Christopher Yoo, a
member of FSF’s Board of Academic Advisers, and Timothy Pfenninger, both
professors at University of Pennsylvania Law School, coauthored a recent
paper entitled “Municipal
Fiber in the United States: An Empirical Assessment of Financial Performance.”
The paper analyzes the financial viability of twenty municipal fiber networks,
finding that eleven of them are cash-flow negative.
It also finds that five of the nine cash-flow positive projects are generating such small returns that it would take over 100 years to recover the projects’ costs. Additionally, two of the nine cash-flow positive projects have a recovery period of 61-65 years, which is beyond the expected useful life of a fiber network. Professor Yoo and Professor Pfenninger’s paper is an important piece of economic literature for understanding the negative consequences that often occur from implementing unnecessary municipal broadband projects.
It also finds that five of the nine cash-flow positive projects are generating such small returns that it would take over 100 years to recover the projects’ costs. Additionally, two of the nine cash-flow positive projects have a recovery period of 61-65 years, which is beyond the expected useful life of a fiber network. Professor Yoo and Professor Pfenninger’s paper is an important piece of economic literature for understanding the negative consequences that often occur from implementing unnecessary municipal broadband projects.
Posts
