Early this year when I was in Boston, I had dinner with Brough. One of the things he told me back then was: "What we really want to ensure competition is that the access part of the network belong to the home owners, not the telcos. That way, we would all be connected to a pop where it would be much easier to ensure competition". Back then I thought that this model, interesting though it was, was somewhat utopian.
And to a certain extent, I still think that, but I nonetheless welcome the further explorations into a similar model done (separately) by Tim Wu and Derek Slater in their recently released paper Homes with Tails. In Homes with Tails, Wu and Slater present the context of homeowners paying for and owning their fiber connection to the nearest pops and the benefits that could be derived from such a model.
Essentially, the concept (if I understand it correctly) is as follows: the home owner would own the fiber strand to the curb individually. The neighbourhood would own the duct back to the pop collectively (in a condominium model) and the service providers would only have to connect the pop to provide services for these homes.
It's an elegant model that potentially solves the issue of investment in the access. It assumes, of course, that home owners would want to pay to connect their homes with fiber, and while that's not unseen (look at Mälarenergi in Sweden), it's also not a given at this point of maturity in the market. Essentially, homeowners will need to want it, and right now the services offered over fiber are essentially identical to those offered on DSL, so unless fiber-grade services become available, it's unlikely that customers will be willing to spend upwards of 1000 EUR for ownership of a fiberstrand that they don't really know what they'll do with.
I'm not sure I believe in such a model dominating the early years of deployment. I think it might be more likely to pick in a phase 2 of the market where the areas that telcos consider to be commercially viable are covered already, the demand starts to pick up in uncovered areas because (hopefully) the service ecosystem will have evolved, but telcos are still unwilling to risk the investment because the costs are too high or the take-ups too uncertain. Then a real grassroots community effort could work.
Finally, the issue of attracting service providers is touched upon in the piece but seems to me to be a crucial part of the success of this model. I recently had a chance to examine the greenfield deployments of FTTH in Europe and everywhere you find that the key issue faced by whoever deploys and manages that fiber is to attract service providers. There's a scale effect that makes is really hard for a service provider to decide on the investment in equipment and backhaul to serve a given area when said area is only 5-10 thousand homes. I don't know rightly what the critical mass is, but I would say probably around 50-100 thousand homes for a service provider to be willing to move into a new model.
Still, it's a really interesting model, and I intend to discuss it face to face with Derek when I'm in San Francisco in a couple of weeks. Maybe even do a podcast on it if I can find a way to interview Bill St Arnaud with a decent audio quality!
