Wellesley MLP’s next act: serving up Internet and phone service?

The Wellesley Municipal Light Plant has long provided the town with a reliable and price-competitive source of energy, and in recent years has continued to innovate, supporting the move to greener power sources and even working to improve cellular phone service in town by installing new antennas that wireless carriers might exploit. The WMLP’s next move could be really exciting though: It is forming an ad hoc Internet Exploratory Committee (IEC) consisting of MLP staff and board members, as well as Internet-savvy residents, to determine whether it might make sense for the organization to become an Internet service provider (ISP), too.

Given that the leading IPSs in the area such as Verizon and Comcast often elicit complaints about their high pricing (Verizon in particular) and less-than-spectacular customer service (Comcast is legendarily challenged here), the WMLP might present some very welcome competition.

The United States, whose Internet access speeds lag behind those of many other developed nations, has been making a push through the Obama administration and FCC to help communities build their own broadband networks in the face of state restrictions and big service providers’ legal teams. Connection speeds in Massachusetts overall are better than those in all but a few states.

Here’s what WMLP Director Dick Joyce has to say about Wellesley’s effort (he cautioned that he has limited knowledge here, but he seemed pretty up on things to me):

What’s the impetus for looking into this?  Speed?  Cost savings?  Other stuff?

All of the above.  The MLP believes we can provide Internet service (and possibly land line telephone service) to Wellesley residents and businesses at state-of-the-art speed at much less cost.  In December 2014 the MLP purchased Verizon’s share of all jointly-owned poles in Wellesley which would considerably facilitate a Town-wide fiber installation.

What might possible outcomes be?

Other Massachusetts communities have systematically entered into the Internet business by focusing on large commercial customers.  In Wellesley, where more than half of the kilowatt-hour sales are to non-residential accounts there would appear to be a good market to test the viability of the MLP’s Internet service.  We believe Wellesley residents and businesses will benefit from faster Internet service at lower prices and the MLP will benefit from its continued expansion into the telecommunications business.

Would you be talking about installing fiber basically?  Or would this involve Wifi?

As part of the MLP’s partnership with American Tower Corporation the MLP will be installing 115,000 feet of fiber-optic cable.  As of today the MLP has installed over 63,000 feet of fiber.  Based on this experience, the MLP’s current plan is to go with a fiber system.  This may change once we receive the benefit of the IEC expertise.

Do you know what other area communities have done this successfully?

With the caveat that we are relying solely on information received from the communities themselves, it is our understanding the following towns/cities with municipal light plants have successfully entered into the Internet business: *Braintree, Chicopee, Concord, Holyoke, *Norwood, *Shrewsbury, South Hadley, Westfield (*offers cable TV too).

Any sense of how soon such a service could be provided if things progress?

Wellesley is unique in the amount of information technology expertise that resides among its residents.  My best guess is the IEC will take the time to evaluate the business model implemented in the above communities and develop a model specifically for Wellesley.  My thought is that this would take 3 to 5 months.  From there we would simultaneously enter into an agreement with an Internet Service Provider (2 months) and reach out to our largest commercial customers to solicit interest.  The fiber installation could easily be done in 2 months, if done on a limited basis.

Any early indications of public support for this?

Having the good fortune of being the MLP Director for the past 20 years I have received positive feedback on how pleased Wellesley residents and businesses are with the electric service we provide.  Our rates are well below those charged by investor-owned utilities and our service is far more reliable.  My sense is that our customers would welcome the competition.  The only question I have is will customers “unbundle” existing cable, television and Internet service.

Any early indications of Verizon/Comcast getting in the way?

Not so much getting in the way as far as the MLP providing actual service.  Other communities have experienced existing Internet providers implementing increased advertising campaigns and some have reduced prices.  The MLP’s Internet business plan will be risk averse knowing full well the companies we would be competing with have very deep pockets.

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