Broadband bullies: Cable companies, lawmakers gang up on local providers

House approves legislation prohibiting the FCC from aiding local communities eager to set up high-speed broadband services

You love your broadband provider, don't you? Right down to the Netflix slowdowns and inscrutable surcharges. You'd never, ever consider switching to faster, cheaper public broadband run by your local municipality.

If Washington gets its way, you’ll never have the chance to make that choice.

But don't point the finger at the FCC. The agency that was slammed with a torrent of comments on its hands-off approach to Net neutrality has indicated its willingness to intervene and preempt state laws that block broadband competition.

So the House of Representatives responded by tacking an amendment onto H.R. 5016, the Financial Services and General Government Appropriations Act, that would prohibit the FCC from acting on behalf of local communities. Last week's vote broke largely along party lines: 221 Republicans, along with two Democrats, voted in favor of the proposal; 196 Democrats and four Republicans opposed it.

Confused that supposedly local government-oriented Republicans are squashing local initiatives aimed at bringing choice and competition to the monopolistic telecom market? The Internet may bring people closer together, but Internet lobbying dollars make for some interesting political bedfellows, and big telecom companies spend millions pushing their agendas in state and federal legislatures.

The amendment was proposed by Rep. Marsha Blackburn, which is another irony, seeing as Chattanooga, in Blackburn's own state of Tennessee, has become a poster child for local government successfully selling high-speed broadband directly to consumers. EPB, the city-owned electric company, offers one of the fastest and least expensive Internet services in the country. Its 1Gbps Internet -- 50 times the average speed for homes in the United States -- costs less than $70 per month.

Meanwhile, the Chattanooga Times Free Press reports that "constituents back in Hickman County in the center of Blackburn's Tennessee district struggle to get fast and affordable Internet services (as) only 38 percent of Hickman residents have access to broadband services, far below the Tennessee statewide average of 58 percent."

Tennessee law prevents EPB from expanding to communities outside Chattanooga, Motherboard reports, even though the rural areas are "places where AT&T, Comcast, and other big telecom companies won't touch (or will only service with outdated DSL technology)." But last month FCC chair Tom Wheeler met with Chattanooga's mayor and published a statement on the FCC's website declaring "it is in the best interests of consumers and competition that the FCC exercises its power to preempt state laws that ban or restrict competition from community broadband."

In fact, there are currently more than 20 states with similar laws that prevent local communities from building out their municipal fiber networks. Earlier this year, Kansas looked set to join the list before public opposition convinced the legislature to back down. That bill, and many state laws like it, were written by telecom lobbyists and pushed forward by state representatives bought with campaign donations.

Longmont, Colo., is moving forward with its municipal broadband project despite heavy opposition from big cable companies. Colorado requires a voter referendum before allowing cities to proceed, and the first referendum, in 2009, was defeated when advocates were caught off-guard by the hundreds of thousands of dollars that cable companies poured in to defeat the measure. In November 2013, Longmont voters finally approved the ballot initiative. Pro-fiber forces spent around $3,700 promoting a network that would reach 1,100 residences, whereas "cable companies spent over half a million dollars trying to prevent four percent of city households from gaining access to municipal fiber on any reasonable timescale," the Washington Post reports.

Blackburn's main argument against municipal networks seems to be that they would be built with taxpayer money -- echoing Comcast, which has described community-owned ISPs as a waste of taxpayer money while seeking to limit their expansion. However Longmont's plan explicitly bars the use of tax money to pay off the bonds and instead will rely solely on revenues from broadband customers. And in Leverett, Mass., residents voted to pay an extra $25 in taxes a month rather than continue to languish without high-speed Internet.

Other towns that have pushed forward with publicly funded projects will end up saving taxpayer dollars. Holly Springs, N.C., which set up a municipal fiber network for community institutions such as schools and hospitals, says the project will save significant public dollars. Unfortunately, state law prohibits the town from offering its service to businesses and residents.

It turns out many communities are already wired with fiber, but businesses and residents are unable to use it because cities have signed noncompete agreements with cable companies like Comcast, Time Warner, CenturyLink, and Verizon that ban local governments from becoming ISPs or leasing their fiber to startups. Washington, for instance, set up the country's first 100Gbps fiber network in 2006, but it's only available to nonprofits and government, not city residents or businesses, because of a deal signed in 1999 with Comcast.

"We have a situation throughout most of the country in which people want greater choice, faster speeds, and lower prices," said Christopher Mitchell, director of the Community Broadband Networks program at the Institute for Local Self-Reliance. "One of the avenues for achieving those goals is community broadband. Rep. Blackburn is now leading an effort to take that choice away."

This story, "Broadband bullies: Cable companies, lawmakers gang up on local providers," was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow InfoWorld.com on Twitter.

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