Fiber for American Fork, Part 2: Anticipated Benefits

This is the second of several planned blog posts about a proposal the American Fork City Council is considering to extend fiber optic connectivity to every residence and business in American Fork as a utility. You can find a more detailed description of the proposal itself in the previous post, where I also explain my head start in knowing about the proposal.

Before we go further, I should interrupt for an apology. I hoped to post this before I left for Lake Tahoe (hence the photo) for a week at the end of July. Now it’s not even August any more, and I’m finally posting it. Sorry about that.

Lake Tahoe

This post explores the expected benefits to residents, businesses, and the City itself, if we build the fiber system. This is one important angle from which to view the proposal. Another will follow in the next post: good and bad reasons for opposing it.

Meanwhile, some housekeeping:

  • The City has held the three information meetings it initially scheduled. I was at the first and third — on the panel — and I have to say they were well attended, and city residents brought lots of great questions and in some cases some serious technical expertise. So, as my Aussie friends say, well done to you, American Fork!
  • Another public information meeting is scheduled for 6:30 p.m., Thursday, September 12, at City Hall in the city council chamber.
  • Three weeks ago, as scheduled, the city council unanimously approved a “parameters” resolution, as a preliminary step toward a final up-or-down vote on the proposal, which will come later. The vote was 5-0 in favor.
  • Last week, the city council approved an interlocal cooperative agreement, another part of preparing the way for a final vote to fund and build the utility or not. The vote was 4-1 in favor, with Councilmember Rob Shelton casting the lone negative vote.
  • Watch for a public hearing at the beginning (7:00 p.m.) of the September 24 city council meeting on this matter. Feel free to attend and listen, and even speak your mind. This is not a done deal; the city council is still studying it, and last time I talked with each of them, they hadn’t finally decided how they’ll vote. They’re eager to hear from constituents.
  • Originally, the final vote was expected in mid-November. Now I’m hearing that it might be as early as late September or sometime in October.
  • Since my first post on this proposal, the LightHub Fiber website has added an FAQ section, which is worth a look.
  • American Fork Mayor Brad Frost’s recent op/ed in the Daily Herald is worth reading.

We’ll get to those anticipated benefits now. Thanks in advance for reading. The importance of learning what is actually proposed and why, before deciding whether you like it or not, seems like it should be self-evident. But sometimes I wonder. In any case, it makes for more sensible, more honest politics.

In a Word, Why?

In this post I’m splitting the anticipated benefits of a citywide fiber utility into three categories:

  • benefits that don’t move me, but may interest you;
  • benefits which I will value and enjoy, if they happen, but which for me do not by themselves justify the venture; and
  • benefits which, in my view, justify the venture.

Your views and priorities may differ from mine, and that’s fine. Official publicity may also prioritize them differently — partly because some of them are more difficult than others to explain in a few words. And I’m sure there are already a few folks around who are willing to give you a much different view. You’ll want to check their facts and reasoning, just as you’ll want to check mine.

In any case, all of the following is one guy’s opinion. I don’t work for the City or speak officially for the City.

No Big Deal (to Me)

If built, the system will make it easier and cheaper for residents to stream to those 4K televisions that are all the rage just now, and to 8k televisions, which are already coming, with their 33 million pixels. I’m not saying 4K and 8K are bad, or that you should think as I do, but I’m still doing just fine with HD. For me, better TV doesn’t justify building a new city utility to bring it to you.

It’s also possible that a citywide fiber utility will hasten (and broaden) the arrival of 5G connectivity in American Fork — if providers want to use the City infrastructure instead of, or in addition to, their own. Those antennas which have to be placed every several hundred feet need to be connected by fiber, you see. In my mind, this wouldn’t justify creating the utility either — even if it might coax providers to offer 5G in more of the city, not just the major business districts and the high-density residential areas, where it will be most profitable.

Someone out there may be thinking that a hard-wired, high-speed alternative to 5G is probably a good idea anyway, because of concerns, legitimate or otherwise, about the health risks of all the electromagnetic radiation from all those 5G antennas. Wherever the science itself eventually leads, it’s not hard to imagine public concerns dramatically slowing the penetration of 5G into residential neighborhoods. I’m not moved by this at present, but I’m … interested.

Good but Not Enough

For $10, give or take, the proposal should deliver to me faster Internet connectivity than I’m getting through my current provider, which is mostly adequate but not great, for $50.

For a higher but more than competitive price, the proposed utility could deliver gigabit speeds. In Ammon, Idaho, their Open Access Fiber Optic Utility (ArcGIS) is delivering a gigabit for less than I’m paying for my present slow broadband.

Speaking of prices, people who want to stick with the service they have now from other providers, if and when the city system is build, should find that those providers have to lower their prices and improve their offerings to compete in American Fork. We’re close to “everybody wins” here.

Better still, we’re talking about point-to-point architecture, which means, among other things, that I can get the same speed in the evening, when all my neighbors are online too. This is not currently the case, to put it mildly.

I’d love to have the symmetrical service LightHub will offer, where the upload speed equals the download speed, instead of being far slower. Fast downloads enable video streaming, for example, but you want fast uploads too, for video conferencing and any number of other things you might want to do while telecommuting, engaging remotely with a medical provider, gaming, etc.

Viewed simply as a competitive product, this is quite seductive to me. But does it justify the creation of a new public utility, which includes every residence in the city paying that approximately $10 fee (or about $20 for every business), whether they use the basic service or not? In cases of legitimate severe financial hardship, opting out will be possible, but still …

This is a thornier question. I much prefer reasonable limits on the size of government at every level. Furthermore, the City’s Airswitch experience, neighboring cities’ UTOPIA struggles, and common sense suggest that there are some things the City could do down the road — of its own will or because unwise voters compel them — to disappoint us all. So the bar is pretty high, in my mind.

If the proposal were simply aimed at reducing the cost and increasing the speed of American Fork residents’ broadband connectivity, compared to what 80-90% of us are paying private companies like Comcast and AFConnect (the AF is for American Fiber; it’s a private company), or in a few cases UTOPIA, my enthusiasm for the project would be so low that it would look a lot like eye-rolling indifference.

That said, if the cost projections weren’t so encouraging, the next set of reasons might not sway me. But they do …

Compelling

1. Economics

The private market — if you can call it that, when the big telecommunications companies spend about $100 million per year on candidates and lawmakers — doesn’t serve American Fork particularly well in broadband connectivity. This is a natural consequence of a market condition economists call large externalities.

When much of the benefit of a thing doesn’t go directly to those who provide it, the provider’s financial incentives are too low, and the market is underserved. In broadband this can mean there are areas of the city where service is not available, or where the price for adequate service is too high, or where the level of service available is low — as in an American Fork medical practice which is connected to three broadband providers, but often can’t get the speed and low latency they require through any of the three.

Large externalities are generally considered to a good case for public involvement in the market — in this case, for a public utility, as in the cases of water, sewer service, electricity, and natural gas. The rationale is similarly compelling for such things as roads and traffic signals, bridges, parks, libraries, and more.

2. Growth

Growth on the Wasatch Front, including American Fork, is inevitable. We expect it will continue to be rapid and massive. This poses all sorts of problems — and a citywide fiber system offers partial solutions.

  • Citywide fiber will help us to manage the nature of the growth, encouraging high-tech firms and other bandwidth-dependent companies to bring their jobs, employees, and tax revenues to American Fork. Someone is coming, and I prefer us to be part of a high-tech corridor, instead of some of the other possibilities.
  • We already cannot build roads fast enough, and for a sad fraction of the year our air quality is poor. We can take some pressure off our lungs and our tax burdens not only by attracting desirable jobs closer to home, but also by facilitating telecommuting and home-based businesses, as a citywide fiber system will. Not everyone can work at home or even wants to. But the more we can reduce automobile trips, the better our air will be, and the fewer new lanes we’ll need.
  • There will be significant benefits to City operations, if we have a citywide fiber system. For example, early estimates are that the retrofitting existing pressurized irrigation connects with meters (which did not exist as a feasible option when we built the system, but which Utah law now mandates, over the next few years) will be $15 million cheaper or more, if we have the fiber system. That savings alone is about half the cost of building the system. (These figures are based on reported costs, including the costs of metering connections in other Utah County cities.) That’s a lot of tax money you and I won’t have to pay over the next several years, because …
  • Even conservative financial models, which I have studied and had explained to me repeatedly and in exhaustive detail (note my work on the mayor’s task force which studied the proposal), have this system paying back its 30-year bonds far ahead of schedule and contributing substantial revenue back to taxpayers, both individual and corporate, in the forms of funds which can be used by the City for other purposes, in lieu of some of our taxes; or used to lower rates for connectivity or offer higher speeds at the same rates; or all of the above.
  • Most of the discussion so far has been simply about the possibilities inherent in faster Internet access with lower latency (shorter delays in transmission). There is a host of other possibilities, including existing technologies and future technologies, which are necessarily somewhat speculative. Lots of different services can be provided over such a system, besides Internet access — by the City itself and by private entities which join the system. These would likely include home security and automation services, public safety services (including school safety, an area in which Ammon, Idaho, is testing some exciting new things), medical services, entertainment, and much more.
  • I already expressed some reservations about whether the private market, in the form of the big telecoms, is really private any more; they’re hugely influential on national and state governments, and they’re paying top dollar to be so. But I’m politically conservative, so as a default position I tend to favor the free market (if we can still find such a thing). To build and run an excellent citywide fiber utility would be to insert ourselves into the quasi-private market, to be sure — but a key effect will be to extend the benefits of that private market citywide, to all residences and businesses in the city, by creating a marketplace where the City can require a high level of service, including customer service. This will actually open more possibilities for the private market than presently exist — quite apart from the benefits to American Fork businesses of having less expensive access to better connectivity.
LightHub fiber

3. The Right Time

As I have studied the proposal — which I first approached with great skepticism and my (regrettably) characteristic cynicism, one of the things which impressed me was the timing. It comes early enough that the big telecoms haven’t twisted the Utah Legislature’s arms to prevent municipalities from doing what we propose. (This became a problem nearly two decades ago, when we tried something quite different with Airswitch.) And it comes late enough that we’re able to learn from the experience, good and bad, of hundreds of US municipalities who’ve built municipal broadband systems.

We’re coming to this late enough that we can learn from the success stories of places like Spanish Fork, and from cautionary tales like UTOPIA and iProvo. The current proposal incorporates key lessons — funded mostly by othere communities — in how to structure the utility, design the network, provide customer service, and so on in a way that brings the benefits to American Fork, not some outside entity.

Definitely Yes, But …

I’m in favor of the proposal, and I’ve told all five members of the city council why, in some detail. But reasonable people can certainly disagree here. So the next post, coming shortly (really, this time) is about good and bad reasons for opposing the proposal.

Stay tuned — and as always, your comments are welcome.

9 Replies to “Fiber for American Fork, Part 2: Anticipated Benefits”

  1. If this is so good then why isn’t a private entrepreneur taking this on? I get it that the city needs to ensure that the necessities of life are met, for its citizens, but is fiber internet access part of this? Should somebody who doesn’t use the internet be required to pay higher taxes for this access? NO! if the city wants to the rights to develop this for the city then let that be the investment for the private entity but not the city. Somewhat recently we went to a secondary water system for our yards, and that is ok, but we lost a ton of cash when we balked at the decision. That being said, our roads are still a mess from the installation of the pipes down the middle of the roads. When are we going to get the roads fixed? Way too many issues here.

    1. Hi everyone ,

      My name is Dave Adams and I serve on the kaysville city council. We seem to be following the exact same model as you and the council has approved last night, the lighthub agreement with you all.

      Our council promised the citizens up until July 17 that there was absolutely going to be a ballot vote of the people on this mega bond. Then they came back and retracted that promise and deemed fiber as necessary critical infrastructure that the city has to have to function. Our city is in a degree of civil war over such and now three days ago they present us, the council, with a lighthub agreement and they passed it. Only myself and one other council member had even read the agreement. We will be partners with you all of this goes through and will be operating out of your data center.

      I’m indifferent to their views and not on board. I am curious if anyone would be willing to discuss their views and share information.

      Dave Adams
      dea3construction@gmail.com
      801-336-7792

    2. Councilman, thanks for identifying yourself. I haven’t paid too much attention to things up in Kaysville, including recent discussions of fiber, but I seem to recall that Kaysville has some experience American Fork doesn’t have in the realm of utilities, owning your own electrical utility.

  2. I am against having fiber installed and I will tell you why. To me, it does not matter how amazing, wonderful, fast, the new connections are touted to be. Nor how easy it will be for the City to read our water meters via a new fiber connection instead of continuing to employ those people who currently read the meters (20 million dollars could employ a lot of people!)

    What is at stake is the “principal” of removing one’s agency, choice, and freedom to make a choice for themselves and be able to say “I do not want or need this service” and because I choose not to use this service, you cannot charge me money for something I do not want, need or use.
    As A.F. has already gone down this road in the past by charging me approx $65.00 a month 12 months of the year for water that I have access to for only 6 months out of the year (secondary waster is shut off 6 months out of the year during winter) , It is now easier for them to want to take my money without my consent for a product or service I do not want. This is WRONG, WRONG, WRONG! We must STOP the government from picking our pocket. Did anyone like being FORCED to buy health insurance by OBAMA? What will it be next? If they can force us to buy products and services, we are doomed. They say, over time, the cost will go down as more people elect to join and pay the additional $40-60.00 more to have more than the “basic” that the $9.95 they will take. Oh yes, you will pay 10.00 per month for a very nominal speed that allows you to send and receive email only, no streaming movies, uploading or downloading from websites or videos!

    But once the system is in, they can raise rates whenever they want for whatever reason. Can you tell me of any service or utility that has ever gone down in price?

    No one has the right to force you to buy something you do not want, at least not in America… Russia or China BUT NOT HERE (even they are doing it with secondary water!)

    Nothing good ever comes from doing something bad.
    Lastly, as much a God loves each of us and wants to have every one of His children return to Him, He will never take away your agency and freedom to choose whether you want to obey His commandments or live a wicked, sin-filled life. YOU GET TO CHOOSE, (just make your choice wisely for our rewards or lack of them are eternal) Botton line, even God will NEVER force anyone to heaven. You will be with God and Christ because you choose to listen and follow Him more than you care to follow Satan (the one who initially devised a plan to remove our freedom to choose for ourselves) Who’s influence do you live by?

    IF American Fork said “we will install a line to every house. If you want the service, we will then charge you (whatever fee they impose) If you do not want to use the service, we will flip a switch and you will not be able to access the service” I wild be perfectly fine with this! This is what we do with our electricity… we pay for what we use. If we turn off every electric appliance in our home, we do not get a bill! And this is how it use to work for our water. How would you like to be billed a flat rate of $50.00 a month just to have “access” to use electricity, even though your house was vacant and shut down for 6 months of the year. This could be possible if we continue to give away our right to choose for ourselves.

    So, based on a solid “principal” of taking my money against my will and for nothing I am to receive I say equivocally and irrevocably NO, NO, NO and so should YOU!

    1. Thanks for taking the time to comment — and for reading in the first place. I’ve posted it since it’s not quite anonymous. But I do prefer that people put their real, full names on their comments.

      As a matter of fact, utility prices sometimes decrease. The most proximate example is this past winter, when natural gas prices fell dramatically in the US, despite rapidly increasing demand — because the supply is increasing faster. I saw the results on my gas bill.

      As a matter of doctrine (or philosophy), having to pay for something has nothing whatsoever to do with moral agency, the informed freedom to choose between good and evil and incur the consequences. I have to pay several kinds of taxes, local and otherwise; these are not moral choices (choices between good and evil), and moral agency is not directly involved. I have to pay for food, shelter, transportation between home and office, clothing, etc. These are not inherently moral choices either. Some of these are the price we pay for survival in a mortal world. Some are the price we pay for a functioning community. In some ways these prices are excessive, I agree. But the principle of moral agency is not directly implicated here.

      That said, if you reduce your argument simply to something like, “We already have to pay for a lot of streets we don’t drive on, a rec center or library we may not use, street signs in places we never drive, parks in neighborhoods we don’t inhabit, and base charges for other utility connections whether we use them or not in a given month, and I don’t think we should add anything more,” then I’d have to say I disagree in this case, but it’s a reasonable argument.

    1. Thanks for reading and commenting, Paul.

      I’ll tell you what. I’ll revisit that question, because it’s certainly possible that an error or misstatement or two could have slipped through legal, technical, and editorial review.

      However, that is a minor point, couched in a subordinate clause in a single sentence, which would read just fine if we just removed it: “While functional, the City’s current municipal broadband system is not adequate to present or immediate future needs.” There’s actually a bigger error there, though. It was a municipal system. Now, as you well know, it is privately owned. We probably should have put the word “former” in there somewhere.

      I do not think either error (if there are two in that sentence) invalidates anything else in the report. Nor do I think that sentence in the report will sway any city council votes.

      We should probably note that the city council did not just vote to raise our taxes to build the system, on that basis or any other. They didn’t vote to build the system at all, not yet. They voted on another piece that has to be in place to set up a final up-or-down vote on the system, which will come later. Even then, unless they dramatically alter the funding mechanism, it won’t raise taxes.

  3. Well I understand you’re a lawyer and you can dissect language very well. The comment and it’s point that the city council voted on moving forward based on information that is not accurate or true.

    You may not call it a tax. A rose by any other name would my city bill go up?

    1. I’m not a lawyer, never have been.

      That said, I’ll look into the matter, and I’ll suggest to the other members of the task force (which no longer exists) that we send a letter promptly to the city council with a correction.

      I’m still pretty sure that’s not why they’re preparing for a final vote, or planning to vote yes, if they are. But I prefer accuracy.

      Our city utility bills will definitely go up, as you say.

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