What is a broadband network?

A broadband network is comprised of the physical infrastructure and the Internet service.

You can think about the physical infrastructure like the pipes that are required to deliver an Internet connection into your home and office. The Internet service travels down these pipes and is provided by Internet Service Providers (ISPs) like AT&T, Time Warner Cable, Comcast, Verizon, Charter, etc.

Right now, it is common for these ISPs to also own the backbone infrastructure in addition to providing the service.

In an open access community-owned broadband model, the community owns the infrastructure, and ISPs pay to “lease” the infrastructure and will compete on price and service to secure Internet subscribers.

It’s also worth noting that there is no agreement on what Internet speed is required to be considered a “broadband” connection. The Federal Communications Commission (FCC) defines broadband as connection speeds of at least 25/3 Mbps but most ISPs argue that broadband is anything from 10/1 Mbps (this translates to 10 megabits of data per second download, and 1 megabit per second upload). 10 Mbps is generally good enough to stream a 1080p (high-def) video, but 10-20 mbps is a more reliable speed to stream content and/or make fast downloads, and often an even better connection is required to run multiple applications at once.

How does the broadband “network” relate to the wifi in your home?

Your WiFi is the Internet service provided by your ISP. ISPs “lease” the right to use the network to deliver the Internet into your home and you pay them for that service.

How does the open access system work?

You can see our principles for the ownership, construction and operation of these networks. In short, communities finance and own the network infrastructure, and then Internet Service Providers “lease” the right of way and compete on price and speed so individuals have the opportunity to select the service that best meets their needs.

Why is public finance a good funding solution for community broadband?

Waiting for state funding or pursuing complicated public-private partnerships are not the only ways to fund a community broadband network. Municipal bonds have successfully raised capital for infrastructure projects for more than 200 years. Landmarks from the Golden Gate Bridge in San Francisco to New York’s Public Library were financed with municipal bonds, and at least 8 municipalities and the U.S. Virgin Islands have issued bonds for financing broadband since 2000.

The municipal bond market is highly developed and gives communities the chance to tap into a much larger pool of investment capital than would otherwise be available, with their community members as the first investors.

The result is that local governments can raise the money they need when they need it from local investors, to build essential services that directly benefit the community. And when it comes to broadband networks, public ownership ensures that the best interests of the community are the only incentive.

How does the revenue model work?

In this model, revenue can be generated through user subscriptions to the network and leasing fees from ISPs who also pay for the right to use the infrastructure. In comparison to public private partnerships, this model keeps all revenue from those cash flows, and from additional investments in the network, inside the community. In addition, public ownership, and the self-determination that comes with it, ensures the best alignment of incentives between communities building networks, ISPs and investors supplying capital.

GLOSSARY

Broadband network: The physical infrastructure required to deliver an Internet connection, and the Internet service that is delivered into your home, office, local cafe etc.

Open access: An open, free-market system where all independent service providers can use the central network infrastructure to offer their services.

Fiber-optic: A system that uses glass (or plastic) to carry light which is used to transmit information. This is the dominant method of transmitting information for the foreseeable future.

Fiber-to-the-home: A high capacity fiber-optic line that is connected directly to the home.

Dark conduit / dark fiber: Unused fiber-optic cable, usually installed to expand the system capacity. Some ISPs lease these dark fibers to other companies that add equipment in order to transmit signals through them.

Mesh network: Network connections that are spread over multiple nodes that “talk” to each other to help share the connection over a large area.

Internet speed: Internet speed is your allocated bandwidth. Bandwidth is the amount of data that can be sent to you, usually measured in seconds. For example, 10 Mbps would mean that you can receive up to 10 megabits of data per second.

Bandwidth: Bandwidth is like a road. All cars (data) travel at the same speed, so to receive more data faster, the road needs to be wider.

SDN: SDN stands for Software Defined Network or Software Defined Networking. Historically, networks relied on hardware devices like routers to move traffic across network infrastructure. SDN removes control from individual devices and centralizes it in a software application called a controller. This system promises better network management and more precise control over traffic flow because it enables prioritizing, de-prioritizing or even blocking of specific types of information packets. This system is usually installed right outside or right inside the home, and is the responsibility of the infrastructure owner.

Take rate: The percentage of residents in a defined community who are subscribers to a broadband network.

Special District: Special districts are independent, special-purpose governmental units that exist separately from local governments. They are set-up with substantial administrative independence, and can also be approved for bonding authority. They are often formed to perform a single function and have been used to finance infrastructure projects like public transport, water and sewer systems and electricity grids. For example, a rural community can create its own special district and then, once approved, can issue bonds to finance its own broadband network. Special districts can be created by legislative action, court action, or public referendum and are authorized by state law; if you’re interested in formation, check out the rules in your state.

LID: LID stands for Local Improvement District and is a type of special district.

Last Mile (sometimes known as First Mile): Last-mile technology carries signals from the main infrastructure system the short, final distance (hence, the "last mile") to and from your home or business. Or to put it another way: the last mile is the infrastructure at the neighborhood level — this is the community broadband network!

Middle Mile: Middle mile refers to the network connection between the last mile and central Internet infrastructure. For instance, in a rural area, the middle mile would connect the town's network to a larger metropolitan area where it interconnects with major carriers.