Gigabit Seattle raising FTTH attention but not cash


Adding lift to a trial balloon.

The Gigabit Seattle team is trying to tap into Google Fiber’s buzz by releasing a fiber-to-the-home pricing plan that sounds a lot like what’s on offer in Kansas City, albeit for a few dollars more and with a little less freebie time. Otherwise, there’s been precious little in the way of specific information about the project since it was announced six months ago.

What I wrote then is true today: Gigabit Seattle’s financial vehicle is still a concept car. Zero private sector investors or lenders have been announced, and actual public sector contributions are minuscule.

Service is supposed to begin somewhere in Seattle “in early 2014”. The roadmap outlined in December had the project starting out in a dozen demonstration neighborhoods. No particular construction timetable has been set, even though engineering work was supposed to be well along by now. The latest announcement said that the project team will let residents know next month how they can sign up. Previously, they said that they’ll prioritise neighborhoods on the basis of pre-commitments, again similar to Google Fiber, with a 15% take rate being mentioned as a threshold for moving ahead in a given area.

It’s also unclear exactly who will be building, owning and operating Gigabit Seattle. The company behind it – Gigabit Squared – now describes itself as a “a digital economic development corporation specializing in the planning, implementation and rollout of IT-enabled infrastructure in core markets”. Not a telecoms company, in other words.

Although Gigabit Squared’s CEO says it will own its own projects, it doesn’t have any track record or significant, visible assets yet. Judging by the few financial details discussed so far, it doesn’t have a firm grasp on how much it costs to build an urban FTTH system and the operational telecoms experience of its principals appears slim.

Gigabit Seattle might be able to evoke Google’s business model in a press release, but it’s still a long way from raising the money to pay for it.

About Steve Blum

Steve Blum is president of Tellus Venture Associates, a management, planning and business development consultancy for municipal and community broadband initiatives. He is a 30-year industry veteran and an expert in developing new broadband infrastructure and services, including wireless, fiber optic and satellite systems. His career includes playing key roles in the launch and growth of DirecTv in the U.S., as well as other satellite broadcasting platforms around the world. For the past ten years, he has helped build municipal wireless and fiber optic broadband systems. His client list includes many California cities, such as San Leandro, Palo Alto, Oakland, Los Angeles, Lompoc and Folsom. He’s a member of the executive team for the Central Coast Broadband Consortium and has worked with other regional consortia in California. Steve is the author of seven books on the Internet and satellite broadcasting and is a frequent contributor to professional journals and industry events. He holds an A.B. in History from the University of California, Berkeley, an M.A. in East Asia Studies from the University of Washington, and an M.B.A. from the University of St. Thomas. He is a triathlete and multiple Ironman finisher, and is currently ranked in the top 100 of the Challenge Triathlon world rankings, out of more than 30,000 athletes.

  • Mike Hammett

    No one has put up money because that pricing simply isn’t sustainable. Who would put in money to a venture that’s doomed from the start? It sounds an awful lot like the free WiFi days.

  • rconaway

    This is a joke project and FTTH is a huge boondoggle. If the taxpayers pay for it’s a waste of money. If private industry does it, Mike is dead on, it’s a financial, how do you say it, “LOOSER”.

    We can deliver up to 20Mbps today to residential for a $200 installation fee today. Explain to me how many people need more than that today compared to the for the thousands per customer you have to spend for a FTTH installation. In a year, that’s going to be 100Mbps for the same price so again, tell me why we need fiber. If we have to subsidize something or steal my taxes to pay for Obama’s redistribution of wealth, then let’s do it efficiently as possible and get the politics out of it.