Yes, you read that right. Internet speeds as fast as 1 gigabit gigabyte per second are the norm in the city of Chattanooga, Tennessee. Not the spot you might have predicted, would you. Certainly not the place I anticipated would have faster, better internet than anywhere else in the United States, and one of the faster internet speeds on the planet. Not only that, but the fast internet is helping to lead Chattanooga out of the economic doldrums.
[A] group of thirty-something local entrepreneurs have set up Lamp Post, an incubator for a new generation of tech companies, in the building. A dozen startups are currently working out of the glitzy downtown office [that was formally the home of Loveman’s department store].“We’re not Silicon Valley. No one will ever replicate that,” says Allan Davis, one of Lamp Post’s partners. “But we don’t need to be and not everyone wants that. The expense, the hassle. You don’t need to be there to create great technology. You can do it here.”
He’s not alone in thinking so. Lamp Post is one of several tech incubators in this mid-sized Tennessee city. Money is flowing in. Chattanooga has gone from close to zero venture capital in 2009 to more than five organized funds with investable capital over $50m in 2014 – not bad for a city of 171,000 people. […]
In large part the success is being driven by The Gig. Thanks to an ambitious roll-out by the city’s municipally owned electricity company, EPB, Chattanooga is one of the only places on Earth with internet at speeds as fast as 1 gigabit per second – about 50 times faster than the US average.
Yes, these young groups of local tech entrepenuers are important, but they couldn’t have created this turnaround alone. They are receiving help help from the city’s Democratic Mayor, Andy Berke, but the real driver of the boom comes from the efforts of the city’s municipally owned electrical provider, EFB, which decided to fast track a high speed fiber optics network, rather than settle for slower service from the big cable company internet providers. On September 17, 2013, after construction was completed seven years earlier than originally planned.
[C]ity residents have an unlikely business to thank [for their faster, cheaper internet service]: the publicly owned electric utility. […][T]he effort to bring cheap broadband to the masses began as a simple engineering problem: The city’s electric company, EPB, needed a way for its systems to monitor and communicate with new digital equipment being installed on the grid. Meanwhile, city hall was learning that the country’s biggest phone and cable companies wouldn’t be starting service there for a decade or more.
Chattanooga spent $330 million on its new network, raising $220 million in bond money and winning $111.5 million in federal stimulus dollars. (The money from Washington was like icing on the cake; by the time EPB applied, it had already reached its initial targets and with the additional funds cut a 10-year construction plan down to three years.)
According to Harold DePriest, EFB’s CEO, the high speed network referred to as “The Gig” is a big profit center for EFB. However, one major benefit is the savings it generates for one of the network’s biggest customers: EFB, itself. He estimates savings of at least $1 Million per year. However, while Chattanooga’s high speed internet is proving to be quite the success story, it didn’t come without opposition from you know who:
Along the way, EPB fought several court battles with Comcast and the state cable association. Even before all this, Chattanooga had to lobby the state government for permission to let EPB participate in the telecom market.
Across the country, twenty states prohibit or restrict municipalities from doing what Chattanooga has done – create their own high speed broadband networks to compete with the big telecom and cable companies, who have a stranglehold on providing slower, crappier, more expensive internet service to most of us. So, it should come as no surprise that the big telecoms are concerned that other municipalities will see what Chattanooga has accomplished, and are taking legal steps to stop any further expansion of EFB’s internet service.
The US cable industry called on the Federal Communications Commission on Friday [August 29, 2014] to block two cities’ plans to expand high-speed internet services to their residents.USTelecom, which represents cable giants Comcast, Time Warner and others, wants the FCC to block expansion of two popular municipally owned high speed internet networks, one in Chattanooga, Tennessee, and the other in Wilson, North Carolina.
“The success of public broadband is a mixed record, with numerous examples of failures,” USTelecom said in a blog post. “With state taxpayers on the financial hook when a municipal broadband network goes under, it is entirely reasonable for state legislatures to be cautious in limiting or even prohibiting that activity.”
Chattanooga has the largest high-speed internet service in the US, offering customers access to speeds of 1 gigabit per second – about 50 times faster than the US average. The service, provided by municipally owned EPB, has sparked a tech boom in the city and attracted international attention. EPB is now petitioning the FCC to expand its territory. Comcast and others have previously sued unsuccessfully to stop EPB’s fibre optic roll out.
Wilson, a town of a little more than 49,000 people, launched Greenlight, its own service offering high speed internet, after complaints about the cost and quality of Time Warner cable’s service. Time Warner lobbied the North Carolina senate to outlaw the service and similar municipal efforts.
How nice of them to be concerned about taxpayers, especially as most of these companies are doing their darnedest to avoid paying taxes. But, as you can guess, what they are really concerned about is competition from local municipalities, and the loss of their virtual monopoly on providing broadband services in America. Imagine availability to internet services fifty times faster than what Comcast and Time Warner (in the process of seeking approval for a mega-merger, FYI) are willing to provide, and at an equal or even lower price? No wonder they want to block Chattanooga and EFB from expanding service to more residents. EFB has the proper response to the pompous, selfish and greedy actions of the telecom industry.
In a statement EPB said: “Communities should have the right – at the local level – to determine their broadband futures.“The private sector didn’t want to serve everyone, but public power companies like EPB were established to make sure that everyone had access to this critical infrastructure.
Meanwhile Chattanooga is thriving, and has even bigger plans for the future:
Mayor Berke has dealt with requests for visits from everyone from tiny rural communities to “humungous international cities”. “You don’t see many mid-sized cities that have the kind of activity that we have right now in Chattanooga,” he said. “What the Gig did was change the idea of what our city could be. Mid-sized southern cities are not generally seen as being ahead of the technological curve, the Gig changed that. We now have people coming in looking to us as a leader.” […]EPB’s high-speed network came about after it decided to set up a smart electric grid in order to cut power outages. EPB estimated it would take 10 years to build the system and raised a $170m through a municipal bond to pay for it. In 2009 president Barack Obama launched the American Recovery and Reinvestment Act, a stimulus programme aimed at getting the US economy back on track amid the devastation of the recession. EPB was awarded $111m to get its smart grid up and running. Less than three years later the whole service territory was built.
… The University of California at Berkeley estimates that power outages cost the US economy $80bn a year through business disruption with manufacturers stopping their lines and restaurants closing. Chattanooga’s share of that loss was about $100m, EPB estimates. … Since the system was installed the duration of power outages has been cut in half.
In short, no shutdowns such as the one millions of customers of Time Warmer had to suffer through this last Wednesday.
Internet service went down for millions of Americans on Wednesday morning after cable company Time Warner Cable suffered a major outage. […]Affected users besieged the helplines and social media accounts of the firm, which declared an operating income of $1.1bn in the 2nd quarter of 2014.
On Tuesday, Reuters reported that Time Warner Cable paid $1.1m to resolve an investigation from the Federal Communications Commission that found the provider did not properly report multiple network outages.
“TWC (Time Warner Cable) failed to file a substantial number of reports with respect to a series of reportable wireline and Voice Over Internet Protocol network outages,” the FCC’s report read. “TWC admits that its failure to timely file the required network outage reports violated the commission’s rules.”
Hey, what a shocker. Lousy service from a monopoly, including the failure to report multiple “network outages” in violation of FCC regulations. In short, you can understand the big telecom companies acting in their own interest, if not yours, to maintain the status quo. At present, they are practically printing money while we get internet service that is worse than thirty other countries, including, among others, Uruguay.Yeah, let that sink in. Uraguayans have better internet service than citizens of the “greatest nation on earth.” Pretty damn embarrassing, if not a big surprise. Ever since we began to glorify Big Business and denigrate government during the Reagan years, we’ve seen America go from being a leader in many fields to falling further and further behind even many third world countries, all so our multinational, tax dodging corporations can feed off ordinary Americans like so many parasites, slowly draining the lifeblood out of our nation even as they steal whatever is left in our pocketbooks.
So, to Chattanooga I say good luck and godspeed in your battle with these corporate psychopaths. I only wish my city had done what yours did. And thanks for showing all of us that government investment in infrastructure, whether at the local level or with assistance from the federal government, in this case the electrical grid and fiber optic networks, works better to grow our economy than the current, private, monopolistic practices of the telecom industry. Indeed, their actions are hurting our nation’s economic future, even as they rake it massive profits for bad service.
More: How Big Telecom Smothers City-Run Broadband, http://www.publicintegrity.org/2014/08/28/15404/how-big-telecom-smothers-city-run-broadband