Beverly Hills finds delays, cost overruns in its municipal broadband efforts
Tom Struble, technology policy manager at R-Street Institute, told the Taxpayers Protection Alliance Foundation that he can be sympathetic to towns in rural areas with little-to-no service from private providers creating their own networks, but Beverly Hills doing it is more of a head-scratcher.
The concept of high-speed municipal broadband being a big economic driver is questionable, to say the least.
“While building a municipal broadband network will likely stimulate the local economy to some degree, those economic gains may not be enough to offset the costs of deploying the network in the first place and operating it over time,” Struble said.
“Extrapolating future bandwidth needs in this way seems like a glaring mistake, and it’s exactly the sort of thing that leads municipal broadband networks to overestimate demand, fall short on uptake and ultimately lead their networks into financial ruin,” Struble said.
“Given these current trends, the actual broadband needs of consumers today and in the near future, and the seemingly flawed analysis in Beverly Hills’ initial projection, I suspect the municipal network will fail to recover its costs (much less turn a profit) and be sold off at a loss to private industry before the end of the next decade, leaving local taxpayers to cover the difference,” Struble said.