Blog Post

Sacramento’s Hacker Lab calls AT&T’s gigabit bluff

Sacramento, California’s capital, was named one of 100 cities where AT&T might build gigabit networks. While many were pondering the seriousness of this latest fiber-to-the-press-release initiative, President Obama asked the FCC to reclassify broadband service as Title II to protect net neutrality. AT&T retaliated by petulantly threating to abandon all plans for the Gig 100 if the FCC reclassifies broadband.

Hacker Lab, together with its partner Consolidated Communications (CNSL), proved that communities needn’t fear the wrath of giant incumbents or grovel in hopes of receiving their broadband largess. Hacker Lab recently introduced constituents to the city’s first gigabit hackerspace, and what it expects to be a quickly expanding world of gigabit services. Few in Sacramento, it seems, are waiting for AT&T.

Hacker Lab crowd
Hacker Lab community applauds new gigabit capability

Hackerspaces: An economic development wheel in a wheel

To understand the importance of Hacker Lab lighting up one gig capability, consider a fiber network that surrounds a city to be a giant wheel of technology whose benefits include the potential to improve the local economy. A hackerspace is a wide-open workspace where hardware tinkerers, software coders, inventors and innovators toil away creating stuff in a collaborative environment without much structure. Often this “stuff” becomes products or services that fuel entrepreneurial ventures, thus creating small wheels of economic development.

Hacker Lab expanded from 750 square feet to over 10,000 square feet in just six months of being in business. It is now home to 200 entrepreneurs and a virtual community of over 3,000. It hosts 40 to 55 tech education classes and user group meetings each month, totaling over 6,000 students a year. Hacker Lab is home to a constant rotation of thirteen private offices for startups and dozens of freelancers. Revenue from companies, freelancers and entrepreneurs is in the millions annually. In less than three years, Hacker Lab has grown to become a technology hub for the region.

Now outfitted with gigabit capability, Hacker Lab can dramatically increase its entrepreneurial output. As Chattanooga discovered with its GigTANK program, if you put innovative people in a gig environment, you increase entrepreneurs’ ability to create data-intensive solutions such as healthcare delivery and 3D printing applications.

“In cities where a gigabit has been widely deployed, we are seeing a new vitality, an energy moving its way through businesses, education, health and civic life,” Anne Neville, director of the state broadband initiative for the National Telecommunications and Information Administration (NTIA), said in her remarks at the lighting ceremony. “In Kansas City and Chattanooga, they have hacker houses, places where people are coming from all over the country to experiment without the boundary of speed, only the limitation of their own creativity.”

Hacker Lab welcome
Nurturing new Sacramento entrepreneurs

There currently are only two hackerspaces with a gig connection in northern California. As one of those, Gina Lujin, Hacker Lab founder and CEO, believes its new capacity will drive gig adoption throughout Sacramento. “This is the point of having a gig in our space. We are looking at the big picture and to the future.” Other cities without widespread gigabit infrastructure can look to Hacker Lab as a model for using gig-charged hackerspaces to boost economic development in targeted neighborhoods.

Communities building their own citywide infrastructure can create several wheels of concentrated economic growth to support a variety of economic missions throughout the network’s footprint. Gabe Waggoner, Consolidated’s VP of operations, concurs. “The Sacramento community is important to us and this is a way for us to give back to the community. Providing a hackerspace and other businesses with a gigabit generates economic advancement and builds innovation incubators.”


Waiting for AT&T — not

Hacker Lab’s partnership with Consolidated to bring a gig to the heart of Sacramento throws into sharp relief the actions of [company]AT&T[/company] and other giant incumbents who rely on faux drama to extract regulatory relief from government. A few in Sacramento became excited about the prospect of AT&T bringing a gig to town as [company]Google[/company] did in Kansas City. But as soon as the White House threatened the company with a regulation it didn’t like, AT&T immediately took its own promise of delivering a gig to 100 cities hostage to try to force the president and the FCC to back down.

A review of telecom history shows that since 1992, giant telcos and cables have fleeced the American public for $400 billion by going to each state with the empty promise to wire their respective constituents with 40 Mbps service. In his recently released, “The Book of Broken Promises: $400 Billion Broadband Scandal & Free the Net,” industry analyst Bruce Kushnick documents how this promise led to deregulation, tax benefits, excess fees and new phone charges. At the federal level, the FCC called out AT&T, probably with an eye on this history.

At the local level, Hacker Lab is essentially saying, “We won’t be fooled again.” Across the U.S., many communities are unhappy that incumbents have promised competition but then failed to deliver it. More than 140 municipal governments and public utilities have taken the initiative to build their own networks, either alone or in public private partnerships. Another 250 have built partial-reach networks. Hacker Lab typifies another tactic for getting better broadband, lobbying regional providers and building viable business cases for creating gig facilities in an area that will then drive greater broadband adoption. C Spire’s efforts in Starkville, MS are another example of this tactic.

Hacker Lab inventor
Custom laser-cut gaskets designed and manufactured at Hacker Lab

Hackerspaces have not received a lot of attention in the overall scheme of using broadband to boost local economies. In the upcoming year, we should expect to see a lot more being done with these centers of innovation and gigabit technology.

Craig Settles is a consultant who helps organizations develop broadband strategies, host of radio talk show Gigabit Nation and a broadband industry analyst. Follow him on Twitter (@cjsettles) or via his blog.

Photos courtesy of Hacker Lab.

6 Responses to “Sacramento’s Hacker Lab calls AT&T’s gigabit bluff”

  1. Eldo Telecom

    “Across the U.S., many communities are unhappy that incumbents have promised competition but then failed to deliver it.”

    Telecommunications infrastructure is not a competitive market. It’s a natural monopoly or duopoly market due to the high cost barriers to entry. Competition (many sellers and buyers) is possible for telecommunications and information services provided over that infrastructure using a wholesale model. But its economics dictate there cannot be a truly competitive market for the infrastructure itself.

  2. The deal with Consolidated is the beginning of a gigabit drive throughout Sacto. Hacker Lab becomes the centerpiece of the drive.

    The AT&T part refers to the fact that they (AT&T) think they have a bunch of sway over federal regs because they put out a press release claiming they’re going to deliver a gig to a bunch of cities, which most people are pretty sure is b.s., and so they’re going to bully the FCC by threatening to take away the promise. The company’s thinking is that cities like Sacto will get all frantic and call the FCC to demand the FCC back down or else the city will lose it’s chance at a gig. The FCC called out AT&T’s threat by demanding, in essence, that AT&T put up or shut up. Hacker Lab and Consolidated tell the community, “forget about AT&T, Sacto’s already got a gig and we don’t need no stinkin’ incumbent.” This is similar to how a small regional provider trumped AT&T’s Fiber-to-the-press-release in Austin – by showing they can deliver the gig faster.

  3. So let me get this straight – HackerLab worked with Consolidated to buy a Gig internet connection to their own location that the community can’t purchase in their own buildings? How is this a major story and a ‘pie in the face’ to AT&T?

    • BOb Hope

      bottom line? it shows that you don’t need AT&T in metro areas where there’s competition. also shows that AT&T was full of crap when they stated they’d roll it out in the first place – clearly they couldn’t and wouldn’t do it even when they had a ready willing partner to pay for the install.