Indeed, many municipal broadband projects are undertaken because the Wall Street metric does not work. The town may be too remote, the population may be too sparse, or the demographic nature may not be consistent with the template used by private sector companies in their profit-maximizing decisions on where and whether to deploy. Those are precisely the circumstances, however, in which the community benefits of providing broadband become most profound, and most valuable.
Georgia Bill Aims to Limit Investment In Internet Networks
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The Georgia General Assembly is considering another bill to limit investment in telecommunications networks in the state, an odd proposition when just about everyone agrees states need as much investment in these networks as possible.
House Bill 282, the "Municipal Broadband Investment Act," purports to limit the ability of public entities to invest only in "unserved" areas. But as usual, the devil is in the details. This bill will be discussed on Wednesday, Feb 13 at 4:00 EST in the Telecom Subcommittee of the House Energy, Utilities & Telecommunications committee (Committee roster here).
We strongly encourage Georgians to write to members of this committee and explain that these decisions should be made at the local level, not by the state. Communities each face unique circumstances regarding the need for telecommunications investment and they can be trusted to make informed decisions after weighing the available evidence.
Many local governments have invested in modest networks to connect local businesses, but such investments will be prohibited in Georgia if residents in the area are already served with a connection of at least 1.5 Mbps in one direction. This baseline is far lower standard than the FCC's definition of "basic" broadband: 4 Mbps down and 1 Mbps up. Setting a low baseline hurts communities but rewards carriers that have refused to invest in modern networks.
This bill poses a dramatic threat to the ability of local governments to encourage economic development and provide the environment necessary for the private sector to create the jobs every community needs. See our fact sheet on how public broadband investments have created jobs.
Supporters of this bill will claim that it only restricts investment to areas that are most needing it. This argument is not only flat wrong, it comes mostly from those most interested in preventing, not encouraging, investment.
The bill will effectively prohibit any community investment because the cost of collecting the data and making the case that areas are unserved is prohibitive, particularly when the bar for what constitutes being unserved is set unrealistically low. The cost of collecting data at the census block level is high and communities are extremely unlikely to spend the necessary sums when there is no guarantee they will be able to take action on it.
Additionally, requiring a network to operate only in unserved areas is akin to requiring a health insurance plan to only accept terminally ill patients. A network requires a mix of densities and households in order to be sustainable. Should any community build a network under these circumstances, however unlikely, such a network would almost certainly require ongoing subsidization, which would then be used as evidence for why such a network should never have been built. Heads they win, tails we lose.
This bill is much sneakier than last year's broadside attack on community networks. Rather than aggressively challenging community broadband, this approach appears to be more reasonable, even as it creates the same result: greatly limiting the authority of communities to decide for themselves whether an investment is appropriate for encouraging economic development.
We understand that Windstream is the main lobbyist pushing this bill forward in an attempt to protect the networks they have refused to upgrade to modern standards. Windstream is just one of several large telecommunications companies that does not have the capacity to invest in the next-generation networks demanded in the 21st century economy. For instance, see this recent story from Missouri about Windstream:
“People feel they are paying for a service they are not getting,” Rep. Fitzwater told Windstream. “I get emails every day, letters, telephone calls. McAllister Software is a major employer, employing around 140 people. They are vital to the local economy, and they need internet service. There were about 45 hours last year that they had to shut their doors because they had no internet. There are other businesses in town that are affected by internet speeds. The other day there was a water main break and school was closed; some of the businesses had to shut down because of reduced internet speeds because the kids were online playing games.”
Even as Windstream cannot provide the necessary speeds, they are pushing a bill to make it harder for others to step in and provide the necessary services. This is why the bill uses a 1.5 Mbps standard, DSL often provides that below-basic level of service but does not support common applications or business needs.
In short, this is a bill that will only hurt the residents and businesses of Georgia, taking away one of the only methods a community can ensure it is ready for the digital economy.