A new study from the New York City Council is recommending that the Big Apple throw open the competitive bidding process for its annual $130 million phone and Internet bill in order to leverage one of the most expansive — and underused — fiber optic networks in the country.
In so doing, New York City could not only cut its annual telecom bill, but would also be in a position to deploy wireless networking links as the “last mile” connecting metropolitan area networks, or MANs
Prepared by Council Speaker Gifford Miller and Councilman Gale Brewer, who chairs the council’s select committee on technology in government, the report is entitled “Network NYC: Building the Broadband City.”
With the rapidly unfolding maturation of wireless and fiber optic technologies, along with a glut of fiber optics lines left over from the telecom bubble, the use of network pricing that can reduce current and future telecom costs is expanding, the report said.
The 22-page study, released Thursday, recommends that the Mayor’s office competitively bid “the city’s $130 million annual phone and Internet bill — 75 percent of which has been historically provided as a sole source contract to Verizon.”
Verizon has held the annual contract for decades, according to a city official.
The report suggested the move would help address the city’s ongoing fiscal crisis, which was already reeling from a recession before Sept. 11.
“Without competition, and with Verizon’s lock on 75 percent of the City’s telecom bill, the Comptroller’s Office repeatedly has asked a basic question: how can New York City be assured that it is getting the best telecom rates and services if it is not soliciting multiple bids in a rigorous, open market process?”
A Verizon spokesman was not available for comment by presstime.
New York City is the largest municipal buyer of telecommunications goods and services in the U.S., said the report. In addition, it said the Department of Information Technology and Telecommunications (DoITT) manages franchise agreements for 21 separate fiber-optic companies — more companies holding more high capacity metropolitan fiber than in any other city, as well as a portfolio of over 2,220 municipal rooftops potentially ripe for wireless deployments.
Yet “there has been little public discussion or long term strategic thinking about how the city could better organize this public and private infrastructure to encourage a truly citywide deployment of affordable, high speed networking capacity,” the report said.
It also criticized the lack of coordination among so many fiber-rich departments within the city. Locally, for example, New York City already essentially owns, operates and manages, an albeit limited fiber network known as the Institutional Network, or I-Net.
In addition, “and as a further indication of the lack of coordinated telecom planning in the City, several [city] agencies, DOT, and the New York Public Library (NYPL), operate their own separate fiber networks for transmitting large amounts of data and/or as backhaul networks for Internet traffic.”
It also cited an example of neighborhoods with several bandwidth-rich municipal buildings clustered nearby. Typically, the firehouses, police precincts, library branches and other government offices are all connected separately via the telephone companies’ network, with multiple T-1 lines, “that cost anywhere between $400 and $1,200 each.”
Instead, the report suggested, with “secure, point to multi-point wireless last mile or last hundred feet links, however, the tallest municipal building in a given area can distribute bandwidth wirelessly to all the various municipal sites off of the one building’s fiber backbone.” In effect, the building itself would become a Point of Presence
Other suggestions in the report said that excess fiber capacity built as a consequence of city funding should be open to third parties at competitive wholesale rates.
The report also suggested that the DoITT issue a five year telecom plan every three years; that the DoITT should look over all of the city’s telecom needs, including pre existing fiber and wireless resources and that it appoint a blue ribbon panel of academics, technicians, and community members to develop a comprehensive feasibility study for a redesigned municipal network.