A map maintained by the Institute for Local Self-Reliance shows more than 400 municipally run broadband networks dotted across the U.S. Most are in communities of about 10,000, making Davenport’s implementation much larger than average. Municipal networks in large cities can face additional challenges, but Davenport may prove to have the capability to pull it off. In 2013, e.Republic’s Center for Digital Government named Davenport one of the nation’s top ranked cities in its category as part of the Digital Cities Survey.
“For years, residents and businesses have been asking us to do this,” Henry said. “We always knew we were going to get to this point.”
Davenport has been talking to the area's primary broadband providers, CenturyLink and Mediacom, to see if they can cooperate with the city in order to make the rollout successful, Henry said. The city doesn’t have enough information yet to know how the project will be funded or whether the city would be a provider or a wholesaler – officials just know it’s time to figure out the details and make it happen, Henry said.
Unlike more rural areas in Iowa and the nation at large, Davenport is served by broadband already. There are several providers to choose from, but there’s a gap that government can help fill, Henry said. “The timeline would be having within the next six to 12 months the business model selected and having a strategy so we know how we are going to go forward to get to connecting fiber to every premise,” he said. “The ultimate goal would be to first assist the existing businesses in the community to support their current needs, which many would say the current environment does not do that.”
City officials looked at what some of their neighbors are doing in Iowa, Henry said, and they saw the benefits. From Google Fiber in Kansas City to small communities like Cedar Falls, Iowa, proponents of broadband cite economic growth, new educational opportunities and a tool against social inequality as benefits of a well-run high-speed network. “What’s happened is that communities realize that high-speed broadband is critical to their economic vitality as well as quality of life, and they can’t sit around and just wait for incumbent carriers to come to them or to build out their networks,” Henry said.
Many governments are in similar positions to Davenport, said Christopher Mitchell, a director at the Institute for Local Self-Reliance – they have fiber that's been built out over a span of years and now they want to expand it for widespread commercial and business use.
Mitchell heads the Telecommunications as Commons Initiative and has spent the past seven years studying municipally run broadband. “People look at a lot of the existing networks, like Chattanooga, and think, ‘Oh wow, they just built everywhere citywide,’ but that’s not how they did it,” he said. “Most of these networks started off as a limited network, in many cases connecting substations or schools or anchor institutions. Often they were built initially knowing that they probably would expand, so they were built with excess capacity.”
Davenport built its network in stages, first laying the infrastructure for internal use by the city, and then later building out to schools, hospitals and parks. The city saves about $400,000 annually by running its own fiber network, instead of buying service from a provider, according to the city.
It’s good that Davenport is trying to cooperate with local Internet service providers (ISP), Mitchell said, but it’s unlikely to produce much substance because, in some cases, ISPs will attempt to starve the municipality for customers. “Every local government at first tries to work with incumbent providers,” said Mitchell, adding that, “my thinking is the city is not going to get a whole lot out of trying to work with them.”
The challenge for a jurisdiction like Davenport is that it might need, for example, a 35 percent take rate to make a citywide network feasible, but incumbent providers are likely to lower their prices in response to competition, making it difficult for the city to achieve the needed customer base, Mitchell said. “People will often take the lower price even if they don’t like the service,” he said.
Existing ISPs and governments do sometimes team up, as they did in Indianola, Iowa, Mitchell said. “It’s something we’re seeing more of,” he said, “but it’s not something we’ve seen a lot of yet.”
