The basics on where Fort Collins stands on providing broadband services
Bit by bit, the city of Fort Collins is moving toward establishing a fiber optic network that could bring a high-speed broadband connection to every residence and business in the city and its growth management area.
But nearly two years into the process of studying options for the city to realize its broadband dream of having internet speeds up to 1 gigabit per second (upload and download) available to the community, fundamental questions remain about how a system would work.
If the city builds and operates a network capable of carrying internet, phone and possibly video services, would it be up for competing with the big dogs of the telecommunications world?
Or should it partner with a private company and let it take on the financial risks of building and running a network?
That might be tempting since the cost of building a network would require the city to take on an estimated $130 million to $150 million in debt.
But it could mean surrendering control of critical system elements, including price, speed and customer service – the very issues that got city officials interested in providing broadband services in the first place.
During a recent City Council work session, most members still voiced support for pursuing a “retail” municipal broadband system with the city running the show. But they don’t want to close the door on a “third party” model.
A request for proposals from companies garnered 11 responses, including from the current main players for residential internet services in the city, Comcast and CenturyLink. All of the responses will be reviewed by city staff and their consultants.
A worry for the city is that if it jumps into the broadband business is the fallout from an inevitable price war with current providers.
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Comcast recently announced 1 Gbps service is available across the state. The price is $110 per month with a one-year contract. Comcast is testing a monthly $70 promotional offer for the service in Longmont, which is building its own fiber optic network.
Fort Collins is currently projecting a price of $50 per month for 50 Mbps service, which would be adequate for most residential users, and $70 for 1 Gbps, which residential users are expected to eventually want.
According to a recent survey, if the city and Comcast were to both offer 1 Gbps service for $70 per month, the city’s “take rate” would be an estimated 28.2 percent.
That’s not bad, but it’s not great. The thinking is that if the city could back up its internet offering with customer service that is better than Comcast’s, the take rate could grow.
Comcast has deep pockets indeed and likely would be way ahead of the city in terms of marketing and offering deals (with contracts) to keep its customers. Fort Collins consumers would face a loyalty test between the city and Comcast based on price and trust.
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But first things first: The City Council on Tuesday is scheduled to call an election in November. The intention would be to ask voters to change the charter of the city’s Light and Power Utility to allow it to provide telecommunications services.
Assuming that procedural matter passes, the actual ballot language would be considered by council on Aug. 8 with a final reading just a week later.
The ballot language has yet to be decided. While the city’s intent would be to pursue a retail model, the ballot language would likely keep open the option of working with a third-party provider.
So, a “yes” vote in November could result in different things when it comes to creating a municipal broadband system.
But city officials say they want to be clear about one thing for a broadband election: A “no” vote would mean no.
Kevin Duggan is a senior reporter and columnist. Follow him at Coloradoan Kevin Duggan on Facebook or @coloradoan_dugg on Twitter.
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