Appingedam (pop.5000) Fiber Plans Get Squished
July 20th, 2006 by Gordon Cook
Yesterday James Enck wrote: Proving that Senator Ted Stevens isn’t alone in having some strange views on what the internet is, the European Commission seems to have some strange views on what it shouldn’t be. The Commission has determined that the Appingedam muni-FTTH project in the Netherlands constitutes state aid. Full post is here.
Then AP wrote” “The European Commission on Wednesday banned a small Dutch town from building its own fiber-optic network, saying the plan would be unfair to broadband companies - a decision with potentially far-reaching consequences. It was the first time the EU has vetoed a municipality’s plan to build a public network.”
Vint Cerf then exclaimed: “that is absolutely terrible news. I hope there is a major outcry.”
An hour later I found this in my mail box: “Yesterday’s prohibition by the EU of the Appingedam fiber project creates some waves in the States as well, however unnecessary. The verdict does not touch other projects - even when Malone’s UPC tries to claim otherwise.”
“Interestingly enough, Appingedam was forbidden on a complaint by Essent cable. So who is that Essent?
Luckily they are so kind to answer that question themselves, in English:
” Essent is a non-listed public company with limited liability, incorporated in 1999. Its shareholders are Dutch provincial and municipal authorities.” http://www.essent-finance.nl/aboutEssent/profile.jsp
So it’s a typical case of a Muni Civil War… (or the pot calling the kettle black)
However, the Appingedam thing does not touch any other muni fiber case in the Netherlands. Like in Amsterdam these are public private setups, conforming to the EU rule of the Market Economy Investors Principle (MEIP) which states that there is no state aid when an authority invests like a market investor would have done or does. Like in Amsterdam where the municipality has a minority share in the passive infrastructure, investing on identical terms as the private partners.
Incidentally - it’s that MEIP that makes it possible for Essent to provide TV, telephone and internet in competition with the incumbent telco KPN ;-).” [Note: my source who would prefer anonymity, is very real and i have had a very nice voice converstaion with him today.]
Cook’s Edge: Note also that - Amsterdam has done its homework. Its contribution is a minority of the overall investment and is at risk should the project fail. I don’t know the details of Appingedam’s “homework”. Judging by the fact that it is very small with presumably limited resources, it looks like it might have stumbled unaware into its mess. There is a hopeful development afoot. A Connected Communities Association. With any luck CCA will so go international. With anyfurther luck I hope it will link with European efforts. At any rate the whole point is that it should serve as an on line educational support environment where a town like Appingedam could go to develop its plans and discuss them in private, having them reviewed by other folk more expert. The goal being that when the next small town steps out on the world stage it doesn’t have a chink in its armor that allows it to get shot down like Appingdam which very much needs a colaborative edge.