back east that Montrose is “Paradise with a couple of small blemishes.” You know, like spring winds and some red dust from Utah. Gigabit City would remove the slow Internet blemish. Last year we were designated an All-American City, and we deserve Internet speeds as fast as Bulgaria.

Jim Branscome is a retired managing director of Standard & Poor’s and lives in Montrose.

 

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