US telcos and cablecos complain that Kansas City gave Google a better deal

Blog, Roland Renner (historic), Uncategorized

US cablecos and telcos are upset that Kansas City gave Google a better deal on access to municipal infrastructure than they get.  Now they want the same deal, complaining that the Google deal is unfair and “not a level playing field”

http://online.wsj.com/article/SB10000872396390443862604578030671101065746.html

Google openly invited cities to bid on access to municipal infrastructure and other services to choose where it would deploy its Fibre to the Home (FTTH) service.   In order to get better service at much better prices for their citizens some cities stepped up and offered Google a better package than cablecos and telcos get.

Why this is a bad thing?  Oh, because it isn’t fair to the telcos and cablecos.  It isn’t a level playing field.

Really?  What is stopping the telcos and cablecos from negotiating a better deal by offering to deploy fibre to the home more quickly, build better networks and offer better services at lower prices?

To me this looks much better than, for example, the unseemly daily government competition to entice employers into their jurisdiction by offering tax holidays, tax reductions, training and other support.

Municipal Rights Of Way, pole attachment, conduit sharing, and construction coordination are all areas where the telcos and cablecos have major advantages including long established personal relationships at the local level.  It is tough to break into that scene.  The vast array of different rules and regs by state and municipality is a major hurdle for a national deployment.  Google has managed to beat the telco and cableco incumbents in an area that they know is one of their core competencies and also one of the last areas where they have a big competitive advantage.  At least they have managed it in one city.

Access to local infrastructure is one of the key issues for last mile deployment as I pointed out in “Rebuilding the Last Mile” in April.  It doesn’t sound like a high tech issue but it really is essential.  It also explains why the handful of successful third party FTTH deployers are local real estate developers, or at least connected to them.  They have similar relationships to municipal ROW and infrastructure people.  That is why I recommended in the paper to overhaul these regulations to facilitate competition in local networks.

While big telcos and cablecos are complaining that Kansas City gave Google a better deal, small phone companies in remote areas of the US appear to be going ahead and getting the job done.

See http://www.fiercetelecom.com/story/smaller-telcos-lead-ftth-charge-9m-us-homes-connected/2012-09-27