Digital Cities: Open Service Provider Networks

The Monday afternoon keynote was by Keith Wilson, the CEO of Dynamic City, which has the contract to design, build, and operate the Utah UTOPIA project (an 18 community fiber project serving 300,000 homes).

The U.S. has the most expensive broadband in the world; the per megabit cost of broadband in Japan is ninety cents. In Korea, it's $2.50. In the U.S., it averages $25-$30 per megabit, or thirty times higher than the lowest. Clearly, the current reliance on incumbents to provide broadband is not working.

Wilson identified four characteristics of a viable communitywide network:

  • Open and interoperable
  • Wholesale access available to multiple service providers
  • High quality carrier class equivalent to commercial networks
  • Highly scalable bandwidth to meet any kind of service need

A wholesale business model that allows for many service providers (as opposed to just one voice provider, one video on demand provider, etc.) reduces the risk for the network owner--if a service vendor fails or pulls out, the financial health of the network is less at risk.

Networks are like airports--a shared facility built by the community and used by multiple service providers (airlines) to offer a variety of services. Airports are good for communities because no airline would come to a community and build their own airport.

Communities need a "communications utility," and no less than the future of the community is at stake. A successful network must have widespread availability, must be affordable, and must offer customers choice. A closed network cannot offer all three, because the incumbent providers don't want competition. Private buildouts (the current situation with incumbents) capture the future of a community because no other provider will come, so the community becomes hostage to a single company.

If regulated monopolies have not worked in the past in terms of affordability and choice, why do we think unregulated monopolies (what we have now, in effect) will work better? What is best for a single company is not necessarily best for the businesses and residents of a community.

Open Service Provider Networks (OSPN) provide shared infrastructure that lowers costs for providers, creates a critical mass of subscribers that attracts providers to a community, and provides ubiquitous access (universal service) throughout the community (which also lowers costs). OSPNs lead to the lowest overall cost per megabit because they aggregate demand.

The issue is not fiber versus wireless, the real issue is bandwidth; abundant bandwidth, however it is delivered fosters economic development.

Small communities have to work regionally on open networks to aggregate enough demand to attract service providers.

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