Remembering David Carr, and His Writing on Monopoly Power

Stacy Mitchell, Co-Director of ILSR and Director of the Community-Scaled Economy Initiative, took a few moments to look back over the work of David Carr. Carr's work included investigating monopolies in the telecommunications space. Stacy's story, re-posted here, originally ran on ILSR.org.

What will we do without David Carr, the brilliant media columnist at the New York Times who died last week? At ILSR, we will especially miss his writing on monopoly power, Amazon, and the book business. Below we’ve excerpted and linked to a few of his best recent pieces on those subjects.

In Modern Media Realm, Big Mergers Are a Bulwark Against Rivals — July 16, 2014

Comcast’s bold strategy of acquisition kicked off a wave of defensive consolidation, fueled by a combination of fear and abundant capital in the media realm.

I talked to the head of one company that creates television and movies, who expressed a common sentiment. “When Comcast decided to get bigger,” he said, “we all had to ask ourselves, Are we big enough? We all have to think about getting bigger.”

And why not? No one is stopping them.

With big data, a Big Brother government and now big media, size creates its own prerogatives. When Amazon used its market dominance to limit access to Hachette books over a price dispute, regulators yawned. When AT&T and DirecTV propose a tie-up in response to Comcast, the market issues are just another deal point. Cable companies slowed down content from clients (which are also competitors) like Netflix, and it was treated as a business dispute.

For the most part, the current government has passed on regulating potential monopolies, and as citizens, we have become inured to the consequences of bigness.


Amazon Absorbing Price Fight Punches — June 1, 2014

Someone forgot to tell the book business that it was dead. Last Thursday afternoon, I walked over to the Javits Center in Manhattan, where a throng of people had gathered for BookExpo America, the industry’s annual campfire — so many people that I wondered if there was a free whiskey concession…

The immense space was brimming with a surprising amount of optimism: After years of downward spiral, the industry seems to have found some kind of equilibrium.

It has also watched with a mix of giddiness and anxiety as the Hachette Book Group, one of the big Manhattan publishers, has taken on Amazon in a bitter dispute over pricing. Hachette is suffering big losses because Amazon is delaying delivery of Hachette titles while also eliminating discounts. (Its authors are getting clobbered in the process.) Amazon is taking a reputational hit for not putting its customers first, which has long been its guiding philosophy.

Hachette is the first big publisher to enter talks with Amazon since the last round of negotiations, and book people have rejoiced watching the bully get sand — a heap of negative press — kicked in his face.

Amazon, beloved by Wall Street (until recently) and its customers for putting growth and low prices ahead of profits, is getting a bit of an image makeover right now, and the results have not been pretty.

On one level, this is just one corporate giant fighting with another — Hachette is owned by Lagardère of France — over the share of e-book profits. So why the fuss? The answer is that books are different from the thousands of other products Amazon sells.

As the uproar grows, Amazon is learning that while it may own the publishing industry with a 40 percent market share of all new books sold, according to Publishers Weekly, it doesn’t own the debate….

 

Growling by Comcast May Bring Tighter Leash — Sept. 28, 2014

Comcast has a long corporate tradition of smiling and wearing beige no matter what kind of criticisms are hurled at it. That public posture is in keeping with the low-key approach favored by Brian L. Roberts, the company’s chief executive, as he seeks to take over the world. It’s worked very well so far.

But in a filing submitted to the Federal Communications Commission last week in defense of its proposed merger with Time Warner Cable, the company lashed out uncharacteristically at its critics. And David L. Cohen, Comcast’s chief lobbyist, continued the salvo in comments to reporters and in his written remarks.

Watching Comcast’s ballistic response to opponents of its $45 billion takeover bid was a bit like watching a campaign debate go off the rails. The front-runner, ahead by 20 points, is besieged by ankle-biters who suggest he is a lout and a bully. He finally loses it and goes off on his opponents in a fury, generally acting like, well, a bully.

 

Questions for Comcast as It Looks to Grow — April 6, 2014

It is hard to say how rugged the questions will be when Comcast goes before the Senate Judiciary Committee on Wednesday to defend its proposed megamerger with Time Warner Cable.

We do know that Comcast is feeling pretty confident about its chances. In a recent interview with C-Span, David Cohen, an executive vice president at Comcast and the man who will represent the company, said, “ I have been struck by the absence of rational, knowledgeable voices in this space coming out in opposition or even raising serious questions about the transaction.”

Really? How can the largest cable company in the country bid to buy the second-largest and gain control over 19 of the country’s top 20 markets — corralling a 30 percent market share in cable and a 40 percent share in broadband — and there be no serious questions?

 

Why Barnes & Noble Is Good for Amazon — July 14, 2013

Having a bookstore in your neighborhood, as opposed to one that is bookmarked on your browser, is an invitation. Not long ago, I was walking by an airport bookstore and thought, “What if this was the only place to buy books?” Similar to Hollywood, only the blockbusters would get shelf space…

Bookstores offer discoverability, not just the latest Dan Brown or Carl Hiaasen book on the front table, but sometimes treasures deep in the stacks, a long tail of midlist authors and specialty books. Even as the book business consolidates, the physical object displayed in an actual place will continue to be an important part of the ecosystem.

Let’s hope it survives.

 

Telecom’s Big Players Hold Back the Future — May 19, 2013

Ms. Crawford argues that the airwaves, the cable systems and even access to the Internet have been overtaken by monopolists who resist innovation and chronically overcharge consumers.

The 1996 Telecommunications Act, which was meant to lay down track to foster competition in a new age, allowed cable companies and telecoms to simply divide markets and merge their way to monopoly. If you are looking for the answer to why much of the developed world has cheap, reliable connections to the Internet while America seems just one step ahead of the dial-up era, her office — or her book — would be a good place to find out.

 

Navigating a Tightrope With Amazon — April 29, 2012

Mr. Bissinger, who has built a franchise on journalistic excellence and rhetorical intemperance — see his Twitter account — managed to choose his words carefully when talking about how his e-book ended up as a bug on the windshield of Amazon’s relentlessness on pricing.

That may have a little something to do with the fact that he has a great big book, “Father’s Day,” being released by Houghton Mifflin Harcourt in just two weeks. It would be a bad time to stick his finger in the eye of a company that sells more books — including his — than any other company in the world.

“It’s a shame that the e-book was not on sale at Amazon,” he said. “Amazon is a crucial outlet for any author, and when you lose them, it’s terrifying. It’s a killer for ‘After Friday Night Lights’ because it was just gaining momentum and books have a very small window of opportunity.”

Like Wal-Mart, Amazon is big enough to set prices in certain categories. Suppliers are left to scramble to meet those objectives or pass up the opportunity to work with the largest retailers in the world. Amazon’s might when it comes to pricing will only grow as the impact of the Justice Department’s lawsuit begins to emerge. But sometimes the company’s tactical aggression lands hard on the people who supply it.

 

Book Publishing’s Real Nemesis - April 16, 2012

The Justice Department finally took aim at the monopolistic monolith that threatened to dominate the book industry. So imagine the shock when the bullet aimed at threats to competition went whizzing by Amazon — which not long ago had a 90 percent stranglehold on e-books — and instead, struck five of the six biggest publishers and Apple, a minor player in the realm of books.

That’s the modern equivalent of taking on Standard Oil but breaking up Ed’s Gas ’N’ Groceries on Route 19 instead…

But pull back a few thousand feet and take a broader look at the interests of consumers. From the very beginning and with increasingly regularity, Amazon has used its market power to bully and dictate. It leaned on the Independent Publishers Group in recent months for better terms and when those negotiations didn’t work out, Amazon simply removed the company’s almost 5,000 e-books from its virtual shelves. The Seattle Times just published a series with examples of how Amazon uses its scale not only to keep its prices low, but also to keep its competitors at bay…

After a week of watching the Justice Department and Amazon team up, I’ve learned that low prices come with a big cost. Maybe I’ll order it at my local bookstore instead.

 

Photo of David Carr by Ian Linkletter.

Lafayette Congratulates Wilson; Offers Support After FCC Ruling

When the FCC announced its intention last week to neutralize the negative impacts of Tennessee and North Carolina anti-muni laws, celebrating reached far beyond Chattanooga and Wilson. In Lafayette, home to LUS Fiber, City-Parish President Joey Durel took time to write a supportive letter to Wilson's Mayor Bruce Rose.

We reproduce the text of that letter below. As Durel points out, the two communities have strong similarities and the victory in Wilson has also reached Lafayette. Durel notes that a community's decision to better its connectivity should always be a local choice, that partisanship is not a natural part of the equation, and he encouraged Rose to "stay strong."

Dear Mayor Rose:

As Mayor of Lafayette, LA, a city that proudly provides electric and communications services to our businesses and residents, I want to congratulate you, your colleagues, and your constituents on your achievement in delivering world-class Internet services to the residents and businesses of Wilson - and on the strong endorsement you received last week from the Federal Communications Commission.

As in Wilson, the Lafayette community has been united in our support for high-capacity broadband connectivity to the Internet as an essential tool of economic development and as a means of securing our community's economic future. While some will use any means possible to distract you from achieving your goals for your community, our deeply conservative electorate has consistently supported our electric utility's great achievement in building a future-proof broadband Internet infrastructure, and this support has been consistently bi-partisan. My Democrat colleagues have joined me and my fellow Republicans in insisting that we in Lafayette should have the right to choose our broadband Internet future. We here in Lafayette will determine how our community engages this essential economic development tool, and we will not have our economic future dictated to us by others.

As you in Wilson have, we have seen the increased politicization of the local Internet choice issue in Washington, and we regret that it has. At the local level, in our community, this is not a partisan issue and we have resisted letting it become one. Like you, we do not believe this issue is about politics or partisanship or electoral politics or the public versus the private sector. Rather, it is about strengthening America, local self-reliance and the opportunity of our citizens to live in a community with all the same opportunities - for jobs, education, health care, public safety, and much more. Wilson, like Lafayette, has built a network that ensures that your community will be second to none in these respects. Congratulations to you for taking this important step, you are obviously interested in doing the right thing for your citizens, so stay strong. And, please feel free to contact me anytime, I've been in your shoes.

Sincerely,

L.J. "Joey" Durel, Jr.

City-Parish President

Lafayette Consolidated Government

Rural Electric Co-Mo Coop Goes Gig - Community Broadband Bits Episode 140

As high quality Internet has become more essential for business and quality of life, those who realized that the existing telecom providers had no intention to invest in better connections in their rural Missouri communities began to ask their electric cooperative - Co-Mo - to step up and do it.

This week, we talk with Randy Klindt, General Manager of Co-Mo Connect, which is building a gigabit fiber network out to its members despite having not been chosen to receive any stimulus funds.

We discuss how they have structured the network, why they felt compelled to get into the business, and some of the results from their approach.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 20 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

Listen to previous episodes here. You can can download this Mp3 file directly from here.

Thanks to Persson for the music, licensed using Creative Commons. The song is "Blues walk."

Blackburn and Tillis Introduce Bill Aimed to Undo FCC Decision to Restore Local Authority

Last week, the FCC made history when it chose to restore local telecommunications authority by nullifying state barriers in Tennessee and North Carolina. Waiting in the wings were Rep. Marsha Blackburn and Senator Thom Tillis from Tennessee and North Carolina respectively, with their legislation to cut off the FCC at the knees. [A PDF of the draft legislation is available online.]

Readers will remember Blackburn from last year. She introduced a similar measure in the form of an amendment to an appropriations bill. Blackburn has repeatedly attributed her attempts to block local authority to her mission to preserve the rights of states. A Broadcasting and Cable article quoted her:

“The FCC’s decision to grant the petitions of Chattanooga, Tennessee and Wilson, North Carolina is a troubling power grab,” Blackburn said. “States are sovereign entities that have Constitutional rights, which should be respected rather than trampled upon. They know best how to manage their limited taxpayer dollars and financial ventures."

Thom Tillis, the other half of this Dystopian Duo, released a statement just hours after the FCC decision:

“Representative Blackburn and I recognize the need for Congress to step in and take action to keep unelected bureaucrats from acting contrary to the expressed will of the American people through their state legislatures.”

Considering that networks in Chattanooga and Wilson are incredibly popular and an increasing number of communities across the country are approving municipal network initatives through the ballot, it is obvious that Tillis is rather confused about the expressed will of the American people. He needs to sign up for our once weekly newsletter!

No doubt the decision will be tied up in court proceedings for some time to come as state lawmakers attempt to control what municipalities do with their own connectivity decisions.

In keeping with the drama of the recent days, I have to say, "The lady doth protest too much, methinks." If Blackburn and Tillis are so convinced the FCC is overstepping, why not let the matter be decided in the courts? They know the law is not on their side, that's why.

We encourage you to contact your elected officials, and let them know that you think about the Blackburn/Tillis bill: "that dog won't hunt," in the words of Chairman Wheeler. The victory of February 26th was a significant first step in a long road to ensuring fast, affordable, reliable Internet for every one. Let's keep the momentum rolling.

Jim Baller is the Senior Principal of Baller Herbst Stokes & Lide, the lead counsel to Wilson and the Chattanooga EPB. You can read Jim's full statement at the firm's website:

“This is an important moment for communities in North Carolina, Tennessee, and other states that have barriers to local investments in advanced communications networks,” said Jim Baller, senior principal of Baller Herbst Stokes & Lide. “Not only has the Commission confirmed that it has authority to remove such barriers, but it has also compiled a massive record documenting the critical role that local Internet choice can play in fostering strong, vibrant communities and in ensuring that the United States will remain a leading nation in the emerging knowledge-based global economy.”

Mitchell to Speak in Syracuse on March 4th

Chris will travel to Syracuse, New York to speak on March 4th as part of Syracuse MetroNet's Broadband Speaker Series. If you are in the area and interested in attending, the lecture will be at 7 p.m. at Grewen Auditorium at the Le Moyne College campus. A PDF of the press release is available online.

Syracuse MetroNet serves fifteen community anchor institutions, including hospitals, educational institutions, government agencies, and community organizations. Unfortunately, the connectivity situation for businesses and residents needs a better solution.

Last fall, Syracuse Mayor Stephanie Miner expressed interest in developing a municipal network to improve connectivity in this community of 147,000. Residents now depend on Time Warner Cable for service and do not treasure the idea of dealing with an even bigger behemoth, should the merger with Comcast come to pass.

Community Broadband Media Roundup - February 27

This week, the FCC made an historic decision in favor of municipal networks in Chattanooga, TN and Wilson, NC. Chris was in Washington, DC to witness the vote, hear the testimony, and celebrate the hard work of several organizations.

As Brendan Sasso with the National Journal reported, "The issue is one of the most controversial that the FCC will vote on this year. But it was largely overshadowed Thursday by the even more explosive debate over net-neutrality regulations." We have full coverage of both decisions this week. 

Municipal Broadband Decision

Feds Nullify State Laws on City Internet: Net neutrality may get more attention, but the FCC is also making a major push for community Internet service—a priority for Obama. This by Brendan Sasso, National Journal

"The bottom line of these matters is that some states have created thickets of red tape to limit competition," Wheeler said Thursday. "What we're doing today is cutting away that red tape, consistent with Congress's instruction to 'encourage the development of broadband' and to 'promote competition.'"

By granting the petitions, the FCC struck down the laws in those two states, but other state restrictions remain in effect. Other cities looking to build or expand their own Internet projects may soon file petitions with the commission.

FCC Grants Petitions to Preempt State Laws Restricting Community Broadband in North Carolina & Tennessee

By Jim Baller, of Baller, Herbst, Stokes, & Lide, who deserves tremendous accolades for this result. Jim has worked for decades toward this goal. It is not possible to imagine these decisions without him. Thank you Jim.

"This is an important moment for communities in North Carolina, Tennessee, and other states that have barriers to local investments in advanced communications networks.  Not only has the Commission confirmed that it has authority to remove such barriers, but it has also compiled a massive record documenting the critical role that local Internet choice can play in fostering strong, vibrant communities and in ensuring that the United States will remain a leading nation in the emerging knowledge-based global economy."

FCC Votes To Allow Cities To Expand Broadband Networks

By Kate Cox, The Consumerist

Speakers at the meeting all referred several times to the FCC’s Congressional mandate to encourage the deployment of advanced telecommunications nationwide on a reasonable and timely basis — a mandate that, the FCC concluded earlier this year, is not currently being met. Several speakers also made references to chairman Wheeler’s stated goal to protect, encourage, create, and promote broadband expansion and competition.

FCC Votes to Allow Municipal Broadband, Overruling Two States’ Laws: Commission’s move sets a precedent for consideration of similar petitions in future

By Thomas Gryta, Wall Street Journal

FCC Chairman Tom Wheeler and President Barack Obama have said towns need to be free to build their own networks if they decide it makes sense. Towns that explore the option generally do so because they believe private sector development of broadband hasn’t kept pace with their needs.

FCC Gives Municipal Broadband Providers (and Internet Competition) a Boost

By Joshua Romero, Ieee Networks

“The competitive landscape is pretty bleak,” says Vishal Misra, an associate professor of computer science at Columbia University. He points out that at “true broadband speeds,” some Americans have two broadband providers to choose from, but most have only one (or zero).

When the FCC redefined broadband last month, it did so largely to highlight the lack of consumer choice at higher bandwidths. In general, ISPs prefer to invest in areas where they’ll be the sole provider, as it’s expensive to try to poach customers from an existing provider.

FCC Weighs Overriding state laws to expand broadband access

By Emery Dalesio, Associate Press

For Richard and Brenda Thornton, the FCC decision could mean a big savings. They live less than a mile from the service area for Chattanooga's Electric Power Board, which provides one gigabit-per-second Internet speeds. The Thorntons now pay $316 for landline phone service, Internet and television from wireless hot spots that two telephone companies offered. Their current connection is a fraction of the speed the Thorntons could get for $133 a month for the same bundle from Chattanooga.

The local cable company has refused to extend broadband service to their home, said Brenda Thornton, who likes to trade securities and commodities futures but can't do it because of the slow wireless speed.

"People don't realize how bad it is if you don't have a good Internet. Those people that have it, they don't even realize there's people like us that exist," she said.

FCC overrules state laws to help cities build out municipal broadband: 3-2 vote gives local broadband an important victory

By Chris Welch, The Verge

The FCC's 3-2 vote will serve as a landmark moment that other communities will point to as they try to compete against commercial ISPs and knock down those deeply restrictive state laws… Unsurprisingly, the cable establishment and entrenched ISPs have lobbied against this becoming a trend, with the opposition (and dissenting commissioners) trying to frame it as an aggressive overreach of the FCC's authority.

"We don’t take lightly the matter of preempting state laws," admitted Wheeler. But the chairman made clear this was a situation in which the FCC saw no other choice but to act. "The human faces of those who are condemned to second-rate broadband are a message to all of us.

This FCC Rule Will Matter More Than Net Neutrality Will

By Brian Bergstein, Technology Review

The decision in favor of municipal broadband networks does more than “open Internet” rules ever could to increase competition in a broken market.

FCC trumps state laws on local broadband limits: A 3-2 vote is the first step in allowing municipalities all over the country to offer their own Internet service in the name of competition.

by Marguerite Reardon, Cnet

The reason this regulation is needed, the FCC has argued, is because competition is largely lacking in the broadband market.

The competitive picture looks worse since the FCC earlier this year redefined broadband as a service that delivers download speeds of 25 megabits per second. 

Broadband Laws: Republicans Strongly Dissent From Decision

By: John Eggerton, Multichannel

Democratic Commissioner Jessica Rosenworcel, who enthusiastically supported the decision, likened municipal service to a broadband barn raising, an analogy that pleased FCC chairman Tom Wheeler. Commissioner Mignon Clyburn was also strongly supportive. 

FCC overturns state laws limiting municipal broadband

by Grant Gross, PC World

City praises FCC vote to overrule state laws regulating municipal broadband

by David Purtell, Associated Press

FCC Proposal Passes In Landmark Decision; Net Neutrality And Municipal Broadband Win, ISPs Lose

by Michael Justin Allen Sexton, Tom's Hardware

Speaking in support of the proposal, FCC commissioner Mignon Clyburn said that "Millions are trapped in digital darkness." Current laws restrict the growth of broadband Internet service, and the lack of competition often results in service fees being much higher than is acceptable. "Break down barriers to infrastructure investment so that no American where they live, no matter their economic status, will be stuck in digital darkness," said Clyburn.

FCC votes to support town of Wilson on municipal broadband expansion

by Lauren K. Ohnesorge, Triangle Business Journal

Mignon Clyburn, commissioner of the FCC, says current regulations have some stuck in a "digital desert," and that communities like Wilson should not be "denied the ability to respond to the infrastructure needs of their communities, particularly when the private sector has opted not to do so."

Some communities "literally beg" private companies to bring broadband. "Sadly, opportunities are being closed far too often, leaving citizens without broadband and leaders with few meaningful ways to address their needs," she says, calling on the FCC to level the playing field.

FCC votes to enforce net neutrality by regulating ISPs, unleashes municipal broadband

by Sam Oliver, Apple Insider

 

City News: by State

Cities that want to move forward with their own networks have several successful models to look at. Lancaster News in Pennsylvania published this update, and below are stories of several communities testing the municipal broadband waters:

Municipal broadband networks: A short history of plans in 4 cities

 

Arizona:

Vandalism shows internet vulnerability

By Felicia Fonseca, Associated Press

New York:

NYC Will Continue to Lag in Broadband

by Brady Dale, Commercial Observer

While it’s true that New York City’s size makes building a better Internet here vastly more expensive than it is for a Chattanooga or even a Kansas City, it also has economies of scale in its favor. This Thursday, the FCC will consider preempting state laws that forbid municipally owned networks. In other words, there may be many more Chattanoogas moving ahead of Gotham soon.

North Carolina

Wilson, North Carolina And Community Broadband Win With FCC Vote

by Leoneda Inge, WUNC

The City of Wilson floated $35 million in bonds, a move approved by the state, in order to build its community broadband service. Wilson City Manager Grant Goings says they wanted a private partner to help, like Time Warner or Embarq, but those companies said “no.”

“We never set out to be first. Our motivating factor was not to be the first community in North Carolina or one of the first in the southeast to have this fiber to the home infrastructure. Our concern was not being last," said Goings.

FCC should topple NC limits on public Internet networks

by News Observer

Maine:

Why government is trying to boost Maine’s worst-in-the-nation Internet speeds

by Darren Fishell, Bangor Daily News Staff

Proponents say the upside isn’t just attracting businesses. It would allow seniors to age in place using “telemedicine,” meet expectations and needs of people considering moving to Maine, and give a leg up to people and companies already in the state.

The Governor’s Broadband Capacity Building Task Force issued its report in December 2013 making the case for why and how the state should invest in new broadband capacity.

Islesboro voters to consider $3 million for broadband

by Tom Groening, Working Waterfront

Voters will be asked at their May 9 annual town meeting to authorize borrowing $3 million to build a broadband Internet network for the island.

In a front-page opinion piece in the January/February edition of the Islesboro Island News, Arch Gillies, chairman of the board of selectmen, argued in favor of the proposal, asserting that such an investment "is today's equivalent to earlier town decisions to bring the telephone, electricity and cars to Islesboro."

Minnesota:

Mpls. faces tricky questions over cable TV, Internet competition

Minnesota Public Radio 

The question of whether to allow a second cable TV provider into Minneapolis is setting off a contentious debate. Minnesota Public Radio interviewed Chris to find out more. 

Pennsylvania:

Q & A: Lancaster's municipal broadband network

The city expects to save nearly $110,000 a year by no longer having to pay for Internet access, VOIP phone service and air cards for municipal government. Officials also say the new network will allow them to read water meters remotely, which be more efficient than taking manual readings.

Tennessee:

FCC allows EPB service expansion: Gig Internet could expand beyond Chattanooga area

by Mitra Malek, Times Free Press

Broadband battle: FCC, Legislature square off over EPB bid to expand Gig territory

by Dave Flessner and Mitra Malek, Times Free Press

State Sen. Janice Bowling, R-Tullahoma, and state Rep. Kevin Brooks, R-Cleveland, are pushing a legislative proposal again this year to give Tennessee municipalities the freedom to expand high-speed Internet services outside of their electric service area, if local governments request the service.

"We cannot afford to wait with the need as critical as it is today for high-speed broadband service," Bowling said. "We're already behind the curve in many rural areas. Let us come out of the 20th century as small towns and join our sisters that are already in the 21st century with modern-day broadband service."

Muni electric services want restrictions lifted on broadband

J.R. Lind, Nashville Post

"The 21st century version of electrification is high speed broadband, providing the same benefits in both eras: access to modern utilities for more people across the state decided at a local level," TMEPA Executive Director Mike Vinson said. "Just as local electric systems did then, municipal electric broadband helps to spur job creation, encourages innovation, and is a driver for economic growth, all by bringing modern services to their communities."

Currently, eight municipal electrical services — those in Bristol, Chattanooga, Clarksville, Jackson, Morristown, Pulaski, Columbia and Tullahoma — offer broadband service, with Erwin starting service soon.

Tennessee’s Municipal Electric Systems Asking Legislature To Remove Broadband Restrictions

by The Chattanoogan

TMEPA consists of the state’s 60 municipal systems which serve 2.1 million homes and businesses, or 70 percent of Tennessee’s electric customers.  TMEPA is supporting legislation (SB1134 / HB1303) that removes the current limitation on municipal electric broadband providers that restricts broadband service to just its electric service territory.  This change in the law would allow municipal electric broadband to expand to more areas where it is needed if those communities want it, the group said…

“High-speed broadband is the next utility of the 21st century, and municipal electric broadband should be allowed to be an option for more communities across Tennessee,” said Jeremy Elrod, director of government relations for TMEPA.  

He said, "Today’s world has made high-speed broadband vital infrastructure that drives local economies, promotes economic development, increases educational opportunities and outcomes, increases regional and global competitiveness, and allows more opportunities for telemedicine, telework, and a better quality of life.  Communities with fast internet service become attractive for private investment, and communities without it are unable to provide the modern services that businesses and consumers need and want.

Net Neutrality Decision

What Happens Now With Net Neutrality? 

 by Michael Weinberg, Public Knowledge

The rules voted on today will define the debate around an Open Internet for the foreseeable future and establish a strong precedent in favor of robust net neutrality protections going forward. However, for better or worse, they do not bring that debate to an end. While it is unclear exactly what the next step will be, this post is an attempt to briefly outline the possibilities.

Before the Vote:

Several outlets were on top of the decision this week, and if you need background, or to help friends and family understand the issues, we include these articles posted before the decisions came down. 

NYC mayor Bill de Blasio pushes for net neutrality on eve of critical vote

By Jacob Kastrenakes, The Verge

"Major media companies shouldn't be gatekeeping our internet access — speeding up some content, blocking other — simply because they're able to pay for it," de Blasio writes. "The FCC must not allow mega firms to stifle innovation, competition, and public goods through exorbitant price points for the speeds that drive the 21st century economy."

Net neutrality: FCC to vote on tougher rules for Internet service providersSyracuse.com

No fast or slow lanes for Internet?Enid News

FCC net neutrality vote: Why there’s a flurry of eleventh-hour lobbying 

by Jeff Ward-Bailey, CS Monitor

The Federal Communications Commission is expected to vote on Thursday morning to reclassify broadband Internet providers as "common carriers." That would give the FCC the authority to enforce "net neutrality" principles by requiring those providers to treat Internet traffic equally.

FCC set to vote on municipal broadband rules, ‘net neutrality’ by Wesley Brown, Talk Business & Politics

What You Need To Know About Tomorrow’s Votes On Net Neutrality And Municipal Broadband by Kate Cox, Consumerist

How Proposed Net Neutrality Law Could Affect You by Christina Lavingia, Daily Finance

FCC net neutrality Vote Feb 26: Why you should care by Hannah Chenoweth, The Daily Athenaeum: West Virginia University

An open Internet is something that deserves strong advocacy from us all unless we would like to promote unfair practices and give away our freedom to corporations. Internet companies have been adversely affected by monopolistic ISPs for years; protection for these companies is far overdue. With net neutrality, our freedom to access websites and services stays intact.

 

Steve Wozniak declares FCC’s net neutrality ruling a ‘victory for the people’

by Alex Heath, Cult of Mac

“To me, more than anything else, this is a victory for the people, the consumers, the average Joes, against the suppliers who have all of the power and the wealth and make decisions for them and they feel hopeless and helpless,” Wozniak told Bloomberg. “And here 4 million of us signed petitions. It’s an indication that the people can sometimes win. We’ve had a lot of defeats over the years, but once in a while we get a win.”

Comcast-Time Warner:

Now it's Time Warner Cable's turn to insult a customer by Chris Isidore, CNN Money

"We are truly sorry for the disgraceful treatment of Ms. Martinez, and we apologized to her directly. Our investigation showed that this was done by an employee at a third-party vendor. We have terminated our agreement with this vendor and are changing our processes to prevent this from happening again," said spokeswoman Susan Leepson."

Comcast, Time Warner Cable hit with $20 billion racial bias lawsuit Fortune

Comcast Still Sees Time Warner Cable Deal Closing as Planned by Scott Moritz and Kelly Gilblom, Bloomberg

Net Fix: 8 burning questions about Net neutrality by Marguerite Reardon, Cnet

With the FCC set to vote this week on new rules governing the Internet, CNET breaks down everything you need to know about complicated, but critical, issue.

Cable Companies Lose Big at FCC, Barriers to Community Broadband Struck Down

For Immediate Release: February 26, 2015

Contact: Christina DiPasquale, 202.716.1953, Christina@fitzgibbonmedia.com

BREAKING: Cable Companies Lose Big at FCC, Barriers to Community Broadband Struck Down

Two southern cities today persuaded the Federal Communications Commission to recognize their right to build their own publicly owned Internet networks where existing providers had refused to invest in modern connections. The 3-2 FCC vote removes barriers for municipal networks in Chattanooga, Tennessee and Wilson, North Carolina, to extend their high-quality Internet service to nearby areas.  

Said Christopher Mitchell, Director of Community Broadband Networks at the Institute for Local Self-Reliance:

“Cable companies lost their bet that millions spent on lobbying to stifle competition was a wiser investment than extending high-quality Internet to our nation’s entrepreneurs, students and rural families. 

“Preventing big Internet Service Providers from unfairly discriminating against content online is a victory, but allowing communities to be the owners and stewards of their own broadband networks is a watershed moment that will serve as a check against the worst abuses of the cable monopoly for decades to come.”

The FCC decision sets an historic precedent for towns working to offer municipal broadband networks in twenty states that have enacted limits or bans on local governments building, owning, or even partnering to give local businesses and residents a choice in high speed Internet access. Three-quarters of Americans currently have either no broadband or no choice of their Internet provider. 

Christopher Mitchell, the Director of Community Broadband Networks at the Institute for Local Self-Reliance, has traveled to over 20 states and spoken with over 100 community groups looking to provide high-quality Internet for their residents. He has also advised members of the FCC on related telecommunications issues in the lead-up to the decision.

For interviews around the FCC decision, please contact Christina DiPasquale at 202.716.1953 or at christina@fitzgibbonmedia.com. To view a map tracking local government investments in wired telecommunications networks and state laws that discourage such approaches, please visit: http://www.muninetworks.org/communitymap.

Municipal broadband networks (munis):

  • Create thousands of new private sector jobsA collaborative muni effort in Georgia between five towns, is credited with bringing over 6,000 new jobs to the region by building and sustaining their network. The muni in Springfield, MO convinced online travel company Expedia to move to the town and has 900 local jobs because their network allowed the company to stay and expand.
  • Protect consumers by offering competitive pricing. During the period of 2007-08, Time Warner Cable increased rates up to 40 percent in some of the areas in Raleigh, NC, while not increasing rates in nearby Wilson—which has a strong muni. Chattanooga’s muni grew from a basic connection of 15 Mbps, when it was first founded, to 100 Mbps today–without raising prices once. The slowest connection available in Chattanooga from the utility is 10 times faster than the average American connection.
  • Provide higher speed Internet that allows for increased business activity. The largest employers in Wilson, NC rely on the municipal broadband network for their transactions. The muni in Springfield, MO, attracted John Deere Remanufactured and the McLane Company to the area. 
  • Do not rely on taxpayer financing, like large private telephone companies. Most municipal networks are financed through methods that do not involve raising taxes: revenue bonds, interdepartmental loans and savings created by ending expensive leased services. Dakota County in MN has saved $10 million over 10-15 years by building their own network and ending leases. Over $2 million in revenues from the Thomasville, GA network contributed to the town’s ability to eliminate its local fire tax.
  • Receive broad support from voters, regardless of party affiliation. Roughly 3 out of 4 cities with citywide munis reliably vote Republican and polling shows that 2 out of 3 Republicans, Independents, and Democrats prefer that decisions about how to best expand their Internet access be made by local governments.
  • Foster the strength of local businesses. Politically conservative communities in Chanute, KS, and Lafayette, LA, have munis that are working on the deployment of fiber networks to encourage economic development by allowing businesses to market themselves and compete online in the global marketplace. Lafayette has added over 1,000 tech jobs in 2014 alone.
  • Expand educational opportunities. The muni in Longmont, CO, is now providing 10 times the bandwidth that their school district previously received from a private provider at an annual savings of $100,000. Munis in Carroll County, MD, and Chanute, KS, have both allowed schools they service to offer new distance learning classes in multiple locations via video streaming. The city of Rockport, ME, partnered with a nonprofit college to bring students upload speeds 200 times faster than Time Warner Cable’s package for the area.

Republican Tennessee Leader Endorses Local Authority

Republican State Senator Janice Bowling from Tennessee is once again speaking out in favor of local telecommunications authority. On Monday, she published an op-ed in the Tennessean titled "Don't limit high-speed broadband to big cities," noting that rural communities often have no choice but to build their own infrastructure to obtain fast, reliable, affordable Internet access for residents and businesses.

Bowling refers to Tullahoma, her own home town, where economic growth is strong and Internet access is affordable. Tullahoma has a history of increasing speeds without increasing rates and now offers gigabit service for around $100. Unfortunately, Tullahoma is surrounded by communities it cannot help due to the state limitations.

Tennessee's restrictive laws prevent other communities from following in Tullahoma's footsteps. She sees the way these laws hold back people in her home state:

Unfortunately, public broadband networks are impeded by restrictive state laws that limit the power municipals have in providing services. In Tennessee, a 1999 law prohibits municipalities that operate broadband networks from providing service to anyone outside of the boundaries of their electrical footprint. This means that people in rural towns and small communities are still without high-speed Internet.

They’re without educational and employment opportunities, improved modern health care, enhanced public safety or better-quality government services, among other benefits.

As a senator representing seven rural counties and a resident of a small community myself, I am speaking out for all of those who are being held hostage to 20th-century technology. Let us grow our economies, improve our governments’ performance and create jobs for in our communities. Let us have Internet choice(s).

In November, Senator Bowling spoke at the Next Century Cities event "Envisioning a Gigabit Future." Below is her presentation on the need for high-speed connectivity and local authority in rural communities.

Photo available as a creative commons work from Senator Bowling's Campaign website.

Video: 
See video

Benton Foundation Article Dives Into Upcoming FCC Decision and Section 706

Kevin Taglang, recently published an excellent explanatory post for the Benton Foundation entitled What Section 706 Means for Net Neutrality, Municipal Networks, and Universal Broadband. He provides just the right amount of detail to get one up top speed on the upcoming decision and why it promises to be so influential. Additionally, he summarizes many federal programs relating to Internet access.

We already know that February 26th will be an historic day in telecommunications. On that day, the FCC's decision on new network neutrality rules and municipal broadband networks has the potential to literally change millions of lives. The decision will impact education, economic development, jobs, healthcare, communications, utilities - you name it. 

Taglang fittingly describes the series of findings from the FCC as a three act play. Read the text of the play, anticipate the conflict, see how the characters clash, and you will be the dramaturge. 

Act I: The FCC Considers U.S. Broadband and Finds It Lacking:

In addition to other factors, the FCC looked at the way we defined broadband (4 Mbps/1 Mbps), what capacity is needed to align with the way households use broadband (as in multiple devices simultaneously), and how ISPs market their services (25 Mbps as a minimum downstream acceptable). 

Accessibility rates showed divergent results based on urban and rural geography. The agency reassessed what is needed in schools for students and staff. The result was a decision to redefine broadband as 25 Mbps/3 Mbps and, once the agency determined that, the landscape changed dramatically. In January, the FCC adopted the Broadband Progress Report for 2015 [PDF], which asked what is advanced telecommunications capability now and are all Americans able to access that capacity?

From the arcticle:

Given these gaps in availability, the FCC concluded that advanced telecommunications capability is not being deployed to all Americans in a reasonable and timely fashion. And, in light of this finding, the FCC must “take immediate action to accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition in the telecommunications market.”

 

Act II: Major Federal Efforts to Expand the Reach of Broadband

Taglang documents the many programs, funds, orders, and initiatives at the federal level aimed at promoting broadband. The White House, the FCC, and the Departments of Agriculture and Commerce have been particularly active. Nevertheless, broadband in the USA is not moving fast enough.

 

Act III: Notice of Inquiry on Immediate Action to Accelerate Broadband Deployment

In addition to the progress Report, the FCC established a Notice of Inquiry to find ways to remove the barriers to infrastructure investment and promote competition. Taglang writes:

The FCC’s NOI asks for comment on additional actions it can take to increase competition, remove barriers to market entry or stimulate the offering of innovative services. For example, are there efforts in addition to those we have taken that would encourage providers to enter the market or expand their reach to unserved or underserved areas, including Tribal lands?

The FCC also seeks comment on how to address the disparity in broadband availability between Americans living in urban areas with those living in rural areas and Tribal lands. This gap, the FCC notes, is, by itself, the basis for a determination that broadband is not being deployed to all Americans in a reasonable and timely fashion.

Finally, the FCC asks if there are additional actions it could take to reduce the number of schools that lack high-capacity broadband.

With these three major acts in mind, the expected result will be a timely implementation of ubiquitous broadband in the U.S., writes Taglang. He is sensible, however:

There are no silver bullets or single efforts that can get us there on their own. It will take pragmatic policy choices and sustained policy attention in a variety of areas -- from new policies around lowering barriers to pole attachments, deployment of fiber, improved access to programming, access to spectrum, a vigorous competition policy agenda, and policies that continue to enable innovation in the content and services that broadband can deliver and that can transform the way we work, the way we live, and the way we learn. Ultimately, that is the challenge that is before us. And the reason that Congress gave us Section 706 in the first place.

Opelika Speaks From Experience: Support Local Authority!

Opelika has offered FTTH to residents and businesses for less than six months but already it is singing the praises of local choice. Mayor Gary Fuller is now speaking out in an opinion piece in AL.com, encouraging the FCC to allow Wilson, Chattanooga, and other communities to have the same opportunity as Opelika.

Mayor Fuller points out that local telecommunications authority is an organic outgrowth of local self-reliance:

Cities have always been at the heart of economic expansion, entrepreneurialism, and local connection to citizens, charged with ensuring high-quality education for our children, caring for our sick and elderly neighbors, and laying the foundation for shared prosperity. As we look to the years ahead, high-speed broadband will only become more and more important to the quality and vitality of our community. 

That's why in Opelika, I led the charge to become the first city in Alabama to offer this cutting edge technology, both to residential and business customers. As a result, Opelika citizens now have access to fast, reliable broadband speeds that will turn possibilities into real opportunities. Businesses now have more opportunities to expand and grow, work more effectively and efficiently, and compete in a larger market. 

As one of over 450 communities that have invested in the infrastructure for better connectivity, Opelika can speak from experience. Mayor Fuller encourages all FCC Commissioners to support the notion of local choice:

The important fact is that every city must have the power to make the best decisions for their residents, free of interference. That's why the Federal Communications Commission should join Chairman Wheeler in preserving these two communities' right to self-determination. 

In Opelika, our citizens are building a stronger more prosperous city based on local Internet choice. If more cities have those same opportunities, someday soon it may not be so strange for a 30,000-person city to offer blazing fast Internet.

Check out Opelika's recent marketing videos and listen to Chris interview Mayor Fuller back in Episode #40 of the Community Broadband Bits podcast.