Christopher Mitchell: Rochester makes smart move by evaulating Internet options
As a budding computer geek in Rochester Mayo High School in the mid '90s, I remember the early days of the public Internet. I was among the first to use it to research school papers and, more importantly to me then, spent hours upon hours figuring out how to play multiplayer games across it.
Ever since, the Internet has played a big part of my life and for nearly 10 years, I have worked with communities throughout the country to expand the highest quality Internet access possible to their businesses and residents. Last year, I got to shake President Obama's hand after working with the White House on policies to improve access throughout the country.
He flew to Cedar Falls, Iowa, to congratulate them on building their own network, the first citywide gigabit network in Iowa. The network has been a wild success, spurring private sector job growth, improving services while lowering prices for subscribers, and was financed by private investors who were repaid by those who subscribed to the network.
Cedar Falls was attacked by critics, who were usually funded by the phone and cable companies that feared other communities encroaching on their monopolies. But with 20 years of impressive results, it is hard to imagine how they could be more successful. Despite competing against CenturyLink and Mediacom, the overwhelmingly majority of businesses and residents choose to take service from the local option — Cedar Falls Utilities.
Going back 20 years in Rochester, anyone could become an Internet service provider. You had buy some modems, lease a few telephone lines and set up a billing system. But today, after a series of deregulatory decisions, a few big cable and telephone companies basically control all high-speed Internet access in the U.S.
Building a network now requires a major investment, which is why there is so little private-sector competition.
According to the Federal Communications Commission, 3 out of 4 Americans only have one choice of high-speed Internet provider. If you hear claims that Rochester has many providers, dig deeper. Those statistics are aggregated, which means that while you could have four different providers in a single neighborhood, most homes probably only have access to one or two of them.
Another challenge that Rochester faces is that some nearby communities like St Charles have HBC, a private provider from Winona with an excellent reputation, that is expanding a gigabit fiber-optic network throughout smaller towns in the region. Those communities will increasingly draw high-tech people out of Rochester, trading a commute for far better Internet access.
At the Institute for Local Self-Reliance, we are tracking more than 450 local governments that have made some kind of investment in better access. Some, like Cedar Falls, took on greater risk and debt to rapidly build a citywide network. Others, like Auburn in Indiana, adopted an incremental, multi-year approach.
The vast majority of those communities have a municipal utility like Rochester Public Utilities. The expertise and trust built up by those utilities over 100 years of dedicated service are hard to replicate overnight.
However, some utilities and many cities without municipal electricity have looked to partner with independent firms to expand access. In Huntsville, Ala., they teamed up with Google. The city utility builds the fiber, and Google will offer services across it, on a non-exclusive basis. Rochester may find a local partner excited about a similar arrangement. And the beauty of owning the fiber publicly is that if a provider fails to perform, the community can seek a new one.
None of these approaches comes without risk — but then, many communities have found that doing nothing is an even greater risk. Just don't let anyone fool you into thinking the choice is between borrowing $67 million and doing nothing.
Rochester should continue examining its options and decide on the best step forward for it as a whole for the long term. We all want a solution to meet our needs in the near term, but as RPU demonstrates, smart investments can continue benefiting the community decades upon decades later.
Christopher Mitchell is the director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance in Minneapolis. He is on Twitter @communitynets.