The study's methodology of comparing only the lowest-priced tier service isn't that great, because it may be more indicative of the degree to which a provider is willing to cross-subsidize service tiers rather than real cost efficiencies. To take the top 3 providers from the chart on page 8: FiberNET in Morristown charges $200 for gigabit, Sebewaing Light & Water charges $160 for 1000/100, and LUS charges $109 for gigabit. The "market rate" for AT&T/VZN/CenturyLink is $70-90 (excluding promos).
There is also the question of what happens going forward. Quite some time ago, Easton MD (on Maryland's eastern shore) put in a cable internet service through its municipal utility. Today, you can get 200/10 for $100/month. Not bad, but head a bit east to Salisbury, MD and you can get 1000/35 through Comcast for $105 ($80 for the first year). That's the big fear with municipal services. Upgrading head ends won't get you press like rolling out a broadband service in the first instance will.
That being said, municipal broadband certainly has a place. Maryland is spending a bunch of money building a fiber backbone in the rural parts of the state, and municipalities are hooking into it: http://www.westminstermd.gov/419/Westminster-Fiber-Network. These are places that don't have the population and density to support potentially even a single private provider, much less multiple competing ones.
> Today, you can get 200/10 for $100/month. Not bad, but head a bit east to Salisbury, MD and you can get 1000/35 through Comcast for $105 ($80 for the first year). That's the big fear with municipal services. Upgrading head ends won't get you press like rolling out a broadband service in the first instance will.
A counterpoint to your argument is Time Warner didn't improve speeds or customer service until Google Fiber started building in Kansas City. Only a few ISP's serve large parts of the country. If they can ignore you while getting monopolistic profit, they will. Building a locally owned competitor might be the only way for lower tier cities and communities to get the gigabit fiber and proper customer service that is so attractive to techies like me.
Edit: Now that I think about it. I have only seen your 'fear' come up once. With Provo's locally owned fiber, which yes, they seemed to have bungled. They did get Google to come and take it over. Many other places have done so much better. Noah from AskNoah/Jupiter Broadcasting lives in Grand Forks, ND. When they had a flood that required them to redo the sewer system a decade ago they put in fiber and now have gigabit internet to residents.
Purely personal, but if my only options in Easton, MD were the municipal and Comcast, I'd probably choose municipal. The 800Mb speed doesn't make up for the fact it's Comcast and their horrible service.
I pay $85.99/mo for Fios for 25/25. I started out at about $54, and they've been bumping it up. I called and complained, and they said that's the best rate.
As an existing customer, I cannot get the "gigabit internet for $79" rate that's advertised on the website. That $70-90 rate for Verizon is the promo rate, because it will go up over time after you join.
Ok, so I can switch to Comcast, and get the $44 rate for a year, and then switch back, but that sounds...dumb.
On this specific Verizon issue - you can set up a "move" with Verizon on line even though you're moving to the same address and you can get the nice gigabit deal. Search for the details. I did it. I was surprised it worked. Nice reduction in cost and better speed.
I've had issues with Verizon letting me get the "New Customer" specials after cancelling then re joining. They wouldn't give me the deals (even though they mailed me them) because I had already had service through them.
Always the dumbest part of their business model - reward switchers and screw your customer base unless they threaten to leave, then give them the same deal (maybe).
> The study's methodology of comparing only the lowest-priced tier service isn't that great, because it may be more indicative of the degree to which a provider is willing to cross-subsidize service tiers rather than real cost efficiencies. To take the top 3 providers from the chart on page 8 ... LUS charges $109 for gigabit. The "market rate" for AT&T/VZN/CenturyLink is $70-90 (excluding promos).
AT&T's 1000/1000 in Lafayette is $80 with promo rates/$90 without, plus a $180 ETF and data caps (though removing the cap for free is often part of a promo deal). However, it doesn't match LUS's coverage area yet.
The next-fastest active residential service in Lafayette today is Cox 300/30, for $80 with/$105 without promo rates.
Closer to even offers, LUS's 100/100 is $50 with/$63 without promo rates, AT&T's 100/20 for $60/$70 + $10 per 50 GB over 1TB cap ($90/$100 without data caps), and Cox's 100/10 is $60/$85.
Cox doesn't compete with LUS's 60/60 plan; their next plan down is 30/3 for $40/$64. AT&T's 75/10 DSL is $70/$80 with data caps.
Some of these community fiber networks also do financing with a balloon payment at the end of 20 years. That makes them look cash flow neutral or positive on an annual basis while they are actually losing significant money.
There is also the question of what happens going forward. Quite some time ago, Easton MD (on Maryland's eastern shore) put in a cable internet service through its municipal utility. Today, you can get 200/10 for $100/month. Not bad, but head a bit east to Salisbury, MD and you can get 1000/35 through Comcast for $105 ($80 for the first year). That's the big fear with municipal services. Upgrading head ends won't get you press like rolling out a broadband service in the first instance will.
That being said, municipal broadband certainly has a place. Maryland is spending a bunch of money building a fiber backbone in the rural parts of the state, and municipalities are hooking into it: http://www.westminstermd.gov/419/Westminster-Fiber-Network. These are places that don't have the population and density to support potentially even a single private provider, much less multiple competing ones.