July 26, 2009 By Andy Opsahl
Stiff competition awaits local governments that are seeking a piece of the $7.2 billion set aside for broadband infrastructure in the American Recovery and Reinvestment Act. Many already have plans that were shelved after the national craze for broadband deployments imploded a few years ago.
Local governments with less developed strategies may want to learn from one initiative observers consider a likely recipient of stimulus money: OpenCape is a consortium of local government and small business representatives in Cape Cod, Mass., who spent the last two years crafting a plan to deploy a broadband backhaul network for the entire cape.
OpenCape is applying for stimulus funds to build the network. Commercial providers will be able to use the infrastructure to provide services to residents, businesses and government entities on the cape that the providers currently don't serve because it's cost prohibitive.
Funding the backhaul with federal money should make doing business less costly for "last-mile" service providers, said Daniel Gallagher, executive director of IT for Cape Cod Community College and an OpenCape representative.
"We intend to build the middle mile for the region that will serve as the conduit for all of the Internet service providers that might wish to provide last-mile services," Gallagher explained.
Critical to OpenCape's strategy is its plan to sustain the network financially in the future. The organization gleaned input from broadband providers on what would make offering services in Cape Cod's low-density towns more profitable.
One challenge is providers can't afford to build the infrastructure required to connect Cape Cod to the broader Internet, Gallagher said. "The capital expenditure is far too great, but if they could get a prorated cost and pay per megabit or whatever their need might be, then it would be a reasonable business model to offer those services."
The final submission window for broadband stimulus applications will likely end in September 2010, according to Mark Tolbert, spokesman of the U.S. National Telecommunications and Information Administration, which is disbursing $4.7 billion of the broadband stimulus. That gives governments roughly a year to hone their strategies before the money is spent entirely. A look at OpenCape's business plan could give competing governments a focus.
By studying past municipal broadband failures, the OpenCape team noticed that overly broad goals were a factor in their demise.
"Some of those wireless metropolitan solutions where they were trying to deal with the underserved, the poor and businesses -- they were basically trying to be all things to all people," Gallagher said. "They failed because of it."
Gallagher and his colleagues decided that a narrow focus for their network goals promised a better chance at success. OpenCape is applying for $20 million in federal stimulus dollars to install approximately 225 miles of fiber-optic cabling, microwave links and a co-location center on Cape Cod.
Various broadband service vendors can then target communities likely to be good fits for their services. With the fiber backhaul already in place, the vendors could extend their infrastructures from it to whatever community they want to serve. Gallagher said trying to determine which service would best suit individual communities was too complex for OpenCape to do effectively.
"Those technologies -- specializations, really -- private companies are best able to provide. What they have been missing is the capital," Gallagher said.
Many failed municipal broadband networks, like Philadelphia's unsuccessful citywide Wi-Fi project, gambled that citizens would want to buy service subscriptions. By contrast, OpenCape is comprised largely of organizations professing interest in being anchor tenants for broadband providers. Gallagher represents one of them.
"Cape Cod Community College, where I work, would likely be an anchor tenant. So would a lot of the municipalities around the cape, the health-care industry