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« Needleman Argues for Free, But Commercially Sensible, Wi-Fi | Main | Atheros Has Single-Chip PCI Express »

April 25, 2005

Fairer Debate over Minneapolis Muni Plans

The debate is much more reasonable in tone between differing parties in the opening days of Minneapolis's RFP: Unlike the Philadelphia plan, which was widely and inaccurately criticized for months before its release--and which criticism hasn't been updated to reflect the plan's real content--the Minneapolis RFP is provoking more reasoned discussion among debaters of the merits of muni networks.

This interesting piece in the Minneapolis-St. Paul Business Journal reminds local residents once again of an ill-fated plan set in 2000 for Time-Warner Cable to build out a fiber network. That work hasn't happened and Time-Warner won't comment on it. But they might bid on the new municipal plan.

The city's network planner, Bill Beck, said 20 companies have already responded with queries for the proposal in which no public money will be used and the network will be entirely privately owned. The city will give the network its telecom business and provide what appears to be preferential access to buildings, poles, and other facilities necessary to build out a wireless and fiber optic network.

I say this debate is more reasonable because Braden Cox of the Competitive Enterprise Institute provides what I would argue is not a strawman argument noting that there isn't an economic imperative in MInneapolis. It's not in the same state of broadband availability as Philadelphia. That's indisputably correct. Cox is interested in the Minneapolis model, too, as it "doesn't risk any taxpayer money..."

Steven Titch of the Heartland Institute, a group I have regularly criticized for not revealing any (if any) ties to incumbent telecom firms and for releasing a broadband report with a group that is owned by Issue Dynamics (whose clients include most major telecom firms), makes his usual argument here: that hotspots don't attract business travelers. But Minneapolis's plan calls for limited hotspot Wi-Fi; it's all about residential and business use, and includes fiber optic as part of the plan.

He objects that the technology isn't quite there and the timetable is ambitious. I'm finding more and more that I am agreeing with the "wait a little while" approach. With the emergence of faster and cheaper standards to the market, I'm not sure that a network planned today and ready in two years will represent the state of the art except on the fiber-optic side which requires so much more physical work to build out. It's possible that the city could fully realize the fiber optic part first with its private partner and delay the wireless part until the backbone timeline was set. That won't cost them more money--except in increased labor costs which should be offset by reduced equipment cost.

Esme Vos points out, however, that similar networks have been built in Europe and have proved that competition from municipalities has spurred cheaper prices and higher speeds.

I'm particularly interested in whether a city-franchised entity can be put together in such a way that it doesn't have discriminatorily low rates for facilities--meaning that no other competitor could afford to build a similar network if they so chose--and that it becomes a third choice alongside cable and DSL. If you could have a city-backed but not owned network plus the duopoly in place and add onto that TowerStream and other business-oriented broadband wireless firms and a handful of smaller residential firms--that could be enough competition to spur innovation, higher speeds, and lower costs.

The entrenched interests may find themselves operating more trenching tools if the multiplicity of options continues to grow.