Tag: private companies

While the telco/cable lobbying war to make muniwifi illegal has died out (as demonstrated by the most recent defeat for the telco/cable lobbyists in North Carolina), the debate on the actual merits of munibroadband lives on. And it’s a good debate to have. States, cities and local governments should consider their projects carefully. What works in St. Cloud, Florida or Philadelphia will not necessarily work elsewhere. And, with all the possible goals of a muni system (service to residents, service to muicipalities, public safety, digital inclusion, enhance local media, economic stimulus), it is a sound idea to have figured out your benchmarks for success in advance.

Unsurprisingly, those generally opposed to government providing services (particularly where such services are available or could be available from private companies) have spent much time and effort arguing that municipal broadband projects usually end as costly failures. These analysis generally use the standard economic criteria of a for-profit business. i.e., Does the network pay for itself over expected time?

That’s an important question, particularly if a government has made this a goal of buiding the network or if you are a private business looking at a public/private partnership. But governments often make investments in infrastructure or provide services on a residential or subscription basis for other reasons. Here in DC, for example, no one pretends that the City will directly make back the hundreds of millions of dollars spent to attract a professional baseball team. This cost gets justified on the grounds that it will revitalize the Anacostia waterfront area, serve as a source of civic pride, and offer additional benefits that justify the cost.

Which brings us to the performance of Minneapolis muniwifi network in the recent bridge collapse diaster. The presence of the network proved an enormous boon to public safety and the citizens of Minneapolis. Because the city had deployed the network for residential service, it was there when they needed it for public safety. That’s difficult to capture in a balance sheet, but there’s no doubt you’re damn glad to have it when you need it.

Of course, local governments can always build public safety muni networks. And many do. But multiple use networks (like the Minneapolis one) are a good way to fund such networks, make sure they get fully deployed, and make sure they stay upgraded and operational. A town reluctant to spend money on public safety communications (and many are) may feel better if the public safety network will also provide low-cost connectivity to poorer neighborhoods. Alternatively, a town might feel better about providing residential services at a possible financial loss if they look on the network as also providing critical infrastructure for emergencies.

At the end of the day, every local or state government looking at municipal broadband needs to do a careful evaluation and figure out what it wants and how it will pay for it. The business case is an important piece of that, especially if local governments promise their citizens the network will end up paying for itself with subscriber fees. But the tragedy in Minneapolis provides an important reminder that local governments have other measures of success besides turning a profit.

Stay tuned . . . .