Los Angeles launches bid for citywide broadband network


(Jim Hood @ ConsumerAffairs) "A chicken in every pot and broadband fiber to every home." Now that the Bloomberg Era is drawing to a close in New York City, who will launch such ambitious municipal projects as citywide bike lending, restrictions on Big Gulps and new laws to prohibit smoking at home?

Perhaps it is Los Angeles that will take up the cudgel. It is launching a project that would bring free -- yes, we said free -- broadband fiber to every home and business and provide free hotspots in public areas.

Now, there are about 3.5 million people in LA and hundreds of thousands of businesses. Public areas we don't know about. Do you think they'll count the freeways? If so, you're talking about a lot of wi-fi.

It's a massive undertaking, perhaps one that skeptics might say is hardly necessary, since Los Angeles already has the Internet, courtesy of Verizon, Time Warner, Charter, AT&T and numerous other providers. Why does the city think it needs to shove its way into the telecom business? Who knows?

Who pays?

And then there's the question of cost. Who's going to pay for all this? Ah, that's where those clever devils at City Hall are way ahead of us. The city plans to put the project out for bid, basically. Whoever "wins" the bidding will not only get to build the network, it will also have to pay for it.

Oh, and besides the estimated $3 to $5 billion construction cost, it will have to pay the costs of any city agency that has to trouble itself to aid in the build-out. And maintain the network, of course.

"The city is going into it and writing the agreement, basically saying, 'we have no additional funding for this effort.' We're requiring the vendors that respond to pay for the city resources needed to expedite any permitting and inspection associated with laying their fiber," said Steve Reneker, who is the general manager of the Los Angeles Information Technology Agency.

(Who even knew there was such a thing? Well, the LAITA, we'll have you know, operates the 311 phone number that you can call to report a dead squirrel or a burned-out street light. It also operates the city's various websites, its fire and police dispatch centers and so forth. So it is clearly up to the job. Too bad LAITA wasn't in charge of setting up Healthcare.gov.)

"If they're not willing to do that, our City Council may consider a general fund transfer to reimburse those departments, but we're going in with the assumption that the vendor is going to absorb those up-front costs to make sure they can do their buildout in a timely fashion," Reneker added, just to make it perfectly clear the the contractor had better finish on time ... or else. Or else what? Good question. It's not like the city is dangling a check in front of whatever lucky company "wins" the contract.

Yes, but who pays?

So let's ask this again: just how, exactly, is this gargantuan undertaking supposed to be financed?

Well, let's see. Los Angelenos will get free Internet access of 2 Mbps to 5 Mbps or so. If they want higher speeds, they'll have to pay for it. So there's a few bucks right there.

Oh, and maybe the network will be supported by advertising, the city fathers indicated. You know, like those ads they have on buses? Except these would be on like the, you know, Internet. 

Hey, no worries.