Municipal broadband has great allure by letting a city or town take control of its own broadband destiny, but a new Pennsylvania Law study reveals that these networks rarely produce a favorable return on investment (ROI).
In their paper “Municipal Fiber in the United States: An Empirical Assessment of Financial Performance” (PDF), University of Pennsylvania Law School professor Christopher Yoo and co-author Timothy Pfenninger revealed that 11 out of the 20 fiber networks assessed do not generate enough cash to cover their current operating costs. Additionally, the authors found that only two out of the 20 are on track to recover their total project costs during their 30 to 40 years of expected useful life.
