Utilities don't set their own rates, for obvious reasons. Public rate-setting boards do, and they are beholden to municipal politics, which target the lowest-common denominator. If you tried to raise rates to upgrade the network, you'd be shouted down by people talking about old folks on fixed incomes.

What do you think is going to happen at a rate-setting meeting? For every young nerd who thinks the utility should invest in fiber, how many people like my parents will be there (who wanted to switch from FiOS to cable to get Indian channels)?