Tuesday, August 28, 2001

Lebanon going into phone business

Council vote could create a competitor for Sprint

By Cindi Andrews
The Cincinnati Enquirer

        LEBANON — This Warren County city, a pioneer in Greater Cincinnati with its own cable TV system, may soon boast its own telephone service.

        And as a bonus to Lebanon residents, they would no longer have to pay tolls to call Cincinnati or Dayton with the city's service.

        City Council will vote today on several measures to begin the project, and a majority of members are leaning in favor.

        The phone service would be a partnership between the city, which built a telecommunications network about three years ago, and Cincinnati Bell, which would pro vide the dial tone.

        The arrangement would be a first for Cincinnati Bell and a first in Greater Cincinnati.

        There is no national group that tracks municipal phone companies, but William Ray, a Glasgow, Ky., official who has worked with many communities planning telecommunications networks, estimates only about a dozen communities in the nation are offering phone service.

        “The city of Lebanon is pretty progressive,” Cincinnati Bell spokeswoman Tressie Long said.

        That progressiveness stems partly from Lebanon's unusual position of owning

        its electric utility, which meant some of the infrastructure for a telecom system already was in place. Also, its distance from both Cincinnati and Dayton — roughly 30 miles to either one — made it a technological no-man's land until its $13 million telecom system was built about three years ago.

        Telephone service has been promoted as a key component of the system since its beginning. Cable TV, however, was the first to go on line, about 2 1/2 years ago, followed by high-speed Internet access last year.

        That's also been the order of things at other municipalities across the country — an estimated 200 — that have started their own cable TV services, says Mr. Ray, who runs the telecommunications system in Glasgow, Ky.

        Like most of its counterparts, Glasgow has not yet gotten around to phone service.

        “Most everyone's planning on that,” Mr. Ray said. “But the one commonality 10,000 cities across the country have is that they hate their cable operator.”

        Time Warner charges about $35 a month for standard cable in the Tristate, but it has been forced to lower its prices in Lebanon to compete with the city's $24 rate.

        Phone service, Mr. Ray said, is the third priority, behind cable and high-speed Internet. Lebanon has a stronger impetus than most others to add phone because residents now pay long distance to call two metro areas they have strong ties to: Cincinnati and Dayton.

        Also, local phone provider Sprint has gotten mixed reviews from residents over the years on its customer service, though recently that has been improving.

        Count Betty Tose among Lebanon residents who would welcome local phone competition: “I'm just disgusted with Sprint. It takes forever to get anything straightened out.”

        Ms. Tose subscribes to city cable, and she said its customer service has been good.

        City officials hope that track record and an extended local calling area will draw close to 5,000 phone subscribers in five years.

        Sprint, meanwhile, plans to poll Lebanon customers next month to see if they're willing to pay an extra $1 monthly for a local calling area that would extend to Cincinnati and Dayton. Both services would cost about $28 a month for basic service, taxes and fees.

        Sprint says its move is part of a statewide expansion, but Lebanon officials see it as a response to their plan — much as Time Warner lowered prices and added high-speed Internet to compete with city cable.

        “(City phone service) is going to be a great advantage to the citizens, whether they're on it or not,” Councilman James Reinhard said.

        The city's bottom line also is a top consideration in council's expected decision to add service. The telecommunications system has cost about $13 million and is not yet breaking even, in spite of counting more than 3,000 of Lebanon's 7,000 households as subscribers.

        The only hope, Councilman Mark Flick has said, is to spend less than $1 million to bring phone service on line. Conservative estimates show phone service returning that initial investment in less than four years, according to Mr. Flick and Service Director Pat Clements, and then it can start paying down telecom's debt.

        Service could begin late this year or in early 2002 if council gives the go-ahead, Mr. Clements said.

        “We're going to try to get this thing on line as quickly as possible,” he said.


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