News

Competition casts large shadow over Palo Alto's fiber effort

Uncertain about AT&T and Google, city to defer potential partnerships until next year

For more than 15 years, Palo Alto has been chasing a dream of bringing ultra high-speed Internet to every local household, only to watch it spark to life in places like Kansas City, Chattanooga and Austin.

Today, with the local economy booming, the City Council is fully behind the Fiber to the Premise project; and long-time proponents of the effort said the time has come for the city to dramatically expand its 20-year-old fiber network, which currently serves about 200 commercial customers.

Unfortunately for the city, the giants of the industry completely agree that fiber is the future. Established telecoms Comcast and AT&T are both preparing to unveil new high-speed Internet services, and Google Fiber is expected to announce later this fall its decision on whether to include the "San Jose metro area," which includes Palo Alto, in its next expansion.

These plans have yet to materialize but they are already putting a hitch in Palo Alto's latest reboot of the municipal project, which has been flickering on and off since the late 1990s. The current council is all in, having set "technology and the connected city" as one of its top priorities in 2014 and having committed in this year's retreat to stay on course.

Palo Alto's last venture to build a citywide system stalled in 2009, when the high-tech consortium that was planning to build the system saw its funding collapse in the midst of a recession. Today, money isn't as much of a problem as the city has more than $20 million in its Dark Fiber reserve.

The only constants in Palo Alto's endless debate over fiber are caution, uncertainty and disappointment for the project's leading proponents. The latest chapter in this familiar tale came on Sept. 2, when the Utilities Advisory Commission considered the future of the fiber project and voted 4-3 to defer further exploration of a city-owned system until early next year.

The three members who dissented — Chair Jonathan Foster, James Cook and Arne Ballentine — favored a more assertive approach, including a clearly stated commitment that the city wants to "connect all Palo Alto households to a fiber network as soon as reasonably possible" and consideration of a ballot measure to give residents a say on creating and funding a municipal network.

"There's been finally a realization that the future of competitive America is in high-speed Internet and eventually customers will begin to demand it for the yet-to-be-determined needs," the city's Chief Information Officer Jonathan Reichental said. "So incumbents and new players, like Google Fiber, are now exploring, announcing and upgrading their systems slowly but surely across the United States."

This, of course, includes the data-hungry, software-obsessed Silicon Valley region. Comcast has announced plans for a 2-gigabit Internet service in the near-term, Reichental said, and a 10-gigabit one in the "medium-term." The latter, he said, would be "1,000 times faster than the connection that the average American has to the Internet today."

AT&T announced in May its plan to bring its own ultra high-speed offering to Palo Alto. The service, called GigaPower, would offer a 1-gigabit broadband service to selected areas. It would not include TV, which would remain on AT&T's existing U-Verse system.

Reichental said that for its initial deployment, AT&T plans to install 27 new cabinets in Palo Alto that will be placed next to existing U-Verse cabinets. About two-thirds of these would be in south Palo Alto, he said, with the remainder in the north. But unlike Fiber to the Premise, this service would not be extended to everyone but made available based on demand.

These incumbents are joined in their quest by an aggressive newcomer. Google Fiber, which has already deployed its fiber system in Kansas City and Austin, announced in January its plan to expand the system into Atlanta; Nashville, Tennessee; and Charlotte, Durham and Raleigh, North Carolina.

One of the finalists for the next round of expansions is the San Jose metro area, an area that includes Palo Alto, Mountain View, Santa Clara, Sunnyvale and San Jose itself. Reichental said the city expects Google to make a decision about the San Jose area in the fall (the company is also considering Phoenix and Portland).

The challenges that a municipal fiber system would present are highlighted in a new study by Columbia Telecommunications Corp. (CTC) The firm concluded that to achieve positive cash flow, 72 percent of Palo Alto's customers would need to subscribe — a "take rate" that Jim Fleming, a manager at City of Palo Alto Utilities, called "very high" and "probably unrealistic."

The report attributes the high rate to Bay Area's high cost of labor and material. If the city applies the $20 million from its fiber fund, the take rate would drop to 57 percent, which is still higher than most other builders of fiber networks have been able to achieve in their communities, according to CTC.

Given the financial risk and the estimated $77.6 million price tag of the new system, CTC and Utilities staff are both recommending that the city find a partner in the private sector. The CTC report states that given the "high cost to build and the extremely high required take rate, it may seem that there is little incentive for any provider (public or private) to pursue an FTTP (Fiber to the Premise) deployment in Palo Alto."

"However, the public and private sectors each have unique advantages and disadvantages that may impact their ability to undertake a standalone overbuild," the report states. "A private entity and a public entity could complement one another by developing a partnership that can take advantage of each entity's strengths, and may significantly reduce cost and risk."

Given these costs and risks, staff has advocated a cautious approach: waiting until the end of the year to see which private-sector services come online and then issuing a request for information to the private sector early next year.

Utilities commissioners Judith Schwartz and Michael Danaher, who served on a subcommittee dealing with the fiber project, both advocated for this approach.

Danaher argued that it's difficult to make a "thoughtful request for a partnership when we don't know the situation on the ground."

"It just made sense to wait a few months and collect that data and have time to think about it," he said.

Commissioner Steve Eglash supported the cautious approach and said he remains unconvinced that a city-owned system is the best way to go. He stressed that everyone agrees that the goal should be universal access to high-speed Internet. But on the question of whether the system should be owned by the city or a private company he had no clear answers.

Others had plenty of ideas. Three members of a citizen advisory committee that has been working on the fiber project issued their own memo, calling for the city to declare a city-owned system as the official goal. In the memo, Bob Harrington, Christine Moe and Andy Poggio, lobbied for a city-owned system.

"The Internet has quickly become the communications network that connects our planet," the memo states. "To assure all our citizens and businesses world class access to the world's most powerful network, and at a competitive prices, Palo Alto logically should own and control a FTTP network."

The three residents also called for the council to direct Utilities staff to negotiate with private companies "immediately" about the possibility of building out the city's fiber system in parallel with their own.

This idea found some support on the commission, with Foster arguing in favor of pursuing a city-owned system in which the fiber service is provided as a "public benefit."

"If there is any place in the United States to do it that is not underserved, it's probably Palo Alto," Foster said. "I think we're leaders on all things technology-related and, even if we're not, we like to believe we are."

Commissioner James Cook agreed with the three residents and their recommendation to begin negotiations now, rather than wait until AT&T, Comcast and Google Fiber come up with their own local programs.

"Instead of waiting, we've sort of got this golden opportunity in the four-month period to take some action and hit the train head on and see if we can steer it the way we want it to go," Cook said. "If we defer, we'll be stuck with whatever they're going to come up with in the next four months."

Ultimately, caution prevailed by a single vote. Schwartz stressed that the intent is not to delay the fiber effort any longer but to gather the needed information. She also argued that it would not be practical for any Internet service provider to make a bid if they don't know whether AT&T or Google plan to unveil their new systems in Palo Alto.

"For a realistic assessment, they need to know: Are the two 800-pound gorillas in the room or not?" Schwartz said.

Related content:

Google brings flicker of hope to Palo Alto's fiber dream

Palo Alto sees its fiber dream fizzle

Comments

6 people like this
Posted by Alice Smith
a resident of Green Acres
on Sep 9, 2015 at 10:26 am

/we have an excellent public utility. Cable as well as underground utilities should be a part of this. I should think this would be a higher priority.


Like this comment
Posted by Grumpy Old Guy
a resident of Palo Alto Orchards
on Sep 9, 2015 at 11:18 am

Grumpy Old Guy is a registered user.

Great idea to bring high speed internet to Palo Alto - or even superfast internet.

My question is whether or not commercial businesses and their landlords will bear their full costs of their use of the system including startup costs, infrastructure, maintenance and regulation.

On the ancient hardwired phone system, commercial businesses subsidize the wiring of rural areas and residential phone services. And there are specialized charges for your cell phone that are similar.

Before we climb onto the bandwagon, we need to examine how the costs will be spread out among the users - commercial and residential. And remember, it's not just the installation costs, but the maintenance, technological upgrades, administrative and staffing costs (with benefits) down that road that will bite us.

Not to be a Luddite, but do you really want to be subsidizing the profits of downtown businesses and their landlords? (Of course, that will create more demand for downtown office space with displacement of smaller local businesses,and hence, more demand for affordable housing with increased traffic).


8 people like this
Posted by R Wray
a resident of Palo Verde
on Sep 9, 2015 at 11:26 am

It's obvious that competition is not the problem. The problem is the City. If the city would get the hell out of the way, we would have fiber in short order.


4 people like this
Posted by Engineer
a resident of Duveneck/St. Francis
on Sep 9, 2015 at 11:47 am

There's way too much ego and way too little expertise in this proposition.


4 people like this
Posted by Slow Down
a resident of Community Center
on Sep 9, 2015 at 11:50 am

Slow Down is a registered user.

@R Wray - Yes, the city is the problem, see the 18 year delay on fixing the SF creek bridges. The idea of a city owned system is a joke.

Also, having the looming threat of a municipal broadband isn't the best way to entice to private internet competitors to come to Palo Alto. Palo alto needs to get out of the fiber business, proactively work to get some more competition in town, and use the 20 million dark fiber fund for something useful like more police and syncing traffic signals.


9 people like this
Posted by JvG
a resident of Duveneck/St. Francis
on Sep 9, 2015 at 12:07 pm

My father led the effort to get Fiber installed at HP in Palo Alto. My father-in-law engineered by himself a 5 mile sonet ring for Fiber in the Silicon Valley. My father-in-law's project took less than 2 years to complete. These projects were in the mid-1990s or before. Sorry folks, for people that know, this is not rocket science.

CPAU Electrical Engineer told me the reason why there are utility polls in Palo Alto is because AT&T and Comcast are dragging their feet. I disagree with the assertion that this cannot be done publicly. I am a world expert on Computers and Communications ( 28 years at the High End of HP and Intel servers).

The issue to me is how to provide content to people in an easy to understand way. AT&T Uverse despite it faults and expensive $/Mb of bandwidth does make accessing content straight forward. With just a high speed internet connection from CPAU and a roof antenna(already installed and upgraded to digital), I can get all the content I have today from CBS,ESPN, Netflix, Apple, Amazon, Disney, major movie studios, etc. The issue is the software and user interface. The hardware installation should be very straight forward. I'm guessing that using modern technology, I should be able to get 200Mb/s instead of 20Mb/s down bandwidth at the same cost. This is why I don't trust AT&T, Comcast, or even Google Fiber. The cable/telephone companies don't care what we want. They want to extract money from us at the minimum investment.


7 people like this
Posted by Wayne Martin
a resident of Fairmeadow
on Sep 9, 2015 at 12:45 pm

This proposal keeps coming back every few years—driven by who? What call is there for a City-owned Fiber Utility? There are changes in society that need to be considered for all cable services. Younger people have shifted to mobile devices, so it’s hard to believe that there will be a huge demand for the 70-100/month PAU offering—in addition to their cell bills.

The wireless companies are all working on the next generation of wireless, which promises to deliver data streams at/up to 1Gb. The following article attests to Verizon’s effort in that domain--

Verizon to be first to field-test crazy-fast 5G wireless:
Web Link

How fast is 5G? Verizon's tests have shown a connection speed that is 30 to 50 times faster than our current 4G network, or higher speeds than what Google Fiber offers through a direct physical connection into the home, Gurnani said.
With 5G, that copy of the movie "The Guardians of the Galaxy" would zip to your device in 15 seconds instead of 6 minutes via 4G.
****

t could be 2018-2020 before 5G is widely available, but that doesn’t give the City much time to install a Fiber system, and make enough revenue to start paying off the bonds that it would have to sell in order to fund the system.

Verizon is now getting its Docsis 3.1 product into field trials:
Web Link
those first-gen 3.1 modems, when fully-loaded, could support about 5 Gbps down by 1 Gbps.
****

With Mobiles disrupting the idea of revenue from landlines, and the Internet offering streaming video that disrupts revenue from a TV-channel, and with AT&T, Comcast, Verizon Wireless and possibly Google in the Palo Alto space—what room is there for a City-owned Fiber offering?


2 people like this
Posted by neighbor
a resident of Barron Park
on Sep 9, 2015 at 12:56 pm

will we ever get those hideous power lines in Barron Park to go underground?


5 people like this
Posted by Midlander
a resident of Midtown
on Sep 9, 2015 at 2:03 pm

I was excited to hear that the AT&T Gigapower deployment is moving ahead! Reading specific information such as "27 new cabinets" makes it sound like planning is well advanced.

Does anyone have a link to more detailed information? In particular, when is the deployment likely to become available?

Separately, I was rather surprised by the assertion that to assure high speed network access the city should own and control a network. This isn't the USSR in 1950! I suspect competing capitalist vendors will provide us with good high speed networks, if the city will only get out of the way. I do not want to be stuck with a city owned network where it will take ten years of planning reviews for each minor upgrade.



Like this comment
Posted by Wayne Martin
a resident of Fairmeadow
on Sep 9, 2015 at 2:37 pm

According to this AT&T press release--AT&T launched its GigaPower service in Cupertino back in March--

U-verse with AT&T GigaPower Launches Today in Cupertino
Web Link

In the past, AT&T had to file a lot of paperwork for approval of its current fiber cabinents in the neighborhoods. It stands to reason that similar paperwork would be filed with the planning department for the GigaPower cabinents. Anyone interested can request copies from Planning.



4 people like this
Posted by Engineer
a resident of Duveneck/St. Francis
on Sep 9, 2015 at 3:48 pm

"This proposal keeps coming back every few years—driven by who? What call is there for a City-owned Fiber Utility?"

Ego, Mr. Martin, pure ego.


Like this comment
Posted by Peter Carpenter
a resident of Atherton
on Sep 9, 2015 at 4:12 pm

Peter Carpenter is a registered user.

Here is a much better way to approach the fiber issue:

Atherton Fiber Project

In mid-2014 the City Council created the Technology Subcommittee. The Subcommittee is led by Council Members Rick DeGolia and Bill Widmer. The make-up of the Committee also includes numerous interested residents and local school representatives. In late 2014, the Subcommittee released a Request for Information (RFI) to potential local service providers, including Google, AT&T and Comcast. The RFI expressed the Town's interest in various options to establish Town-wide connectivity and provide high-bandwidth services to its residents, Town organizations, facilities (library, city hall, council chambers) and schools (public and private).

The Town envisioned the creation of a network that used existing and future public infrastructure to deliver service. Potential usage across such a system could include emergency notification, traffic signal management, security management, street light management, information sharing, and other traditional communications, entertainment and internet access. None of the traditional companies responded. Local resident, Mike Farmwald, learned of the RFI and responded to the Town's Technology Committee. After learning more about what the Committee was exploring, Mike created Atherton Fiber and made a proposal to the Town Council at the July City Council meeting. At that meeting, the Council directed staff to work further with Atherton Fiber to create a possible Development Agreement for the project.

Atherton Fiber would offer up to 10 gigabits/second making it one of the fastest and most robust Fiber Network in the world. Atherton Fiber anticipates that the build out will be 20% underground and 80% aerial, leveraging existing overhead and below-ground systems. The overall cost to complete the build-out Town-wide is estimated at $6.5-$7 million. The goal of the project is to install a minimum of one fiber to each home in Atherton.

To finance the project, Atherton Fiber plans to raise approximately $3 million via a traditional investment mechanism (lead by Mike) and other interested Atherton residents. The remaining funds would be raised by selling interested property owners a "set" of bundled fibers to their home that they would own directly.

Atherton Fiber estimates that 20% of residents (500 homes) will purchase the bundled fiber set. These sets would only be available as part of the initial design. Once the system is installed, no additional fiber sets can be run and homes would only be able to access their single fiber run. Purchasing a bundled set of fibers (owned by the property owner) for current and future use (ownership transferrable with the property) when the system is initially deployed is like an initial public offering. Those sets of fibers can be used by the property any way they choose without an ongoing lease requirement.

For the remaining single fiber runs to each property, if the property owner wants service on that fiber line, they will need to lease that fiber from Atherton Fiber. All fiber will be "home runs" to the central office box locations such that no property owner will share a fiber with others (as compared to existing broadband lines). This allows each property owner to have the very fastest speed possible without degradation of their connection during the most active use periods.

At its July 2015 Regular Meeting, the Council unanimously voted to direct the City Attorney to prepare a Development Agreement with Atherton Fiber which would enable Atherton Fiber to access the Town's rights-of-way throughout the Town to provide the fiber to every residence in the Town and to connect all residents that that want to be connected. In exchange for such access, the Town may seek to receive fiber services for its public service delivery, to include the potential for emergency notification, traffic signal management, security management, street light management, information sharing, and other traditional communications, entertainment and internet access.

Atherton Fiber expects to create at least two (2) central office locations to lease access to internet service providers chosen by residents (Google, Sonic, AT&T, Comcast and others). Choice is one of the primary benefits of the system design. Service providers that are already in the Atherton service market may wish to assess the cost-benefit of offering services over the Atherton Fiber network.

Atherton Fiber also hopes that the Atherton Library will lease access to entire Fiber Network. By leasing access to the system, the Library can deliver 21st-century library services to the living rooms of those on the network. If this occurs, Atherton Fiber may seek to have its service providers offer basic Internet service to anyone on the fiber network at no cost.

The Atherton Fiber Network is a huge win-win for Atherton residents, the Town, and the Atherton Library that puts us on the cutting edge of service delivery options using possibly the fastest fiber network in the world.

Watch for more on the Atherton Fiber Network as Atherton Fiber begins local pricing surveys, marketing, network design, and other steps toward implementing this network. The Town anticipates completing the Development Agreement by Fall 2015 and anticipates work on the Network to begin by the end of 2015.

The Town will provide basic information via its website, but because this is a private network designed and built privately, the Town will refer most issues directly to Atherton Fiber. Contact information is available on the Town's website and as more information becomes available, the Town will list it here. "

Web Link


4 people like this
Posted by Mike-Crescent Park
a resident of Crescent Park
on Sep 9, 2015 at 4:53 pm

Mike-Crescent Park is a registered user.

The only Palo Alto project moving more slowly than fiber is the San Franciscito Creek flooding plan...


7 people like this
Posted by Kevin Ohlson
a resident of Old Palo Alto
on Sep 9, 2015 at 5:32 pm

Increasingly, people just want a fast connection at an affordable price. Comcast, AT&T, and others don't want to deliver just that - it makes them a commodity. They want to deliver telephone and TV services, too. The thing is, not many want these any more and they know it. Over the weekend I helped my daughter move into an off-campus apartment, and high-speed Internet, all by itself, was more expensive than bundled services. But she cares only about Netflix and HBO, and has a cellphone.

In theory, because the City is not dragging along old business models, and because they can leverage existing CPAU capabilities, they could be a competitor. Companies are building out for the next generation of services, such as 4K TV. This is a potential window for the City.


8 people like this
Posted by Ben
a resident of Midtown
on Sep 9, 2015 at 7:08 pm

I had ATT for phone and internet service for years. They were the absolute worst, and offer little value for the cost of service. My internet service was intermittent, and about 10x slower than advertised, and what I was paying for. I live in midtown, hardly a remote difficult to serve area for that sort of product. ATT's attitude about these constant problems was that I should subscribe to a faster service, and by some bizarre logic, my internet rate might speed up.

I dumped ATT and now have Sonic phone and internet. Quite simply, it works as advertised, and I pay quite a bit less than I ever did with ATT.

I have no idea how Google would be as a business partner, but I suspect that ATT and Comcast, both vying for the title of worst customer service and bad value companies in the US, would most likely be expensive, unreliable, and difficult to deal with. I would suggest that the city contact Sonic Web Link and see what they have to offer. At a minimum, it's a third party comparison. I for one would be VERY uninterested in another business 'relationship' with ATT, of any sort.


7 people like this
Posted by Terry
a resident of Midtown
on Sep 9, 2015 at 7:47 pm

Normally we come here, pick a topic and argue with each other.

This topic drives me nuts as I'm driven to argue with myself. First, I'm 100% for fiber access, happy to pay what ever it takes, ... but Comcast and AT&T service is poor, and not sure if I trust Google. Would be nice if the City took on the project, except they have never been able to competently complete a project in the last 25 years.


2 people like this
Posted by Jim h
a resident of Community Center
on Sep 9, 2015 at 10:24 pm

In theory, I think Wayne has good arguments for wireless. But there are advantages to FTTH that I doubt wireless will ever overcome and both technologies are needed to get both speed with mobility and speed with dependability. See Web Link

The physics of digital communication via the air rather than fiber is not straightforward. Weather changes can effect the signal and spectrum is limited by law. But even more, unlimited demand for signal can strangle the network speeds as there is no limitation of nodes as there is on a FTTH system.
For all of you with a a Verizon phone running 4G, you may experience download speeds 5 times that of your home AT&T Uverse line. However, depending on number of people using their phones, weather conditions or tower locations you may not get ANY download speed over 4G LTE wireless. I think this problem will still exist with 5G.
For the immediate future, wireless will get way faster - but not as dependable.

So that is why municipalities and telecommunication companies invest in FTTH. But the investment is heavy and is definitely quite different than an electrical network. I back the decision to wait a while to see if Google or AT&T will step up with investment. I think the hardest part for Palo Alto would be competing with major telecoms on content licensing, staying current with technology, and making the politically difficult investments in infrastructure required.


Like this comment
Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 9, 2015 at 10:48 pm

The current products offered by Comcast include 50mb, 100mb, and 150mb service (as they are labelled by Comcast). While Comcast does not publish their market shares for these products, what I have heard is that most people in PA who use Comcast are opting for the 50mb service.

Which raises the question: if there is huge immediate need for services above 1gb, so huge and so unmet by the incumbent providers that they city needs to enter this space, why aren't there more people opting for the highest service they can get (150mb from Comcast)?

The answer is simple: the need is just not there as of yet. It will be, of course, but just not now. My explanation: people are not spending their money for the 150mb service from Comcast because they realize that they don't need it.

Moreover, as the article cites, incumbent providers are well aware that faster internet is needed. Comcast, for example, is rolling out 2gb services in some areas, and all providers are working on their plans.

JUST IN TIME.

There is no need for the city to offer its own services. What the city should be doing is the following:

1. Work with the existing incumbents and others in a more pro-active way. Ask what would help them, don't just lecture them on the city's vision.
2. For wireless services, lower the bureaucratic and financial burdens to installing needed new infrastructure. Mobile is an increasingly large factor in internet service, yet it is very hard to overcome the resistance to the antenna systems in individual neighborhoods.




Like this comment
Posted by Slow Down
a resident of Community Center
on Sep 9, 2015 at 11:23 pm

Slow Down is a registered user.

@Kevin Ohlson - Can you share more about the internet plan you set up for you daughter? You mentioned unbundled internet was more expensive than the tv/phone/internet bundle. That hasn't been my experience - unbundled internet may seem like a bad value compared to a bundle, but typically not more expensive. Comcast has a 25mb unbundled internet connection for $39.99, and 75mb for $44.99. That's less than bundles w/tv & phone which run btw $75-100.


8 people like this
Posted by Alice Smith
a resident of Green Acres
on Sep 10, 2015 at 7:14 am

I think the slap at Palo Alto is untoward. The 3 library redevelopment projects came in below budget and except for litigation from a terrible contractor arising from the lowest bid syndrone instead of the highest quality supplier option, on time. Mitchell Park is just plain gorgeous.

And our Palo Alto owned and run Public Utility is the envy of many cities.


Like this comment
Posted by SteveU
a resident of Barron Park
on Sep 10, 2015 at 7:54 am

SteveU is a registered user.

Palo Alto already has a (Dark) Fibre program you can sign up for.

All you need is about $10K per MONTH plus your own Equipment.

Why would AT&T or Comcast WANT to underground? The COST per drop rises exponentially when undergrounded.

Palo Alto home owners already whine about the 'unsightly' green boxes along the street.
The best reason NOT to... In many neighborhoods, lime mine. Phone and cable are from the rear. Digging would damage the redwoods and other trees on that property line right of way


2 people like this
Posted by Slow Down
a resident of Community Center
on Sep 10, 2015 at 12:02 pm

Slow Down is a registered user.

@Alice Smith - If holding up Mitchell Park library as one of the big success stories is the best we can do, then Palo Alto deserves more than a slap.


Like this comment
Posted by Wayne Martin
a resident of Fairmeadow
on Sep 10, 2015 at 2:12 pm

> AT&T phone service was the worst

Periodically, there are people claiming that the AT&T phone service is “poor”, yet they don’t provide any hard evidence as to what they mean. The American telephone grid is the best in the world—with nation-wide reliability at 99.999% (often described as 5-9s in the industry). The electric grid, by comparison, is a little less reliable, at 99.9%. It’s my belief that the AT&T service here in PA matches the national average..

For most people, the telephone sits idle about 99+% of the day. So, how many of you complaining about AT&T service can attest that when you pick up the phone to use it that there is no dial tone, or that there is so much noise on the circuit that you can not conduct a conversation? Did you have to wait a week, or more, for AT&T service to fix the problem?

There was a time here in the Silicon Valley, back in the mid-1990s, when the Internet became popular that people experienced a sort of “brown out” when they tried to dial into their Internet providers. They didn’t receive a dial tone for 20-odd seconds. This was because the switches in the central office had individual dial tone generators. With the tsunami-like increase in the use of the phone system at times like 6:00PM, the switches were overwhelmed. Over a few months, the telephone company seemed to have corrected this problem by adding more hardware—as the complaints disappeared. Today, dialup Internet access is a thing of the past.

So—it would be instructive for those of you complaining about AT&T telephone service to be more precise in your complaints. If you are including AT&T wireless service in your complaints, could you make that clear?

As to Comcast—this is a different technology, so a different class of complaints are possible. Would be interesting to hear from you, also.


Like this comment
Posted by Engineer
a resident of Duveneck/St. Francis
on Sep 10, 2015 at 2:45 pm

"Weather changes can effect the signal and spectrum is limited by law."

Weather effects on wifi signal propagation are negligible at 2.4 GHz, which is just below the band where NOAAs weather radar opetates. Infinitesimal echoes from raindrops routinely propagate 100 miles or more back to the radar antenna, and the much stronger wifi packet easily gets through a few hundred feet of rain.

Spectrum allocation laws change like chameleons.


2 people like this
Posted by Peter Carpenter
a resident of Atherton
on Sep 10, 2015 at 2:53 pm

Peter Carpenter is a registered user.

Why doesn't Palo Alto tap it huge pool of expert citizens and successful entrepreneurs and put together a Technology Committee like Atherton did?

The Atherton Technology Committee wisely proposed an Atherton Fiber Network . The proposed network is a huge win-win for Atherton residents, the Town, and the Atherton Library that puts us on the cutting edge of service delivery options using possibly the fastest fiber network in the world. And it does so without a financial burden on the Town whose contribution is the very valuable right of way rights.


1 person likes this
Posted by Curmudgeon
a resident of Downtown North
on Sep 10, 2015 at 2:59 pm

"To finance the project, Atherton Fiber plans to raise approximately $3 million via a traditional investment mechanism (lead by Mike) and other interested Atherton residents. The remaining funds would be raised by selling interested property owners a "set" of bundled fibers to their home that they would own directly."

You're doing this part of the thing right, at least upfront. However, I'd strongly recommend adding an absolutely money-tight firewall between fiber matters and public funds.

Good luck!


1 person likes this
Posted by Slow Down
a resident of Community Center
on Sep 10, 2015 at 3:02 pm

Slow Down is a registered user.

@Wayne Martin - ATT may deliver 5-9s for phone service, but unlikely true of their internet service, which is what this thread is about. It definitely isn't true of their cell service.

I'd like to see private competition, from a google or a sonic, because of the Comcast bandwidth capping policies (thankfully suspended in Palo Alto) and anti-competitive streaming practices. To their credit, Comcast has made two big bumps in their internet speed in the last few years. Until ATT decides to roll out fibe rin PA, they are uncompetitive on speed.


3 people like this
Posted by Curmudgeon
a resident of Downtown North
on Sep 10, 2015 at 3:15 pm

Geez Peter. Kindred messages crossing in the ethernet.

I've been advocating exactly your proposal since FTTH first raised its glassy-wire-haired head in PA.

Result: thud, thud, thud, ... . The local FTTHeads are irretreivably hung on having the government finance build and operate it for their delectation, and the municipal utilities have drunk the kool-aid too. Neither knows jack about the technology or economics, which explains their eagerness.


1 person likes this
Posted by Wayne Martin
a resident of Fairmeadow
on Sep 10, 2015 at 3:18 pm

> ATT may deliver 5-9s for phone service, but unlikely true of their internet service,
> which is what this thread is about. It definitely isn't true of their cell service.

The comments from various posters seem to suggest that they were complaining about AT&T phone service—prior to AT&T’s being an prime Internet provider here in PA. Having followed this matter since the later 1970s, I can attest that people have complained bitterly in public meetings about AT&T, but never provided any hard data to back up their claims.

My question also applies to AT&T internet service. While it’s clear that AT&T is not providing the fastest service that it can, it’s clear from the article that AT&T is planning to bring its ultra-high-speed service to PA in the near future.

This leaves the issue of price. Many of the comments in this threat seem to not fully appreciate the costs associated with installing all of the fiber and associated electronics. This is not cheap, yet people seems to be ignoring the costs.

So—please add AT&T Internet service complaints—such as outages, transmission quality metrics, service call wait times, etc.

BTW—I should say that I use AT&T and so I have a good feeling for the service availability. The older DSL service went out once in a while for a short period. I use U-verse, which has a 99.999% availability for me. I am not married to AT&T, but definitely don’t believe the City is the right vendor for these sorts of services.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 10, 2015 at 3:27 pm

Peter Carpenter is a registered user.

Well one player is off the boards for Palo Alto for now:

"SAN FRANCISCO — Google Fiber is considering three new cities for its high-speed Internet service: San Diego, Irvine, Calif., and Louisville, Ky."


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Posted by jim h
a resident of Community Center
on Sep 10, 2015 at 3:33 pm

@slowdown
Comcast is $39.99 for 25mb during the trial period. However, the price then jumps up.
"Comcast's service charge for Performance 25 Internet is $61.95/mo"


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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 10, 2015 at 4:08 pm

Wayne Martin,

One problem with complaints about our incumbent providers is that they are often couched in comparison to a city-owned FTTP service that doesn't exist yet. Naturally, the city's system "wins" such arguments.

When you look at actual municipal systems, they often end up with exactly the same "problems" that the incumbents had. This has been a common theme of reviews of real systems.


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Posted by bill kelly
a resident of Barron Park
on Sep 10, 2015 at 4:56 pm

I visited a city in New Zealand about the size of Palo Alto that had completed a high speed fiber to every house and business in 1998. I current;y use Comcast Business high speed internet at $120 a month for less than half the speed of google fiber and 5X the cost. PA Utlilites could easily do this, we just lack the vision.


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Posted by Slow Down
a resident of Community Center
on Sep 10, 2015 at 5:21 pm

Slow Down is a registered user.

@ jim h - The OP said naked internet cost more than the bundles, I don't think that is true. Both the bundle and internet go up after 1 year, but the bundle is always more. Also, you can stay on promotional pricing indefinitely with Comcast as long as you are willing to call and ask every year. It is annoying, but worth doing.

@bill kelly - Google small business pricing is 100/mo + 20 for an IP address at 1gb. You are probably getting even less the 1/2 the speed, more like 1/10th or 1/20th, but at a comparable price.

@Peter Carpenter - "Three areas, including San Jose and surrounding cities, remain in the pool of potential expansion sites." (It's luck I enjoy fact checking you..) Web Link

This comment on the google fiber blog probably best explains why it won't be coming to Palo Alto, "It’s clear that Irvine, Louisville and San Diego have strong leaders at city hall, who are passionate about bringing fiber to their communities and making the Internet more accessible for everyone."


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Posted by Peter Carpenter
a resident of Atherton
on Sep 10, 2015 at 5:30 pm

Peter Carpenter is a registered user.

Please fact check all you want - that is what keeps this discussion, mostly, truthful.

My quote was completely accurate and was sourced from USA Today


Your quote also omitted this very pertinent statement "Besides the good news, nothing is set stone as both Google and the cities have to conduct detailed study of factors that affect construction, such as local topography, housing density, and the condition of existing infrastructure. They will determine if it’s technically feasible to install Fiber and to generate all the planning process."

Yes, Palo Alto remains in the pool but the timing to date suggests that Irvine, Louisville and San Diego will take at least a couple of years to do, so Palo Alto is in a "deep" pool.


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Posted by Slow Down
a resident of Community Center
on Sep 10, 2015 at 6:03 pm

Slow Down is a registered user.

@PC - Your quote was fine, it just in now way supported your assertion that "one player is off the boards" for Palo Alto. Google Fiber probably won't be coming to PA, because the city thinks too highly of itself to go beg for it and make concessions, which is what these other cities are willing to do.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 10, 2015 at 6:13 pm

Peter Carpenter is a registered user.

" Your quote was fine, it just in now way supported your assertion that "one player is off the boards" for Palo Alto."

Please include my COMPLETE statement "Well one player is off the boards for Palo Alto FOR NOW (bolding added):"

What you are doing is NOT being truthful - it is what is described amongst people of honor as playing with the truth.


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Posted by Slow Down
a resident of Community Center
on Sep 10, 2015 at 8:53 pm

Slow Down is a registered user.

@Peter Carpenter - The quote doesn't support your incorrect assertion that palo alto is off the table "FOR NOW" either. That implies a delay or stoppage in the consideration process that isn't referenced in the article, and hasn't happened.

So be honorable, and show us where it says Palo Alto is off the table FOR NOW, and if you can't, I'm sure you'll do the honorable thing.


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Posted by Anonymous
a resident of Another Palo Alto neighborhood
on Sep 10, 2015 at 9:22 pm

I've concluded that the only way I'm going to have fiber to the home is by moving to a community that offers it. It won't happen in Palo Alto anytime soon.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 10, 2015 at 9:29 pm

Peter Carpenter is a registered user.

As previously posted, but obviously carefully overlooked ,

"Yes, Palo Alto remains in the pool but the timing to date suggests that Irvine, Louisville and San Diego will take at least a couple of years to do, so Palo Alto is in a "deep" pool."


And my moderators have quietly advised me that to help maintain the Town Square as a thoughtful gathering place for sharing community information and opinion I should no longer respond to Slow Down's postings.

I have agreed with their recommendation.


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Posted by PatrickD
a resident of Barron Park
on Sep 10, 2015 at 11:40 pm

@Wayne Martin: A quick search for "worst customer service companies" on Google will turn up many, many lists which include both AT&T and Comcast as two of the worst companies in the US. If you've used either of them and have had great service, you're one of the lucky few.


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Posted by Alice Smith
a resident of Green Acres
on Sep 11, 2015 at 8:24 am

@slow down

I wasn't aware that the residents of Palo Alto wanted large building projects. Have you been to Mitchell Park library and community center? Why not take pride in our city's achievements?

Also, not sure why some people need to fictionalize their names in these exchanges? Chacun a son gout (no accents available).


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 11:00 am

@Wayne Martin -- A 01-08-11 New York Times article claims AT&T's phone network "... was engineered so that 99.999 percent of the time, you could successfully make a phone call."
Web Link

My experience at my current address in Palo Alto over 17 years is that on at least two occasions, my landline phone was completely dead for multiple days. So its reliability over 17 years was no better than 99.936%. If I had thought to keep records, I'd be able to cite a lower reliability figure. On lots of other occasions, mostly after it had been raining heavily, there was excessive "static" on the line, which made phone conversations somewhat difficult and might have made dial-up or DSL unusable. Once, I discovered that the phone company had attached someone else's FAX machine to my phone line. So I could make phone calls, and I could receive phone calls if I answered before the FAX machine answered, but my answering machine wasn't receiving phone calls. I have no idea how long my phone service had been impaired in this way before I noticed the problem.

Here, AT&T claims that the reliability of its global backbone network is 99.999%. Whether that's true or not, it's not the reliability of the phone network overall.
Web Link

*Slow Down -- I agree with you that this thread is about Internet service, not phone service. I speculate that the problems reported above would have been a problem for Internet service.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 11:11 am

@R Wray (09-09-15, 11:26 am)
> If the city would get the hell out of the way, we would have fiber in short order.

As far as I can see, the city hasn't been "in the way." As far as I can see, the City has given Google all the information they've asked for, which is even better, from Google's point of view, than getting out of the way.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 11:43 am

@Slow Down (09-09-15, 11:50 am)

> Palo alto needs to get out of the fiber business ...

Palo Alto has been very successful in the dark fiber business, not only making money, but also providing the communications opportunities big businesses and schools need to be successful. I certainly wouldn't want to see Palo Alto get out of this business, and neither would its customers. I think municipal FTTP could be similarly successful, given the chance.

> use the 20 million dark fiber fund for something useful like more police and syncing traffic signals.

Nowadays, Palo Alto Utilities in general sets up its utilities as separate entities financially, so that ratepayers can be assured that what they pay for a utility stays within that utility and isn't siphoned off to be used for something completely different. For some of the City's utilities, state law even requires this. So I think the fiber utility's funds should stay within the fiber utility. Incidentally, the fact that fiber already goes to the City's traffic lights is what makes it possible even to think about syncing them. Apparently, syncing the City's traffic lights to the County's traffic lights within the City is hard.


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Posted by Norman
a resident of Menlo Park
on Sep 11, 2015 at 11:53 am

Cable Coop redux. Palo Alto was probably the last major area to get cable tv. One reason was that with technology (by the way, science is never settled) if you wait for the next improvement you'll do nothing today and for 15 years. Having tech savvy smart folks in Palo Alto kept this process going. And of course, the glory of not having corporate ownership: we can do it better ourselves. A fiasco now repeating itself.


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 1:31 pm

> A quick search for "worst customer service companies

I agree that such lists exist, but everyone knows that those posting on such lists are anonymous, and that there are really no scientific studies that back up these lists. AT&T claims that it now has 122M wireless customers and more than 16M broadband connections. Traditional wireline customers have been declining over the years, for all carriers.

AT&T Plans for No Wirelines:
Web Link

Nearly 40% of U.S. households now have no landline phone, and there are more wireless devices than people. "Revolution is all around us," says Federal Communications Commission ChairmanThomas E. Wheeler. An all-Internet protocol network could lead to better products, lower prices and "massive benefits" for consumers, he says.
- - -
Given the large number of AT&T customers—there’s no reason not to believe that some sort of problems will result. Putting much stock in the complaints of anonymous posters is not something that should drive public policy.

As to Comcast, given that they use a different technology delivering signal to the premises, complaints about signal quality probably have more validity. Comcast complaints often involve slow Internet access speeds caused by overloading a given circuit, data capping, and monitoring for illegal downloads. —Again, given the Comcast’s customer base (about 30M subscribers)—there is no way to know what most of its customers think. Installing Docsis 3.1 service will doubtless reduce the number of service delivery-related complaints. But only time will tell.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 1:37 pm

@Norman -- As a resident of Menlo Park, why do you care about what happens to FTTP in Palo Alto?

This time around, nobody's asking Menlo Park to be a part of a TV joint powers authority (JPA), so you're safe.

This time around, potential FTTP providers don't need a franchise from a city (or a JPA), so you're safe.

This time around, I don't hear anyone saying we should wait for the next technology improvement before starting.

Cable Coop was a private-sector entity. This time around, I'd prefer that Palo Alto implement FTTP as a municipal entity.

So far, 154 municipalities have implemented FTTP networks. The vast majority have been successful.

Web Link


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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 11, 2015 at 1:49 pm

Jeff Hoel,

Your statistic is interesting but I have two questions:

1. Where do you get it from?
2. Were there controls for the quality of incumbent services? My impression was that most communities that could be called successful either had no broadband at all or very weak providers. [Palo Alto is very strong btw.]


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 1:55 pm

@Jeff—

Thanks for posting this information.

Reliability numbers may vary from source to source. The AT&T numbers cited above are for its fiber optic backbone. This is a highly redundant system, so it stands to reason that reliability is high.

The following, from Wikipedia, although not sourced, offers the same 99.999% number I did, which presumably applies to all telephone systems (not just AT&T(—

Web Link

While POTS provides limited features, low bandwidth, and no mobile capabilities, it provides greater reliability than other telephony systems (mobile phone, VoIP, etc.). Many telephone service providers attempt to achieve dial-tone availability more than 99.999% of the time the telephone is taken off-hook. This is an often cited benchmark in marketing and systems-engineering comparisons, called the "five nines" reliability standard. It is equivalent to having a dial-tone available for all but about five minutes each year.

As to the poster's claims that his telephone was out for multiple days a couple of times in 17 years—one can only wonder how many times the PAU power has been out in his neighborhood during the same period? My power was out for five days during the Loma Prieta event, whereas the telephone service was not interrupted.

> So its reliability over 17 years was no better than 99.936%.

Amazing that anyone would be complaining about 99.936% service availability.

As to the article in the NYT, one is free to believe what one wants—but the NYT probably doesn’t hire many telephony/network engineers.


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 1:58 pm

> Incidentally, the fact that fiber already goes to the City's traffic lights
> is what makes it possible even to think about syncing them.

Modern traffic signal controllers have interfaces for wireless, DSL, POTs and Fiber.


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 2:03 pm

> This time around, potential FTTP providers don't need a franchise from a city
> (or a JPA)

Given that the City is collecting a 5% francise fee from Comcast customers--it's hard to believe that the City would not want to impose such a fee on any telecommunications/networking entity that would have to use City property in order to service its customers.

Oh, and in the past, the City has included some very onerous language in its franchise that ultimately claims the right to seize the deployed equipment if the franchise holder does not satisfy the City in its execution of the awarded franchise.


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 2:11 pm

> Most municipal fiber networks have been successful

Well, maybe. This WSJ reviews that premise:

Web Link

Like most utopian dreams, the Utah Telecommunications Open Infrastructure Agency, or Utopia, hasn't panned out. Utopia, a consortium of 11 municipalities to build a fiber-optic network, was initially financed in 2004 with a $185 million bond; it was supposed to be completed in three years and have a positive cash flow in five. The project is a prime example of why governments should not be in the business of building or operating broadband networks—and why the federal government should not be in the business of cheerleading for them.
---

And then there was the Google takeover of the Provo, UT, fiber system--

Web Link

Small, rural, communities have a good reason to build fiber systems. PA is not a small, rural, underserved community.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 11, 2015 at 2:41 pm

Peter Carpenter is a registered user.

"@Norman -- As a resident of Menlo Park, why do you care about what happens to FTTP in Palo Alto?"

Norman and I and others care because we have relevant experience that just MIGHT be helpful in finding a good solution for Palo Alto.

I encourage you to read the report from the Atherton Technology Committee:

Web Link


1 person likes this
Posted by Jane
a resident of College Terrace
on Sep 11, 2015 at 3:19 pm

"ratepayers can be assured that what they pay for a utility stays within that utility and isn't siphoned off to be used for something completely different. "

Palo Alto siphons off an increasingly large share of the utility profits to the general fund. Last year I believe it was about $17 million. Ever wonder why our utility rates keep going up?


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Posted by Slow Down
a resident of Community Center
on Sep 11, 2015 at 3:23 pm

Slow Down is a registered user.

@Peter Carpenter - You are of course selectively ignoring the fact that google is taking on multiple cities at a time, 6 in the most recent batch, so that they announced three does not push Palo Alto back.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 3:39 pm

@Wayne Martin -- The WSJ article you cited was written by Thomas A Schatz, President of Citizens Against Government Waste, and Royce Van Tassell, who at the time worked for the Utah Taxpayers Association, a well-known opponent of UTOPIA. So I suspect the article was biased. I didn't read the article because it's behind a pay wall.

Yes, it's well-known that UTOPIA, while providing good services to customers, has not yet been a financial success. One factor has been a Utah state law that restricts muni telecom. They also made some mistakes early on (that other munis can learn from).

Yes, Provo's muni FTTP network was not financially successful. Again, Utah's state law was a factor.

I agree that Palo Alto is not a small, rural community. Neither are Chattanooga, TN; Lafayette, LA; Longmont, CO; Cedar Rapids, IA. In Chattanooga, the muni FTTP utility now has more broadband customers than Comcast does in its footprint.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 11, 2015 at 3:51 pm

Peter Carpenter is a registered user.

The proposed Atherton model let's the Town grants right of way access to the resident owned private distribution company which in turn lets any ISP compete for customers by offering better or less expensive service.

Granting an individual ISP a city wide monopoly would be an unnecessary gift of public assets.

In my opinion using public funds to build a fiber network would also be an unnecessary use of public funds.


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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 11, 2015 at 4:06 pm

Jeff Hoel,

When reviewing other cities with municipal broadband, one needs to consider the context and the details.

You mention how successful Chattanooga TN has been. Well, Chattanooga received $111.5 MILLION from a federal stimulus grant; such grants are no longer being offered. This is obviously an example of a non-replicable situation that should not be taken as a role model that a given city can emulate.

Other examples are cities that have won the "Google lottery" as it is called in the industry. Kansas City, MO comes to mind.


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Posted by Curmudgeon
a resident of Downtown North
on Sep 11, 2015 at 4:22 pm

"Palo Alto has been very successful in the dark fiber business, not only making money, but also providing the communications opportunities big businesses and schools need to be successful."

Palo Alto is only doing the POTS equivalent of renting out dead wires. It is not running a FTTH operation and cannot claim relevant experience.

If FTTH was commercially viable, the biggies would be rushing to build it, and suing each other to impede the competition. They are instead learning from the mistakes of the fools rushing in. That's very smart. Palo Alto ought not finance their education by buying them another case study.

But if you can raise the capital, build it and show us all how it's done.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 4:24 pm

@Wayne Martin -- Re franchises, what I meant was that ever since the California Digital Infrastructure and Video Competition Act (DIVCA) (AB 2987) was passed in 2006, a cable TV provider can choose to be franchised by the state rather than by the municipality, so the municipality couldn't impose its own exotic requirements, e.g. whatever the JPA imposed on Cable Coop initially.
Web Link

DIVCA continues to impose the franchise fee on the municipality's behalf. But I think it's only on cable TV services, not Internet services. So if the City offered only an Internet service, it wouldn't be forgoing franchise fees a private-sector ISP might have provided.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 4:39 pm

@Robert Smith -- It's true that Chattanooga EPB received a $111.5 million federal stimulus grant. But it was for smart grid, not FTTP. EPB says it was committed to dong FTTP before it got the grant and would have been successful at doing FTTP without the grant.


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 4:40 pm

> Chattanooga

Comcast Brings 2-Gig Service To Chattanooga
Web Link

About 66,000 homes and 6,000 businesses use EPB's fiber-optics service. Of those, 5,425 get 1 Gbps service.
& &

Comcast does not release subscriber numbers, so it’s not possible to compare their user base with the City's service. However, with a population of only 173K, it does seem that the municipal agency has most of the business. Interesting that so few people seem to be willing to pay for the 1Gb service. The EPB crows about its offering 1Gb, but less than 8% of the total subscriber base is actually using the capability.

This is another example of a municipal utility operating in a bubble—within its municipal borders. Comcast/ATT/etc. have regional obligations, and in some cases, Federal/State regulation that municipals don’t have. Municipals do not generally feed profits back into R&D—which is expected of the larger providers.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 11, 2015 at 4:43 pm

Peter Carpenter is a registered user.

" Municipals do not generally feed profits back into R&D—which is expected of the larger providers. "

Exactly, so where does their innovation come from?

How many of these municipal FTTPs have actually migrated from their original installed service to newer technologies?


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Posted by Wayne Martin
a resident of Fairmeadow
on Sep 11, 2015 at 4:45 pm

> But I think it's only on cable TV services, not Internet services.

Given the ever-growing slice of the GDP consumed by government--it's very hard to believe that sooner or later Internet services won't be taxed, or franchise-feed to provide increased funding for government.

This is speculation, but there are all sorts of proposals in State/Federal legislative bodies for ways to gouge Internet users more than is the case today.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 5:06 pm

@Curmudgeon -- I wasn't claiming that the fact that Palo Alto's dark fiber business is wildly successful shows that staff has all the skills needed for making a FTTP business successful. I was just questioning Slow Down's assertion that Palo Alto should get out of the fiber business.

The question of whether Palo Alto can build and operate a FTTP utility so that it pays for itself is not the same as the question of whether a private-sector provider could build and operate a FTTP business in Palo Alto and get the kind of ROI businesses think they have a right to expect.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 11, 2015 at 5:20 pm

CORRECTION: When I was citing successful municipal FTTP networks, I should have said Cedar Falls, IA (not Cedar Rapids).


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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 11, 2015 at 6:10 pm

Hi folks,

I have read the entire CTC report in the last few days. I suggest that you read it. It is actually rather thorough. My major complaint is that it does not cover the cellular situation.

Staff Report (September 2, 2015)

Web Link

I cannot see that there is any feasible chance of the city succeeding with this.

1. The report flatly rejects the concept of the city doing the entire thing.
2. The report covers a number of partnership options but there are serious problems as below.

Briefly:

1. CTC goes through a number of financial scenarios. The most favorable one comes up with a "take rate" of 45%. This means that the municipal system would have to attain 45% penetration. At present, I am told that Comcast has about 35% and AT&T has about 35%. Getting 45% looks very difficult.

2. CTC suggests that the city float a bond issue for $50M to pay for this. I don't know if this would be 50% or 67% majority. If the latter, it will be very hard to win based on previous bond issues. The first library bond issue failed, and the school board had one recent issue fail. Don't see how this one can win if there is an effective opposition.

3. Walking through the timeline, it looks to me that this could take 3-4 years to accomplish. It seems very likely that the incumbents will come up with 1gb service here within that time frame, they have already announced some deployments.

4. Someone is bound to point out that this is a lot of effort and risk for very little gain compared to what the incumbents are already providing and almost certain to provide.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 12, 2015 at 10:38 am

@Peter Carpenter --
> How many of these municipal FTTPs have actually migrated from their original installed service to newer technologies?

Good question. First, the fiber infrastructure of a FTTP network should probably last for at least 30 years. Municipal FTTP networks aren't that old yet. Second, the electronics of a FTTP network should probably last at least seven years. UTOPIA started in 2004 with 100-Mbps CPEs. Later, they switched to 1-Gbps CPEs for all new installations. On 06-12-12, they announced the availability of 1-Gbps Internet service to all customers, meaning, I think, they would upgrade anyone who needed to be upgraded to get the service. UTOPIA also provides 10 Gbps to business customers who want it, but as far as I know, the "baseline" CPE is still 1 Gbps. (I like FTTP architectures where upgrades can occur one premises at a time.) Lafayette started in 2007 with a GPON CPE whose premises-facing interface was 100 Mbps, but is willing to upgrade to a GPON CPE whose premises-facing interface is 1 Gbps if the premises wants to subscribe to 1-Bbps Internet service. I don't know a quick way to find out how many muni FTTP systems have upgraded electronics at some point.

Cedar Falls started in 1996 with a hybrid fiber-coax system, and gradually switched to FTTP between 2006 and 2013.

I think muni FTTP networks can use innovative technology, not by having their own captive R&D departments, but by being savvy customers of electronics technology innovated by the private sector. They can also innovate in other ways. For example, I think of Longmont's decision not to offer a traditional TV service as an innovation.


1 person likes this
Posted by Kevin Ohlson
a resident of Old Palo Alto
on Sep 12, 2015 at 11:50 am

"Slow Down" asked about my Comcast pricing information. No, I can't really provide any real details, nor do I believe anyone can. First, some background, then some opinion...
My daughter called, very frustrated, because she was asking for, at my direction, just Internet. She said she was quoted $80/month for 50Mb, no contract. Since I was flying out in a few days, we put it off until then. At the Comcast retail store, the over-the-counter price was $60 for 75Mb plus some amount of TV. No phone, no contract. They were very friendly. I asked if just plain Internet would have been more, and the person said yes, it was. And, he threw in a DVR for free for 12 months.
Here's the thing - no one can look and easily find out Comcast pricing. I mean real, what-you-pay-after-the teaser-rate pricing. Comcast makes it very difficult to know what you're getting - not a judgement or policy statement just an observation. What you see as an existing subscriber and what you see as a potential new customer is different. The rates "Slow Down" cited are typically 6-12 month teasers.
What this discussion thread is missing is how much Comcast (and ATT and TWC and ...) lobby and influence - by which I mean intimidate - local government. It happened here in Palo Alto. Cable companies define competition and "competitive markets" not as one in which they deliver great value for consumers, but as one in which they wield market power. Green light in North Carolina, Citi of Chattanooga, and Sandy Oregon all have successful muni fiber, after pleading to get better than DSL from the usual cast of corporate characters. Comcast and others have pushed for, and passed laws in 21 states that prevent muni's from doing this themselves. This isn't about competition, it's about market power. And really, if Sandy Oregon can deliver 100Mb for $40/month, why can't PA?


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Posted by Jeff Hoel
a resident of Midtown
on Sep 12, 2015 at 11:59 am

@Robert Smith --
> I have read the entire CTC report ....

I read the entire CTC report (343 pages in all) too.

I also commented on it to UAC and Council. You can see the comments in various "Letters From Citizens" documents.
Pages 51-56 here (top-level staff report):
Web Link
Pages 121-148, 170-173, and 178-188 here (FTTP report):
Web Link
I hope to comment soon on the wireless report.

Generally, I thought the FTTP report was way too pessimistic and the wireless report was way too optimistic.

For example, the report says that deploying municipal FTTP in Palo Alto would cost $77.6 million. But Longmont bonded for $40.3 million to deploy citywide FTTP. Longmont has a population of 89,919 (2013), 35 percent larger than Palo Alto's population of 66,642 (2013). Longmont has more undergrounded utilities than Palo Alto does (and undergrounded FTTP is more expensive than aerial). Both cities have municipal electric utilities, and both cities have dark fiber networks. Longmont has started the sixth and last phase of OSP construction. So far, so good.

Incidentally, Longmont's take rate for the phase 1 neighborhood was 45 percent after just 3 months, way higher than their business plan required.
Web Link


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Posted by Jeff Hoel
a resident of Midtown
on Sep 12, 2015 at 12:31 pm

@Wayne Martin --
> Chattanooga ... The EPB crows about its offering 1Gb, but less than 8% of the total subscriber base is actually using the capability.

EPB has invested in 1-Gbps-capable CPEs that will last longer than less capable CPEs would have lasted. So, as more and more subscribers demand 1 Gbps, EPB won't have to spend money on upgrading CPEs. Also, for subscribers who need (or at least are willing to pay for) 1 Gbps now, EPB is delivering what the community wants. Note that EPB's price difference between 1 Gbps and 100 Mbps is only $12 per month. So if you thought 1 Gbps might deliver a better experience, it wouldn't cost that much to find out.
Web Link


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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 12, 2015 at 1:41 pm

Jeff Hoel,

I have not been able to find out much about Longmont, especially from objective sources. I will try to find out.

I have always discovered that each of these cases must be considered carefully in terms of context and local details. For example:
1. What kind of services did they previously have? [Cities with successful municipal Internet often had really bad or no service before.]
2. Where did the get their funding? [Sometimes there are big grants that make it easy.]
3. How long have they been in business? [Sometimes they cherry pick areas and do well at first but then have problems as they keep going.]




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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 12, 2015 at 1:48 pm

@Jeff Hoel
>EPB has invested in 1-Gbps-capable CPEs that will last longer than less capable CPEs would have lasted. So, as more and more subscribers demand 1 Gbps, EPB won't have to spend money on upgrading CPEs. Also, for subscribers who need (or at least are willing to pay for) 1 Gbps now, EPB is delivering what the community wants. Note that EPB's price difference between 1 Gbps and 100 Mbps is only $12 per month. So if you thought 1 Gbps might deliver a better experience, it wouldn't cost that much to find out.

Sometimes this strategy works and sometimes it does not and it is hard to predict. Provo UT used what it thought was good gear for their iProvo system, but when they went bankrupt and were forced to sell, they discovered that everything was obsolete and valueless. They finally sold to Google for $1 but retained the bonded debt.

One of my concerns is that this entire area is shifting so quickly that cities just get caught up in something they weren't fully prepared to handle. Palo Alto keeps thinking of telecom as a utility like its successful utility business, but it is very different for many reasons.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 12, 2015 at 1:50 pm

Peter Carpenter is a registered user.

In my opinion local government should only provide the essential infrastructure and most specific services are best provided via the competitive market.

For example, local governments provide streets but not the cars and trucks that move on those streets.

In the Atherton Fiber Model the Town provides access to its owned right of ways, a separate entity would provide the fiber and then any provider who wanted to could access the fiber to provide cost competitive services.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 12, 2015 at 1:52 pm

@Jane --
> Palo Alto siphons off an increasingly large share of the utility profits to the general fund.

I don't think so, but if you can document this, maybe you should start a thread only about this. I think it's off-topic for fiber-related stuff.

This 2013 City document says, "CPAU provides an equity transfer to the City of Palo Alto’s General Fund which provides a return on the City’s original investment in the Utilities and reflects the City’s ultimate responsibility for Utilities operations. Council approved the current equity transfer method in May 2009."
Web Link

This 2009 City document says that wastewater and refuse utilities don't make equity transfers to the General Fund.
Web Link

This 12-16-14 City document mentions, "Operating Transfers include the equity transfer from the Electric and Gas funds ...."
Web Link

I believe that the City's fiber utility doesn't do an equity transfer to the General Fund, because the General Fund didn't provide the funds to start it up.


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Posted by Jeff Hoel
a resident of Midtown
on Sep 12, 2015 at 2:20 pm

@Wayne Martin --
> Amazing that anyone would be complaining about 99.936% service availability.

What I'm complaining about is that you would claim that AT&T's phone network has 99.999% reliability. I don't think even AT&T can know this, which is why they limit their claim to just the backbone.

The 99.936% reliability calculation for my landline phone connection was based on only the minimum time I knew the phone was completely dead. It didn't include the times there was excessive "static" on the line. It didn't include the days or weeks when someone else's FAX machine was preventing my answering machine from receiving messages. (I finally became aware of the problem when I answered a call after the FAX machine had answered it, so my phone was no longer ringing.)

Anyhow, the reliability of AT&T's POTS phone network isn't really relevant to FTTP.


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Posted by Curmudgeon
a resident of Downtown North
on Sep 12, 2015 at 3:15 pm

"In the Atherton Fiber Model the Town provides access to its owned right of ways, a separate entity would provide the fiber and then any provider who wanted to could access the fiber to provide cost competitive services."

If the FTTH pushers had adopted that Silicon-Valleyesque model fifteen years ago, raised the needed private capital, and installed the infrastructure, I could have been submitting this comment over a nice little 100Mbps fiber link.

Or as they doubtless feared, they could now be in deep debt and bankrupt, hence the continuing pressure to risk taxpayers' funds on their pipe dream.


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Posted by Robert Smith
a resident of Duveneck/St. Francis
on Sep 12, 2015 at 9:58 pm

Peter Carpenter,

I am not sure I agree completely with your limited definition of what government should do. There are many things that the government should od.

However, in the case at hand, there is no reason for the City of Palo Alto to enter the broadband market. Competition between a variety of providers is working reasonably well.

This is a case where government needs to perform its regulatory functions efficienty and otherwise let the marketplace work without intervention.




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Posted by Jeff Hoel
a resident of Midtown
on Sep 13, 2015 at 1:50 pm

@SteveU --
> Palo Alto already has a (Dark) Fibre program you can sign up for. All you need is about $10K per MONTH plus your own Equipment.

Here's a "pricing overview" for Palo Alto dark fiber.
Web Link

Dark fiber's initial cost depends on how hard it is to make the connections. It could be $500, or $8,000, or more. Dark fiber's monthly cost depends mostly on the length of the fiber you're leasing. Examples: $635 per month (less than a mile) and $1,900 per month (more than 5 miles). If the connection goes to PAIX and uses an ISP there, and those costs are included, then the examples say $1,585 per month and $2,600 per month. The rates are reasonable for dark fiber, but not what you'd like to pay for residential FTTP.

> ... the 'unsightly' green boxes along the street,

I'd like to consider a FTTP architecture where premises are connected directly to aggregation switches at electrical substations, without having to go through green boxes in neighborhoods. But the CTC report doesn't consider that.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 13, 2015 at 2:22 pm

Peter Carpenter is a registered user.

In some countries like the UK each electricity user get to select from multiple competitive suppliers and all of the suppliers use the same distribution system. This makes for great competition.

Why not do the same, ala the Atherton Fiber Model, in Palo Alto for internet services?proposed

Actually why not do it in Palo Alto for electricity?


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Posted by Curmudgeon
a resident of Downtown North
on Sep 13, 2015 at 5:17 pm

So each end point gets served by an individual fiber that could be a mile or more long. Now that's gotta be inexpensive.

What about reliability, given a mile or so of exposure to single point failure for each end customer?

Somebody needs to think these things through before going public.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 13, 2015 at 5:24 pm

Peter Carpenter is a registered user.

The Publisher has cautioned me not to respond to taunts and therefore Curmudgeon has been placed on the Do Not Respond list.


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Posted by Curmudgeon
a resident of Downtown North
on Sep 13, 2015 at 5:29 pm

"In some countries like the UK each electricity user get to select from multiple competitive suppliers and all of the suppliers use the same distribution system. This makes for great competition."

You're new here aren't you. California tried that 2000-2001. Everybody knew the God of the Free Market had arrived and all would soon be ducky. It worked great for Enron and several other red suspender operators but not for consumers: zooming prices, supply shortages, brownouts, blackouts.

The state dumped this utopia as fast as it could.


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Posted by Peter Carpenter
a resident of Atherton
on Sep 13, 2015 at 6:15 pm

Peter Carpenter is a registered user.

"You're new here aren't you"

Curmudgeon is on the Do Not Respond list.


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Posted by Nayeli
a resident of Midtown
on Sep 14, 2015 at 5:15 pm

Nayeli is a registered user.

Palo Alto needs more internet competition. Comcast is pathetic (to say the least). The service is consistently unreliable, their reps lie over the phone and they change your service without letting you know that they did it.

This city needs gigabit fiber -- but it shouldn't come solely from a dishonest and shady company like Comcast.


Sorry, but further commenting on this topic has been closed.

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