Your Cable Dollars at Work!

The following blurb and link were contained in an email eLetter from Southeast Tech Wire today:

o Discovery Acquires Raleigh-based Rainbow Educational Media

Raleigh, N.C. — Discovery Communications, the Maryland-based media

company behind such cable TV stalwarts as The Discovery Channel and TLC,

said on Monday that it has acquired Raleigh-based Rainbow Educational

Media, a publisher and distributor of core-curriculum educational videos,

CD-ROMs and DVDs. A Discovery spokesman said that the principals of

family-owned Rainbow — also known as the Charles W. Clark Company — plan

to retire, with the business being absorbed into Discovery’s current

facilities. Financial terms of the deal were not disclosed.

What’s the connection? Well, Cox is an owner of Discovery Communications, owner of The Discovery Channel and The Learning Channel (TLC).

This just in: Cox still has no plans to build a fiber to the premises network in Lafayette!

Another Letter Alert

In my little crusade to make sure that folks don’t take the recent flurry of anti fiber letters as all that indicative of the opinion of anyone but BellSouthCox folk I give you the latest letter. Though he doesn’t mention it he’s a BellSouth retiree; he said as much in his previous letter. I imagine he retired a while ago since he seems unaware of Voice Over Internet Protocol—VOIP. VOIP is surely the method that LUS will use if its plan goes forward and it involves using none of BellSouth’s resources unless the person you call is a paying customer of BellSouth or one of its lessees. Anyway, those “discounts” aren’t such a good deal anymore. The Ma Bell, AT&T, recently stopped taking new customers in our region due to regulatory changes which will eliminate much of the “discount” the writer complains of. Ma is moving to Cox, among others, to provide its local connection using VOIP as was reported here earlier. (See: Running to Mama for VOIP).

Don’t worry, I’ll get over this silly little bit soon. It just irritates me.

Education Expert Eager to See Lafayette

I went to the Zydetec meeting that featured Don Knezek, covered in the Advertiser story Expert: Technology vital in education and was impressed. Thanks to Zydetec for inviting him. Knezek is an interesting guy and I agreed with most of what he had to say about education and technolgy. A happy thing for me since ISTE, the organization he heads, is tremendously influential in setting standards for technology education at every level from kindergarten to grade 16 (that’s what educators call seniors in college). Part of my job in a former life was to make sure our college of ed could meet those standards for new teachers.

It turns out he’s a fan of broadband and intelligent advocate of settling on what you want to accomplish in education—the vision thing—before buying into particular technologies. That was refreshingly forthright and absolutely crucial to good decision-making. If we decide to persist in the idea that education is about transferring knowledge from one head to another textbooks really are the cost-effective, “proven” solution. It’s only if we decide we want to help students learn to engage in more active learning—the sort of learning that is more like our day-to-day, real world learning than textbook learning, do the richer resources of computation, databases, simulations, and the net turn out to be crucial.

Be as interesting as I found that and related parts of his talk, this blog isn’t about education and what was interesting from a broadband point of view was that this guy is smart, actually really important and, get this, passed up a slot on Jay Leno to come to Lafayette. What drew him was local projects that bring students into more active learning by bring them into the workplace and –you guessed it–the rumors of a large-scale fiber initiative.

If rumors can move a guy like this to visit, imagine the influx of just education folks eager to try out their grants in a large, diverse community. Folks will line up to beg for a chance to trot out the latest ed tech innovations. And that would be a lot of fun, believe me—and not only for the kids.

Slashdot | Municipal Networks as Alternative to Commercial Broadband?

Maybe I am just in a contemplative mood this lazy Saturday morning, posting pieces that are more philosophical than newsy, but it occurs to me that Slashdot might be a good example of the possibilities of wider net access.

(Ensues longish both technical and philosophical discussion, if your day is not as lazy as mine jump to the bottom for the moral.)

Folks love the net but even its most ardent fans will admit that parts of it are pretty juvenile. Folks that are unpleasantly and often baselessly opinionated, for instance, dominate most discussion features. (I trust we are trying to be pleasantly opinionated here. 🙂 ) You can get the good stuff but you have to wade through a lot of silliness to get there. In an earlier post today I dismissed slashdot forums, leaving the implication that they were usually a waste of time. That is unfair and untrue. They are just a LOT and reasonable folks don’t always have the time or energy unless the topic is important to them.

Slashdot is a little preview of what can happen when a community users gets serious about having serious discussions. Slashdot is mostly about technical, web-oriented stuff. So its users are very net-oriented and have had access for longer than any one else. And they have had longer to get annoyed with folks we call “jerks” and they call “trolls”—folks who spoil the discussion. Being technical themselves they set about a fairly technical solution. They decided not to exclude people but to find other ways of keeping the conversation on track.

Update 3:30: The walk-through below is a nice teaching example of how the Slashdot system works. But as content it is old. A newer version of a very similar question asked the Slashdot community, Cities Building Own Fiber Networks, is recent and if you want to browse for information it is a better choice. The information there is a lot fresher. All the principles developed below apply. It might be fun for those not familiar with Slashdot to walk through the example below and then go explore the newer version.

If you’d like to see what I’m talking about open the slashdot fiber discussion in a new window and follow along.

The intro sets up the discussion and at points toward the real issues. Beneath the intro is a interface bar that allows you to change how things are displayed. If you set it up for -1:291 comments, Nested, and Oldest First and click the Change button you will be taken to a new page that starts with the comments. Look at ’em. The very first one is a silly off-topic thing that the someone a crew of folks who have been deputized to keep things sensible have downgraded to a (Score: -1 Offtopic) indicating that it’s offtopic. Looking down a bit you see one labeled (Score: -1 troll) indicating that its a post that is just trying to start trouble. You don’t want all that gradu do you? Go back to the top. Try the other extreme. Change -1: 291 comments to 5: 4 comments. Someone on the rating squad thought these the best. The system isn’t perfect. The first comment is way off base as responses in that thread demondstrate. But third one rate 5 for insightful actually is. Take a gander at it and you’ll see what I mean. (alone in a separate screen if you haven’t been following along) But while the rating system is very useful the adults using the forum do most of the work. They ignore dumb stuff. They point out what is misleading. They dont’ tolerate baseless, ideologically driven nonsense. When they think they are right they don’t back down but argue their point. But calmly, afraid of looking foolish or be downgraded–and hoping to be upgraded and notices as a sensible head. All that stuff is pretty much what we do in everyday life. But the web has been missing those amenities and slashdot goes a good way toward giving them back.

A long way to a short point: Once folks have good, solid net access they figure out ways to make it more useful.

It’ll work the same way here if we get cheap universal access. Once we get used to it we’ll figure out how to make it more useful…and good discussion groups will be the least of it I am willing to bet.

Another View on Natural Monopolies

I was semi-idly noodling around the web following link trails of fiberish stuff when I tripped onto a Slashdot forum discussing Fiber To The Home projects. I have tried to tell myself not to get drawn into reading slashdot discussions unless the need is dire. Hours can disappear into that hole with nothing productive emerging. But I still graze those forums when it is something that interests me and this time it paid off.

Lawrence Lessing, he of intellectual property and constitutional law fame, was referenced somewhere in the middle of that very long page of comments and that link lead to a Wired article written in December 2003. There he presented a very clear discussion of the economics of Natural Monopolies as they relate to municipal fiber. If you’ve looked at my bits on that issue and wondered about the concept and application take a look a Lessing’s differently slanted take. Here is representative paragraph from the middle of the short article (AFN is All Fiber Network):

Most economists would leap from the premise of a natural monopoly to the conclusion that such a monopoly must be regulated. But regulation is not the end that McAdams seeks. Ownership is. If a traditional network provider owned an AFN in a particular area, that network provider, acting rationally, would charge customers a monopoly price, or restrict service to get its monopoly benefit. But if the customer owned the network, then the customer could get the same access at a much lower price and be free of use restrictions. McAdams is pushing – and Burlington and other cities are actually deploying – customer-owned AFNs.

You might think that a municipal monopoly might have the same abusive tendencies that any monopoly would have. But according to Lessing you’d be wrong: you’d be missing the essential point of ownership. He notes: You don’t monopolize yourself.” Straight to the heart of the matter; I admire that. Lessing illustrates the matter by using the example of Boeing’s in-house fiber network. Businesses bring services in-house to save money, increase efficiency and to make sure the services offered meets their quality needs. Its a good deal for Boeing. And exactly the same logic applies to communities. Lafayette can’t monopolize itself. Monopolies act “rationally” (according to that strange conception of rationality found in economics) when they maximize profits wherever they are able. But there is no such motive for the people to exploit themselves.

Lessing caught my eye in the scanning because we have recently received a request to reuse material on this site. We’re for it, of course, and flattered, but realize that the material here is pretty tightly linked to Lafayette. (As are we.) People reusing the material and customizing it for their site run the risk of violating unreasonably restrictive, in our opinion, new interpretations of what is “fair use” of our material. As we realize how widespread the municipal telecom fight is we’d like for people to be able to freely reuse our material. One of the things Lessing is famous for is championing a less restrictive form of copyright called Creative Commons. It’s a great idea that allows people who want their stuff reused to make that clear. So, as soon as we can figure out how to do it, we are putting our material on this site under a Creative Commons license. More when it happens—but suffice it to say that Lessing is a hero of mine and I think well worth reading. He thinks clearly about hard to grasp issues like copyright…and natural monopolies.

Not in Your Front Yard!

CED magazine has an article examing the question of whether DSL (the phone companies’ digital subscriber line technology) can handle the bandwidth requirements of High Definition television (HDTV).

The answer is a definite maybe — depending on the technological paths chosen by the respective providers. Hit the headline of this story to view that article. It’s pretty interesting.

However, the most interesting part of the article was this paragraph which brings us back to the heart of the matter here in Lafayette:

“Though some of the major RBOCs — Verizon, SBC Communications and BellSouth, among them — are pushing ahead with fiber plans that will provide plenty of bandwidth for HD, there are still questions about whether DSL will pack enough punch for telcos that don’t have the bucks to make a big upgrade and, instead, will need to rely on their legacy copper networks.”

Got that?

BellSouth has made a corporate decision that fiber is the future of the company and its services.

The problem for Lafayette is that BellSouth does not now consider us worthy of the fiber to the premises technology.

Every company and every institution has its own hierarchy of priorities which guide its moves. For companies like BellSouth and Cox, these hierarchies help them decide where they will make their infrastructure investments and when they’ll do it.

There is no question that BellSouth and Cox intend to build a fiber to the premises infrastructure in Lafayette. Both companies, left to their own priorities, would one day ensure that their respective fiber systems got to almost every business and home in Lafayette. That’s fine. I have no problem with them moving at a pace which suits their corporate mindset and corporate priorities.

For the foreseeable future, they’ve decided that they are not going to deploy a fiber network through your front yard.

This is the essence of the issue: who has established Lafayette’s interest as its top priority. By their respective decisions not to make the requesite investments in fiber infrastructure in Lafayette, BellSouth and Cox have announced that Lafayette is a nice little market, but they each have higher priorities elsewhere.

This has significant implications for the economic viability of Lafayette. If we accept the judgments of BellSouth and Cox, we are accepting their decisions to relegate Lafayette to a third tier city.

But, there are people in both the public and private sectors here who have higher aspirations for our community. We believe it can thrive. We believe it can grow wisely by harnessing the creative capacities of our people, our businesses, and our institutions through the enlightened use of information technology.

The LUS fiber to the premises proposal taps into and feeds off of that vision of a greater Lafayette.

I believe that this vision flows naturally from the strong entrepreneurial base in Lafayette’s economy. Lafayette is a community dominated by an ownership mindset — at least, our leaders are. Those communities dominated by a managerial mindset fare differently.

Let me explain.

I grew up in Eunice, LA. It’s a small town that has not grown much since about 1970. In the time prior to 1970s, Eunice was dominated by small business owners. While there were undeniable social problems in the town, primarily the relations among the races, the fact is that the business leaders of the community had a sense of a community which was greater than their own personal and business interests, though, no doubt they figured to profit if the local market grew.

In the decades since the 1970s, main street has been decimated and retail activities shifted to malls. Stores in those malls are chains which install managers to run them. Those managers are accountable to the expectations of the home office where ever that may be. That is the case whether the store they manage is in Eunice or in Atlanta.

I think it is difficult to appreciate the impact of this disappearance of the local ownership class on community leadership. But, managers are caretakers; they tend not to be into ‘the vision thing.’

The vision thing, though, is alive and well in Lafayette. It is, in my view, inseperable from entrepreneurship which is by definition forward looking. That is, it is not focused so much on where we are now, but where we might be able to go as a community. Lafayette’s entrepreneurial base fuels the vision of what our community can become.

It is the difference between what LUS sees as the potential of Lafayette and how BellSouth and Cox see that same community.

Running home to Mama for VoIP

New technology is making for some strange telecom bed fellows.

Once a pillar of stability, you now need a live RSS feed to keep up with AT&T’s business models these days.

Consider these moves: AT&T was once THE Phone Company; then became a long distance company; tried to become a cable company and a wireless company; then reversed its course, sold off the cable businesses to ComCast and its cellular business to Cingular; then decided to get into the local phone business; then . . . Well, you get the picture, no?

Well, AT&T has made its current bet on Voice over Internet Protocol (VoIP) technology — that is, carrying phone calls over the Internet. The company has a good bit of experience with data networks, which was really at the heart of its lurch into cable.

With the Bell companies apparently succeeding at getting clearance from the FCC and the courts to raise access rates that they can charge companies like AT&T to access their networks, AT&T has begun to withdraw from the local access market — at least via phone lines.

The news out of the former Ma Bell is that it has struck deals with cable companies to bring its VoIP expertise to the table to help those cable companies develop and deploy telephony offerings.

Cox Communications is one of five cable companies with which AT&T has struck deals.

The point, here, is that while LUS has succeeded in creating a temporary alliance between BellSouth and Cox, it is just that — temporary. The cable companies’ move into telephony has the regional bell operating companies (RBOCs) like BellSouth squarely in the cross-hairs. It will be interesting to see how this alliance handles the strains of the fierce competition between its members.

New Poll Less Pushy

There’s a new Cox poll out there and it appears to be less pushy than previous Cox efforts. This one, put into the field by well-established Louisiana political pollster Kennedy looks like it might actually be a real poll. Or at least the first part of it. —The second part was comprised of Cox floating a series of talking points past the virtually assembled test panel to see what might work to turn the Lafayette public away from LUS. And they aren’t telling you what they found there. As you will see they need the info. Poll results are mixed for the company paying.

The Advocate appears to have scooped local media, currently completely embroiled as they are with the school bus mess. (And a mess it is.) A quick survey of local media outlets reveals not a clue.

Reporter Blanchard shares his trademarked incisive lead:

Most people in Lafayette want to vote on whether to allow Lafayette Utilities System to enter into the competitive telecommunications business — but that doesn’t mean they’d necessarily vote against the proposal, a pollster said Wednesday.

That’s pretty much the whole of the content in a nice, neat packet. But if you want the details here they are:

Kennedy surveyed 600 registered voters in Lafayette Parish on June 24-26. The poll had a 4 percent margin of error.

Hmmn, that should be a clue that not all is well with this poll for Cox. June 24-26. It took going on two months to compile this survey and run the stats? Not. Nah. No Way. They sat on it. Why? It wasn’t exactly everything they wanted to hear. Read on:

About 78 percent of respondents said they have heard of the LUS proposal.

Sixty-four percent said they had a favorable opinion of the LUS plan — while only 21 percent said they are not in favor of the plan, Kennedy said.


Fifty-four percent agreed that government “should be in business competing with private business,” while 34 percent disagreed with that statement.

But when asked if the final decision should rest with the “city-parish council” or “the people,” 83 percent chose the people, Kennedy said.

Now those last two findings are pretty amazing. The questions they respond to drift over into being leading ones but retain that patina of legitimacy that Kennedy has no doubt honed while serving candidates for political office. Given the phrasing and the push to delegitimate the very idea of a local telecom utility on this “free enterprise” basis, finding that 54% favor government competition seems like evidence that the people of Lafayette know that they want fiber, recognized how that question was supposed to manipulate them and refused to be so driven. Put the same question before a group that didn’t know what it means in our context and I dare say that about 98 percent of all Americans would give the pure “no competition” answer. When folks begin to take ‘unnatural’ positions like this you gotta think opinion is solidifying. And not in favor of Cox and BellSouth. The council will be less happy with the findings of that last question, though. It puts pressure on them to call an election or it least it gives fiber opponents something to bash them with. How to reconcile the responses to those last two questions? Here is the simple interpretation: The citizenry apparently know what they want and they want to let everyone know they want it. I’m willing to bet that Cox has come to that conclusion too.

The Council is rightly worried about what an election campaign would look like. After all we are going through one of those right now and it isn’t pretty. They have already witnessed exactly how far Cox and BellSouth are willing to go in misrepresenting the case they put before the people. Everyone form the Council to the Mayor to Chamber of Commerce has been given cause to be angry. But this is not just a local fight and the tactics that have angered people locally are not particular to Louisiana. This kind of public relations war has gone on all over the country. And it has been very ugly. (Sneak Preview: LafayetteProFiber is working on a piece based on another community’s experience with teleco tactics even now.) One of the great ironies of our little fight is that Cox has been very vocal about supposed unfair “government” advantages. But what it wants to do is drive the battle to a vote where all the advantages are its. To fight the good fight in an election battle the city would have to buy time on the cable networks. LUS would hate giving money to the enemy. And how much would it cost Cox to saturate the airwaves with Fear, Uncertainty, and Doubt? Nothing. Cox’s positions aren’t about fairness. They are about advantage.

Cox does have alternatives. It could force a vote if it wanted to. It could rouse the (not so) restive citizenry and stage a petition drive. They would only need 15% of the voters to do so. Yet there has been no move in that direction. Why not? Go back and review those polling numbers. No support. They people want fiber; they even want to vote for it. Getting those numbers won’t be at all easy. And failing in a petition drive would be fatal.

So they want to shift the battle to their own turf: an advertising campaign. Where they own significant portions of the media battleground.

But go get the story and decided for yourself.

Another Cox employee makes mean

Ok, let me say from the outset that this is a little petty. Folks have a perfect right to say just exactly what they (or even their employer) want to.

(Grumpyness on)

Still, I am irritated each time I take a look at a letter to the editor or go to a public meeting and find that as far as I can tell the vast—and I do mean vast—majority of those that speak out against Lafayette even thinking about treating fiber optics as a utility are employees or retirees of Cox or BellSouth. You have to wonder what is in the employee’s and retiree’s newsletters. if you assume, to be fair, that these folks will be more interested in the still-abuilding plan than their neighbors because they have a horse in the race you would still think that a few of them would see the advantage for the community that a majority of Lafayette residents apparently do. Is there a reason that fraction doesn’t speak up? …You say you think it matters that their employers might not like it? And you can really understand that? …Yup, I agree, and to keep up the fairness I also think it matters for those that speak against the idea that they think their employers will be pleased.

What motivates this little bit of spleen is that we have in the Advertiser today another bit of meanness from a Cox employee who doesn’t share the fact that he is an employee with the readers. In this one he trash talks the character and intelligence of Broussard’s Mayor Langlinais. (Missed that letter? It was good–but you won’t find it online; the advertiser is missing that day’s letters. But you can get it from us.) Why do I think Steve Puckett is a Cox employee? Because he said he was at a Lafayette City-Parish Council meeting. Nor is this his first such letter: I’ve found two more in the Advertiser archives. And, to give the devil his due, in one of them he does own up to his employment.

In the normal course of events I’d probably sit down, eat breakfast, recognize that people unfairly insult public officials all the time and decide to let this one pass without posting. But this one is going in for a simple reason: I’d like our readers to start noticing the percentage of anti-fiber voices that are paid by the telecoms. Letters to the editors, public meetings, and even the infamous “Academic” forum are all populated by paid voices. If you don’t pay close attention you might be tempted to think that there was substantial dissension among Lafayette citizens. Maybe, though I doubt it. But what you see in these venues is as poisoned by the corporations as the results of those push polls and is not fair evidence of widespread concern with a popular utility.

Make up your own mind—and be aware of the interests of those speaking. Listen, but be aware of who you are listening to.

OK, I feel better now.

(Grumpyness off)

All that said I want to note for the record that not all employees of telecoms strike me as making unfair cases. LafayetteProFiber recently received an email from a wireless employee opposing fiber that was well thought out, respectful of people and the community, and used his specialized knowledge to raise concerns well worth worrying about. I spent half a day going over in my mind how I would talk about fiber with a principled opponent of the idea. That was a refreshing change and I was grateful for the opportunity to think about the issues with that assumption.

Are We a Nuisance or a Competitive Threat?

According to a telephony online article municipal telecom utilities are moving from being regarded by incumbent teleco and cable companies as mere nuisances to being recognized as competitive threats. This is the best analysis of the complex emerging issue that Lafayette is embroiled in that I have yet seen and explains, at least in part, the passion we have seen on the part of incumbent companies. (Another part of course is simple money. See Mike’s posting on that issue. A 30-40% profit margin? You do the math.)

The Threat

Here is what they have to say about why the attitude toward municipal fiber is changing:

Once considered merely niche players in smaller telecom markets incumbents didn’t care about, municipalities are announcing fiber buildouts with greater regularity in increasingly larger markets already served by telcos and cable operators.

Incumbent providers downplay the big-picture threat but are adamantly lobbying against municipal entry into the telecom market at every level of government, with good reason. In addition to philosophical arguments regarding governments competing against the private sector, the last thing the struggling telecom industry needs is to have to match prices with deep-pocketed competitors that have access to cheap capital and — most importantly — no requirement to turn a profit.

Notice how neatly this tracks our experience in Lafayette. The infamous SB 511was

BellSouth’s instant response to the impudent suggestion that Lafayette might consider building a fiber utility.

The History

As Joey Durel has emphasized from the begining the appropriate comparison here is the role municipal utilities played in electrification of their communities—and the demonstrated benefits of electrification for the communities that had the courage to take the risk. Their recounting of the same historical moment tracks Durel’s closely:

There are “remarkable parallels” between the electrification of America in the 1890s and the transition to “true broadband” in the United States during today’s information era, Baller said. In the 1890s, private electric companies focused their investments on urban areas that offered greater profit opportunities. Many municipalities that didn’t fit this criteria eventually decided to establish their own electric companies.

Baller said the arguments against the creation of municipally owned electric companies were similar to the arguments posed by critics of today’s municipal forays into telecom — most notably, that cities lacked expertise in the field and that the governments should let the free market run its course. History proved those arguments wrong, Baller said. Today, there are more than 2000 municipally owned power companies that have withstood the test of time much better than cities that literally were left in the dark, he said.

“Many cities that waited for the private sector to serve them became dust,”


For even more parallels to Lafayette’s situation pay close attention to the discussion of iProvo a municipal project to build a fiber optic network in a college town of 100,000. The telecos and cable companies are especially bitter about municipal networks being built where they are currently making real money. They even called on the same Progress and Freedom Foundation that provided an “expert” for Lafayette’s “Academic” Broadband Forum (see our pregame analysis, with special emphasis on the “experts” or indulge in our postgame report) in to declare iProvo’s plan as impossible as his colleague declared Lafayette’s.

Lafayette. You didn’t think they missed us, did you?

On of the things that the private providers claim—and really seem to resent—is that public entities don’t have to make a profit. But it isn’t really true that private entities don’t have to make a profit and they know it. What they mean to say is that public entities don’t have to do any better than break-even. Their profit can be small, and the owner-customers of a utility will likely prefer it that way. That is what they really resent. (Again, see Mike’s story for the real skivvy on cable profits.) It seems that the “flexibility” (read: willingness to not skin the consumer) that this service orientation leads to really makes teleco’s uncomfortable. The reporter catches Louisiana’s Oliver in an unguarded moment:

…that flexibility also makes it hard for private-sector providers to compete in a territory where there’s an effective FTTP deployment, according to Bill Oliver, president of BellSouth’s Louisiana operations.

“It’s like, which math course did I miss?” Oliver said of the accounting for some municipally owned telecom ventures. “It looks like they’re losing money, and they still haven’t paid for a truck to roll or someone to answer the phone.

“It makes it difficult for a private company like BellSouth to compete with a governmental entity that’s only goal is to break even.”

Oliver’s position here, that it is somehow unfair for other providers not to labor under the same disabilities that he does, is reminiscent of Cox’s desire that Arizona tax satellite TV providers into competitive equity with them. Or BellSouth’s strange demand, now eshrined in Lousiana law, that municipal providers like LUS be forced to prove to the Louisiana Public Service Commission that they calculate what they charge their citizen/consumers as if they were leasing their own right of ways and poles the way BellSouth does. (See an earlier entry of mine that goes on at length on this strangly anticompetitive attitude.)

Open and Closed Systems

One of the issues that divides proponents of municipal broadband networks is that of whether the new network should be open or closed; whether the municipality should open up the network by leasing access to competing retail providers or whether the local municipality should take a more conservative, closed, route (the same conservative route both cable and telecos take with regard to their networks) and provide services to its citizens directly. The virtue of open systems in the eyes of its advocates is that the consumer will presumably benefit by lower prices and a richer array of new services brought on by competition. The virtue of closed systems in its proponents opinion, is in a word, safety. You own the network, you offer a good service and because you know that profit levels in, for instance, cable are high you know you can both please the public and have room in the pricing to build up a cushion for future development and to deal with unanticipated problems. You also don’t have to split your profits with the retailers on your system. Closed systems are arguably the safe, “business plan,” model.

Iprovo and its big brother the Utopia project, which links small cities and towns in Utah, are taking the open route.

Lafayette is not:

Huval, the hard-nosed reaction

Huval said there’s no timetable for LUS to make a decision, but he said the organization wouldonly make the investment if it offers a voice-video-data triple play. In addition, Huval said he does not believe the LUS would make its network open to all service providers.

“The idea of open access is nice, but does it pay the bills?” Huval said. “The problem with open access is that the driver of [broadband] penetration isn’t the entity that has to pay the debt service.”

And whether municipal entities can at least break even on their fiber buildouts remains the biggest question. Incumbent providers are skeptical, but Baller said adoption rates for some community networks offering triple plays have legitimized the UTOPIA projected take rates. But both public and private proponents agree that it’s too early to estimate the impact municipally owned networks will have on the telecom market.

I’m an admirer of hard-nosed, realistic plans. And, readers may have noticed, pretty clearly an admirer of idealistic, hopeful plans. I’m torn. A reasonable point that the proponents of open systems sometimes make is that while fiber, and the true broadband capacity it offers are a good bet, the particular services that are offered are less certain. For instance real broadband might end up destroying the cable model–and a leasing plan would offer a more nimble way to switch to video downloading if that is the path the future takes. Maybe. But I am not sure why LUS couldn’t mix models. Keep the basic three services, phone, TV, and Internet, and use that revenue to make sure the cost of the build is absolutely secure. Pledge to make a fixed percentage of the bandwidth available to lessees. There will be plenty of bandwidth available, especially if Lafayette goes with an active, ethernet-based system (please!) and forcing yourself to always keep plenty of “spare” bandwidth would not be bad discipline anyway—my guess is that the easiest “business” mistake to make would be, contrary to what the incumbents tell us, to underestimate demand. We simply have no models of what might happen if network effects take hold once true bandwidth is universal and cheap. (Network effects you ask? Discussed here.)

Hey, LUS, if you are out there. You need to start talking with folks about things like this. Before your plan is set in stone.