Enabling Competition & Innovation on a City Fiber Network: Case Study

Abstract

This report describes how the municipally owned fiber-optic network in Ammon, Idaho, uses a technology known as network virtualization to inexpensively allow retail service providers to compete for users and provide innovative services over a public network without any requirement for new hardware at the customer’s home or business. Among other novelties, Ammon allows users to instantly switch between services, receive more than one service at a time, and inexpensively create private sub-networks. Under network virtualization, functions previously performed by specialized hardware devices are instead performed by software. In the United States, such technology is most often used by private telecommunications companies in ways that reduce internal costs but leave those companies controlling all services over their networks. Ammon’s technology strategy—along with other aspects of Ammon’s financing and operational model—provides one model for other U.S. public entities and for policymakers seeking to increase service competition and innovation. Other models include building public "dark" (or unused) fiber for use by private entities, and using virtualization in a more limited way.