The study, funded in part by Fiber to the Home Council Americas, used data from nearly half a million home sales between 2011 and 2013, U.S. Census data and data from the National Broadband Map in order to determine the effect of high-speed fiber-optic Internet on home prices.
What Is Fiber?
Before we go much further, what is fiber Internet? Sadly it’s not operated by cable hooked up to your bran-based breakfast cereal, although that would be an awesome science-fiction concept.
Your computer reads electrical signals like binary or machine code: On is one; off is zero. Most of the time these signals are transmitted over copper-based wire. (We don’t see the copper because it’s surrounded in a protective plastic so we don’t electrocute ourselves.) The problem with copper is that it’s subject to radio interference and environmental factors.
Fiber-optic Internet works a little differently. First, the cables are bundled together from hundreds of strands of glass no thicker than a human hair. The cables are then covered in a protective sheath and hooked up to a laser. Everyone knows things don’t start getting really cool until lasers are involved.
The laser is angled so the light bounces around the cable, but never gets out. The light flashes on and off millions of times per second, and computers convert this to the information we crave.
So how does this add to your property value? First let’s take a look at the numbers.
The median home value in the study was $175,000. When high-speed fiber is added, this home sees an increase in value of $5,437. The increase is approximately equivalent to the value of a fireplace or a little under half the value of a bathroom.
Furthermore, this study says there is a 7.1% difference between the value of single-family homes where the available connection is less than 25 megabits per second and homes with gigabit (1,000 megabit) connections available.
Why is all this speed so desirable to home buyers? Marc Hudson is the CEO of Rocket Fiber, a company that is rolling out fiber-optic Internet service starting in Detroit later this year. He said we have the need for speed.
“In today’s home, gigabit fiber Internet is an amenity that enables residents to live free of buffering wheels and the bandwidth constraints that multiple connected devices can cause,” he said.
What difference can a fast connection make? If your Internet speed is 10 megabits per second, it takes 60 minutes to download a two-hour HD movie, according to a speed comparison by Fast Metrics. With a gigabit fiber-optic connection, the movie would be downloaded in 25 seconds. That kind of speed can make a man drunk with power.
OK, not really. However, think of all the connected devices we have and all the streaming and downloading and status updating we do on a daily basis. Now think of how much easier it would be if we never had to think about waiting for anything to load. I just shed a tear of happiness at the mere thought. It’s incredible to think how far we’ve come.
How Do You Get It?
So what’s the catch? As with every technological innovation from electricity to telephones to computers, it starts somewhere and slowly makes its way to the rest of the world.
Companies like Rocket Fiber and Google are rolling out their services in areas where there’s the most demand. This strategy so far has been to pick major metropolitan cities like Atlanta, Austin and Detroit. Once that’s done, they gauge interest in individual districts and neighborhoods.
If fiber isn’t available in your area, how do you help encourage installation of the service? First, get your name on a waiting list. Many of these service providers let you sign up for email updates on when the new high-speed fiber-optic option is coming to your area. They’re also looking at these lists to see where demand is for the next rollout.
The second approach is a little more complicated and involves greasing the wheels of capitalism. It basically boils down to this: Encourage your city leaders to be friendly to the rollout of the new network.
Construction projects are complicated. In the planning phase, you need access to all sorts of information including how the cables will integrate with the existing power infrastructure. You need to know where water mains and gas lines are so you can avoid them when you’re laying cable. Last, there are a ton of permits that need to be pulled.
With all these infrastructure logistics, the biggest thing anyone can do to help get the ball rolling is to encourage city leaders to closely cooperate with any company looking to start a new high-speed fiber project in your area.
High-speed fiber Internet isn’t available everywhere, but it’s starting to roll out more and more across the country. Are you planning to upgrade when it becomes available in your area? What would you do with all that extra speed?
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