Internet speed wars escalate in region

City officials from the region say their explorations into creating municipal broadband utilities are moving forward despite recent announcements by Comcast and CenturyLink that the companies plan to significantly increase the speeds of their Internet services in Colorado.

While Longmont is well into the build-out of its 1-gigabit network dubbed NextLight, Boulder Valley and Northern Colorado cities such as Boulder, Loveland, Fort Collins and Estes Park all are examining doing something similar.

While they applaud the announcements by CenturyLink and Comcast as good for consumers in general, local officials say it’s too early to tell whether the ramped-up competition will be enough to decrease their leaders’ and residents’ appetites for municipal broadband.

“There’s nothing at this point that leads me to believe we shouldn’t continue our conversations with the city council and community,” Fort Collins city manager Darin Atteberry told BizWest, noting that he believes a ballot measure related to the issue is likely for his city this fall. “I would say we’re still in our due-diligence period, and (increased speeds from Comcast and CenturyLink are) something we’ll look very closely at.”

In the space of a few days in May, both CenturyLink and Comcast made headlines with their announcements, leading to buzz about Internet “speed wars” along Colorado’s Front Range.

First came news that CenturyLink would begin offering its gigabit speeds for small and medium-sized businesses in Aurora, Fort Collins and parts of Boulder. Comcast, which already offers multi-gigabit speeds for businesses across most of its Colorado footprint, seemed to one-up CenturyLink a few days later with its announcement that this summer it will begin offering 2-gigabit fiber-to-the-home service to nearly 1 million residences in the state. Comcast that day also made a new 250-megabit residential tier of service available to much of the state for $150 per month.

Comcast officials said they’ve been building out their fiber optic network over the past several years to the point that the infrastructure now is in place for a broad rollout of residential gigabit service.

“Our Internet service and our platform is really built for tomorrow’s technologies,” Comcast vice president of public relations Cindy Parsons said. “Access to this gigabit pro service obviously is an opportunity for us to ensure our customers have access to the most advanced services.”

Cities looking at providing their own service still are waiting to learn some details about the state’s two major broadband providers’ new offerings.

CenturyLink’s approach to rolling out new speeds has been largely on a neighborhood-by-neighborhood basis. While many parts of Denver and all new construction along the Front Range have access to the company’s residential gigabit Internet speeds, company officials have yet to commit to a timeline for adding such service elsewhere in existing neighborhoods – other than stating that it will do so when demand and return on investment make sense.

Comcast, meanwhile, has taken a different approach to adding speed by rolling out the advances to large swaths of its footprint all at the same time. Locally, the 2-gigabit rollout will happen almost throughout. While the 250-megabit service isn’t immediately available in Fort Collins, Windsor or Greeley, Parsons said it will be coming to those cities soon. Comcast hasn’t set a specific month for its 2-gigabit launch yet, though. Pricing for that service is still under wraps as well, and Parsons said there could be promotional pricing early on. But given the 250-megabit pricing, the 2-gigabit price figures to be well above the $50 per month at which Longmont offers its gigabit service to charter members.

The added speed is great, said Don Ingle, director of information technology for the city of Boulder, but he, too, is waiting to learn more about the two companies’ new offerings.

“Can they do it cost-competitively?” Ingle said. “The affordability becomes a real question, so we’re anxious to hear more about that.”

Boulder was among cities in the state that last fall received voter approval to free themselves from the confines of a state law put in place in 2005 that prevents Colorado municipalities from providing telecommunications services. Those cities still have plenty to work out before actually providing such service if they decide to do so. Boulder, for instance, probably will publish a request for proposals soon for a feasibility study that would look at various business models and the logistics involved with each. Ingle said Boulder’s city council has so far been “pretty adamant” about wanting to do some sort of public-private partnership rather than going it alone as Longmont has done.

Fort Collins has budgeted $300,000 to explore the pros and cons of creating a municipal broadband utility, although Atteberry said more exploration would take place even if voters this fall decide to grant the city the right to provide broadband services.

In Loveland, meanwhile, the city council at a May 12 study session gave guidance to its staff to draft an ordinance that also would override the state law. Steve Adams, director of water and power for the city of Loveland, said a first reading of such an ordinance probably would go before the council sometime this summer, with final approval needed by mid-August before such a measure could be placed on the November ballot.

Adams said Loveland is in the early stages of exploring municipal broadband and is looking at as many as six possible models. But he doesn’t believe the announcements from Comcast and CenturyLink will alter those plans for now.

“I think at this point we have our direction (from council), and that’s what we’re going to pursue,” Adams said. “We’re going to take it one step at a time.”

While Comcast and CenturyLink are reluctant to say so, area city officials believe the increased interest in adding municipal broadband throughout the state has helped accelerate increased speed offerings from the incumbent providers in Colorado. When Fort Collins officials met with officials from Comcast and CenturyLink a year ago, Atteberry said there was no indication then that the companies would be making such moves.

Penny Larson, CenturyLink’s vice president for operations in Colorado, said her company is focusing squarely on customer demand and needs as it rolls out new services, rather than getting caught up in speed wars. CenturyLink’s gigabit service is available to 92,000 businesses in Colorado, and a large focus for the company in the near term is catering to those small and medium-sized businesses.

Seeing Comcast and CenturyLink ratchet up their services in Colorado comes as no surprise to Longmont officials. The city began building out fiber-to-the-home service to residences and businesses citywide last year. Earlier this year it announced that it was accelerating its timeline for doing so, now aiming to have the network complete several months sooner than the original early 2017 goal. Among the first wave of residents to be offered Longmont’s gigabit service, city officials say they’ve seen a 45 percent take rate.

“I knew darn well they weren’t going to stand still and let us eat into their market share,” Tom Roiniotis, general manager of Longmont Power and Communications, said of CenturyLink’s and Comcast’s announcements.

But Roiniotis said he isn’t worried about the viability of NextLight in the face of the increased competition. For one thing, he believes there’s still no competition for the price at which the city is offering its gigabit speed. In fact, he added, he’s happy to see the incumbent providers in Colorado responding positively to the threat of competition from municipalities by increasing their own services rather than suing municipalities, as has happened elsewhere in the country.

“The consumer wins,” Roiniotis said. “So my reaction is I think it’s great. I think it’s going to be good for Colorado and ultimately good for the nation.”

Joshua Lindenstein can be reached at 303-630-1943, 970-416-7343 or jlindenstein@bizwestmedia.com. Follow him on Twitter at @joshlindenstein