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Op-ed: Next-Generation Networks Needed

The Knoxville News Sentinel published this op-ed about Tennessee's restrictive broadband law on January 9, 2016.

Christopher Mitchell: Next-Generation Networks Needed

Four words in Tennessee law are denying an important element of Tennessee's proud heritage and restricting choices for Internet access across the state.

When private firms would not electrify Tennessee, public power came to the rescue. In the same spirit, some local governments have built their own next-generation Internet access networks because companies like AT&T refused to invest in modern technology. These municipal networks have created competition, dramatic consumer savings and a better business climate in each of their communities.

The four words at issue prevent municipal electric utilities from expanding their successful fiber optic Internet networks to their neighbors, a rejection of the public investment that built the modern economy Tennessee relies upon.

Current law allows a municipal utility to offer telephone service anywhere in the state, but Internet access is available only "within its service area." This limit on local authority protects big firms like AT&T and Comcast from needed competition, and they have long lobbied to protect their de facto monopolies. To thrive, Tennessee should encourage both public and private investment in needed infrastructure.

These municipal systems have already shown they can bring the highest-quality Internet services to their communities. Chattanooga's utility agency, EPB, built one of the best Internet networks in the nation. Municipal fiber networks in Tullahoma, Morristown and more have delivered benefits far in excess of their costs while giving residents and local businesses a real choice in providers.

Many of these networks are willing to connect their neighbors — people and businesses living just outside the electric utility boundary. If Chattanooga wants to expand its incredible EPB Fiber into Bradley County with the consent of all parties, why should the state get in the way?

Consider that Tennessee metro areas almost always have at least one high-speed Internet option. Those with municipal networks have a real choice in providers. Nashville is slated for Google Fiber. But there is no such hope on the horizon in rural areas, despite the billions of dollars that have been spent on subsidies to providers like AT&T.

While AT&T's lobbyists scheme to prevent competition, the federal government subsidizes AT&T operations with more than $500,000 per month in Tennessee alone. So much for the "private" sector.

When it comes to municipal networks, taxpayer dollars are rarely used. Private investors often finance municipal networks by purchasing long-term bonds and are repaid by the revenues from the network. The Tennessee Valley Authority strictly oversees municipal utilities to ensure they are not cross-subsidizing telecom services with electrical ratepayer revenues.

To the extent municipal networks affect taxpayers, the taxpayers benefit. EPB just announced that in 2015 alone, its payments in lieu of taxes exceeded $19 million to the 17 jurisdictions in which it operates.

When local businesses connect to municipal fiber, more of their money stays in the community. Compare that to how much communities without a real choice send to AT&T and Comcast headquarters in distant states. And thanks to the competition, residents and businesses pay less. Morristown estimates a $3.4 million annual aggregate savings from lower bills.

The state should encourage communities to be more self-reliant and to build resilient regions rather than taking the side of distantly-owned monopolies. The state should be focused on how to encourage investment in next-generation Internet networks, not limit it.

 

Christopher Mitchell is the director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance. He is on Twitter: @CommunityNets.

Thoughts on 2015, Predictions for 2016 - Community Broadband Bits Episode 183

Given all the exciting events of 2015 and our hopes for 2016, we decided to do another year end / year beginning show that looks both backward and forward. Unfortunately, our timing did not allow for Lisa to join us in the recording, but Christopher Mitchell is joined by communications staff at the Institute for Local Self-Reliance -- Rebecca Toews and Nick Stumo-Langer.

We talk about what strikes us about the past year and what we expect to be happening in the near future. When I write "we" I mean that Christopher dominates the discussion.

We will be back with our usual interviews starting next week.

The transcript from this episode is available here.

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

This show is 27 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

You can can download this Mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music, licensed using Creative Commons. The song is "Warm Duck Shuffle."

Ringing in the New Year, Celebrating a Win for Prison Phone Justice

At MuniNetworks, we often focus on access to the Internet, but the impact of telecommunication policy extends beyond data. In 2016, families might finally see reasonable prices for phone calls to incarcerated loved ones.

Last October, the FCC voted to close loopholes and cap rates for Inmate Calling Service providers in jails and prisons across the nation. While incarcerated, folks couldn’t choose their long-distance service provider, and the prices these Inmate Calling Service providers demanded could reach up to $14 a minute. Although the FCC had some regulations in place, they did little to prevent add-on fees and service charges. 

These charges proved absurdly expensive for low-income people, disproportionately impacting people of color. As if that wasn’t bad enough, people with disabilities found that the Telecommunications Relay Service (which enables people with hearing or speech disabilities to use the phone) was sometimes considered an add-on. The FCC's decision puts a stop to any extra charge for this necessary service. 

We’ve covered the monopoly power that these providers have over incarcerated folks for some time. In Community Broadband Bits Episode 20, Chris spoke about prison phone justice in more detail with Amalia Deloney of the Media Action Grassroots Network and the Center for Media Justice. Deloney explained the many ways Inmate Calling Service providers exploit incarcerated people and the families.

This holiday season, the FCC’s decision allowed all families impacted by incarceration to connect with each other in the new year. Without the efforts of Media Action Grassroots Network, the Center for Media Justice, and the many people who worked on the prison phone justice issue, the FCC may have never reviewed the problem. Change can happen where it is needed most.

Pioneer Press Op-Ed: Competition and Community Savings

The Pioneer Press published this op-ed about Minnesota high speed Internet access and availability on December 3, 2015. 

Christopher Mitchell: Competition and community savings

Minnesota has just one more month to achieve its goal of high speed Internet access available to every resident and local business. In 2010, the Legislature set a 2015 goal for universal Internet access at speeds just under the current federal broadband definition. But the state never really committed to anything more than a token effort and will fall far short.

Even for those of us living in metro areas that have comparatively high speed access, we don't have a real choice in providers and most of us lack access to next-generation gigabit speeds.

The big cable and telephone companies excel at restricting competition by manipulating markets, state and federal government policy, and other means. This is why so many local governments across the nation are themselves expanding Internet infrastructure: to ensure local businesses and residents can access affordable next-generation services and create a real choice. We should be encouraging these local approaches.

The Institute for Local Self-Reliance is tracking more than 450 communities where local governments are expanding choices with direct investments in networks. Just this month, some 50 communities in Colorado and two in Iowa voted to move forward with plans for their own networks or partnerships.

Here in Minnesota, we have seen a variety of successful approaches. Eagan's modest network attracted a data center.

Dakota County has saved itself millions of dollars by placing conduit for fiber in the ground at very low cost as part of other projects. Now it can use that to help local companies to compete with the big cable and telephone companies.

Scott County's fiber network has helped create more than 1,000 jobs and tremendously improved access in area schools. In Sibley County and part of Renville, cities and townships joined together to help launch a new cooperative, RS Fiber, which shows tremendous promise. Cooperatives, which are effectively community-owned as well, offer some of the best connectivity in rural regions of the state.

Some municipal networks have been accused as being failures. For years, cable and telephone companies claimed Windom in southeast Minnesota was a disaster. WindomNet is one of the most advanced networks in the state and has been expanded to serve nearby towns that had been ignored by the big telephone companies.

In our 2014 study All Hands on Deck, we identified more than $400,000 in regional savings from WindomNet every year. In addition, the network helped keep 47 jobs in the community from one employer alone that previously couldn't get the service it needed from the national telephone company serving it. This is a threat to cable and telephone monopolies, not local taxpayers.

With Windom's success, the cable and telephone companies now attack Monticello's municipal FiberNet for not having yet broken even financially. However, that is the not the only metric by which it should be judged.

Ten years ago, Internet access in Monticello was dismal, harming local businesses. They demanded the city take action and the city asked the telephone and cable company to improve their services -- but those companies insisted everything was fine. So Monticello voted by 74 percent to build its own network.

The telephone company sued, costing Monticello millions in lost time despite its prevailing easily in court.

During the case, the telephone company improved its services, and, after Monticello built its own network, the cable company dropped its rates dramatically. The same package that residents in Rochester and Duluth pay $145 per month for was offered for $60 per month guaranteed for two years. Prices in Monticello from all providers are a fraction of what we pay in the metro.

We estimated the aggregate savings in the community at $10 million over the past five years in All Hands on Deck.

Rather than allowing communities to decide locally on the best strategies to improve Internet access, Minnesota discourages them by requiring a supermajority vote before a community can offer telephone service. This requirement particularly harms Greater Minnesota, where mobile phones are far less reliable and telephone service plays a more important public safety role.

We need an "All Hands on Deck" approach to improving Internet access. The state should be lessening barriers to investment, not maintaining them at the behest of large cable and telephone companies. Local government strategies will play an important role in ensuring our communities can thrive in the digital age.

Christopher Mitchell, St. Paul, is director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance. He is on Twitter @communitynets

Op-ed: Spanish Fork Proves Utah Law is Counter-Productive

The Salt Lake Tribune published this op-ed championing local investment in Internet infrastructure on December 11, 2015.

 

Op-ed: Spanish Fork’s success shows municipal Internet networks work

By Christopher Mitchell

For nearly 10 years, large telephone and cable companies have claimed municipal Internet networks are so risky that local government authority should be restricted. But after 15 years of experience, we can only conclude that the cure is worse than the disease.

Utah has three municipal networks, where local governments invested in Internet infrastructure to provide choices in a monopolistic environment. But only two of those networks are regularly discussed and used as examples of why local governments shouldn't be in this business: iProvo and UTOPIA, which were not able to meet their financial targets.

The network missing from the conversation is Spanish Fork Community Network, which has just finished paying off its debt and has generated millions of dollars in surplus revenue for the community. The network is now upgrading from community cable to community gigabit fiber optics.

Of the over 450 municipal networks tracked by the Institute for Local Self-Reliance, Spanish Fork's experience is above average. The vast majority of municipal networks deliver benefits well in excess of costs and do not require subsidies to operate.

It may come as a surprise, but iProvo and Spanish Fork are nearly twins, separated at birth and raised in dramatically different environments. Both were conceived at the same time — the same consultant did the feasibility study for each. But Spanish Fork, being smaller and more nimble, was able to move forward before Utah's Legislature weighed in to restrict local decision-making.

Comcast and the predecessor to CenturyLink crafted the legislation, which was revealed in a brilliant 2011 BusinessWeek article aptly entitled "Pssst … Wanna Buy a Law?" by Brendan Greeley and Alison Fitzgerald.

Since then, any new Utah municipal network has been subject to numerous requirements unlike anything private providers face, including a de facto requirement to use a wholesale-only arrangement.

Provo wanted to use the same business model as Spanish Fork, which we now know was tremendously successful. Whereas Spanish Fork could directly offer services to local businesses and residents, Provo was required to wholesale to other companies that delivered services.

Google has since taken over Provo's network and may soon be building in Salt Lake City, ensuring some competition for Comcast and CenturyLink in the short term at least. Whether they remain for the long term or not is their decision to make, independent of what is best for the community. Where the network is available, the services and prices will be determined from California, not Utah.

This powerlessness to ensure universal high quality access to the most important utility of the 21st century is a legacy of Utah law, which discourages locally-rooted networks. Utah should embrace the leadership from FCC Chairman Tom Wheeler, who has pushed a pro-competition agenda to bring a real choice in high speed Internet access to local businesses and residents.

Ensuring universal high-speed Internet access requires all hands on deck, not only the private companies. We are seeing new local approaches out of smart communities like Ammon, Idaho, where an incremental approach to the wholesale-only model is very promising.

But that model shouldn't be imposed on communities by the state. Especially when those state laws are written by the very industry voices that seek to limit competition. The record is clear — laws revoking local authority to create Internet choice have increased the risk to taxpayers, limited investment in better networks and have only benefited cable and telephone companies monopolies headquartered outside the state.

Christopher Mitchell is the director of Community Broadband Networks at the Institute for Local Self-Reliance in Minneapolis (MuniNetworks.org).

Lake Oswego Seeks Out Expert Advice: Video

Lake Oswego, Oregon, was pegged as a potential target for Google Fiber in 2014 but this town of 35,000 may not wait for the tech giant to bring fast, affordable, reliable connectivity. They may just do it themselves.

In order to get more information about municipal fiber networks, our Chris Mitchell visited during an October City Council meeting at the request of community leaders. The Lake Oswego Review covered the meeting.

According to the Review, the northwest community issued an RFP in June and received two responses. City leaders are still pondering the responses and feelings are mixed over whether or not to make the investment.

City Manager Scott Lazenby told the Council:

Just getting this network would put Lake Oswego on the map…I think increasing that level of service, especially for the demographics we have here — highly educated, many tech-oriented folks in our community — that would be a real service to make available.

Chris pointed out that the area is ripe with a number of high-tech companies and other entities that will find a fiber network attractive. “Not everyone has that regional connectivity that you have here,” he told the Council.

He also asked them to consider all the long term possibilities if Google does eventually enter into the market in Lake Oswego:

“When I think about relying on Google, if Google decides to get out of this business, the community has no say about who takes it over,” he said.

After discussion, the Council voted to negotiate an agreement with one of the RFP respondents for further review, contingent on a market study.

To view Chris's entire presentation to the Lake Oswego City Council, watch the video below: 

Happy Birthday, Next Century Cities!

One year ago, we helped launch Next Century Cities, a collaboration between local governments that want to ensure fast, reliable, affordable Internet access for all. Our own Chris Mitchell, as Policy Director, has helped shape the organization with Executive Director Deb Socia and Deputy Director Todd O'Boyle.

Over the past 12 months:

  • Membership has grown from 32 communities to 121
  • Population represented by Next Century Cities has climbed from 6.5 million to 23.9 million
  • Member states have increased from 19 to 33

The organization has been recognized by the White House, testified before Congress, and has been instrumental in launching a number of awards. The organization has developed resources and organized events to assemble members who want to share innovative ideas. Learn more about their accomplishments at the blog.

We look forward to another year of working with Next Century Cities toward the goal of fast, affordable, reliable Internet access for all.

birthday-candles.jpg
Image courtesy of tiverylucky at FreeDigitalPhotos.net

Audio Available: Financing Fiber for the New Economy Conference in Lexington

At a September conference in Lexington, Kentucky, Next Century Cities (NCC) hosted an influential and diverse group of leaders from the municipal broadband arena to share their experiences as leaders in community broadband. Four audio recordings, which you can find on NCC’s website, include panel discussions on a variety of issues surrounding the topic of financing for next generation broadband.

Recording #1: “Lexington Mayor Jim Gray and the Kentucky Wired Story”

In the first recording, Lexington Mayor Gray and the city’s Chief Information Officer discuss their ongoing efforts to make Lexington a gigabit city. These efforts are part of a broader initiative also discussed on building a statewide 3,000 mile fiber optic ring. Several Kentucky government leaders make remarks about the project, called Kentucky Wired, including their thoughts about the public-private partnership model that is helping make the project possible.

Recording #2: “Achieving the Last Mile

Our own Christopher Mitchell, the Director of the Community Broadband Networks Initiative at ILSR and the Policy Director for Next Century Cities, moderates this panel that includes officials who have led municipal broadband initiatives in their communities. These officials share some of the challenges they have faced and solutions they discovered in their efforts to finance last mile infrastructure.

Recording #3: “Exploring Options and Approaches for Broadband Financing”

Scott Shapiro, the Senior Advisor to the Mayor of Lexington Kentucky, moderates the panel discussion that includes a group of people with varied knowledge and perspectives on the community broadband issue.  They discuss models and approaches communities can use to finance their broadband networks, with a particular focus on the public-private partnership model.

Recording #4: “Federal Support for Broadband Projects” 

Hilda Legg, former Rural Utilities Service Administrator and current Vice Chair of Broadband Communities, leads a panel of several experts examining funding supports and offering recommendations and next steps for communities.

If you could not make the conference or if you need a refresher on information you found compelling, this is your opportunity to revisit the discussion.

Video: Next Century Cities' Digital New England Conference

On September 28th, Christopher participated in the Digital New England regional broadband summit in Portland, Maine sponsored by Next Century Cities and the NTIA (National Telecommunications and Information Administration). In the morning, he moderated a panel focusing on regional approaches to improve Internet access, and in the afternoon he moderated a panel that included incumbent providers on their preferences for partnerships.

If you were unable to attend the event or did not see the live stream, Next Century Cities has released a video playlist of the two day long event. Christopher can be found moderating the morning panel in the main room during part three. The full agenda is available online.

Op-Ed: Community Broadband Networks Drive NC Economy

The Roanoke Daily Herald published this op-ed about local government action for broadband networks on September 25, 2015. We were responding to an earlier Op-Ed, available here. Christopher Mitchell wrote the following op-ed.

Local governments should make broadband choices

Community broadband must be a local choice, a guest columnist writes.

It is stunning any legislator can look at the constituents they serve in rural North Carolina and think, “‘These people don’t need the same high quality Internet access now being delivered in Charlotte and the Triangle. They should be happy with whatever cable and telephone companies offer.”

But that’s just what I think Representatives Jason Saine and Michael Wray are implying in their recent opinion piece on community broadband networks.

By supporting U.S. Sen. Thom Tillis’ legislation to remove local authority for building broadband networks, the two lawmakers are siding with big cable and telephone firms over their own communities.

It is hardly a secret that Time Warner Cable, AT&T, CenturyLink and others are investing too little in rural communities. The majority of residents and local businesses in North Carolina have no real choice today and can expect their bills to go up tomorrow.

Areas served by coops or locally-rooted companies are more likely to see upgrades because they are accountable to the community in ways that national firms are not. Local firms are more willing to invest in better networks and keep prices low because they live in the community.

North Carolina communities stuck with no broadband or slow DSL and cable at best are disadvantaged in economic development and property values. This is why hundreds of local governments have already invested in fiber optic networks — with remarkable success.

Wilson is one example, where the city built the first gigabit fiber optic network in the state. The network has paid all its bills on time and the largest employers in the area all subscribe to it. One local business, which was a vocal opponent of the idea at first, now credits the municipal fiber network with helping her business to expand and reach new clients. The General Manager of Central Computer, Tina Mooring, argues that restrictions on municipal networks hurt the private sector, noting that her clients in areas near Wilson strongly desire access to the high capacity services they cannot get from cable and DSL networks.

Just across the Virginia state line is another approach, where Danville has built a fiber network that is available to private ISPs to offer services. The network has led to new investment and high tech jobs as well as helping existing businesses to expand. Not only have they paid all their bills on time, they make enough net income to contribute $300,000 per year to the general fund.

The fastest citywide network in the nation, offering 10 Gbps was just announced in Salisbury, north of Charlotte. Again, city owned.

This strategy is rarely a partisan issue at the local level. Some 75 percent of the communities that have a citywide municipal network voted for Mitt Romney in 2012. From Maine to Louisiana to California, municipal broadband is a pragmatic question of whether it will improve quality of life and spur economic development.

U.S. Senator Thom Tillis’ legislation to challenge the FCC is not a win for local autonomy. It is an example of distant officials micro-managing local issues.

It is unfathomable the state Attorney General, whose job it is to protect residents and local businesses, has sided with Time Warner Cable and AT&T rather than champion the cause of fast and affordable Internet access for North Carolinians. The state is literally using taxpayer dollars to protect the monopolies of big telecom firms that prevent communities from having a real choice in providers. This is yet another decision that should be made locally, not in Raleigh or D.C.

Christopher Mitchell is the director of Community Broadband Networks at the Institute for Local Self-Reliance in Minneapolis and is @communitynets on Twitter. He writes regularly on MuniNetworks.org.