Muni fiber networks bounce back

Lawsuits mean delays, which can be costly, although not all delays translate into lost capital, as LUS found out in Lafayette. Still, Huvall believes the hassle is discouraging to some cities that might otherwise consider building their own networks.

“I think there would be a lot more municipalities doing this if it weren't for the fear tactics of going through lawsuits and delays that incumbents throw up against you,” Huvall said.

LUS did lose out on a source of video content. The utility had planned to join the National Cable Television Cooperative to purchase its content, but the NCTC declared a moratorium on members during the period when LUS was fighting in court, and the utility has had to buy its content from individual providers at a higher cost.

“The positive side of that is that we now have our own relationship with those content providers, and we will still be able to meet our commitments, in terms of the price of our service,” Huvall said.

Baller sees a reversal in the legal trend that favors municipalities, citing recent success in fighting state laws designed to limit what can be done.

“Take a look at the biggest battle we had within North Carolina [in 2007],” Baller said. “The kinds of people who line up in support of municipalities — Googles, Alcatels, Intels — everyone saying these restrictions make no sense, they are not good for our communities, the states or our country.”

According to Joe Savage, president of the Fiber to the Home Council, there are 14 states where laws either prohibit or limit muni networks. “Lately there are three or four states that have tried and failed,” he said. “I think we'll see some states begin to roll back these restrictions.”

A national Community Broadband Act failed in 2007 at the federal level, but U.S. Rep. Edward Markey (D-Mass.) introduced similar provisions as part of a 2008 bill that also seeks to unlock cell phones from specific mobile networks.

As more cities get more experience and that experience is shared, municipal networks will become more common in the U.S., as they already are in Europe, Scott said.

“I believe that some of these challenges over the last few years — there are great lessons to be learned there,” he said. “There will always be mistakes to be made, but as long as new initiatives learn from these, the future of municipal broadband looks pretty good.”