* * * * * * * * * * *
  *
* *
* * * * * * * * *
*

Why do communities need telecom public/ private partnerships?

Background:
Telecommunications networks are interconnected information transportation systems comprised of fiber, microwave, satellite, telephone, cable and wireless technologies. It helps to use road systems as a model, to better understand telecom as transporting infrastructure and discuss ownership issues that affect its operation.

Differences between interstates, on and off ramps, streets and driveways are easily recognizable. Government operates and maintains the highway system with tax dollars. Individuals pay for driveways, buy their own vehicles or use public transportation. The difference between public highways versus private vehicle ownership is universally understood.

There’s a reason why a company like Ford isn’t allowed to own Interstates. It’s not because they’re bad guys—it’s because if we let Ford own highways, the company would only let Fords use the roads, or charge other brands more or deny entry entirely. A private company has an obligation to make a profit—not protect the public’s need for transportation. Government protects the public’s right to use shared assets such as highways which are the gates to the economy. Regulations ensure everyone’s access to roads leading to markets and jobs.

Because of the way technology evolved, cable and telephone companies own the last mile of the telecom highway at the local level. Nationally, private carriers own long distance fiber networks that are the telecom equivalent of interstate highways. But within communities, private cable and telephone companies own the last telecom mile, or the on and off ramps needed to connect fiber interstates to homes and businesses. In order to reach customers, long distance fiber operators must lease last mile connections from their competitors—either the phone or cable company.

The problem is that telephone and cable companies offer not only last mile connections but also the services carried on the networks—in the highway example, this is the equivalent of Ford owning all the roads and all the vehicles that use them. Phone and cable companies successfully lobbied the federal government to pass laws so they don’t have to sell last mile access to competitors if they don’t want to; or if they do, they can charge whatever they want. More often, phone and cable operators merge with competitors, thus extending monopoly holdings, eliminating competition and removing the need for upgrading last-mile infrastructure to fiber-to-the-premises (FTTP) networks. Telecom last-mile operators continue to charge more for less service carried on obsolete infrastructure, in a non-competitive, virtually unregulated environment.

Ranking fifteenth in the world, with Internet speeds of 1.5-3 Mbps available in only metro areas, the U.S. lags behind most of Europe and Asia where, for the same price, 25-100 Mbps Internet speeds are available to homes and businesses. Communities need wireless broadband / FTTP networks to carry an Internet that eliminates land boundaries and allows communities to remain economically viable in the 21st Century, no matter their size or location.

Some communities that own electric utilities are installing municipally owned wireless broadband / FTTP networks since phone and cable companies don’t offer high-speed Internet in small markets. Others band together and form commissions to share costs and acquire high-speed Internet infrastructure for a region. Municipalities form partnerships with willing small telecom companies interested in entering local markets to compete with cable and phone operators. Public/private partnerships not only deliver previously unavailable, advanced technology, but also support public safety and homeland security programs needed to implement comprehensive emergency management plans.

Typical incentives offered in public/private partnerships include:

committing public sector users as anchor tenants in the partnership,
facilitating access to right-of-way by installing conduits for leasing,
creating financing and grants’ packages to support new installations, and
offering reduced-costs for telecom service to attract new businesses.

*
* *

*

*