Thursday, April 19, 2012

"ALEC Wants You To Pay 750 Percent More For High-Speed Internet"

What's Being Said Dept.

The Independent puts us on to an article that uses LUS Fiber to illustrate the the malign nature of ALEC. (The American Legislative Exchange Council is a secretive, corporate-funded organization that exists to create model state-level laws that favor corporate interests.) In  "ALEC Wants You To Pay 750 Percent More For High-Speed Internet" ALEC, which has been in both the national and the state news lately, is taken to task for sponsoring state bills that attempt to outlaw new municipal networks or cripple them once the exist. An ALEC bill was the basis of the infamous (un)fair competition act which would have, in its original form, made Lafayette's home-town network impossible to build. ALEC state president, then the (ig)Nobel Ellington (R, Winnsboro), embarrassed himself during debate by repeatedly having to walk away from the podium to confer with lobbyists in order to explain a bill he supposedly "authored." Only a veto threat from the Lafayette native who was then governor, Blanco, altered the bill enough to allow LUS Fiber to launch.

This article is in the way of piling on—ALEC has been pilloried in the national arena for having sponsored a series of "stand your ground" state gun laws that culminated in the Florida death of Trayvon Martin. The corporate-sponsored group has also come under attack for promoting series of laws restricting access to voting which range from shortening the voting day to restrictive voter ID laws. ALEC has responded by disbanding the committee that pushed laws not directly benefiting their corporate sponsors.

Lagniappe: The headline's sensational "750% more for High-Speed Internet" referenced LUS Fiber's advantage over Cox and substantiated the claim by referring back to an article on this site but I couldn't find anything that was very close to that figure in the post. The nearest I could find was price per Mbps for the two companies lowest tier of internet usage—where Cox's price per meg was 8.7 times LUS Fiber's price, or 870%. I'm not sure why the article was so nice on that one....

Wednesday, April 11, 2012

"How Chattanooga, Bristol, and Lafayette Built the Best Broadband in America"

Christopher Mitchell has published "How Chattanooga, Bristol, and Lafayette Built the Best Broadband in America," an in-depth case study and analysis of how the three named cities have, well, built the best broadband in America. It is indeed in-depth; weighing in at 65 pages the study digs into the history, the current status—with an emphasis on unique features of the networks—and the benefits that each community-owned network has developed. There's a little something for every interest in the studies. If you want to know how to get a network started there are three successful models to review. The types of opposition and local preparations are discussed at length. Widely different business plans are revealed. Each network's unique services and approaches are highlighted.

This is exactly the sort of study of community-owned broadband success stories that has long been needed. A structured set of case studies both gets at the common features of successful municipal networks share and the very real differences between local circumstances and strategies. Both the Institute for Local Self-Reliance, Mitchell's home base, and the Benton Foundation, who supported the work financially are deserving of thanks.

Lafayette readers of this blog will be most interested in how the study deals with LUS Fiber. Mitchell does a good job—and put in the time necessary to get a good handle on the area's unique features. He visited all the cities covered and hung out in Lafayette, interviewing the principals and rooting around in local privately held "archives." (By which I mean folk's old card board boxes and saved documents.) I reviewed an earlier draft and think he's done an excellent job. You can't do better for a succinct catch-up on the history and development of LUS Fiber.


Recommended without reservation.  

Saturday, April 07, 2012

Gigabit News: Roundup—Causes, Cox, AT&T, and Durel

What's Being Said Dept. 

The news that LUS Fiber is offering a gigabit service to businesses has generated news coverage—both locally and nationally. What I find interesting is the contrast between how national and regional stories cover the topic at hand and what they find important to focus on. The Louisiana-based stories are actually a good bit more substantial.

Nationally
The national coverage has shown up at various advocacy and communications-centric specialty sites. Notable ones include Stop The Cap and Broadband Reports.  Stop the Cap's story notes ATT's role in trying to block LUS and it malign influence on lost delta-region fiber broadband grant. Pull quotes:

That puts Lafayette on the map with Chattanooga, Tenn., as the two fastest operating fiber broadband networks in the country selling to both residential and business customers.  Both are publicly-owned networks private companies like AT&T have lobbied hard to banish... 
An $80 million federal grant to fund much-needed improvements to the state’s Internet infrastructure was returned in what one public official called Gov. Bobby Jindal’s special favor to Big Telecom companies like AT&T.
Broadband Reports titles its story: Lafayette Offering 1 Gbps Connections Seven Years After Idea Was Nearly Destroyed And that's pretty much the story. As always at Broadband Reports the really interesting stuff is in the comments. A 150x150 tier coming from LUS?  Interesting.

Local
The local stories are notable for being less cause-oriented and more down into the economic nitty-gritty.

First up though is an audio clip from KPEL's "Lafayette’s Fiber Gets Even Faster"...its nice to see the internet being used so competently by local media. The audio clip at the bottom of the page is the real thing—hear director Huval discuss the new capacity.

The Advertiser story, "LUS to release new high-end Internet" covers the local supporters of LUS' new tier, the competitors reactions, and throws in an interesting bit on the wholesale business. This site has already discussed the supporters' take. But of the two competitors AT&T's response—or rather, non-respsonse—was most interesting. AT&T basically told the reporter that they weren't competing and didn't plan to. Well, not in those words. But pretty nearly. Judge for yourself:

AT&T spokeswoman Sue Sperry said she doesn't anticipate a high demand for that kind of speed from residential customers... adding that AT&T offers 24 megabits per second with its U-Verse service in other markets, but not Lafayette. 
"Our focus right now is expanding capacity to our wireless network and adding more cell sites in the rural areas of Acadiana," she said.
Okaaay...

Cox on the other hand said that they had plenty of good bandwidth
"...in the municipalities of Lafayette, Youngsville, Broussard, Carencro, Scott, Duson, New Iberia, Breaux Bridge, St. Martinville, Crowley, Rayne, Abbeville, Erath, Delcambre, Kaplan, Franklin and surrounding areas."

Fair enough, and they provide dedicated business bandwidth as well; though they didn't discuss how their a la carte product might cost. One interesting tidbit was revealed in the attempt to put Cox's best foot forward: apparently they're doing a fiber build:
Thompson said Cox Business is in the process of installing an all-fiber optic private network for a south Louisiana public school system that services about 90 schools and 50,000 students. 
"This customer is representative of the size and scope of a customer who actually requires gigabit level Internet services," she said."an all-fiber optic private network for a south Louisiana public school system that services about 90 schools and 50,000 students.
No, that's not exactly right. As St. Thomas More's gigabit connection demonstrates, a really well-equipped, forward-looking school requires a Gbps all by itself. I will be fascinated to discover who owns that network when it is done. And how much it costs to install.

The Advertiser has the savvy to ask about LUS' wholesale network and the relationship of the new gig tier to that set of LUS Fiber customers:

"This does provide other options for wholesale customers to serve their customers," Huval said. "In some cases, the wholesalers are going to have new options. It might require a shift in the way it is approached because of what we have out there, but the options are available to all customers." 
Wholesale customers would also have the option of buying LUS Fiber's gigabit service, Huval added.

That's hedging things considerably. Having a gigabit option on the table that is competitive in capacity with what wholesalers buy is definitely going to impact the way they market services. That's another area to watch and I'll be interested to hear what current wholesale providers think. Will it expand the market for the bandwidth intensive services they sell on top of the bandwidth they buy from LUS? Is 999.95 expensive enough to leave some room for their current marketing schemes?

Burgess at the Advocate pens "Utility increases Internet speed" He touches base with two other municipal systems that also provide a gigabit documenting the wide range in prices with one charging $2,500 to $3,500 a month, and another, EPB Fiber Optics in Chattanooga, TN, which offers 1 gigabit service for residential customers and small businesses for $349 a month. The implication, of course, is that LUS's service is not as remarkable as its home-town proponents might claim. That raised the ire of Joey Durel, Lafayette's mayor, who came onto the comments to counter any such impression:

2) Comment by Joey Durel - 04/06/2012
A clarification on Chatanooga. If you compare apples with apples, their guaranteed gig service is $20,000 per month. They have a shared gig service that only costs $395, but they say it commonly only delivers as little as 80mbs. This is much like the "marketed" speeds we often see companies offer. It is legal to market, but is rarely delivered. Lafayette's true gig service is $999.95, unheard of in America. 
I look forward to the battle of speed tests that is sure to ensue. But that might not be so easy to pull off—apparently for all that the gigabit connection has been very loudly and successfully trumpeted as the distinguishing feature of Chattanooga's project there are not many actual users of the feature:

EPB’s 1 gigabit service is offered to both residential and business customers, but she said only about 10 residential customers have signed on.

That's very interesting...

Burgess notes that LUS' gigabit service is only available to businesses (the Advertiser seems to have overlooked this point) but when asked LUS granted that they'd entertain the idea if any residences actually wanted the service, a sentiment that Huval repeated to me when I asked the same question.

Cox responded to the Advocate's apparently pointed questions about their pricing in a revealing way:

Cox spokeswoman Patricia Thompson said the connections are customized for individual businesses and that the company could not give a basic price for 1 gigabit service. 
She said Cox’s prices for the service are competitive with other private companies but might not compare with what’s offered by the publicly owned LUS Fiber, which had the advantage of government bonds to fund the startup costs and occasional intergovernmental loans.
That's more than a little defensive and more than a little misleading. One would think that a new overbuilder, trying to buy down an enormous initial investment while competing against an entrenched incumbent whose network is already paid off could be spotted a couple of points on a their startup loan. The "intergovernmental loan" business is purest hogwash. What "loans" there have been have been the result of LUS having to borrow back its own earnings, at a standard interest, that it was forced to pay over to the larger utility to satisfy the PSC's dubious interpretation of an incumbent-sponsored law that already unfairly forced the utility to hike its prices to satisfy nonexistent costs ranging from taxes it doesn't pay to fees for using poles LUS already owns. Cox wants to double dip on the loans thing, both forcing LUS to pay interest to use its own money and also complaining when it does.

A quick side note: I was impressed by the quality of both the local stories. Both reporters delved into issues that weren't apparent on the surface and actually went out and made calls and interpreted what they saw in a pretty reasonable way. LUS, Cox, and AT&T all had to deal with some insightful and uncomfortable questions. And that's the way it should be. Kudos all around.

Lagniappe: The move to 1 gig is not exactly a total surprise. It's been anticipated and hinted at for a long time. I blogged a quick bit on it back in June last. Back then, though, it was supposed to be for both businesses and residents....

Thursday, April 05, 2012

Lafayette goes to a Gigabit!

LUS Fiber is now offering a 1 gigabit internet connection to businesses. That puts Lafayette at an elite level globally and among the very few providers in the US which offer a gig of service available to the whole city and not just a few in the "business core." 

Joey Durel and Huval presented the new service as advancing Lafayette to the forefront of communities that could serve as testbeds for new services and as further fulfilling their promise to the community to maintain LUS Fiber as a world-class asset.

LEDA's Greg Gothreaux, the public school system's Logan McDaniel, and Dr. Menard, principal of St. Thomas More all spoke a few words of support, agreeing that in their experience the system was rock solid. Gothreaux touted that he'd long wanted a gig to market to the new business prospects that LEDA seeks to bring to Lafayette and claimed that he relished being able to get up from the table and make a follow up call to a prospect that had been in town last week and was impressed with the 100 meg intranet. Logan McDaniel, whose LPSS has been on the wholesale network since 2005, reported that they'd already upgraded the central office to two gigs and some of the high schools to a gig. The new plan that superintendent Cooper unveiled last night included an increased use of distance learning. But the most interesting testimonial came from Dr. Menard of St. Thomas More who noted that her school's technology initiative had placed an internet-connected device in the hands of every student complained that they were already hitting the limit of a 100 meg connection and were eager to be the first customers of the new 1 gig service. Schools are a good example, perhaps the best example, of institutions where the basic functions of the institution demand more bandwidth than is commonly available. Educators simply cannot count on having enough capacity available to reliably slot in 15 minutes for a high bandwidth activity like video conferencing to sister school in France. The reliability and headroom that a 1 gig fiber connections provides will make all the difference in such institutional settings.

Elsewhere—and here until this morning—gigabit services only been practically available to large corporations and public institutions like universities at a staggering price. LUS notes that in Lafayette before today it cost $20,000 a month to buy such a connection. Against that background LUS Fiber pricing its offering at $999.95 sounds like a bargain. (Though I suspect that part of the reason for the relatively high price is that LUS maintains a stable of wholesale providers to whom it has been marketing very large connections and who then resell their connections to business users. I expect we'll hear an outcry from such users that this pricing is too low and undercuts their business model...?) 

Part of the traditional high cost of such connections is that the seller assumed that organizations that wanted such speeds would have a damned good reason to buy it and that they needed to have that much service available without fail. Consequently most such services were "dedicated" and "guaranteed." That roughly means that  a purchaser can count on getting the full gig of service—as long as their connection stays on-network. No one can guarantee service speeds on the open internet. 

One of the things that sets LUS Fiber apart, and this may be due to their history of having been a wholesale provider of dedicated bandwidth for years before getting into the retail business, is that all LUS services are treated as if they were dedicated services. In most Internet Service Providers' (ISPs') networks the bottleneck is at or very near the last mile connection and anyone wanting large, guaranteed service requires rewiring or dedicating physical assets in the last mile to that customer alone; something which is very costly—hence the high prices. Oversubscription and "best effort" is the name of the game for almost all ISPs and the bandwidth available to the last mile customer is in practice limited: if all subscribers were to use their full bandwidth at once the available speed would drop to a small fraction of the promised bandwidth. LUS has always played that game a different way, minimizing oversubscription and ensuring that even during busy hours of the day the customer's full bandwidth is available. That's in marked contrast to what I used to experience on Cox when the kids in my neighborhood got off the bus. LUS Fiber's modern network takes fiber optics all the way to the home but over a PON network where the final distribution node is a 32 address split. In talking with Huval after the press conference he noted that LUS will, as a matter of policy, split a node in half to 16 customers anytime any customer on a node buys a gig connection. That effectively doubles the available bandwidth available and ensures a reliable speed that doesn't fluctuate.

LUS is not the first to offer a Gigabit of service...Chattanooga, for one, has offered gigabit services to all its customers for quite some time, and on a very similarly architected system. So the question you have to ask is: what has kept LUS from offering a gig before and what has changed? Mona Simon, in charge of LUS Fiber's daily operations, explained that LUS has as a matter of policy has purchased two main connections to the internet that together is double the capacity it anticipates needing on a regular basis. They want to maintain full fall-over capacity so that if one of their providers fails they'll be able to continue to provide service without interruption or even degradation. What changed, apparently, was that LUS Fiber has reached a point in its customer growth that it has enough people online that the sudden spikes in usage that a gigabit service can provide would no longer be unmanageably large relative to the baseline usage. Companies that are less careful about the effects of oversubscription at all levels (meaning most companies) would tolerate the sudden drops in the network's shared connection to the internet that having a Gbps product would entail. LUS was unwilling, apparently, to offer such a product until it could "drown" the effects in a large user pool that overall justified a larger internet pipe.