Incumbent providers, grown lazy on a steady diet of public subsidies and monopoly rents, have done their best to cast this as a debate between efficient private competitors and inefficient government monopolies. But it is the incumbents that would rather regulate than compete. They resist municipal entry not because it is incompetent – no one resists incompetent competitors – or because it is unnecessary. Rather incumbents resist municipal entry because they recognize the ability of local government to offer a genuine competitive alternative to a high priced monopoly or duopoly services.
Christopher Mitchell Tells FCC To Regulate in the Public Interest
On August 19, 2010, I was one of hundreds of people telling the Federal Communications Commission to do its job and regulate in the public interest. My comments focused on the benefits of publicly owned broadband networks and the need for the FCC to ensure states cannot preempt local governments from building networks.
I’ll start with the obvious.
Private companies are self-interested. They act on behalf of their shareholders and they have a responsibility to put profits ahead of the public interest.
A recent post from the Economist magazine’s technology blog picks up from there:
WHY, exactly, does America have regulators? … Regulators, in theory, are more expert than politicians, and less passionate. …They are imperfect; but that we have any regulators at all is a testament … to the idea that companies left to their own devices don't always act in the best interests of the market.
They go on to say
If companies always agreed with regulators' rules, there would be no need for regulators. The very point of a regulator is to do things that companies don't like, out of concern for the welfare of the market or the consumer.
When we talk about broadband, there is a definite gap between what is best for communities and what is best for private companies. Next generation networks are expensive investments that take many years to break even.
With that preface, I challenge the FCC to start regulating in the public interest.
The FCC does not need a consensus from big companies on network neutrality. It needs to respect the consensus of Americans that do not want our access to the Internet to look like our access to cable television.
But while Network Neutrality is necessary, it is not sufficient. The entire issue of Network Neutrality arises out of the failed de-regulation approach of the past decade. Such policies have allowed a few private companies to dominate broadband access, giving communities neither a true choice in providers nor any ability to influence the networks on which they depend.
The FCC must ensure all communities have the authority to build the networks they need.
Outside of DC, community networks are not a partisan issue. Last week, Opelika, Alabama, voted by a 62% margin to build one. The City Council President noted: “As a council we have never been more unified on a single matter than we have been on this.”
One of the most conservative cities in America - Lafayette Louisiana now operates the best broadband network in the US as measured by value. For less than $30/month, anyone can get a 10Mbps symmetrical connection - I have to pay more than 3 times as much in Saint Paul for a similar upload speed.
Lafayette is not alone. The single fastest widely available broadband tier in this country is offered by Chattanooga- at 150Mbps symmetrical, few even come close to it.
Long before Verizon's FiOS network, Bristol, Virginia built a fiber-to-the-home network for its rural community, which attracted new investment and hundreds of high-paying jobs.
Here in MN, Monticello is unique, being the only community in the country with two citywide fiber-to-the-home networks competing head to head. The incumbent phone company previously maintained DSL was sufficient for their needs.
But when Monticello moved ahead with their superior network, the incumbent used a lawsuit to delay the community network while it invested in faster services. Monticello won the lawsuit, but lost a year. Nonetheless, Monticello now has the best broadband deals in the Midwest.
In Utah, the UTOPIA network offers more than 10 service providers to every subscriber. This is a real choice between service providers offering some of the fastest speeds in the country at affordable prices. Yet they have struggled financially -- in part due to constant attacks from massive incumbent companies and crippling laws passed by a state Legislature seemingly controlled by cable and telco lobbyists.
Eighteen states have barriers to discourage community networks, including Minnesota. Cook County, our most rural county, has long depended on a sole fiber line from Qwest for all connectivity. They begged for a redundant connection over many years to no avail.
This past January, a single accident left them without telecom services for 12 hours. No business could process credit cards. 9-11 did not work. US border security had to use Canadian communications. ATMs ceased to function. Police officers could not run plates.
The previous November, a majority of their citizens had actually approved building a community fiber network to create middle mile redundancy and last mile services. They even agreed to a small tax on themselves to help fund it. But MN law requires a super-majority of 65% for a community to build this kind of network. This is 5% more than the impossible 60% threshold in the US Senate.
Such a restrictive law is great for incumbent companies who are protected from competition. Offering a single fiber line to Cook is a profitable decision for Qwest's shareholders. It is a disastrous decision for the community.
This is why the FCC must stand up for all of us. States must not be allowed to cripple communities, forcing them to watch history pass them by.
We demand both Network Neutrality and the right to build our own networks when we choose. The FCC has authority on these issues and must start to use it.
You can view the entire event here.