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City officials consider expanding fiber-optic communication system
Friday, August 31, 2012
City officials want to find out whether expanding Martinsville’s fiber-optic communications system to provide improved Internet, telephone and cable television capabilities is feasible — and if residents and businesses want it.
But the city is not going to try and launch its own cable TV service again, officials emphasize, having lost a court battle in a previous attempt to do that.
The city has contracted with CCG Consulting LLC to develop a business plan for an expanded system.
The plan will include a review of
the current system and services being offered, surveys of residents and businesses and financial options, according to Interim City Manager Leon Towarnicki.
Phone surveys will start next week. About 360 residences and half of the city’s businesses will be surveyed by CCG, Towarnicki said, adding that the firm thinks those are appropriate amounts.
The surveys are designed to evaluate residents’ and businesses’ interest in an expanded city-owned and operated communications system and possible deployment of a fiber-to-the-home project, he said.
Martinsville began installing its fiber-optic system in the late 1990s, and the system has since been expanded, but it is not citywide, Towarnicki said.
It initially provided high-speed Internet, telephone service and information-sharing among city buildings and systems such as electrical substations and traffic signals, he said.
Over the years, though, as costs for such services rose, businesses asked to use the system, thinking it would be more affordable, and the city let them. Towarnicki said the system now has about 30 private customers.
Thursday afternoon, he did not immediately have information on who the customers are and how much they are paying.
He said the city system often has proven more reliable than similar private systems because employees are on duty around the clock monitoring it and quickly respond to temporary outages and other occasional problems.
However, “we are essentially maxed out” with current staff and resources, Towarnicki said, hence a need for a study of whether expanding the system would be worthwhile.
If the city runs an expanded fiber-optic system, it would be in competition with private sector communications firms, Mayor Kim Adkins acknowledged Thursday.
But it already competes with those businesses since it already has private customers, Adkins said.
She emphasized that all of the customers approached the city about using its system; the city did not approach them.
In the case of cable television, a cable company could use the city’s fiber-optic lines, but the city would not be operating a television system.
About five years ago after Adelphia — the former provider of cable television in Martinsville and Henry County — went bankrupt, a U.S. District Court judge ruled that Martinsville could not legally buy the local franchises. The judge determined that the city disregarded its own ordinances in the attempt.
The city racked up more than $711,000 in legal expenses at that time.
Asked if the city would try to provide cable TV service again, City Attorney Eric Monday said, “We tried it. We litigated. We lost. We’re done.”
If there is interest among residents and businesses in expanding the fiber optic system, it would require allocations of city funds to install more lines and equipment and hire more people to maintain the system, Towarnicki said.
He said, though, he envisions an expanded system being “a financially self-sustaining project,” or — if payments from subscribers exceed costs to run and maintain the system — one that eventually may generate revenue that could be put toward other expenses.
He compared it to the city’s electric utility.
Contracting with CCG to develop the business plan will cost about $40,000, and the money was included in the current fiscal year’s budget, according to Towarnicki.
The business plan is expected to be completed in 4-6 weeks, he said.
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