UTOPIA Trailblazing New Opportunity For User-Owned Fiber

An exciting development has occurred recently in the world of fiber deployment. A new model is emerging in Brigham City, a city of less than 20,000 in northern Utah, for how user-owned open fiber networks can be financed and deployed.

It used to be that the only way you could get fiber was if you were lucky enough to have a private provider lay it or to live in a city that did it itself. Today in Brigham City, for $3,000 you can buy your own fiber. And in fact more than 1,600 local residents have already bought in to this new opportunity.

With that fiber they'll get access to UTOPIA's competitive and growing ecosystem of service providers, where they get to choose what services from what providers they want running on their pipe.

While this may sound radically different from how fiber has been traditionally deployed in the US to date, user-owned open fiber networks have already been a big success in Sweden, helping them wire remote mountainous communities with world-class broadband infrastructure.

We also need to realize how potentially brilliant the open fiber concept is for rural America because of how it allows for competition to happen between service providers on a single pipe. With open fiber you can make sure that everyone benefits from having access to a competitive marketplace of communications services.

But I'm even more excited about what UTOPIA's new model could mean for the future of fiber deployment.

The biggest problem with the economics of deploying fiber is that you have to carry a massive debt load and begin paying it off before much revenue starts coming in. Plus you have to invest a lot of money into neighborhoods without any real idea of how many people are going to sign up for service.

The user-owned model totally changes these dynamics. First off, by having users pay for their own pipes you disaggregate most of the debt. Just look at Brigham City. They're building a $5.5 million network and the city's only putting up less than $700,000. So no massive debt load for the city (or a private provider for that matter) to carry.

The second major piece of this is that UTOPIA's going to have built-in take-rates when they build out neighborhoods. Plus churn should fall to zero since people own their pipes.

Basically the way I see this is as the possible beginnings of a new third model for fiber deployment in the US. You no longer have to wait for a private provider to make the investment, or for your city to figure out how it can overcome all the roadblocks and then actually execute effectively. Instead users who want service can band together and find a way to get it now rather than waiting twenty years for someone else to figure out how to do it.

I have to catch myself, though, as the reality of the situation is that this is the first time this has ever been attempted in the US. There are still a lot of questions to be answered and hurdles to overcome.

For example, the current model in Brigham City is that if you don't buy in then you can't get service. So they've completely abandoned the old model, which may prevent some from being willing to take the leap, especially as Brigham City does have Comcast and Qwest offering service in town.

They have developed a special assessment area model, though, that allows homeowners to commit to a $25 a month payment over 20 years to spread out the cost over time.

Another potential trouble spot is how to deal with renters who want service but landlords who don't want to pay to have it installed.

But while there are questions still to be answered, the keys for right now is that this model has worked elsewhere, and now at long last we have someone willing to step out and see if it can work here in the US.

So I say to UTOPIA: best of luck as you continue on these endeavors! The rest of the country is watching, and we're all hoping you succeed as there are millions of us that wish we could get our fiber now but can't.

And to Brigham City: Kudos to you all! We are all cheering you on, inspired by your commitment to getting yourselves wired with the most important infrastructure of the 21st century.