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Cambridge Unveils Report on Municipal Broadband Feasibility and Business Model Options

The City of Cambridge has released the final report for its comprehensive year-long municipal broadband feasibility study, Municipal Broadband in Cambridge: Feasibility and Business Model Options. The report examines the feasibility of the City of Cambridge implementing a municipal fiber-to-the-premises (FTTP) service, providing a detailed FTTP design and cost estimate, and a range of business and financial models for building, operating, and providing service to all premises in Cambridge.

“We have the opportunity to build a gigabit-fiber network that will serve Cambridge for the next generation while protecting our values around data privacy, net neutrality, and  digital equity. While there is still significant work to be done, this report will guide the City’s next steps in its broadband journey,” said City Manager Yi-An Huang.    

The City of Cambridge partnered with nationally recognized firms, CTC Technology & Energy (CTC) and Rebel Group (Rebel), to conduct the study. CTC offers independent strategic, technical, and financial guidance primarily to public sector and nonprofit entities, while Rebel works with public and private organizations on infrastructure needs and financial resources through public-private partnerships, innovative financing, and strategic program management. CTC and Rebel have helped develop municipal broadband strategies for cities and communities across the nation.

The Municipal Broadband in Cambridge report explores several key findings, including:

  • Constructing an FTTP network to reach all 52,300 residences and businesses in Cambridge would cost an estimated $124 million to $161 million in 2022 dollars or $149 million to $194 million when considering inflation.
  • A citywide FTTP network would likely require a significant capital contribution to be financially feasible, including a $150 million upfront City contribution, based on relatively conservative assumptions, including that 40 percent of premises subscribe.
  • There are several business models that the City could explore, each impacting Cambridge’s contribution differently depending on the type of partnership and a variety of business factors.
  • Once the City reaches a decision to move forward on exploring a specific option, there is 18 to 24 months of key activities and decision points before the City would formally decide to execute a specific implementation project.

The report also highlights a high-level FTTP network design and cost estimates developed by CTC to inform the City’s broadband planning effort. The design provides for ubiquitous service within the Cambridge city limits, delivering residential services at symmetrical speeds of up to gigabit speeds and scalable to higher speeds with modest upgrades to electronics in the future.

The report identifies four business models developed by Rebel, each with the potential to meet the City’s goals, albeit to varying degrees and with certain tradeoffs. Regardless of the business model selected, the report suggests that the City should leverage competition to maximize value for taxpayers and subscribers.

A randomized mail survey conducted in May and June of 2022 also provided key insights into broadband access and use, and demand for additional internet service options. The survey found very few gaps in acquisition of residential internet services, but also that lower-income households may be underserved. Additionally, connection reliability ranks as the most important internet service aspect among subscribers, followed by connection speed. Many respondents also would be interested in acquiring services from a new internet service provider (ISP) in Cambridge, and would support a new fiber broadband network, even if it is subsidized by the City.

Any finalized project time horizon would most likely include a five-year construction period and 25 years of operations.

Download the Municipal Broadband in Cambridge: Feasibility and Business Model Options report.

Page was posted on 3/15/2023 6:21 PM
Page was last modified on 7/24/2023 9:48 PM
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