Gigabit Network Coverage Almost Has to be Uneven, At First

It hasn't happened yet, but it is predictable that, at some point, concerns will be raised about the extent of coverage of gigabit access networks in the United States. One might argue that is a fair public policy concern, but also a concern that some might argue has to be secondary to promoting the building of gigabit networks as widely as possible.

Even within its own chosen cities, Google Fiber builds first in neighborhoods where the expressed demand is the highest.

Now AT&T, facing Google Fiber in Austin, Texas and Kansas City, Mo., believes there will be demand for gigabit or other similar very high speed networks in neighborhoods, if not whole areas of every city.

AT&T Chairman and Chief Executive Randall Stephenson says AT&T is not the only ISP that will want to provide gigabit or other very high speed service,  though perhaps in neighborhoods with many potential customers, rather than "everywhere."

Other projects, such as Gig.U, have roughly the same idea, that communities within cities, anchored by colleges and universities are the ways to get gigabit access networks up and running.

The point is that pushing forward will require deploying where that is possible: where there is demand. That will be an uneven process, almost by definition. And that is going to raise hackles, because communications is a political business.

There eventually will be complaints about universal service, or the communications equivalent of “redlining,” where whole neighborhoods might be deemed “low priority” or “no priority.” But that is just a problem we will have to face.

Given the uncertain business model and high costs of upgrading access networks for gigabit operation, we will have to push forward bit by bit, area by area, where the chances of sustainable success are highest.

The biggest single problem most would-be ISPs face when trying to provide  low cost, universal Internet access is a sustainable revenue model. Grants won’t do it. Permanent government support won’t do it. Good intentions won’t do it.

A self-sustaining revenue model of some sort is necessary. Though indirect mechanisms might be possible in some cases (ad-supported Wi-Fi hotspots, for example), in most cases actual end users will have to support the continued operation of the networks.

The second biggest problem is inability to get government permission to do so (licensing, spectrum). In many countries, ISPs are required to get telecom licenses, or can use unlicensed spectrum, but only if they pay a licensing fee.

That adds expensive overhead for any set of entrepreneurs trying to bring Internet access to everybody, under difficult financial circumstances.

Even for well-heeled providers in the United States, gigabit networks might have to be spot deployed.

"The key is being able to do it in areas where you know there's going to be high demand, and people are willing to pay the premium to be able to do it," Stephenson said.

Stephenson suggested the ideal level of potential subscribers would occur when 25 percent to 35 percent of households in a neighborhood want it.

There are sure to be complaints that such a deployment process is unfair. But without an attitude of “build gigabit networks where you can,” we run the risk of slowing the availability of such networks anywhere.