News

Chicago-Area Trio Eye Muni Network

1/19/2003 7:00 PM Eastern

The city councils of three Chicago suburbs will soon decide whether to let residents vote to establish a joint municipal broadband telecommunications system.

Officials are scheduled to meet Jan. 21 in St. Charles, population 42,000; Geneva, Ill., population 19,000; and Batavia, population 24,000; to approve an April ballot measure, possibly for a tri-city network that would deliver cable, data and phone services.

A lack of high-speed data service is driving the project, as well as dissatisfaction with the region's cable operator. Comcast Corp. has just taken over the system that serves the three towns from AT&T Broadband.

The system is being rebuilt, and Comcast recently said that work in Batavia would be complete — and cable-modem service available — by the end of February. There is no arrival date scheduled for the other two towns.

SBC Communications Inc.'s Ameritech division provides local telephone service to the three municipalities.

St. Charles city administrator Larry Maholland said the communities have been studying the feasibility of a broadband system for some time. Each town has a municipal utility operation.

At least in St. Charles, though, a broadband operation would be separate from the power utility, purchasing its unused fiber capacity.

Officials have toured other municipal operations, including systems in Thomasville, Ga., and Palo Alto, Calif., and have collected data by the phone from other municipal operators.

Based on municipal studies, the communities believe they can build a fiber-to-the-home plant for the three towns for $62 million.

Take-up forecasts

Data compiled by a consultant and presented to Batavia indicates that 55 percent of residents polled intend to purchase services from the municipal provider. That number rises to 70 percent for data.

The cities believe they'll reach a 34 percent penetration rate for video, 13 percent for high-speed data and 8 percent for telephony.

About 30 percent of potential customers also said they would buy broadband services from the city even if incumbent providers slash their rates, according to consultant Convergence Research Inc., which figured the venture could break even in two years.

"We think we can provide much better customer service and stabilize rates," St. Charles's Maholland said. "The business community isn't served now."

The Batavia and Geneva councils discussed the project separately Jan. 13. Batavia regulators ordered up proposed referendum language for the Jan. 21 meeting, said Randy Recklaus, assistant city manager.

Geneva Administrator Philip Page said he also expected a vote at that time, and said the council appears to support a referendum.

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