Mayor announces high-speed fiber deal
Lexington is poised to become the largest city in the country with gigabit internet service available for all residents to purchase, providing much-needed competition to existing internet and cable television providers, Lexington Mayor Jim Gray said Tuesday.
“Just in time for Christmas, Santa Claus is coming to town,” Gray said at a news conference officially announcing that Indiana-based MetroNet plans to spend as much as $100 million building a fiber-optic network that covers the city’s entire urban service area.
MetroNet pledged Tuesday to spend at least $70 million to build the network over the next three to four years if it receives a cable franchise from the city. Gigabit speed is equivalent to moving data at 1,000 megabits per second. Lexington’s average internet speed is 16.2 megabits per second, according to some studies.
If the company makes good on its pledge, Gray’s claim that Lexington will be the largest city in the country with gigabit speeds available citywide is accurate, said one organization that works with cities to develop high-speed networks.
“There are larger cities that have fiber to the home but they have not built out to the entire city,” said Deb Socia, executive director of Next Century Cities, a nonprofit group. “The difference here is that there is a franchise agreement that obligates them to build out to the entire city.”
“I’m pleased that they won’t be picking certain neighborhoods in the city,” Socia said. “It’s a nice thing that the city has empowered citizens in every neighborhood in the city to participate in the digital economy.”
If the company gets all the necessary approvals from the Lexington-Fayette Urban County Council quickly, MetroNet officials said the company could begin stringing fiber-optic cable on utility poles as early as January. The first customers could come onto MetroNet’s network as early as summer 2018.
MetroNet President John Cinelli said Tuesday that the privately-held company is growing rapidly. Last year, it connected 90,000 homes and businesses to its fiber-optic networks in 35 mostly smaller cities in Indiana and Illinois.
The company has a private equity partner — Cinelli declined to name the partner — that is helping make the company’s rapid expansion possible.
Gray announced in 2014 that he wanted Lexington to become a “Gig” city, saying ultra high-speed internet was a key economic development tool for a city that wants to attract and keep more high-tech and high-paying jobs. Nearly every major city in the country is trying to figure out how to get a fiber-optic network built.
Smaller towns have been more successful than larger cities. In the Western Kentucky town of Russellville, for example, officials used the municipally-owned power company to wire the city. In Louisville, officials have partnered with Google Fiber to provide high-speed internet to portions of the city.
MetroNet still must bid on a 10-year cable franchise agreement. The council voted Tuesday to put a request for bids for the franchise on the agenda for its Thursday meeting. It’s possible other companies could also bid on the franchise agreement.
One factor fueling the city’s eagerness to partner with MetroNet is Lexington’s icy relationship with Spectrum, the city’s largest cable provider.
The city and Spectrum have been at loggerheads for more than 18 months over the city’s contention that Spectrum violated its cable franchise agreement by repeatedly providing poor customer service.
In a Nov. 13 letter to the city, an official with Spectrum and its parent company, Charter Communications, said Spectrum did not violate the franchise agreement and has resolved all customer service complaints.
“We acknowledge that the LFUCG has referred various complaints to Charter over the last few months, our understanding is that all of these complaints have been resolved and there is nothing outstanding,” wrote Jason Keller.
The city is now trying to determine if it can enact a provision in the franchise agreement that allows it to fine the cable giant.
Meanwhile, Spectrum opened a retail store on Nicholasville Road Tuesday. That store will replace the one on Palumbo Drive. Also, Spectrum recently opened a $1 million technology center on Winchester Road. It will bring 25 new jobs to Lexington, said Mike Hogan, a spokesman for Spectrum.
Hogan said Spectrum believes it is well positioned to compete with MetroNet
“We welcome the competition and will continue to focus on delivering the highest quality products and services to our customers,” Hogan said. “In Lexington, we offer the fastest introductory internet speed at 60 Mbps, as well as no modem fees, data caps or contracts, which is appealing to customers.”
Several council members said Tuesday they were relieved another television provider would soon enter the Lexington market. High-speed internet also will better position the city to attract businesses, the said.
“It’s good for businesses. It’s good for residences,” said Vice Mayor Steve Kay. “For those of us who have had longstanding concerns about the level of service we’ve been getting in this city, it opens up the possibility for real competition.”
Councilman Joe Smith said “everybody has concerns about how they have been treated.”
“I know a lot of people who have dropped (Spectrum) because of the price,” Smith said. “One of the questions I’ve been asked is: ‘When are we going to get competition in here?’ This definitely will help.”