Meeting began at 7:40 AM at the Terman meeting room. Bob Evans of the Fiber Internet Center began by saying that the existing city staff isn't capable of doing the FTTH installation or know how to operate as an ISP. Cost estimates for the FTTH project are low, and don't account for the steep learning curve of staff. Actual costs to build and operate the fiber system are much higher than suggested by the consultants.
To build a successful technology company you have to have a technologist at the top, so they will understand what to do and how to do it. The city lacks that. The existing FTTH trial is expensive, costing almost $10,000/home for 70 homes. Fiber ring construction was much cheaper, less than $2 million for over 23 miles, and is making money, but it's operation and funding status isn't fully documented.
Present staff at CPAU does a variety of tasks citywide such as fiber pulling and splicing, stop light repairs, replacing street lights, and others. They only review plans for fiber installations every Monday and the workers are pulled in various directions in addition to working on fiber. The fiber part of utilities is a stepchild. A problem in the past was lack of support by the Utilities management for FTTH, and problems internally with priorities. Now there is more management support for fiber, but the costs and analysis are not there yet. Present information is inadequate to justify the cost estimates and payback.
One issue is will city crews, contractors, or both do FTTH. If it is done by a contractor, how will they select a good contractor? Who will run it after it is built, the city or an outside provider?
There was a lot of dispute between Bob Evans and members of the audience about whether CPAU will be able to perform adequately and if costs will be high because the city pay rates are high, and they are not set up to do things efficiently. They also will have to provide insurance, pay for studies, do detailed designs and plan construction and installation. It takes too long and costs too much to complete a fiber installation now, mainly because it's an orphan in CPAU and there isn't dedicated staff to do the installs.
The counter argument was that when FTTH is approved it will be a major project and no longer an orphan. It will get lots of attention and pressure to do it right and show that FTTH can turn a profit.
Marvin Lee noted he was the first one hooked up in the FTTH trial. The utility workers made many errors and took far longer than expected to complete the installation. There was a pretty steep learning curve. By the time they finished the 3rd installation they were almost error-free and worked much faster. They are fully qualified now and can handle hundreds of installations/week if the city gets into the FTTH operation and also wants to keep lines of communications open with others.
Cost estimates for passed homes and connected homes were discussed. Average cost for fiber to passed homes is about $1200, and for connected homes is about $1000 more. Costs have been going down over the past several years and should continue to drop.
There is no dedicated group in CPAU to do fiber, so when someone asks for connection to the fiber ring the user needs to work on getting the right people and getting them to do it. The city needs to devote more resources and focus on just fiber work being done by particular people. They lack real understanding of technical problems. If they had a couple of people dedicated mainly to fiber installation, within a few months they would be fully able to connect the fiber ring to businesses and homes much cheaper and to act as a core staff for future expansion. Now it takes 6 weeks to get cost estimates from CPAU for a fiber project. There is a real lack of information about where the conduit is, where the fiber ring is, what is needed for fiber connections, schedules for installation, etc. They are well below where they need to be to do a proper fiber installation. It would be good to make sure the Council agrees to upgrade the operation and then gives approval to the FTTH project.
We need to see things done right before we can be sure it's done right, especially with CPAU and fiber. It probably will get worse before it gets better. The financials are still muddy, but the dark fiber now is working well and is profitable. FTTH can be profitable.
The city model is mainly to set up the basic structure and let others provide the actual services. Home security, load shedding, load monitoring, etc., all are possible using FTTH. One problem will be selecting the organizations that will provide the actual services, and coordinating their performance to assure the job is done right and that customers are properly taken care of.
Meeting adjourned at 8:45 AM.
Submitted by Bob Moss