Faster, more reliable broadband at a lower cost for consumers is the goal behind a plan developed by Entry Point Networks of Salt Lake City, Utah, for Superior’s Communications and Information Technology Committee.
The plan, which was presented to the committee at its Monday, Jan. 25, meeting, will allow the committee to evaluate the feasibility of implementing a broadband network for residents, businesses and institutions in the city. It will help city leaders understand the operational implications, risk factors and cost factors for developing and operating city-owned fiber optic infrastructure.
The plan includes an analysis of costs for currently available internet services, as well as projected costs for the project and consumers based on the cost of building and maintaining the city-owned network. It would also factor in adding competition to the number of internet service providers that could utilize the network.
Based on a 60% take rate — the number of households that decide to install the city network — and the network construction method, the plan estimates consumer costs ranging from $46.73 to $55.05 per month based on current ISP pricing for 1 gigabyte per second upload and download speeds.
As the percentage of take rate goes up, it dramatically reduces the cost, said Devin Cox of Entry Point Networks.
“I love all the work that everyone’s put into this; don’t get me wrong,” said councilor Craig Sutherland. “I was just kind of sticker-shocked at $31 million as the price for this … if we’re going to go down this route. What’s stopping Spectrum from seeing these numbers and lowering their cost to us.”
Sutherland questioned whether a scenario like that has occurred in other markets where community-owned networks were being built.
Cox said it has happened before, but the more important question is whether Spectrum could achieve the same results the city is trying to achieve in building its own network and whether it could be done for the price of the network long-term.
“If the entire goal of the network is to get faster, cheaper internet connectivity, the answer to your question is yes … they’ll come in and lower their cost and try to compete head-on to try to kill the network,” Cox said. “They’ve done it in other markets; there’s no reason to believe they wouldn’t do it in Superior.”
Cox said faster, affordable internet is only one aspect of building the network, and it could benefit public safety, education and telehealth as well.
“It would be really difficult for them to maintain (lower costs) over time,” Cox said.
The cost of installing the network would be about $2,500 per home if the city achieved a 60% take rate, and he said city leaders shouldn't move forward unless they know they have the commitment from customers.
The plan calls for a three-year buildout of the network.
Mayor Jim Paine said the fiber optic network would be a substantial infrastructure project for the city, but it doesn’t even compare to other infrastructure projects such as streets and sewers the city has taken on over time. The committee will have to carefully plan how to move forward, he said.
“Long-term, it’s not very crazy at all,” Paine said. “Short-term it presents some challenges.”
Councilor Tylor Elm recommended holding the plan in committee to review it more carefully and plan what steps it would take to move forward. A public hearing and community engagement would be next, Elm said.
“The goal here is in order for this to be feasible, we do need to have a particular take rate,” Elm said.
Cox said the surprising result of a survey of Ammon, Idaho, network users was faster speeds or lower costs weren’t the most appealing factor of a community-wide network.
“No. 1 was that I like that I have choices and I have power in the situation,” Cox said. “If I’m not getting good service from my ISP, I don’t call them. I don’t text them. I just cancel my service and sign up for the next one … that was surprising to us honestly.”