Committee on Technology in Government
Bruce Lai, Policy
Fredy H. Kaplan, Legal
Steve Hamill, Press
Carl Thelemaque, Finance
THE COUNCIL OF THE CITY OF
NEW YORK
BRIEFING PAPER OF
THE INFRASTRUCTURE DIVISION
Marcel Van Ooyen, Deputy
Chief of Staff
COMMITTEE
ON TECHNOLOGY IN GOVERNMENT
Hon. Gale A. Brewer, Chair
June 10, 2005
Proposed Int. No. 625-A: By
Council Members Brewer, Boyland, Comrie, Fidler, Gerson, Gonzalez, James, Liu,
Nelson, Palma, Recchia Jr., Sears and Weprin
Title: To create a temporary task force to study how affordable broadband access can be made available to all New York City residents, nonprofit organizations and businesses.
Introduction
On Friday, June 10, 2005 at 10 AM in the Committee Room, City Hall, the Committee will hold its first hearing on Int. No. 625-A, which mandates the creation of “a temporary task force to study how affordable broadband[1] access can be made available to all New York City residents, nonprofit organizations and businesses.” The goal of the hearing is to get commentary on Int. No. 625. Specifically, the Committee would like to get feedback on the necessity, mission, objectives, focus and composition of the Commission. Representatives of New York City's Economic Development Corporation and Department of Information Technology and Telecommunications, telecommunications experts, economic development experts, nonprofit organizations, wireline and wireless broadband companies as well as other technology companies have been invited to testify.
Analysis of Int. No. 625-A
In section one of Int. No. 625-A, the intent of the legislation is explained and preliminary findings of the Committee on Technology in Government regarding broadband are laid out.
First, broadband, i.e., a high-speed connection to the Internet, is a necessity for every resident, nonprofit organization and business in New York City. As the Internet evolves, the interactive applications and services on it will become multimedia experiences that will use words, images, sounds and video and will require large of amounts of bandwidth, which only a broadband connection can provide.
Second, a broadband connection improves the quality of life of everyone who has access to one. Broadband in the home expands the educational opportunities of all schoolchildren by allowing them to communicate with their teachers at home quickly and easily as well as complete homework projects that require access to on-line multi-media educational resources. Broadband saves businesses, both for-profit and non-profit, time and money by giving them the option to implement cost-saving technologies like Voice over Internet Protocol, institute telecommuting programs that reduce the cost of rent, and increasing the amount of time they have to serve their customers.
Third, broadband is often least available to low-income children and families and is also often not available to many small businesses and nonprofit organizations, particularly those located outside of Manhattan. Most importantly, broadband access is often not affordable to these underserved communities, thus, preventing higher rates of broadband adoption and limiting the social and economic opportunities of many New York City residents, nonprofit organizations and businesses.
Subdivision (a) of section two establishes a temporary task force to advise the Mayor of the City of New York and the Speaker of the Council of the City of New York as to the technical, legal, environmental and economical feasibility of providing affordable broadband access to all New York City residents, nonprofit organizations and businesses.
Subdivision (b) requires that the task force shall be comprised of nine members, five of whom shall be appointed by the Speaker of the City Council and four by the Mayor. It also says that the Chairperson shall be elected from amongst the members, and that the members of the task force shall be appointed within thirty days of the enactment of this local law and shall serve without compensation. Any vacancy shall be filled in the same manner as the original appointment for the unexpired term.
Subdivision (c) specifies that the members of the task force shall serve for a period of twelve months at which time the task force shall cease to exist, and that task force member terms shall begin thirty days from the effective date of this law.
Subdivision (d) mandates that no later than three months before the expiration of the task force, the task force shall submit a report containing its conclusions and recommendations to the Mayor of the City of New York and the Speaker of the Council of the City of New York.
Section 3 requires that this local law shall take effect immediately upon its enactment.
Differences between Int. No. 625 and Int. No. 625-A
The following are some of the differences between Int. No. 625 and Int. No. 625-A:
Subdivision (b)
· In Int. No. 625, the phrase “one of whom shall be the chairperson” was attached to the end of the first sentence of subdivision (b). In Int. No. 625-A, that phrase was deleted, and the following new sentence was inserted immediately after the first sentence, “The Chairperson shall be elected from amongst the members.”
· In Int. No. 625, the sentence regarding filling vacancies was originally written as “Any vacancy shall be filled within fourteen days by the original appointing authority.” In Int. No. 625-A, the sentence was changed to “Any vacancy shall be filled in the same manner as the original appointment for the unexpired term.”
· The sentence, originally in Int. No. 625, “The chairperson of the council of the city of New York’s committee on technology in government and the commissioner of the department of information technology and telecommunication shall provide staff to assist the task force” was deleted from Int. No. 625-A.
Subdivision (c)
· The sentence, originally in Int. No. 625, “Such task force shall serve for a period of twelve months, which shall begin thirty days from the effective date of this law or thirty days from the appointment of the last member of the task force, whichever is sooner” was changed into the following two sentences: “Such members of the task force shall serve for a period of twelve months at which time the task force shall cease to exist. Task force member terms shall begin thirty days from the effective date of this law.”
Reasoning Behind Int. No. 625
Goal of Task Force: Universal Broadband Adoption
The primary goal of the task force created by Int. No. 625 is to determine a vision and a strategy to guide New York City government in its efforts to ensure that affordable broadband is accessible to every single resident, nonprofit organization and business in New York City, with the ultimate objective being universal broadband adoption by all residents, nonprofit organizations and businesses in New York City.
Affordability is a Significant Barrier to Broadband Adoption
In New York City, broadband is accessible to almost every resident through either the cable modem or Digital Subscriber Line (or DSL) service.[2] However, only 38 percent of all New York City households have actually adopted broadband.[3] That means 62 percent of all New York City households have not adopted broadband, and it is likely that most of these households are low-income households. At a recent Committee on Technology in Government hearing, Mark Levine, Vice President of the national nonprofit organization, One Economy Corporation, which promotes the use of technology among low-income families, testified:
· “The truth is that affordability remains a significant barrier to adoption of broadband by those on the lower rungs of the economic ladder, since the going rate of $40 per month is beyond the reach of many.”[4]
Additionally, “over the course of a 3-year period, broadband costs at least $1800,”[5] and that amount of money is approximately equal to or is more than the cost of purchasing and using a computer for those same three years. Additionally, in the U.S. Department of Commerce’s Report, A Nation Online, 38.9% of non-Internet users or Internet users with only dial-up access say the main reason why they have not adopted broadband is because it is “too expensive.”[6] In that same report, only 7.5% of households with incomes under $15,000 a year live in a broadband household, while 57.7% of households with incomes above $150,000 a year live in a broadband household.[7]
In addition to significant broadband access problems outside of Manhattan for small and mid-sized businesses,[8] the biggest barrier to broadband adoption for many businesses is also affordability. “For many businesses, particularly those with low profit margins, broadband providers have not lowered their prices that would justify the additional expense of adopting broadband.”[9]
Because affordability is such an issue, the City of Philadelphia is planning to price residential access to its citywide wireless broadband network at $16-$20, about half the price for comparable residential DSL or cable modem service, and business-class access at $50-$60, about half of the price of comparable business-class DSL or cable modem service.[10]
The Underlying Assumption: Broadband is a Necessity
The assumption that drives the creation of the task force mandated in Int. No. 625 is the assertion that broadband is a necessity, not an amenity, for every resident, nonprofit organization and business in New York City. Throughout the world, water and electricity are now seen as a necessity. Accordingly, government has long been committed to ensuring that these public goods are universally available. Increasingly, broadband is being recognized as a necessity and a public good in today’s world.
Broadband is Being Recognized as a Necessity and a Right
President George W. Bush,[11] the European Union,[12] many Asian countries,[13] as well as cities all over the U.S. and the world – including Philadelphia,[14] Seattle,[15] Los Angeles,[16] and Taipei, Taiwan[17] – have publicly committed to building either citywide wireless or wireline (usually fiber-optic) broadband networks for its residents, within the next several years or next decade. Michael Copps, a current FCC Commissioner, has characterized access to broadband a civil right:
· “Each and every citizen of this great country should have access to the wonders of telecommunications – whether they live in the rural countryside or the inner city; whether they are high income or low income; whether they have disabilities, whether they are young or old. I’d go even further: I don’t think it exaggerates much to characterize access to telecommunications in this modern age as a civil right.”[18]
Why Broadband is a Necessity
The following describes why broadband is increasingly being considered a necessity and a right.
Broadband Improves Quality of Life
Broadband is a transformative technology that improves the quality of life of everyone who has access to it. In today’s world, access to broadband – that is, high-speed access to the Internet – is the key that opens the door to its vast information resources,[19] much of which are multi-media, thus, requiring a high-speed connection. In addition to e-mail and “surfing the Web” quickly and easily, broadband allows its users to take advantage of the newest (and usually cheaper) communications technologies, including Voice over Internet Protocol,[20] video e-mail, video conferencing, the networking of home electronics and appliances, peer-to-peer file sharing, and digital television as well as IPTV (Television over Internet Protocol).[21] Instead of standing “in line,” broadband saves its users time and money by giving them the option to shop on-line, to bank on-line, and to find health and financial information on-line. According to The Pew Internet & American Life project,[22] the Internet has successfully been incorporated into almost everyone's daily lives in the U.S.[23] In November and December of 2003, Pew found that:
· “92% of respondents qualify the Internet as a good place to get everyday information.
· 85% of respondents say the Internet is a good way to communicate or interact with others.
· 75% say the Internet is a good place to conduct everyday transactions.
· 69% think the Internet is a good entertainment resource in everyday life.”[24]
Broadband is Crucial to Economic Competitiveness
The Yankee Group predicted $223 billion in cost savings with universally available broadband in the United States, while an August 2002 study by Dataquest, Inc., a unit of Gartner, Inc., estimates that the implementation of “true” broadband infrastructure could result in an incremental increase in the United States gross domestic product by as much as $500 billion annually for each of the next 10 years.[25] Access to affordable broadband is particularly important when put into the context that New York City residents and businesses are not just competing with each other; they are competing in the global economy. In the book, The World is Flat,[26] Thomas L. Friedman sheds further light on the world that is emerging and America’s role in it:
· “The dynamic force in [the current stage of globalization] – the thing that gives it its unique character – is the newfound power for individuals to collaborate and compete globally. And the lever that is enabling individuals and groups to go global so easily and so seamlessly is not horsepower, and not hardware, but software – and all sorts of new applications – in conjunction with the creation of a global fiber-optic network that has made us all next-door neighbors.”[27]
In other words, technology, enabled by broadband access, has enabled anyone -- whether they live in a first world nation or a "developing nation" -- to compete with the United States, including New York City.
Broadband is Must-Have for All Businesses
Many business will not locate new offices or branches in locations where there are broadband constraints. Broadband is now at or near the top of 'must-haves' for many new businesses. Communities with ubiquitous and affordable broadband will continue to attract jobs while communities with broadband constraints will lose jobs over time. Businesses typically want far more bandwidth than residences, and thus the economic development issue is the availability of large data pipes for affordable prices.[28] In New York City, broadband is essential for many of its major industries.
· Finance. $1.5 trillion in financial trades are completed over existing broadband networks each day.
· Media. Print, broadcast and online services depend on a robust fiber infrastructure.
· Telecommunications. It is a $23 billion annual industry, representing 3% of the City’s economy.
· Technology. Opportunities and incentives for the development of innovative new technologies depend on broadband networks, particularly fiber-optic connectivity.[29]
The United States is Falling Behind in the Broadband Race
According to the International Telecommunications Union,[30] South Korea, Hong Kong, Taiwan and Japan rank 1st, 2nd, 7th and 13th respectively in the world in terms of broadband adoption per capita (i.e., broadband penetration), while the United States just fell to 16th in 2005, down from 4th in the world in 2002. The Organization for Economic Cooperation and Development recently reported that the United States dropped from 10th place to 12th place in a per capita ranking of developed nations with high-speed Internet access. President George Bush recently said of the United States’ drop in the broadband access rankings:
· “America ranks 10th amongst the industrialized world. That’s not good enough. We don’t like to be ranked 10th in anything. The goal is to be ranked 1st when it comes to per capita use of broadband technology. It’s in our nation’s interest. It’s good for our economy.”[31]
In terms of price, broadband in Asian countries is about half of the price of broadband in America[32] while, at the same time, being 10-20 times faster, sometimes more. For example, in Japan, citizens can get a 26 Mbps connection for $22 U.S. dollars a month, half the price of and about 13 times faster than the typical cable modem connection in the United States.[33] Recently, Hong Kong announced that some households now have access to 1 Gbps connections, about 50 times faster than the average cable modem connection in the United States.[34]
Broadband Expands Educational Opportunity
Broadband access at home is crucial for the success of children in school. With broadband, learning is not confined to the school day. “Learning moments” can happen at home as well. Specifically, broadband access at home will help schoolchildren communicate with their teachers at home, do research, complete homework and access on-line educational resources. As Elisabeth Stock, Executive Director of the nonprofit organization Computers for Youth, which supplies and trains low-income families to use computers and the Internet, remarked at a recent Committee on Technology in Government hearing: “Parents use the Internet to help their children learn … and stay connected to the school.[35]
Broadband Helps People Find Jobs and Upgrade Skills
More and more, the Internet is becoming the place where employers post job opportunities that are not available through word of mouth or in-person community networks. Conversely, with broadband access, jobseekers can also market themselves to employers. In addition to facilitating the connection between jobseekers and employers and vice versa, broadband access brings the wealth of information resources to its users and helps promote lifelong learning. Broadband facilitates long-distance education and training that helps workers upgrade their skills and gain credentials to move up the employment and career ladder. As Myron Uretsky, Professor of Information Technology, Stern School of Business, New York University, said at a recent Committee on Technology in Government hearing: “We need to take steps to make sure that anyone wanting to upgrade their skills has affordable access to the necessary resources.”[36] Many of those resources are on the Internet, and broadband allows users to access these resources quickly.
Broadband is Key to the Development of Businesses
Broadband makes businesses – large and small – more productive by allowing them to communicate and share files quickly and easily with customers around the world via e-mail and Web technology. Additionally, broadband allows businesses to save on telecommunications costs through Voice Over Internet Protocol (VoIP), save on travel expenses through video conferencing capabilities, and save on rent through telecommuting programs. With broadband, employees have more flexibility to work from anywhere, at home or on the road. Finally, broadband enables businesses to improve on their marketing efforts, as broadband’s “fast, seamless connection to the Internet enables companies to reach an infinitely larger pool of customers,”[37] particularly customers in other parts of the U.S. and in other countries.
Broadband Can Improve Services by Nonprofits
As with businesses, broadband helps nonprofit organizations become more productive and save money. By reducing the time and money spent on administrative tasks, nonprofit organizations can spend more time delivering services. Broadband also increases the ability of service providers to share information about the people they service, increasing the possibility that they will be able to deliver the right service at the right time to the right person.
Broadband Promotes e-Government and e-Democracy
With ubiquitous broadband access, broadband allows all New York City residents to take advantage of the increasing number of municipal governmental services (e.g., buying a parking card on-line[38]) accessible through the Internet, saving residents time and money as well as potentially reducing the cost of government services. Also, broadband gives residents the capability to communicate with their elected officials and participate in the legislative and/or policy-making process more easily. For example, with universal and affordable access to broadband, more residents could have accessed the website[39] that the New York City Council set up that allowed users to talk amongst themselves about how to spend the Campaign for Fiscal Equity[40] monies that are owed to the New York City public school system by court order.
Broadband Enables Telemedicine
Telemedicine, as defined by the American Telemedicine Association, is the use of medical information exchanged from one site to another via electronic communications for the health and education of the patient or healthcare provider and for the purpose of improving patient care.[41] Telemedicine does not replace in-person face-to-face health care; it is a multi-faceted tool to be employed, when appropriate, to enhance the delivery of health care services.[42] With universal availability of affordable broadband, telemedicine technologies could be used to expand access to medical services and explore the delivery of more sophisticated medical services.[43] In providing flexibility, telemedicine holds the potential to greatly increase cost effectiveness:
· Its judicious use and application holds the promise of reducing the frequency and / or duration of hospital stays, reducing the frequency of physical office and home health care visits, expanding service availability to a greater number of patients at a lesser unit cost through more efficient use of provider time and facilities, and by generally supporting community wellness.[44]
Status of Broadband in New York City
Competition in Telecommunications Market
Universally accessible and affordable broadband can only happen with robust competition. However, in New York City, competition is considered tepid at best. The following paragraph describes the state of the telecommunications market in New York City well:
· “With at most two broadband providers dominating most markets, the telephone and cable industries appear to have settled into a comfortable state of ‘co-opetition’ in which both industries seek to wring as much profit out of their aging infrastructures as possible, with neither pushing the other very hard on price or quality.”[45]
Future Bandwidth Needs & Availability of Necessary Bandwidth
Industry experts have also predicted that, within the next few years, homes will need vastly more bandwidth capacity than is currently available. For example, a recent study by Jupiter Research concluded that, by 2009, average households will need 57-72 Mbps[46] of bandwidth and that ‘tech savvy’ households will consume nearly 100 Mbps. A significant amount of this bandwidth will support in-home wireless applications, as well as high definition television and other bandwidth-rich applications.[47] However, it is unclear whether New York City will get the bandwidth it needs to keep up with the rest of the world from its incumbent providers – Verizon, Time Warner and Cablevision. Verizon has embarked on a plan to deploy FTTH (or Fiber to the Home) through a service called Fios[48] as rapidly as possible across the country, including New York City. It is however unclear how successful Verizon will be in deploying fiber-optic connections to every apartment and home in New York City anytime soon. On the other hand, “cable companies, currently offering bandwidth in the single-digit Mbps range, claim that they have no plans to boost their bandwidth to any significant extent. At most, they may match the speeds offered by the telephone companies.”[49]
Involvement of City Government in Telecommunications
Municipalities are Entering the Telecommunications Market
Over two hundred cities in the U.S. and around the world are currently considering or making major investments in broadband networks, both wireless[50] and fiber optic.[51] There is evidence that municipal entry into the telecommunications market promotes competition. A recent study on public investment in telecommunications in Florida concluded that “public investment in communications networks increase competitive communications firm entry by a sizeable amount,”[52] thus, potentially lowering telecommunications prices for all customers. And the Federal Communications Commission (FCC) “has found that introduction of a third competitor into a given market with two existing competitors can result in significant benefits for consumers.”[53]
NYC Government Can Affect The Telecommunications Market
Even though many public policy and regulatory decision relating to telecommunications are made at the state and federal levels of government, New York City government still has two very powerful tools that can promote the development of a robust telecommunications infrastructure in New York City. They are (1) control over public rights of ways (i.e., pole tops, rooftops, streets, underground conduit such as water mains and sewers) and (2) the resources to be an “anchor tenant” to make it economic feasible for the private sector to build citywide broadband networks, either wireline or wireless. Alan Shark, Executive Director of the Public Technology Institute, a national nonprofit organization advises municipalities on technology and telecommunications, stated a recent Committee on Technology in Government hearing:
- “I believe that we can’t wait for the private sector to always do the ‘right’ thing and within the ‘right’ timeframe, or for that matter at the ‘right’ price. The City of New York with all of its collective purchasing power and other tools and incentives at its disposal can do much more than wait and see.”[54]
Possible Policies for Broadband Task Force to Focus On
Building New Citywide Broadband Networks
By building competing broadband networks, either wireline (fiber-optic) or wireless, city government can provide much needed competition in the telecommunications market, potentially driving down prices and increasing quality of service. As many cities have done and are currently doing, the task force should consider looking into this option seriously. City government building broadband networks is similar to government building airports. Currently, the telephone companies and cable companies have built broadband “airports” but allow a limited number, if any at all, of their competitors to “fly” on it, greatly reducing competition in the telecommunications market. Other cities are making their broadband networks open and non-discriminatory. What this means is that the City’s broadband “airport” would be open to all providers (or “airlines”) and everyone’s content (or information) or services (e.g., VoIP) would be allowed onto it in a non-discriminatory manner. In other words, the network would be completely open to all providers, all types of information and all types of services. These principles are what Seattle’s future broadband network will be based on.[55]
Any potential municipal broadband network does not have to be a publicly owned and operated network. Many municipalities are engaging in public-private partnerships where the City contracts with private sector companies to install and maintain the broadband network. In return, the City would allow the companies building the network to use municipally-owned rights-of-ways at below market rates. City government could also get a share of the revenue that this network would earn as well as ensure that universal and affordable access is provided by that network. This is the model that Philadelphia is adopting.[56]
Allowing Access to Existing Municipal Broadband Networks
The City of New York is currently in the process of building one of the largest wireless broadband networks in the world – a citywide wireless network for public safety agencies (police, fire, etc.).[57] With 95% coverage of the City, the Citywide Mobile Wireless network would be one of the largest municipal wireless broadband projects in the world. It is technically possible – and possibly desirable – for the city government to let other user groups access this network, including the general public (e.g., schoolchildren), small businesses and nonprofits. City government would not necessarily have to provide retail service to the public (that is, direct Internet access). Instead they could sell bandwidth at wholesale rates to private providers who would then provide a broadband connection and broadband services to the aforementioned groups.
Using Franchises to Promote Equitable Buildout
Currently, all cable television providers in New York City have franchises with the City that allow them to install their networks in municipally-owned rights-of-way (e.g., under the roads). The task force could look into ways to enhance the cable TV franchises to ensure that cable modem service goes into areas zoned solely for business use so that the businesses located in these areas have the option of cable modem service. Right now, as noted in the recent Center for an Urban Future report,[58] there are many industrial parks around the City that cannot get DSL or cable modem service. The task force may also consider studying how to incentivize new broadband franchise holders (e.g., City-owned poletop[59] franchise holders) to build new telecommunications infrastructure (e.g., wireless broadband base stations) in underserved areas, particularly in the areas outside of the central business districts of Manhattan.
Install Conduit in All New Residential and Commercial Buildings
On February 2, 2005, the New York City Council passed Reso. No. 669,[60] which calls “upon all relevant City agencies to use their funding and regulatory power to support and encourage the provision of affordable high-speed Internet service and computer purchases for the benefit of residents of affordable housing.”[61] The task force could look at how implement the provisions of Reso. No. 669. One way the City could implement the Reso. No. 669 would be to provide incentives – or require – all new affordable housing developments to have conduit for broadband cabling (e.g., fiber-optics, coaxial, etc.) built to every single unit. This policy would make it more cost-effective for telecommunications companies to provide broadband service residents in affordable housing developments. The task force could look into the possibility of going one step farther and require in the City’s building code that all new buildings, residential or commercial, have broadband conduit built in. Additionally, the task force could consider how to ensure that these networks remain open and non-discriminatory as described above.
The Work of Other U.S. Cities’ Broadband Commissions
Wireless Philadelphia
History and Mission of Wireless Philadelphia
In August 2004, the Honorable John F. Street, mayor of Philadelphia, appointed a seventeen-member Wireless Philadelphia Executive Committee to serve as an advisory / advocacy group for wireless community networking through community outreach programs, communications with the press, and participation in meetings and conferences. The Mayor’s charter to the Committee was to develop a public and private partnership to achieve wireless access throughout the City to enhance economic development in neighborhoods, help overcome the digital divide, and improve quality of life for all Philadelphians. To meet these objectives, the Committee, chaired by City of Philadelphia CIO Dianah Neff, with the involvement of Philadelphia-area universities and private-sector companies, studied issues such as stakeholder analysis, requirements definition, business model scenarios, funding options, investment analysis, and technical architectures.[62] In April 2005, the City of Philadelphia released its Wireless Philadelphia Business Plan.
Mission of Wireless Philadelphia
First and foremost, the City embraced this initiative to remain a competitive location for businesses, a world-class center for education, and an attraction for visitors. The investment will also reduce the cost of delivery of public services. Finally, it is an essential element of a long-term strategy to invest in the human capital of the City: its workers, its residents, and perhaps most importantly, for the future of its children.[63]
Selected Findings of the Wireless Philadelphia Committee
Temple and Drexel Universities conducted extensive analysis to support the Wireless Philadelphia initiative. Their analysis supports the following conclusions:
· The stakeholder analysis shows that there is a need for low-cost broadband Internet access in the City above and beyond what is available today.
· The demographic and projected-demand calculations show that there is a potential market for broadband access. However, the stakeholder analysis also shows that the demand must be paired with compelling applications … such as video mail, voice-over Wi-FI, and distance learning.
· It is unclear if, when, and at what price the private sector will provide such services and whether the services will provide universal or near-universal access, which is an important societal goal of the City.
· Given the scale and rapid evolution of wireless technology, the City will likely achieve greater success partnering with private sector specialists rather than implementing this project on its own.
· The challenges of technology and the risk of implementing a project that is not a core competence of the City suggests that private industry should play a major role in the funding, implementation, and ongoing operation.
· There will need to be substantial involvement by the City to ensure that the project gets off the ground and that underserved populations are targeted.[64]
Selected Recommendations from the Wireless Philadelphia Business Plan
To accomplish the goal of designing, deploying, and managing a self-sustaining, high-speed, affordable, broadband network over a 135 square-mile area, the Committee makes the following recommendations:
- Create a nonprofit corporation to oversee the implementation of a Cooperative WholesaleTM business model. The Cooperative Wholesale model promotes public-private cooperation, creates increased competition for lower broadband prices in the market, and funds free cash flow for Economic Development and Digital Divide programs.
- The nonprofit receives startup funding from foundation grants, bank loans, and/or other non-city sources.
- The nonprofit, through an RFP process, outsources the design, deployment, management, and maintenance of a citywide wireless network to private companies.
- The nonprofit makes access to the network available for low wholesale fees to retail service providers, telecommunications companies, institutions and other nonprofit corporations.
- Service providers market the service to subscribers and provide customer service, billing, technical support, content, and other value-added services.
- Service providers make discounted rates available to low-income and disadvantaged residents as well as minority, women, disabled-owned, and other small businesses.
- The nonprofit provides some level of free wireless Internet access to everyone living, working, or visiting the City in public spaces like parks and squares.
- The nonprofit uses its free cash flow to fund Economic Development and Digital Divide Programs aimed at getting PCs into low-income and disadvantaged subscribers’ homes, making training programs available, and stimulating small business innovation and growth.
- The nonprofit builds key informational messages for distribution to multiple stakeholders, informing, educating, and familiarizing them with the benefits of the Wireless Philadelphia initiative through key marketing and public relations programs.
- The City provides the nonprofit with access to city-owned light poles and other assets.
- The City agrees to act as an ‘anchor tenant’[65] for the network.
The Cooperative Wholesale model is unique in its ability to accomplish the social goals of Wireless Philadelphia, while at the same time promoting competition in and enabling rapid-growth broadband access. Rather than attempt to enforce government regulation of broadband pricing, the Committee believes that the availability of an alternative, low-cost broadband network and an increase in the amount and intensity of competition will result in more affordable broadband services.[66]
Expected Return-on-Investment of Wireless Philadelphia Network
The proposed business model demonstrates that a $10 million investment to deploy a citywide wireless network will result in broadband access at dial-up prices and provide positive financial results. Through conservative assumptions, the model estimates that the nonprofit will break even in year four, build $4 million of working capital reserve for network upgrades and generate $5 million in free cash flow to support economic development and digital divide programs.[67]
Seattle’s Task Force on Telecommunications Innovation
Mission and History of the Task Force
The Internet has sparked a communications revolution that will accelerate as advanced voice, data and video services emerge. Interactive, high-speed broadband networks with the capacity to deliver next-generation applications will become essential to businesses, schools, health care providers, government and individuals. Such a network is not available to most of Seattle today. If Seattle is to compete in the new world of enhanced communications, it must have an affordable, open, universally available, state of-the-art broadband network.
Recognizing that Seattle faces this challenge, the Seattle City Council, with the concurrence of Mayor Greg Nickels, adopted a resolution sponsored by Councilman Jim Compton establishing the Task Force on Telecommunications Innovation in 2004. Its purpose was to explore the feasibility of using the City’s broadband assets in a network available to the public. The Task Force gathered and analyzed information over a seven month period, and submitted this report of its findings and recommendations to the City in May 2005.[68]
Findings of the Task Force
- For the next half century, a city’s economic, social, and cultural success will depend, in part, on its broadband infrastructure.
- Seattle, in particular, would benefit from the availability of increased bandwidth because it is a leader in the information economy.
- Seattle could gain competitive advantages by becoming an early adopter of broadband. Seattle’s economy will grow if broadband gives local businesses advantages that aren’t available elsewhere.
- A majority of Seattle residents use networked information technology today, and their demand for access to state-of-the-art technologies and services will continue and increase.
- To serve future needs, networks must be available with bandwidth capable of simultaneously delivering voice, switched video and data.
- Fiber-optic cable extended to the premises is the only technology available today with the capacity to meet all of Seattle’s long-term needs.
- Incumbent cable and phone companies do not provide, and have not presented plans to develop, the high-speed network that Seattle will need in the future.
- The City of Seattle has substantial broadband resources and capabilities, and could play a leadership role in the development of public broadband systems by encouraging private investment or using City assets in a public network.
- The City’s fiber network would be especially attractive to companies that are developing and testing broadband applications.
Based on these conclusions, the Task Force believes the City of Seattle should take an active leadership role in fostering development of a robust broadband network. The following recommendations for City action will not lead to an overnight solution. Development of a broadband network will be a complex and costly challenge. It is not clear today who will build the system, what is the best technology, and how it should be financed. The steps we recommend will set the City on a path toward resolution of these issues; as we proceed, it will become evident what more must be done to ensure that Seattle has a 21st century broadband infrastructure.[69]
Recommendations of the Task Force
The Task Force recommends that the City adopt this goal:
2015: Broadband for All: Within a decade all of Seattle will have
affordable access to an interactive, open, broadband network capable of
supporting applications and services using integrated layers of voice, video
and data, with sufficient capacity to meet the ongoing information,
communications and entertainment needs of the city’s citizens, businesses,
institutions and municipal government.
The Task Force proposes that the City take the following steps to move toward the goal:
1. The City should work with private companies to encourage them to develop high-speed networks for Seattle.
2. The City should develop its own network for municipal purposes, and potentially to support the creation of an open network available to the public.
3. The City should make its communications network available to private service providers, when feasible.
4. The City should monitor emerging Internet technologies, and take advantage of opportunities that make sense for Seattle.
5. The City should encourage local broadband enterprises that are developing next-generation applications, services and technologies.
6. The City should establish an Office of Broadband, with the authority and funding necessary to successfully carry out these recommendations.
7. The City should create an advisory committee to provide advice and support to the Office of Broadband.
8. The City should monitor progress toward 2015: Broadband for All.[70]
Los Angeles WiFi & Beyond Executive Advisory Panel
History of Executive Advisory Panel
In October of 2004, Mayor Hahn asked the panel of experts to provide his office a strategic plan on how Los Angeles could lead the way in providing fast (high speed broadband) communication and easy Internet access (your device, your choice) to its residents, businesses and visitors. This report from the ‘WiFi and Beyond’ panel is designed to provide policy makers and planners guidance along the path to that very desirable future.[71] In April 2004, the Mayor’s WiFi and Beyond Executive Advisory Panel issued a report entitled, “Fast and Easy: The Future of WiFi & Beyond in the City of Los Angeles.”
Vision Statement
We envision the City of Los Angeles as a place where everyone who works, lives or visits here enjoys convenient and affordable broadband access to the Internet. We want Los Angeles to be a ‘broadband city’ both in reality and in global reputation. We think that the experience of increasingly mobile, high speed, personalized communication will help make the City a great place to live, work and enjoy the excitement of urban life. Most importantly, we believe the ability for everyone to communicate easily and quickly is vital to the City’s aspiration to serve as a great forum of open and free democratic discussion and creative expression.[72]
Principles Guiding the Panel
In developing the report, the members of the panel agreed on several core values that guided their deliberations and recommendations:
· Affordability. High speed communication services need to be available at prices competitive with other cities and regions in the U.S. not just to help close the Digital Divide within the City, but to avoid any negative impact on the decision to locate in Los Angeles or even in one area of the City versus another by individuals, non-profits or businesses.
· Convenience. Access to high speed networks should be available to all City residents, businesses and visitors in ways and at locations that encourage their use and enhance the experience of living in a modern, connected metropolis.
· Technological Neutrality. The rapid changes in communication technologies that will occur over the next five years requires that the City not attempt to “lock in” on any one technological solution nor attempt to award preferred status to any particular solution for fast and easy access to the Net.
· Public/Private Partnerships. One of the best ways for a city the size of Los Angeles to achieve their goal in the next five years is to work with institutions in the private sector that share its vision and want to work in partnership with the City to achieve it.
Mission for the City of Los Angeles on Broadband
We believe the City of Los Angeles, within the next five years, should ensure that high speed access to the Internet is available and affordable for anyone who wants it anywhere in the City. In addition, we believe it is possible to implement strategies to accomplish that mission in ways that address the Mayor’s goals of:
1. Helping to close the digital divide;
2. Accelerating economic development; and,
3. Making our City’s government more efficient and accessible.[73]
Recommendations
1. Encourage the adoption of a public/private partnership business model designed to deploy fast and easy broadband communications services in every neighborhood, to minimize gaps in existing service.
2. As part of the first phase of the coordinated plan, conduct a citywide broadband survey to determine if there are any gaps in the availability of broadband services for residents and businesses in Los Angeles.
3. Do a review of the available City-owned physical assets in the City’s rights-of-way, including facilities, to determine the available “space” that could potentially be used to construct broadband networks.
4. Provide all City residents, and those doing business with the City, fast and easy access to the Net in all municipal facilities within three years.
5. In addition, ensure that fast and easy communication services are available in key public places and commercial corridors used by visitors and travelers of all types.
6. Encourage public/private partnerships that would create new e-government applications of benefit to the City of Los Angeles and ensure that City of Los Angeles web pages that provide information about and access to various City services are incorporated into such services.
7. Finance these activities through the use of securitized bonds (tax exempt of taxable depending upon the use of the proceeds), savings from cross-departmental and agency partnering, and grant funding for specific projects.
8. Become a national and local champion of WiFi and future technologies.
The City’s role in assuring the deployment of WiFi and Beyond (WAB) communications services in Los Angeles should be driven by the needs of its users, based on periodic assessment studies and community input coordinated through Neighborhood Councils and other groups. The plan should proceed in phases to assure constant attention to user needs and the rapid changes in technological alternatives. If the City of Los Angeles adopts our recommendations we can become a “broadband city” both in reality and in global reputation within five years.[74]
Proposed Int. No. 625-A
By Council Members Brewer, Boyland, Comrie, Fidler, Gerson, Gonzalez, James, Liu, Nelson, Palma, Recchia Jr., Sears and Weprin
A LOCAL LAW
To create a temporary task force to study how affordable broadband access can be made available to all New York City residents, nonprofit organizations and businesses.
Be it enacted by the Council as follows:
Section 1. Legislative findings and intent. Broadband, i.e., a high-speed connection to the Internet, is a necessity for every resident, nonprofit organization and business in New York City. As the Internet evolves, the interactive applications and services on it will become multimedia experiences that will use words, images, sounds and video and will require large of amounts of bandwidth, which only a broadband connection can provide.
A broadband connection improves the quality of life of everyone who has access to one. Broadband in the home expands the educational opportunities of all schoolchildren by allowing them to communicate with their teachers at home quickly and easily as well as complete homework projects that require access to on-line multi-media educational resources. Broadband saves businesses, both for-profit and non-profit, time and money by giving them the option to implement cost-saving technologies like Voice over Internet Protocol, institute telecommuting programs that reduce the cost of rent, and increasing the amount of time they have to serve their customers.
Broadband is often least available to low-income children and families and is also often not available to many small businesses and nonprofit organizations, particularly those located outside of Manhattan. Most importantly, broadband access is often not affordable to these underserved communities, thus, preventing higher rates of broadband adoption and limiting the social and economic opportunities of many New York City residents, nonprofit organizations and businesses.
§2. a. There is hereby
established a temporary task force to advise the mayor of the city of New York
and the speaker of the council of the city of New York as to the technical,
legal, environmental and economical feasibility of providing affordable
broadband access to all New York City residents, nonprofit organizations and
businesses.
b. Such task force shall be
comprised of nine members, five of whom shall be appointed by the speaker of
the council and four by the mayor. The
chairperson shall be elected from amongst the members. The members shall be appointed within thirty
days of the enactment of this local law and shall serve without
compensation. Any vacancy shall be
filled in the same manner as the original appointment for the unexpired term.
c. Such members of the task
force shall serve for a period of twelve months at which time the task force
shall cease to exist. Task force member
terms shall begin thirty days from the effective date of this law.
d. No later than three
months before the expiration of the task force, the task force shall submit a
report containing its conclusions and recommendations to the mayor of the city
of New York and the speaker of the council of the city of New York.
§3. This local law shall take effect immediately upon its enactment.
FHK/BYL 6/1/2005 3:40 PM