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Making IT Work for Municipalities:
Building Municipal Wireless Networks
Matt Stone
Senior Partner
Civitium, LLC
902 Huntington Chase Circle
Warner Robins, GA 31088
Phone 478-447-2944
[email protected]
www.civitium.com
Carleen Maitland, Ph.D.
School of Information Sciences & Technology
The Pennsylvania State University USA
phone: 814-863-0640
[email protected]
Andrea Tapia, Ph.D.
School of Information Sciences & Technology
The Pennsylvania State University USA
phone: 814-865-1524
[email protected]
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Making IT work for municipalities:
Building municipal wireless networks
Matt Stone¹*, Carleen Maitland², Andrea Tapia²
¹ Senior Partner, Civitium, LLC, Warner Robins, Georgia
² School of Information Sciences & Technology, The Pennsylvania State University
Abstract
The lack of widely available, affordable broadband Internet access has spurred a
movement in which municipalities are rolling out wireless broadband networks. This
movement has raised a number of questions including: Why are municipalities acting as
the early adopters of wireless broadband technology? How does increased state
regulation of municipal broadband networks affect this trend and how can cities respond?
As cities use wireless broadband technology to enhance services to citizens, the growth of
municipal wireless deployments has transitioned from linear to exponential. In response,
many states have passed laws to regulate and restrict cities' ability to own, operate,
deploy, or profit from either telecommunications or information services. Current and
pending laws will be examined to understand how cities can deploy a wireless broadband
network under these regulations. An analysis of municipal facilities and technology
expertise illustrates the opportunity for public-private cooperation in wireless
deployments. This paper will show that cooperation is beneficial in many cases. Finally,
current business models will be examined for their ability to foster cooperation between
the public and private sectors, bridge the digital divide, and create competition among
private sector providers.
Corresponding author. Tel.: +478-447-2944.
E-mail address: [email protected] (M. Stone).
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1. Introduction
As the Internet increasingly becomes a cornerstone of American life, the
transition from dial-up to high speed access has taken center stage. This transition is
reflected in recent statistics that found 55% of all adult Internet users - or 34% of all adult
Americans, subscribe to high-speed Internet connections either at home or on the job.
Secondly, 39% of adult Internet users - or 24% of all adult Americans - have high-speed
access at home, an increase of 60% since March 2003.1 High speed access can make
Internet use more enjoyable and can lower the threshold to further integrate it into
peoples’ lives. This is likely to result in Internet content (richer web sites, voice, video,
etc.) being geared toward high bandwidth users.
As broadband access increasingly becomes a necessity, greater attention is being
placed on whether access is universally available and affordably priced to avoid a
deepening of the digital divide. The digital divide refers to "the gap between those who
have access to and can effectively use information technologies and those who cannot."2
While the US has made significant gains in broadband adoption, a first step in closing
this gap, it still lags far behind other countries.3 For example, among industrialized
nations, the US is ranked 10th in per-capita broadband penetration, trailing such countries
as South Korea, Canada, Japan, and Sweden. The US also trails these countries in terms
of the average speeds available over their broadband connections.4 Recent commentary
has characterized US broadband among the “slowest, most expensive, and least reliable
in the developed world, and the United States has fallen even further behind in mobilephone-based Internet access.”5
4
These dismal statistics have not gone unnoticed. President Bush recently
announced that he wants to make universal, affordable, broadband access available by the
year 2007.6 According to the President, broadband connectivity guarantees "that we have
access to the information that is transforming our economy.”7 To achieve his goal, the
President ordered federal agencies to streamline the process of granting broadband
providers access to federal land, to deregulate fiber-optic connections, to develop
specifications for broadband over power lines, and to curb taxes on Internet access.8 It is
unclear, however, the extent to which these initiatives will address the root cause of the
problem.
The slower adoption of broadband service in the US is likely due in part to high
prices.9 Prices for broadband access via wired media (DSL or cable) have steadily risen
to hover around the $50.00 per month mark, making broadband connectivity too
expensive for many lower income households. According to Mark Cooper of the
Consumer Federation of America, “Cable rates continue to rise at three times the rate of
inflation and "bundling" products and services is costing subscribers an estimated $4.5
billion a year” (2004, p. 10). In addition, the two trends of consolidating service
providers and the bundling of services into high cost packages will ultimately mean fewer
provider choices and higher prices for consumers. The consequences of these high
prices, as noted by New York City Council member Gail Brewer, are limits on the
economic potential for residents, businesses, and non profits of New York City.10
Policies concerned with universal access to telecommunication services, including
Internet access, exist at the federal, state, and local levels. Such efforts follow a long
tradition of “universal service” programs that attempt to provide low cost
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telecommunication services both to low income persons and those living in areas where it
is costly to provide such services (i.e., rural areas). At the federal level, Internet access is
subsidized to certain schools, classrooms, health care providers, and libraries through the
universal service fund, which is administered by the Federal-State Universal Service Joint
Board (Prieger, 1998). Additional efforts at the state levels include programs to improve
the benefits of Internet access (see Strover, S., Chapman, G., and Waters, J., 2004) and
tax incentives for fixed line operators to deploy broadband “last mile” networks.
However, together these efforts have been insufficient to guarantee ubiquitous low-cost
broadband access. One likely reason for this is that these programs are implemented
through the incumbent local exchange carriers (ILECs) rather than directly through
potential users of the technology.
A second possible reason current policies fail is also related to the focus on the
carriers. ILECs are typically large, established companies that face the innovator’s
dilemma (Christensen, 2003). As such, they tend to concentrate on meeting the needs of
their current customers with sustaining technologies, pursuing strategies that have led to
past successes instead of focusing on innovative new services. The need for greater
innovation in broadband has been publicly acknowledged by the FCC in its recent
broadband ruling11, although it will be some time before it is evident whether or not
relieving ILECs of common carrier obligations regarding broadband results in greater
innovation. To date, they have yet to take advantage of new wireless network
technologies that create the possibility for widely deployed, inexpensive broadband
access.
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These new wireless technologies, namely Wi-Fi (wireless fidelity or 802.11a/b/g)
and WiMAX (802.16), enable broadband Internet access without requiring a spectrum
license from the FCC, such as is required for cellular telephone service providers.
WiMAX is a wireless standard designed to extend wireless Internet access across greater
distances, as well as to provide last mile connectivity to an ISP or other carrier. These
technologies enable networks to have a wireless last mile solution and will be especially
useful in bringing broadband access to low density areas. Similar to wired access such as
DSL or cable, Wi-Fi can provide connection speeds of up to 54 megabytes per second.
However, unlike wired infrastructure, wireless networks do not require “last mile” fixed
connections, which account for much of the high cost of deploying and maintaining wired
networks. While early use of wireless technologies such as Wi-Fi was targeted at local
networking for homes and businesses, it is evolving to support metropolitan areas,
granting high speed Internet access to address the needs of mobile users.
Thus, municipal governments are attempting to provide broadband Internet access
in a context where access is becoming essential, and yet, Americans face relatively high
prices for it as compared to other industrialized nations. These municipal actions have
provoked a flurry of responses from concerned constituents, fixed line operators, and
state legislators, and raise question such as: Why are municipalities acting as the early
adopters of wireless broadband technology? How does increased state regulation of
municipal broadband networks affect this trend, and how can cities respond? Why are
public-private partnerships a beneficial means of offering municipal broadband? What
business models can be used to facilitate this?
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This research paper addresses these questions through an examination of current
activities at the municipal and state levels. The paper begins by examining in greater
detail the incentives for municipalities to offer wireless broadband service, as well as the
challenges. Subsequently, the strategic response by incumbent local exchange carriers
(ILECs) and state legislatures are discussed. This is followed by a discussion of various
business models that have been proposed or implemented, including a model that is based
on a public-private partnership. The paper concludes with a discussion and suggestions
for future research.
2. Incentives for municipal broadband deployment
Given the circumstances presented above, there are certainly adequate public
interest grounds for municipalities to consider offering wireless broadband. As a public
entity charged with providing high quality services for citizens, some municipalities feel
compelled to act. However, undertaking such a project requires consideration of a wide
variety of issues, many of which can be broken down according to the dual role of the
municipality as both provider and consumer of broadband access (Gillett, S. E., Lehr, W.
H., & Osorio, C., 2004).
It should also be noted that municipal provision of broadband may achieve a
variety of goals. Recent initiatives underscore an intense focus by municipalities to use
wireless broadband to strengthen economic development, promote digital inclusion, or
improve the efficiency of government services. These goals can be accomplished in
many different ways. Such a project might be limited to offering free Wi-Fi access in
parks, downtown areas, and/or pedestrian malls to attract businesses to blighted areas,
providing low cost broadband access and hardware in low-income neighborhoods, or to
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allow municipal employees to receive daily assignments and submit reports via the
wireless network. In the latter case, the city may earn no revenue to offset the cost of
investments from the project, but instead may realize cost savings and new efficiencies.
Revenue generating projects might include making broadband access available to
businesses or residents for a fee or providing wholesale access to firms who then sell the
business and/or residential access themselves.
2.1 Municipality as wireless broadband provider
There are several reasons for municipal entry into the market for broadband
service provision. The first is simply that the technology now makes it possible. FCC
regulation of wireless broadband technology has been extremely limited as the
technology has matured. Through the creation of the Wireless Broadband Access Task
Force, the FCC has proactively worked to remove obstacles to widespread deployment.12
The only substantive regulation on wireless broadband devices comes from FCC Rule
Part 15, which governs wireless devices that operate in the unlicensed spectrums.13
Cities most often use unlicensed spectrum solutions for public access networks since the
only alternative is licensed spectrum, which is auctioned by the FCC to private providers,
often for billions of dollars.14 Part 15 requires that users allow interference on the
network and that wireless devices that utilize unlicensed spectrum are regulated in several
areas, including directionality of device, type of device, and power usage.15 The FCC
continues to revisit Part 15 and the 2.4 GHz band through rule changes intended to
increase the effectiveness of unlicensed spectrum. The FCC has also reserved the 4.9
GHz band for wireless networks dedicated to public safety at the local level. As a result,
municipalities are able to leverage both the unlicensed spectrum and spectrum reserved
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for public safety to support a metro-scale wireless network. This low barrier to entry has
motivated many urban and rural municipalities to explore deploying wireless broadband
technology.
A second incentive for municipal broadband deployment is that filling the gaps in
affordable broadband access will necessarily vary by locale. The identification of
appropriate solutions must take into account local variation in what is deemed
“affordable,” as well as technologies appropriate for a given terrain. Furthermore, while
local governments do not have control over state and federal policies, they do have
control over local government policies that can influence communications infrastructure
deployment, business and residential demographics that shape demand, and the nature
and quality of existing infrastructure (Gillett et al., 2004).
Given existing municipal assets such as buildings, rights of way, and structures
that can house wireless antennas, a third incentive is that municipalities may enjoy lower
cost of broadband infrastructure deployment. This lower cost of infrastructure provision
presents several benefits for municipalities. As a low cost provider of broadband
services, municipalities can offer these services to those who could not otherwise afford
them. This includes low income populations as well as small businesses. This position
can provide a competitive advantage compared with other municipalities for attracting
businesses and consequently fostering economic development. Municipalities have also
seen low cost ubiquitous broadband as a means of increasing education opportunities and
tourism (Gillett et al., 2004).
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2.2 Municipality as wireless broadband consumer
Municipalities may also enter the broadband market based on the incentives they
derive from their position as consumers of broadband services. Local municipalities have
become involved in the development and deployment of Internet services within their
boundaries to lower the cost they themselves incur in delivering services to citizens.
Wireless broadband, with its use of free airwaves and unlicensed spectrum, is
substantially less expensive to deploy than other broadband solutions.16 In general,
municipalities become Internet service providers to decrease telecommunications
expenses by lowering the cost of broadband Internet access for government institutions
and citizen users.
In addition to low cost, wireless broadband solutions have also been touted as a
solution to providing portable and mobile Internet access for municipal employees. The
need for such access continues to grow, particularly with internal e-government
programs, referred to as government-to-government (G2G) and internal efficiency and
effectiveness (IEE) initiatives (Lee, Tan, and Trimi, 2005). These initiatives, and the
resulting need to extend Internet and email access to mobile public servants, such as
public works personnel, can place a financial burden on a municipality. For example,
outfitting an entire public works crew with mobile cellular devices could be costly.
Wireless broadband presents a comparatively inexpensive solution. Widespread, yet
inexpensive, Internet access by municipal employees has advantages for citizens such as
faster response times and written records of communications, but also improves quality
of work life for employees (Sawyer, S., Tapia, A., Pesheck, L., and Davenport, J., 2004;
Sawyer and Tapia, 2005). As organizations that must compete with the private sector for
the best and brightest, municipalities must rely on competitive advantages other than
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salaries. Finally, ubiquitous Internet access may also help municipalities to achieve
broader objectives, such as improving inter- and intra governmental communications and
promoting workforce development (Gillett et al., 2004).
Thus, municipal governments derive incentives for wireless broadband
deployment from their roles as both suppliers and consumers of broadband services. This
position, however, has prompted responses from concerned citizens, industry players, and
government entities. In the following sections the basis for, and consequences of, these
responses are discussed.
3. Strategic and policy responses
The context of the strategic and policy responses to municipal entry generated by
municipal entry into the broadband services market has been largely defined by the locus
of power for making telecommunications policy for wireless technologies. Since the
Federal Communications Commission’s (FCC) inception during Franklin Roosevelt’s
administration, communications regulations have largely come from the federal level and
restricted what and how states and municipalities could be involved in
telecommunications. However, in the context of municipal wireless broadband
deployments, this “top-down” model of policymaking has been flipped on its head, with
the power shifting away from the FCC to city halls and state legislatures throughout
America. This is partly a result of the FCC’s own policies that lower the barriers of entry
for cities to deploy wireless broadband networks. The result is that over 100 cities have
announced such plans.17 In turn, state legislatures have been pressured by private
providers to regulate if and how a municipality can deploy and operate a broadband
network.
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Recently, policy makers at the state level have proposed legislation to prevent
local municipalities from entering the wireless Internet provider sphere. Most states have
legislation proposed, pending, or passed that constrains municipal provision of
telecommunication services directly or indirectly. In some cases, state legislatures have
prevented municipalities from expanding existing networks. In other cases, state
legislatures have not explicitly prohibited the development and deployment of municipal
broadband networks, but they have created nearly insurmountable organizational and
bureaucratic barriers so that these networks have effectively been outlawed. The central
argument on the part of those lobbying state legislatures is that the public funding and
support of municipal broadband networks will unfairly impact competition in municipal
markets between traditional private telecommunications providers and new ventures
funded in part with public tax funds.
Several reasons have been discussed for dissuading municipalities from
developing and deploying broadband networks. The key arguments center around cost,
competition, and a failure to stimulate economic growth and social equity as expected. It
has been argued that these broadband networks may cost more than the cities anticipate,
resulting in money and attention being diverted away from other public interests18.
Another argument that has been made against the development of municipal broadband
networks is the impact it might have on competition and the telecommunications
market.20 Following this line, the city would have unfair regulatory and economic
advantages. The regulatory advantages stem from their control over rights-of-way, which
puts municipal providers of network services in the dual role of both purchasers and
purveyors of these rights.21 In addition, there is currently no evidence that economic
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development and a lessening of the digital divide will directly result from municipal
broadband deployment.22
As municipal wireless deployments have received greater attention in the last
twelve months, private sector providers have expressed a number of concerns. Private
providers understandably express concern that cities providing wireless broadband
service have an unlimited base from which to raise capital, act as a regulator for local
rights of way and tower permitting, own public infrastructure necessary for network
deployments, including street lights, and are tax-exempt organizations. While
opportunities for partnerships between private providers and local governments exist,
many companies have sought legislative relief at the state level, which would regulate or
restrict a municipality’s ability to provide wireless broadband services to the public. In
the last twelve months, fifteen states have responded by considering such legislation.23
3.1. State legislation
State governments have regulated a municipality’s ability to provide
telecommunications services for many years. Before the emergence of metro-scale
wireless broadband, at least fifteen states had passed laws regulating a city’s right to
provide telecommunications services.24 These laws often required a city to have public
hearings, develop detailed business plans, and use separate cost accounting methods for
the telecommunications utility. However, existing laws do not apply to broadband or
voice over Internet protocol (VoIP) services because they were not defined as
telecommunications services in the 1996 Act, and their treatment has been determined by
the FCC.25
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Since the existing laws were not applicable, state legislatures began considering
how to respond to the objections of private sector providers. The legislative initiatives
make use of a variety of tools that ostensibly aim to insure that
1. A majority of local residents are behind the initiative
2. The broadband project will not negatively affect a city’s finances
3. The broadband deployment does not compete or competes on a level playing field
with private carriers.
The tools used to achieve these objectives include the following. First, to insure that a
majority of the residents support the initiative, several states include a requirement that
municipalities hold hearings and/or referenda about the broadband deployment. These
activities also go some way to answering the second concern, that the project not
negatively affect finances. In addition to reporting to the public, some states have also
required plans be submitted for approval to a state entity. Tools used to achieve the third
objective include a variety of stipulations ranging from providing the local exchange
carrier the right of first refusal to outright prohibition of competing with LECs. In some
cases, municipalities are strictly prohibited from charging for broadband services
altogether. These tools and their use in legislation in the various states are summarized in
Table 1.
<Table 1 about here>
Rather than provide a summary of each bill that has been introduced, this paper
will address and analyze the objectives of the legislation and the tools used to regulate or
prohibit municipal wireless broadband initiatives. A review of proposed and passed
legislation must include an analysis of how politics impacts the legislation process.
15
Therefore, the effect of the political process on Pennsylvania’s House Bill 30 will be
discussed.
Three states and one special interest group have crafted legislation that focuses on
the financial soundness of municipal wireless broadband initiatives. As a result, Florida,
Indiana, Ohio, Oregon, and the American Legislative Exchange Council (ALEC) have
considered bills that would require municipalities to conduct due diligence efforts to
build a business plan and project capital and operating expenses for the network over a
period of time. After this work is complete, the final results are released at a public
hearing where citizens have the opportunity to comment. Florida’s Senate Bill 1322
requires Florida cities to hold two public hearings to discuss their wireless broadband
initiative.26 Ohio requires cities to hold public hearings and develop detailed costs
projections during the planning process.27
In addition to the state bills that require public hearings, the conservative
American Legislative Exchange Council (ALEC) think-tank released a template
legislative bill in December, 2004, that would require a municipality to conduct an indepth feasibility test, develop a business plan, and present the results in a public
hearing.28 The ALEC template also signaled the first move by private providers to
influence the debate through arms-length third parties. After the template was released,
critics of the template pointed out that both Verizon and BellSouth are represented on
ALEC’s private enterprise board.29
Since most municipalities conduct feasibility studies to measure costs for a
project, these obstacles can easily be overcome for municipal wireless broadband
initiatives. These provisions actually encourage cities to perform due diligence for their
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citizens to insure that the wireless solution will be a viable investment for the community.
Such work is necessary to protect political leaders from making costly decisions, buying
overly expensive equipment, or not understanding the total cost of ownership of a
wireless broadband network.
Other states require cities to hold a referendum before moving forward with a
wireless broadband network. ALEC, Colorado, Iowa, Louisiana, and Oregon all
proposed legislation that required a municipality’s governing body to call a referendum
election to approve a wireless broadband initiative. The focus of such legislation is to
measure the support of local citizens for a municipal Wi-Fi network. Initially, many of
these bills required a supermajority for the community to move forward with its wireless
initiative. In many cases during the legislative process, the requirement was lowered to a
simple majority.
The requirement to have a referendum can often be avoided if certain conditions
regarding cooperation with the private sector are met or certain financing vehicles are
used. Colorado’s Senate Bill 152 allows a city to move forward without a referendum if
the incumbent provider denies a request for service from the municipality after sixty days
or is unable to build the requested network within fourteen months.30 In Oregon, a
referendum must be held to approve government financing of the broadband initiative.31
Florida cities can avoid holding a referendum if the network is financed by revenue bonds
that mature within fifteen years.32
While it may sound politically popular to hold an election to measure the pulse of
the people, the referendum tool can be easily abused to delay and defeat wireless
initiatives. Most political leaders know that referendum items can become quite
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controversial and decide to shy away from any initiative that requires a referendum vote.
When local leaders move forward with a referendum, the resulting campaign can confuse
citizens about the initiative in question. During referenda to approve municipal
broadband initiatives involving fiber to the home, private providers funded push polls in
which citizens were asked questions meant to create opposition to the initiative including,
“Should tax money be allowed to provide pornographic movies for residents?”33 During
a similar referendum in Lafayette, Louisiana, private providers spent $400,000 in
lobbying efforts to oppose the broadband initiative.34 For this reason, states should be
cautious in requiring referenda that can be manipulated by private providers willing to
outspend supporters to derail a municipal wireless initiative, especially when past
elections show a willingness to use less than honest tactics.
While the first two legislative strategies focus on local oversight through study or
public hearings, two states have chosen a different route to examine the financial
soundness of municipal wireless initiatives. Tennessee and Texas are both considering
legislation that requires cities to submit their financial models to state agencies for
approval before moving forward with their initiative. Currently, Tennessee proposes that
municipalities present a business plan to the State Comptroller’s office and receive
approval before moving forward with a wireless initiative.35 However, HB 1403 and its
Senate counterpart, SB 1760, would place a moratorium on municipal wireless initiatives
until the State Comptroller finishes auditing the existing municipal providers and
authorizes cities to again move forward.36 Texas HB 789 would require municipalities to
file a notice of intent with the Texas Utility Commission to provide either free or feebased wireless broadband services to end users after June, 2006.37
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Local leaders who work with state agencies on projects learn how bureaucratic
such organizations can be. Requiring a city to receive approval from a state agency only
prolongs the process and increases the political risk for the applicant city. Tennessee has
gone even further to propose a moratorium until the state can conclude an audit of
existing municipal broadband initiatives. The state does not make clear what information
will be used to decide whether or how Tennessee cities will be able to deploy wireless
broadband networks based on the audit’s results. Furthermore, the audit includes cities
that have deployed other broadband solutions that have substantially different costs per
location passed and served, making the data collected and inferences made incomparable
to wireless broadband solutions.
A majority of states have chosen legislative language that requires cities to grant
the local exchange carrier the right of first refusal before deploying a wireless broadband
network. Meant to ensure a level playing field and foster partnership between the private
and public sectors, these bills allow a city to deploy wireless broadband technology only
after requesting that their incumbent provider build a network with similar speeds. Even
after a private provider has waived the right of first refusal, many states require cities to
meet additional criteria, including hearings or referenda, before moving forward with the
initiative. Though Colorado’s bill requires cities to hold a referendum, it can be avoided
if the incumbent provider denies a request for service from the municipality after sixty
days or is unable to build the requested network within fourteen months. Before an
Indiana city can hold a public hearing and move forward with a project, the municipality
must examine the existing services being offered and defer to any private provider who
committed to build the requested network within nine months.38 Ohio’s bill requires
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cities to move forward with an initiative only if fewer than two private providers are
offering competitive services within a city.39 Pennsylvania’s House Bill 30, the first
municipal wireless broadband legislation introduced and the most high profile because of
its potential effect on the Wireless Philadelphia initiative, requires cities interested in a
wireless broadband initiative to request a network supporting similar speeds from the
“local exchange telecommunications company serving the area” and allow the private
provider up to two months to decide whether they would build the network and provide
the requested services.40 If the private provider agrees to provide the service, then the
company has up to fourteen months from the date of the municipality’s request.41
Otherwise, the city could move forward with its own initiative. After the West Virginia
legislature introduced a bill favorable to municipal networks, private providers lobbied to
require cities to partner with the private sector to deploy networks only if the private
provider did not commit to build the requested network in the future.42
Since the right of first refusal strategy allows the private sector to build the
network but preserves the city’s right to build infrastructure demanded by its citizens, it is
easy to see why many legislative bodies have chosen this option. However, in order to
provide reasonable time frames for private providers to consider a municipality’s request
for network service and then build the network, these bills often allow the private sector
as long as two months to decide whether to provide service and over one year to build the
network. While this timeframe is reasonable to build a broadband network, it is
unreasonable to require a city to wait that long to see if the private provider will meet its
citizens’ broadband needs. In a space where entire countries can roll out wireless
broadband in the span of a year, cities and states can lose incredible ground in the
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information economy by forcing a one year stop to network deployments, expansions,
and upgrades.
Furthermore, private providers have responsibilities to shareholders to be
profitable. In telecommunications, such focus requires (and rightly so) the prioritization
of service areas based on return on investment models. For that reason, private providers
only cover certain areas in any given state. In contrast, cities do not answer to
stakeholders seeking profit but rather to citizens seeking quality services that strengthen
the economy, assist the disadvantaged, and improve the quality of life. Therefore, cities
that embark on wireless broadband initiatives either have broadband service from private
providers that is too expensive for many of its residents or no broadband access at all.
Profit-driven companies that have been unable to build a business case to provide service
to a particular community will usually be unable to build a network even after a request
from the local government. The right of first refusal, then, limits a city’s ability to
quickly move to provide services requested by citizens.
Finally, a number of states are considering an outright prohibition on services.
The main difference between the bills is whether free municipal Wi-Fi networks are
prohibited along with fee based wireless networks. Illinois is considering SB 499 to
prohibit a municipality from providing “for sale, either to the public or to a
telecommunications provider, a telecommunications service.”43 This language prohibits
both wholesale and retail offerings by municipalities. Michigan may prohibit both free
and fee-based telecommunications service from cities. However, due to the legal
definition of telecommunications service, HB 4600 might not affect a city’s ability to
deploy a wireless broadband network.44 Nebraska’s legislation would prohibit cities from
21
charging wholesale or retail fees for their broadband networks while the Texas bill would
prohibit fee-based networks immediately and free networks after September, 2006.45
Since a city’s responsibility is to provide those infrastructure services that are
essential to a community’s viability and growth, prohibiting municipal leaders from
deploying wireless broadband networks will hurt municipal efforts to both strengthen the
economy by attracting new tech firms and drive down the cost of broadband access so all
residents can connect to the Internet. Furthermore, this prohibition gives private
providers fiat power to decide which areas will and will not have broadband access and
how much those with service will pay based solely on financial considerations.
Due to the complexity of the legislative process and the controversy surrounding
state regulation of municipal wireless broadband initiatives, many of these bills have not
survived the committee review process or been passed by the legislature. The following
table provides the status for each bill:
<Table 2 about here>
Though these bills are often supported by well funded private providers with an
established lobbying presence, many of them fail to be signed into law. This high failure
rate is due in part to a politically charged legislative process. Pennsylvania’s House Bill
30 provides an interesting case study to illustrate how politics changes this type of
legislation. The Pennsylvania General Assembly was the first to consider legislation that
would regulate if and how a city deploys wireless broadband infrastructure. House Bill
30 was initially focused on increasing the deployment of broadband networks and
regulating telephone services when it was introduced in April, 2003.46 However, the City
of Philadelphia announced an initiative to deploy a city-wide wireless broadband network
22
for public use that highlighted the emerging trend of municipal wireless networks. As a
result, language was added to House Bill 30 to restrict how municipalities could deploy
wireless broadband networks that would provide fee-based services.
The bill required cities interested in a wireless broadband initiative to request a
network supporting similar speeds from the local telecommunications company serving
the area and allow the private provider up to two months to decide whether they would
build the network and provide the requested services.47 If the private provider agreed to
provide the service, then the company would have up to fourteen months from the date of
the municipality’s request.48 However, the private provider’s choice not to deploy the
network would allow the city to move forward with its initiative.49 This late addition to
the legislation created controversy across the country as municipal leaders and
organizations spoke out against the restriction, state legislators considered whether the
municipal wireless trend was a threat to private providers, and technology leaders
representing both the wireless broadband ecosystem and the incumbent providers debated
whether cities should have the authority to become a broadband provider. Essentially,
the bill requires that cities offer the local exchange carrier the right of first refusal before
deploying a wireless broadband network to provide fee-based access to the public.50
Before Governor Ed Rendell, who previously served as the Mayor of
Philadelphia, would commit to sign the bill into law, he worked with Verizon and the
City of Philadelphia to reach a compromise to allow Philadelphia’s wireless initiative to
move forward unimpeded.51 Verizon agreed to waive their right of first refusal for
Philadelphia’s project, thereby allowing the city to move forward without delay.52
Despite Governor Rendell’s efforts to appease both sides, he was criticized by many
23
political observers and technology leaders for protecting his hometown while signing
away the rights of every other city.53
Pennsylvania’s process is illustrative of how nearly every state deliberates over
bills to regulate municipal wireless broadband networks. Original language is softened,
timelines are extended or reduced based on negotiations, and compromises are made to
avoid or minimize controversy. The legislative focus is clearly not on the technology’s
capabilities or limitations, security issues, or emerging business models.
In an effort to build consensus for this legislation, nearly every proposed bill has
allowed municipalities to deploy a wireless broadband network for internal government
usage without any regulation. This trend to in-source broadband services can save a
municipality thousands of dollars each year. In Allegany County, Maryland, the local
governments deployed a wireless network for internal use and currently save government
organizations over $65,000 each month.54 While the networks cannot provide public
access without meeting the legislative regulations, cities are able to provide both fixed
and mobile wireless access to their government agencies, thereby increasing efficiency
and improving delivery of services while lowering operational costs.
The intent of the legislation proposed in fifteen states is to ensure cooperation and
communication between the public and private sector when considering wireless
broadband networks for public access. However, while legislators have been grappling
with ways to restrict municipalities from owning and operating wireless broadband
networks, city leaders have been creative in developing business models that support
their community’s motivation for deploying the network.
24
4. Potential business models
The ideological focus of the debate on municipal wireless initiatives has
propagated the idea that only two business model options exist for broadband networks:
privately owned or publicly owned and operated utilities. However, a number of other
models have emerged and countless hybrid possibilities exist. These other options are
important to understand because they can help educate the current policy debate
occurring at state houses throughout America.
4.1. Community network
The community network model is focused on providing free or low cost wireless
broadband access. Two hybrid models have emerged from cities using this model, but
both share similar characteristics: free Wi-Fi access in areas known for tourism or
targeted for revitalization. This model most often supports wireless hot zones or citywide networks and is being used in Hermosa Beach, California, and Austin, Texas.55
The first hybrid involves the city or a non-profit entity obtaining funding from
taxpayer funds, foundation grants, donations from citizens and businesses, and
advertising revenue from a splash page. The city or non-profit entity then builds the
network and provides marketing and customer service. Hermosa Beach has used this
model to provide free Wi-Fi to residents throughout the city.56 The network has been
funded largely through general fund monies, although the city is evaluating options to
partner with Google to generate advertising revenue.57
The idea of partnering with a content provider like Google or Yahoo for
advertising revenue is being tested. One municipal wireless commentator has suggested
that combining Google’s Adsense program with local search and mapping capabilities
25
could provide both ongoing funding for a free Wi-Fi network and compelling content to
increase users (hence strengthening the revenue stream).58
The second model involves a non-profit community group or government entity
that acquires funding to educate business owners about the benefits of deploying a Wi-Fi
hotspot. The city or community group then acts as a catalyst to encourage the organic
build-out of a Wi-Fi network in downtown areas. Since the city or non-profit
organization is not funding the network deployment, the need to use city funds is
substantially lower. The network, however, may not be ubiquitous because it depends on
venue owners’ financial support. This model is being used in Austin, Texas.59 Through
this organic approach, the Austin Wireless City Project is responsible for deploying over
80 hotspots throughout downtown Austin.60
The most pronounced advantage to the community network model is free access
to broadband. The model supports targeting certain areas for revitalization by attracting
people to downtown areas. Since the network is most often provided as an amenity, little
focus is given to building a universally available, secure, and reliable network.
Therefore, the city government usually chooses not to use the network to support mobile
applications for public safety and public works functions. However, many of the state
bills only pertain to cities that provide wireless broadband access for a fee. Since most
community networks offer free service, municipalities are able to proceed without
meeting those state requirements.
Though this model does not currently provide an ongoing funding strategy to
support network maintenance and upgrades, many communities may be able to generate a
return on investment through economic development and revitalization efforts that
26
increase property values and attract the “creative class” to a targeted area. However, the
potential lack of both a sustainable funding strategy and direct revenue stream can make
it difficult to partner with private providers for network management and customer care.
4.2. Public utility
Under the public utility model, the need to deploy, operate, and manage
broadband service for its citizens requires a local government to establish a new city
department or combine operations with existing water, gas, and/or electric departments.
The broadband utility's capital cost is funded through the use of taxpayer dollars and
revenue bonds. The public utility installs the network, markets the service, and provides
customer support and billing. In addition, the local government may choose to provide
both fixed and mobile broadband to its agencies. This model is most often used when
private providers choose not to offer broadband service in a city for financial reasons.
The City of Chaska, Minnesota, has used the public utility model to deploy a citywide
Wi-Fi mesh network.61
Most states allow municipalities to form enterprise funds for utility projects.
Unlike a general fund, which must be balanced each fiscal year, enterprise funds are able
to show annual profits or losses.62
The public utility model allows local governments to control a number of
variables involving broadband access. Since governments have easier access to capital
through tax dollars, bonds, and other revenue sources, municipalities do not always face
the same capital scarcity that private sector providers do. With a clear funding strategy,
public utility networks can be built quickly by a city interested in providing broadband
service to its citizens. Cities are also able to control the price of broadband access to the
27
end user through this model, even subsidizing enterprise fund losses with general fund
monies.
However, this model's dependence on taxpayer dollars can make it both
politically unattractive and almost financially impossible for most city leaders. Though
the national economy continues to rebound from the recent recession, municipal budgets
are still strained. According to the National League of Cities' report, "City Fiscal
Conditions in 2004," nearly two out of every three municipalities were less able to meet
their financial needs in 2004 than they were in 2003.63 The vast majority of cities simply
cannot fund capital projects like wireless broadband networks while their revenue
declines and their expenses increase.
Cities are also hesitant to enter direct competition with private sector providers.
Since this model requires head-to-head competition between the local government and
private sector providers, little opportunity is left for local government to partner with forprofit firms to operate and manage the network.
However, the public utility model is used by rural cities that cannot receive
broadband access from a private provider or that cannot have competitive prices for
broadband service. In these cases, cities are much more willing to use this model to
insure that citizens have the access to information that many require.
4.3. Private consortium
The private consortium model involves one or many private sector provider(s)
offering broadband service to end users. Funded by private investment, the provider
offers access to both the city and to subscribers for a monthly fee. The provider is
responsible for operating and maintaining the network and providing technical support,
28
customer service, and billing. The vast majority of broadband networks in the US are
built to support this business model.
Since the private sector bears the responsibility for funding the network
deployment and maintenance costs under this model, no taxpayer funds are required and
no city employees are needed to provide service. Businesses provide the service where
they can do so profitably, thereby creating local jobs.
Opportunities for partnerships exist between the local government and the private
provider under this model. Private firms often need access to city assets, including street
lights or traffic lights, to deploy a wireless network. Cities often provide these assets to
private providers at low fees in exchange for low-cost wireless broadband access. Some
wireless broadband providers agree to revenue sharing agreements with the city, creating
a new revenue stream for the local government. Since the network is professionally
monitored and can be secured, government agencies, including public safety, can use the
network for mobility applications. In addition, many states have created tax incentives
for private providers who extend broadband networks into rural areas.
However, deciding where to deploy broadband networks under this model is often
based on building business cases and return on investment models. Such profit-driven
decisions can limit the markets for broadband providers and prevent the deployment of
ubiquitous broadband networks.
4.4. Cooperative wholesale
The cooperative wholesale model provides two options for local political leaders.
The first is a city-owned model in which the city makes a “build versus buy” decision
29
regarding broadband service. The city builds a broadband network to provide its
broadband and telecommunications needs.
Funding for the network comes from taxpayer dollars, state and federal grants,
foundation grants, and/or bonds. After securing funds, the city issues an Request for
Proposals (RFP) for the design, deployment, and management of the network.
After the network is deployed and the city has completed in-sourcing its
broadband needs, the excess capacity is sold to private providers, including Wireless
Internet Service Providers (WISPs), Incumbent Local Exchange Carriers (ILECs),
Competitive Local Exchange Carrier (CLECs), or another local Internet Service Provider
(ISPs) at wholesale prices. The private providers then compete for business and
residential subscribers while providing marketing, technical support, customer care, and
billing. Free cash flow (or the total positive cash flow remaining after network upgrades
and maintenance) generated from the wholesale fees can be used to fund a number of
programs, including economic development and digital divide initiatives.
While the first model meets many municipal leaders' needs, it still requires
taxpayer dollars and city employees to be successful. Instead of the city funding and
managing the network, the community can create a non-profit organization to accomplish
the following tasks:
•
Raise funding for the wireless broadband network deployment
•
Outsource network design, deployment, and management to a private sector
company
•
Provide broadband service directly to city agencies and employees (fixed and
mobile)
30
•
Market wholesale service to WISPs, ILECs, CLECs, and dial-up ISPs
•
Develop social and/or economic development programs that are funded by
free cash flow
The local government provides low cost access to light poles and other assets for
the network deployment and acts as an anchor tenant for the network. With a social
and/or economic development charter, the non-profit is able to secure funding for the
network deployment from state and federal grants and private foundation donations.
Additional monies can be obtained through bank loans, which are easier to obtain with a
secure anchor tenant commitment from city government agencies.
The non-profit partners with private companies to both build and manage the
network, resulting in a smaller staff. The non-profit's focus is to monitor network
management, develop effective social and/or economic development programs, and
attract and develop relationships with retail providers. This model was developed for the
Wireless Philadelphia initiative to deploy a 135 square mile wireless broadband network
to support fee-based public access, T1 replacement service for businesses, and fixed and
mobile services for government agencies.64
The Cooperative Wholesale model allows cities to have influence over a
broadband network build out and the wholesale price offered to retail providers without
necessarily relying on taxpayer funding. By determining the wholesale price for service,
the non-profit can estimate the retail price for the end user.
The wholesale approach also ensures cooperation between the public and private
sector and reintroduces competition into the Internet access market, a move that can drive
down prices and lead to innovative, value-added applications and content. Since the local
31
entity builds out one neutral host network, scarce assets, including towers and light poles,
are maximized.
The model also allows both the government and the private sector to maximize
their strengths. Though the government acts as a catalyst, the private sector is able to
maximize its existing customer base, back office systems for billing, customer service,
and technical support expertise and facilities. The model is not restrictive since private
providers not interested in the wholesale program can deploy their own network
infrastructure. Finally, this model can improve cash flow that can be used to fund
economic or social programs related to technology.
However, the model does rest upon attracting enough funding from loans and
grants to fund the initial capital expenses without using tax dollars. In addition, cities or
non-profits must recruit private providers to offer their service over a network owned by
another party to support operational costs. Many of the proposed legislative bills regulate
both retail and wholesale broadband services provided by a city, requiring that this model
comply with some proposed regulations. Even if the non-profit approach is chosen in the
regulatory states, the legislation most often precludes cities from being involved in the
creation or management of such entities unless the state requirements for a municipal
broadband network are met.
Though the legislative debate has only focused on the two polarized positions of
the public utility and private consortium models (see Figure 1), cities have developed
(and will continue to develop) innovative, viable business models to meet their needs.
<Figure 1 about here>
32
Policy makers need to understand the multi-dimensional realities of such business
models as they consider what type of regulation is appropriate to require of municipalities
interested in wireless broadband. Clearly, most of the models allow for, and encourage,
partnership with the private sector. Therefore, an environment that provides incentives
for such cooperation and fosters further creativity should be preferable to legislation that
compels cooperation and diminishes decision making power at the local level.
5. Conclusions
Wireless technologies create possibilities for ubiquitous, low cost Internet access.
This possibility has consequently raised questions of who will fund, own, design, deploy,
and manage these networks, and under what terms and conditions. The debates over
these questions have resulted in legislation that aims to achieve three objectives:
measuring local resident support, developing a sound financial plan, and maintaining a
level playing field with private telecommunications carriers. While these goals have
merits, the policies by which they will be achieved, in many cases, will lead to negative
consequences, as highlighted in the following narrative:
Since many of our government clients are located in states
considering restrictions on municipal wireless broadband networks,
we have seen the first hand effects of such legislation on a city’s
thought process. In a recent meeting with a local government to
clarify project objectives and choose an appropriate business model,
the officials’ focus was on pending state legislation to regulate
how cities could deploy broadband networks.
33
As I outlined the bill’s requirements to have public meetings,
create a business plan, and hold a referendum, my clients asked how
they could avoid meeting such requirements. Since nearly all of the
proposed legislation allows networks to be built for internal use
without public approval or a business plan, they adjusted their objective
to provide broadband to government agencies and later examine if
they could support free public access in certain areas. However, at
least two business models were eliminated and the opportunity for
innovation in applications and public access was lost. The state legislation
being considered around America has a chilling effect on municipal
broadband networks and innovation at the local level that will never be
quantified. (Stone Interview, March 2005)
This chilling effect created by the legislative tools has several dimensions. While some
municipalities may speed up network deployment to “beat” the deadline of the enactment
of restrictions, others may either roll back their plans or abandon the project altogether.
In these latter cases, the result is the diminished potential of wireless networks. While
the benefits of wireless networks may accrue to municipalities, as consumers of
broadband services, private citizens and small firms may be denied these benefits. The
broader implications of such an occurrence include missed opportunities for economic
development based on wider use of broadband by individuals and firms in the local
34
economy and the possibility of a deepening digital divide. Whereas municipal
employees, who in some populations are already envied for holding stable jobs with
benefits, will enhance their computing skills by having ubiquitous access, others could
remain stagnant.
However, even if municipal broadband networks are not deployed to the public,
there may yet be positive outcomes. With broadband serving as a disruptive technology
and municipalities playing the role of entrepreneur, the actions of these entrepreneurs
may spur private sector innovation, or at least wider broadband deployment.
This result is evident in the provisions of Pennsylvania’s House Bill 30, which in
this light appears to have a silver lining. In particular, the bill is an incentive package to
broadband providers like Verizon to update and improve their current broadband service.
Under the Pennsylvania legislation, any political subdivision would have to get the
permission of the local telephone company to provide a telecommunications service for a
fee, including broadband. If the telecommunications company rejects the plan, it would
have to offer a similar service within 14 months. Under the law, the telecommunications
provider in a region is required to provide high-speed Internet access across its territories
over the next decade. In Verizon's case, such access must be made available by 2013. In
addition, House Bill 30 might actually give cities greater leverage by allowing them to
push Verizon and other dominant telecommunications companies to speed up their
broadband efforts or step aside.
Finally, this research has contributed to the body of work on municipal broadband
initiatives by explaining the incentives for these actions, identifying the implications of
corporate and state strategic responses, and by identifying business models that facilitate
35
the establishment of public-private partnerships, which are a tool to address many of the
state and corporate concerns. Despite these contributions, this research raises several
interesting questions for future research. These questions include: Given all the
legislative activity at the state levels, how many municipalities have carried on to meet
the requirements laid out in the legislation? How did the process of fulfilling these
requirements change the project, and did municipal leaders consider the changes to be
improvements? And finally, how successful were the incentives provided to ILECs in
facilitating the wider deployment of broadband networks?
Footnotes
1
Raine, L. (2005). Internet: The mainstreaming of online life. The Pew Internet
& American Life Project. Available:
http://www.pewinternet.org/pdfs/Internet_Status_2005.pdf.
2
Wilhelm, A. G. (2001, April). They threw me a computer ... But what I really
needed was a life preserver. First Monday, 6(4) (April 2001). Available:
http://www.firstmonday.org/issues/issue6_4/wilhelm/.
3
Bleha, T. (2005). Down to the wire. Foreign Affairs, 84(3). Available:
http://www.foreignaffairs.org/20050501faessay84311/thomas-bleha/down-to-thewire.html.
4
Little, A. (2005). Broadband update 2005. Retrieved May 26, 2005, from
http://www.websiteoptimization.com/bw/0505/.
5
Bleha, T., note 3, above.
6
Ibid.
36
7
White House. (2004). A new generation of American innovation: Executive
summary. Retrieved May 26, 2005, from
http://www.whitehouse.gov/infocus/technology/economic_policy200404/innovation.pdf.
8
Ibid.
9
Cooper, M. Consumer Federation of America. Available:
http://www.consumerfed.org/021304_cablereportrelease.html.
10
New York City Council Int. No. 625. Gail Brewer.
11
See FCC 15050. Retrieved October 5, 2005, from
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-05-150A1.pdf.
12
Federal Communications Commission. The Wireless Broadband Task Force.
Retrieved May 13, 2005, from http://www.fcc.gov/wbatf/.
13
Cokenias, T. (2002). New rules for unlicensed digital transmission systems.
Compliance Engineering. Available: http://www.cemag.com/archive/02/Spring/cokenias.html.
14
Cramton, P. (1998). The efficiency of FCC spectrum auctions [Electronic
version]. Journal of Law and Economics, 41, 727-736. Retrieved May 26, 2005, from
http://www.market-design.com/files/98jle-efficiency-of-the-fcc-spectrum-auctions.pdf.
15
Cokenias, T., note 14 above.
16
Wanichkorn, K., & Sirbu, M. (2004). The role of fixed wireless access
networks in deployment of broadband services and competition in local
telecommunication markets. Department of Engineering and Public Policy, Carnegie
Mellon University. Retrieved September 4, 2004, from
http://itc.mit.edu/itel/docs/2002/wanichkorn_sirbu.pdf.
37
17
Vos, E. (2005). March 2005 report. Retrieved May 26, 2005, from
http://www.muniwireless.com/reports/docs/March2005Report.pdf.
18
Lenard, T. M. (2004, February). Government entry into the telecom business:
Are the benefits commensurate with the costs? Progress on Point, Release 11.3.
Available: http://www.pff.org/issues-pubs/pops/pop11.3govtownership.pdf.
20
Lenard, T. M. (2005, April). Wireless Philadelphia: A leap into the unknown.
Progress on Point, Release 12.3. Available: http://www.pff.org/issuespubs/pops/pop12.3lenardwifi.pdf.
21
See Day (2002) and the rebuttal of Malone (2003) for a detailed account of both
sides of the argument for and against continued involvement of municipalities in
managing municipal rights-of-way.
22
Lenard,T. M., note 19 above.
23
Baller Herbst Law Group. (2005). Proposed state barriers to public entry.
Retrieved May 13, 2005, from
http://www.baller.com/pdfs/Baller_Proposed_State_Barriers.pdf.
24
Civitium LLC. (2005). Municipal broadband and telecommunications.
Retrieved May 13, 2005, from http://www.civitium.com/states.htm.
25
The Telecommunications Act of 1996 (1996). Retrieved May 22, 2005, from
http://www.access-board.gov/about/laws/telecomm.htm.
26
S. 1322, Florida General Assembly (2005). Retrieved May 15, 2005, from
http://www.flsenate.gov/session/index.cfm?BI_Mode=ViewBillInfo&Mode=Bills&Sub
Menu=1&Year=2005&billnum=1322.
38
27
Ohio General Assembly. (2005). House bill status report of legislation: 126th
General Assembly. Retrieved May 16, 2005, from
http://lsc.state.oh.us/coderev/hou126.nsf/House+Bill+Number/0188?OpenDocument.
28
MuniWireless. (2004, December 20). Do-it-yourself anti-municipal broadband
kit. Retrieved May 15, 2005, from http://muniwireless.com/municipal/504.
29
Ibid.
30
Colorado General Assembly. (2005). Summarized bill history for S. 152
(Concerning Local Government Competition in the Provision of Specified
Communications Services). Retrieved May 13, 2005, from
http://www.leg.state.co.us/Clics2005a/csl.nsf/fsbillcont3/FA216226F45192FE87256F410
07B483C?Open&file=152_enr.pdf.
31
Oregon Legislative Assembly. (2005). House Bill 2445 (Summary). Retrieved
May 16, 2005, from
http://www.leg.state.or.us/05reg/measpdf/hb2400.dir/hb2445.intro.pdf.
32
Florida General Assembly: S. 1322, note 26 above.
33
Case, D. (2005, May/June). GigaFight [Electronic version]. Mother Jones.
Retrieved May 20, 2005, from
http://www.motherjones.com/news/dispatch/2005/05/municipal_broadband.html.
34
Cauley, L. (2005, January 3). Bells dig in to dominate high-speed Internet
realm [Electronic version]. USA Today. Retrieved May 20, 2005, from
http://www.usatoday.com/tech/news/2005-01-03-fiber-cover_x.htm.
35
Baller Herbst Law Group, note 23 above.
36
Ibid.
39
37
Texas Legislature. (2005). House Bill 789. Retrieved May 16, 2005, from
http://www.capitol.state.tx.us/cgibin/tlo/textframe.cmd?LEG=79&SESS=R&CHAMBER=H&BILLTYPE=B&BILLSUF
FIX=00789&VERSION=3&TYPE=B.
38
Indiana General Assembly. (2005). House Bill 1148. Retrieved May 15, 2005,
from http://www.in.gov/legislative/bills/2005/IN/IN1148.1.html.
39
OhioGeneral Assembly. (2005). House Bill 188. Retrieved May 16, 2005,
from http://www.legislature.state.oh.us/bills.cfm?ID=126_HB_188.
40
General Assembly of Pennsylvania. (2004). House Bill 30. Retrieved May 15,
2005, from http://www2.legis.state.pa.us/WU01/LI/BI/BT/2003/0/HB0030P1554.pdf.
41
Ibid.
42
Baller Herbst Law Group, note 23 above.
43
Illinois General Assembly. (2005). Amendment to Senate Bill 499. Retrieved
May 15, 2005, from
http://www.ilga.gov/legislation/fulltext.asp?DocName=09400SB0499sam001&GA=94&
SessionId=50&DocTypeId=SB&LegID=17288&DocNum=499&GAID=8&Session.
44
Michigan State Legislature. (2005). House Bill 4600. Retrieved May 16,
2005, from http://www.legislature.mi.gov/documents/20052006/billintroduced/house/pdf/2005-HIB-4600.pdf.
45
Texas Legislature: House Bill 789, note 37 above.
46
General Assembly of Pennsylvania: House Bill 30, note 40 above.
47
Ibid.
48
Ibid.
40
49
Ibid.
50
PaPowerPort. (2004, November). Governor Rendell signs House Bill 30.
Retrieved May 15, 2005, from
http://www.state.pa.us/papower/cwp/view.asp?A=11&Q=439281.
51
Ibid.
52
Ibid.
53
Muniwireless (2005). Retrieved May 26, 2005, from
http://muniwireless.com/municipal/491.
54
"Marconi Adds Quality of Service to Wireless Broadband Network." Retrieved
September 4, 2004, from
http://www.marconi.com/Home/customer_center/Case%20Stud/Enterprise%20Networks/
Ethernet%20Switching/Allconet.
55
Muniwireless (2005). Retrieved May 22, 2005, from
http://muniwireless.com/municipal/436.
56
Ibid.
57
Ibid.
58
Vos, Esme (2005). “Fund a Free Citywide Wi-Fi Network.” Muniwireless.
Retrieved May 22, 2005, from http://muniwireless.com/municipal/631.
59
Austin Wireless City [On-line]. Retrieved February 17, 2005, from
http://www.austinwirelesscity.org/about.php.
60
Austin Wireless City [On-line]. (2005). Participating hotspots. Retrieved May
22, 2005, from http://www.austinwirelesscity.org/hotspot-list.php.
41
61
Chaska.net [On-line]. Retrieved February 16, 2005, from
http://www.chaska.net/.
62
Weeks, J. D., & Hardy, P. T. (Eds.). 1989. Handbook for Georgia mayors and
councilmembers. Athens, GA: University of Georgia, Carl Vinson Institute of
Government.
63
Pagano, M. "City Fiscal Conditions in 2004." National League of Cities.
Retrieved February 11, 2005, from
http://www.nlc.org/content/Files/RMPctyfiscalcondrpt04.pdf.
64
Wireless Philadelphia. (2005). Wireless Philadelphia business plan. Retrieved
May 22, 2005, from http://www.phila.gov/wireless/pdfs/Wireless-Phila-Business-Plan040305-1245pm.pdf.
42
References
Christensen, C. M. (2000). The innovator's dilemma. New York: Harper Business.
Cooper, M. (2004, February). The continuing abuse of market power by the cable
industry: Rising prices, denial of consumer choice, and discriminatory access to
content. Consumer Federation of America. Available:
http://www.consumerfed.org/Pdfs/Mpcableindustry.Pdf.
Day, C. R. (2002). The concrete barrier at the end of the information superhighway:
Why lack of local rights-of-way access is killing competitive local exchange
carriers. Federal Communications Law Journal, 54(3), 461-491.
Gillett, S. E., Lehr, W. H., & Osorio, C. (2004). Local government broadband
initiatives. Telecommunications Policy, 28, 537-558.
Lee, S. M., Tan, X., & Trimi, S. (2005). Current practices of leading e-government
countries. Communications of the ACM, 48(10), 99-104.
Malone, W. (2003). Access to local rights-of-way: A rebuttal. Federal Communications
Law Journal, 55(2), 251-272.
Preiger, J. (1998). Universal service and the Telecommunications Act of 1996.
Telecommunications Policy, 22(1), 57-71.
Sawyer, S., Tapia, A., Pesheck, L., & Davenport, J. (2004). Observations on mobility
and the first responder. Communications of the ACM, 47(2), 62-65.
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Sawyer, S., & Tapia, A. (2005). The sociotechnical nature of mobile computing work:
Evidence from a study of policing in the United States. International Journal of
Technology and Human Interaction, 1(3), 1-14.
Stone, M. (2005). Interview with Florida Legislator. Confidential Source.
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44
Table 1
Tools Used in Various State Legislation
States
ALEC
Template
Florida SB
1322
Oregon HB
2445
Indiana HB
1148
Ohio HB 188
Iowa HF 861
Louisiana SB
126
Colorado SB
152
Tennessee HB
1403/SB 1760
Texas HB 789
Pennsylvania
HB 30
Virginia HB
2395
West Virginia
SB 740
Illinois SB 499
Michigan HB
4600
Nebraska LB
157
Hearings
Referenda
State level
authorization
*
* - Depending on use of bonds for financing purposes
LEC right of
first refusal
Prohibit Fee
Based Service
45
Table 2
Bill Status
State Bill
Pennsylvania
HB 30
Colorado SB
152
Florida SB 1322
Iowa HF 861
Ohio HB 188
Texas HB 789
Tennessee HB
1403/SB 1760
Illinois SB 499
Indiana HB
1148
Virginia HB
2395
West Virginia
SB 740
Louisiana SB
126
Michigan HB
4600
Nebraska LB
157
Oregon HB
2445
Assigned
to
Committee
Died in
Committee
Waiting
Vote in
House or
Senate
Passed
House
Passed
Senate
Signed
into Law
46
Fig. 1. The Municipal Broadband Business Model Continuum