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USA Today Covers Lafayette Community Fiber Success

The USA Today occasionally covered the Lafayette muni fiber network fight as Cox and Bellsouth used every dirty trick conceivable against the community to shut it down. Reporter Rick Jervis looks back in now that the network is available to everyone in town.

The battle over broadband in Lafayette is part of a growing number of clashes across the USA that pit municipalities against telecom firms for the right to deliver Web access to homes and businesses. More than 150 local governments across the country have built or are planning to build cyber networks, says Christopher Mitchell of the Washington-based Institute for Local Self-Reliance, a non-profit group that advocates community development and local access to technology. Mitchell says those efforts often draw opposition in the form of misinformation campaigns, lawsuits from private providers or unfavorable state laws resulting from telecom lobbying. Nineteen states either ban cities and counties from getting into the broadband business — or make it difficult.

Minor quibble: the Institute for Local Self-Reliance (and particularly my work) is not Washington-based.

Like the toy in Crackerjack boxes, we cannot have a story about community networks without at least one blatant lie from some cable company employee. No disappointments here:

"Our initial objection was, and remains, that it is an unfair advantage for your competitor to also be your regulator," says Todd Smith, a Cox spokesman. "Many states prohibit government from competing with the private sector."

I challenge Todd Smith to name one way in which LUS Fiber regulates Cox. When the local government makes rules that impact either Cox or LUS Fiber, such rules have to be non-disciminatory or they violate state and federal laws. If incumbents think the community is violating any laws, we know that they know how to hire lawyers and file lawsuits. They've done it often enough.

The story details some of the benefits to the community since LUS Fiber opened shop -- including businesses moving to Lafayette to create new jobs:

LUS Logo

Scott Eric Olivier moved his tech startup firm, Skyscraper Holding, from Los Angeles to Lafayette when he heard of the speeds and service offered by LUS Fiber. The same connectivity of 100 megabytes per second, which allows him to move large files across the Web for clients, would cost him several thousand dollars a month on the West Coast, he says. In Lafayette, he pays $200 a month. Another plus: He's getting what he paid for — exactly 100 megabytes per second — while his previous provider rarely delivered the promised speeds, Olivier says.

...

For Stephen Abshire, founding partner of the Gastroenterology Clinic of Acadiana, the city's fiber upgrade allowed him and his partners to finally make the switch to a fully electronic clinic. Health records, billing, pathology reports and endoscopy readouts are all reviewed digitally, he says.

The story profiles a local businessman who opposes the network and fought against it but still subscribes to it out of recognition that is "much quicker" than commercial alternatives.

LUS Fiber has historically kept its subscriber count close to its chest to avoid giving Cox any competitive information it is not required to divulge due to the more rigorous disclosure requirements on public entities than private providers. The story nonetheless reports that almost 1/3 of the city is subscribing already. Those who have stuck with Cox are paying less than nearby Cox customers as Cox has responded to competition with a host of special deals to prevent subscribers from switching to the far superior fiber-optic network.

Smart Conduit Considerations for Forward-Looking Communities

Local governments are often looking for low-risk options for expanding broadband access to residents and local businesses. There are not many. Seattle put some extra conduit in the ground as a part of a different project that was tearing up the streets but Comcast was the only provider interested.

The problem with a haphazard program of putting conduit in the ground is that while it benefits existing providers, it does very little to help new entrants. And conduit is inherently limited -- only a few providers can benefit from it and when used up, there is no space for more providers.

In short, more conduit may slightly improve the status quo but it does little to get us to a future where residents and local businesses have a variety of choices from service providers offering fast, reliable, and affordable access to the Internet.

Smart conduit policy can lay the groundwork for lowering the cost of a community network, which can get us where we want to be. It may take time, but will create benefits far more rapidly than private providers will be building next-generation networks in most of our communities.

John Brown, a friend from Albuquerque, New Mexico, has offered some tips for communities that want to develop smart conduit policies. Brown runs CityLink Telecommunications, an impressive privately owned, open access, FTTH network that connects residents, businesses, schools, muni buildings, etc.

We tend not to support privately owned networks because for all the great work a companiy like CityLink Fiber does, one does not know who will own it in 5, 10, or 20 years. However, we recognize that CityLink Fiber is a far better partner for communities than the vast majority of companies in this space.

The following comments are taken from an email he shared with me and is permitting me to republish. Direct quotes are indented and the rest is paraphrased.

Not all conduit is created equal. A 2 inch pipe will be sufficient for perhaps 2 providers. If conduit does not have inter-duct, it is much harder for multiple providers to share it. Inter-duct creates channels within the conduit that allows a provider to pull its fiber cables through without disturbing other cables in the conduit. However, using interduct reduces the amount of usable space in the conduit.

Conduit approach used in Seattle

So let's say you size this as a 4" pipe, and place (4) 1" inter-ducts in. That limits you to 4 providers, or 4 cables. Those cables are limited in size because of the 1" inter-duct size. You are at best going to get maybe a 144, or a 216 count cable. That is NOT enough for today/future.

Who maintains the conduit?

Can a service provider come along and intercept the conduit mid-way? How are the other provider cables protected? Who is responsible for that? What happens if it breaks?

These are a few conduits local governments need to be prepared to answer, courtesy of John Brown. Below, I add a few more.

Who can use the conduit? If you have space for four providers and one bank wants to get in that conduit to lay one fiber for their use, is that permitted? Can a single provider dominate all four channels? Are you reserving sufficient capacity for future local government and/or community network use?

In an upcoming post, I'll highlight an existing policy used by a community-owned network to prevent any provider from monopolizing dark fibers.

We Told You So: Subscribers Abandon DSL

We have long been arguing that the telephone and cable companies are not sufficiently investing in the connections needed by communities.

Quarter after quarter, companies offering DSL see decreases in their lines as subscribers jump to cable or fiber-optic alternatives (where available, which is not many places). Recall that AT&T's CEO himself believes DSL to be obsolete.

As this trend continues, most communities will find that a single cable company has a monopoly on high speed broadband access and those willing to settle for slower, less reliable alternatives will have a choice between DSL and wireless options. Susan Crawford has written about this, terming it the Looming Cable Monopoly.

The main reason is that cable is cheaper to upgrade to higher capacity connections than the telephone lines. Unfortunately, due to the reality of natural monopoly, the big cable companies will almost certainly continue to dominate in their communities. It is just too hard and risky for other businesses to challenge their market power.

This is why smart communities are evaluating all their options and determining if a long term public investment in fiber-optic infrastructure would generate enough benefits to justify the high upfront cost.

Media Coverage Roundup: Georgia AT&T Bill to Kill Community Broadband

In the wake of a bill in Georgia to revoke local authority and substitute it with state say-so over whether a community can build a broadband network, multiple outlets have covered the situation.

As usual, Stop the Cap! was quick on the ball, offering original in-depth commentary. Phil digs into the campaign cash history to find the real motivations behind this bill:

Rogers’ legislation is exceptionally friendly to the state’s incumbent phone and cable companies, and they have returned the favor with a sudden interest in financing Rogers’ 2012 re-election bid. In the last quarter alone, Georgia’s largest cable and phone companies have sent some big thank-you checks to the senator’s campaign:

  • Cable Television Association of Georgia ($500)
  • Verizon ($500)
  • Charter Communications ($500)
  • Comcast ($1,000)
  • AT&T ($1,500)

A review of the senator’s earlier campaign contributions showed no interest among large telecommunications companies operating in Georgia. That all changed, however, when the senator announced he was getting into the community broadband over-regulation business.

Phil also refutes the supposed failures cited by those pushing the bill. Not only do such stories misrepresent what really happened, some actually cite EPB's incredible 1Gbps service as demonstrating that munis are out of touch. What else would you expect from the Heartland Institute, which made its name fighting against the radical claim that cigarettes are linked to cancer?

Government Technology's Brian Heaton also covered the story in "Georgia Community Broaband in Legislative Crosshairs."

In addition, Mitchell [me] said that SB 313’s requirement of the public entity paying the same taxes or the same cost of capital as the private sector is another red herring. He said that while the provision looks reasonable on the surface, it would critically hamstring any effort to establish government-owned high-speed broadband services.

“That’s like telling me I have to pay the same taxes that another American would,” Mitchell said. “Are we talking about my middle-class neighbor, or Mitt Romney? Whose taxes am I going to pay a similar rate to? These are all issues that are left open-ended intentionally so that it’s uncertain for a community and they are more likely to end up in court, which is possibly the most devastating situation.”

Fierce Telecom riffed on the GovTech story here.

Karl Bode at DSL Reports asks if "Georgia wants to be a broadband backwater."

As noted, ISPs particularly love bills that require endless public hearings and votes, where deep-pocketed carriers can can out spend supporters by millions of dollars on (often incredibly sleazy) PR campaigns aimed at shouting these services down. That same money could be used to upgrade last mile connectivity, but isn't thanks to the uncompetitive markets these companies are trying to keep uncompetitive. The result? Continued slow speeds, high prices and poor service, all protected by the very government ISPs claim they don't want involved in the market.

And finally, Slashdot got the point of the bill wrong (ignoring many of the provisions of the bill) but did start a conversation about Georgia "Prohibiting Subsidies for Municipal Broadband. One of the commenters lives just outside one of the towns that Majority Leader Rogers cited as a bad example. This commenter disagrees with that assesment. Strongly.

Until the city implemented a broadband plan with cable TV, we had ONE choice for cable TV and virtually NO high speed internet especially in the county (Bellsouth/AT&T DSL is a massive joke to anyone who lived in the county and so was high speed internet connections). Suddenly, when the city decided "We want to attract more business to the area and also supply all of our schools with high speed internet services..." then WHOA! the local cable company went into overdrive. They started expanding their high speed internet services much faster and pushed them out into the county. They offered better bundle rates AND dropped their cost for cable TV alone. The move by the city _incentivized_ the local cable MONOPOLY to get off their ass and start offering the services to both city and county that they had been promising for a while and to bring their price down to a more competitive level.

And finally, the Augusta Chronicle covered the proposed bill and the increased campaign contributions from telco and cable companies to those pushing the bill:

The telecom companies have beefed up their lobbying forces this legislative session. Many lawmakers have received campaign contributions from them, including Rogers, who rejects any suggestion that they might have motivated him.

Unfortunately, the Augusta Chronicle again repeats the false claim that the public will be under the same rules as the private sector. The bill explicitly creates new rules that will only apply to public sector providers. It is right in front of them and they print blatantly false claims.

New Year, Same Lame Cable and DSL Monopolies

It's a new year, but most of us are still stuck with the same old DSL and cable monopolies. Though many communities have built their own networks to create competition and numerous other benefits, nearly half of the 50 states have enacted legislation to make it harder for communities to build their own networks.

Fortunately, this practice has increasingly come under scrutiny. Unfortunately, we expect to see massive cable and telephone corporations use their unrivaled lobbying power to pass more laws in 2012 like the North Carolina law pushed by Time Warner Cable to essentially stop new community broadband networks.

The FCC's National Broadband Plan calls for all local governments to be free of state barriers (created by big cable and phone companies trying to limit competition). Recommendation 8.19: Congress should make clear that Tribal, state, regional and local governments can build broadband networks.

But modern day railroad barons like Time Warner Cable, AT&T, etc., have a stranglehold on a Congress that depends on their campaign contributions and a national capital built on the lobbying largesse of dominant industries that want to throttle any threats to their businesses. (Hat tip to the Rootstrikers that are trying to fix that mess.)

We occasionally put together a list of notable achievements of these few companies that dominate access to the Internet across the United States. The last one is available here.

FCC Logo

As you read this, remember that the FCC's National Broadband Plan largely places the future of Internet access in the hands of these corporations. On the few occasions the FCC tries to defend the public from their schemes to rip-off broadband subscribers, Republicans (joined by a number of Democrats) threaten to overrule what is supposed to be an independent agency to defend the corporations that just happen to be donors to their campaigns.

Back when most assumed AT&T would be able to push its horribly anti-competitive takeover with T-Mobile through an impotent federal government, a few stories exposed the tip of the iceberg of AT&T's astroturf efforts, as with this report from the Center for Public Integrity:

“It is important that we, as Christians, never stop working on behalf of the underserved and forgotten,” the Rev. R. Henry Martin, director of the clinic, wrote to FCC Chairman Julius Genachowski in June. “It might seem like an out-of-place endorsement, but I am writing today in order to convey our support for the AT&T/T-Mobile merger.”

...

Not included in Martin’s letter to the FCC was the fact that his organization had received a $50,000 donation from AT&T just five months earlier. Indeed the Shreveport-Bossier Mission is one of at least two-dozen charities that were recipients of AT&T’s largesse and have written in support of the T-Mobile buyout, which will cut the number of national wireless companies from four to three.

When AT&T's wasn't able to buy enough influence with legitimate groups willing to sell out the interests of their members (who would pay more for their communications in a less competitive environment), it would simply create its own groups to push its interests:

AT&T Logo

Tallahassee Mayor John Marks brought an Atlanta nonprofit to the city as a partner in a $1.6-million federal-grant project, saying it would put high-speed Internet into the hands of poor people.

What he didn't say, and now says he didn't know, was that the Alliance for Digital Equality (ADE), in its first three years of existence, was nearly 100-percent funded by AT&T and spent most of its money — four of every five dollars — to pay board members, consultants, lawyers and media companies to push the global communication giant's positions on Internet and wireless regulation. Nor did Marks disclose, initially, that ADE had paid him $86,000 over several years as a member of its board of advisers.

We continue to see these massive companies abuse their market power to increase their prices, knowing that their lobbying arms will continue pushing legislation to stop communities from building their own networks.
Time Warner Cable hiked its rates in North Carolina immediately after passing its legislation to stop communities from building networks. Mediacom raised its prices while it attempts to sabotage efforts in rural Minnesota to build networks in unserved areas. And invented new fees to rip off its subscribers while trying to disrupt a rural fiber-to-the-farm initiative that slightly overlapped some territory in which they have long refused to invest.

Even as profits on cable broadband services approach Exxon proportions, Time Warner Cable has pushed for usage-based pricing to further overcharge subscribers, but mostly to strangle enormously popular competitors like Netflix. CenturyLink is not far behind, with usage caps prioritizing its own video content over competitors.

Verizon Wireless tried to sneak a new fee past subscribers by announcing it just before Christmas but backed down after outraged consumers reacted. One has to wonder whether it would have backed down in a world where AT&T took over T-Mobile, resulting in 3 out of 4 wireless customers being with Verizon Wireless and AT&T. Four competitors isn't the robust competition envisioned by Adam Smith, but it still beats the duopoly dynamic that results from even less competition.

Verizon Logo

Speaking of less competition, the recent deal between Verizon and cable companies is troubling. We already knew that FiOS was all but dead, but this deal truly puts a fork in it:

I'll assume that neither cable operators or Verizon are going to let us see the deal fine print to confirm the Times guess, but the logic fits Verizon's strategy. Verizon already cherry picked the most valuable FTTH upgrade markets, and has shown total disinterest in further upgrades. This deal allows them to save money on FTTH upgrade costs, instead soaking up remaining customers with LTE -- which we noted was the plan some time ago. This deal is very bad news to the rural telcos without the cash for large-scale upgrades (CenturyLink, Frontier, Fairpoint, two of which Verizon sold aging DSL networks to), and for satellite broadband providers.

The future of next-generation networks is now only community networks, cooperatives, and some small private networks.

We've long argued that phone and cable companies have systematically overstated their coverage in mapping efforts as part of their effort to blunt any sensible public policy that would result in all Americans having a choice between fast, affordable, and reliable connections to the Internet. The New England disaster called FairPoint is back in the news for overstating the number of subscribers that have access to DSL. The company has not met the requirements it agreed to when purchasing Verizon's lines a few years ago.

Comcast Logo

And in the continuing saga of Comcast's growing domination over the information people can access, Bloomberg TV is fighting Comcast's practice of discriminating against channels in which it has no ownership stake. Comcast has long strongly encouraged those who want to put television channels on its lineup to give Comcast a piece of the action, not unlike a mobster encouraging a small business to pay protection money. It wants to continue expanding its role as a gatekeeper to the Internet, particularly in the many areas where people have no real choice from other high speed providers.

And perhaps the best example of why we should not trust these massive corporations to run essential infrastructure is the revelation that AT&T defunded 9-11 call centers in Tennessee to gain a market advantage over competitors, a practice they were previously caught doing, leading to settlements out of court.

These corporations are not evil, they are following a sensible mandate to maximize their shareholder value. It is our government that is not sensible -- entrusting them with the future of Internet access without even bothering to enact the most basic regulations. Communities must continue to wise up and ensure they have the access they need to modern communications -- access that reponds to their needs, not those of distant shareholders.

The Internet is More Important than Broadband

I encourage readers to visit Doc Searls post "Broadband vs. Internet" for a discussion about things that matter regarding the future of Internet access for most Americans.

The Internet is no more capable than the infrastructures that carry it. Here in the U.S. most of the infrastructures that carry the Internet to our homes are owned by telephone and cable companies. Those companies are not only in a position to limit use of the Internet for purposes other than those they favor, but to reduce the Net itself to something less, called “broadband.” In fact, they’ve been working hard on both.

There is a difference between the Internet and "broadband." Broadband is a connection that is always on and tends to be somewhat faster than the dial-up speeds of 56kbps. Broadband could connect you to anything... could be the Internet or to an AOL like service where some company decides what you can see, who you can talk to, and the rules for doing anything.

The Internet is something different. It is anarchic, in the textbook definitional sense of being leaderless. It is a commons. As Doc says,

The Internet’s protocols are NEA:

  • Nobody owns them.*
  • Everybody can use them, and
  • Anybody can improve them.

Because no one owns it, few promote it or defend. Sure, major companies promote their connections to it (and when you connect to it, you are part of it) but they are promoting the broadband connection. And the biggest ones (Comcast, AT&T, Verizon, Time Warner Cable, etc) will do anything to increase the profits they make by being one of the few means of connecting to the Internet -- including charging much more and limiting what people can do over their connection, etc.

This is one reason the connections from major corporations are so heavily tilted toward download speeds -- they want consumers to consume content. Just about every community network built in the last 3-4 years offers symmetrical connections by contrast.

Last I heard, the fastest cable offering in the upstream direction was 12Mbps. Cox, our cable provider in Santa Barbara, gives us about 25Mbps down, but only 4Mbps up. Last time I talked to them (in June 2009), their plan was to deliver up to 100Mbps down eventually, but still only about 5Mbps up. That’s competitive as long as all you want is “content delivery.” But what about when you want to live “in the cloud,” and all your data is elsewhere? In the long run you’ll need a lot more upstream as well as downstream capacity for that. Internet service optimized for media delivery (where TV especially wants to go) won’t cut it. But then, most people aren’t looking at that. They’re looking at TV on their iPads over broadband, and thinking that’s way cool enough.

So here we are, smack up against what John Perry Barlow warned us about in Death From Above, way back in early 1995. There he wrote, “The cable companies and Baby Bells have a model for developing the next phase of telecom infrastructure which, were it applied to the design of physical superhighways, would have us building them with about five thousand lanes in one direction and one lane in the other.”

This is where Bob Frankson comes in, reminding us that the big cable and phone companies are good at billing, not connecting. Their methods and procedures are optimized to maximize their revenues, not to maximize the benefits of the Internet or anything else. Back to Doc:

The division is between what communications wonks crudely characterize as “net-heads” and “bell-heads.” Think of conflict as one betwee any and only. Net-heads want the Net to support anything. Bell-heads want communications systems optimized only for the businesses they prefer — namely, their own — and to avoid even talking about the Internet. (Bell-heads have never been comfortable with the Net, because it was not made to bill. TV and telephony are easy to bill, and so is “content” in general. Thanks to Apple’s and Google’s pioneering work —mostly in league with the operators — so now are apps.)

Community Broadband generally sides with the net-heads. The focus tends to be on what is best for the community as a whole, rather than what is good for a single company or industry. After all, if a community had a choice between one business providing 5,000 jobs and 500 businesses each providing 10 jobs, they would be crazy to opt for the single employer.

Verizon had been the only major company investing in next-generation networks with its FiOS deployment. It is done expanding -- unless you live in one of the wealth neighborhoods or suburbs that got it, you won't. AT&T has even ceased its pathetic U-Verse upgrades, even as they spend millions to prevent communities from building their own, much better networks. Communities that want to be relevant in 10 years take notice -- and take a good hard look at building a locally owned network that responds to the needs of the community.

Doc Searls photos used under creative commons license, courtesy of Flickr's Irisheyes

Business Week Tackles Anti-Community Broadband Lobbying

Publication Date: 
December 1, 2011
Author(s): 
Alison Fitzgerald
Author(s): 
Brendan Greeley
Publication Title: 
Business Week

Brendan Greeley and Alison Fitzgerald have authored an in-depth exposé of the role the American Legislative Exchange Council (ALEC) played in passing a law in Louisiana designed to cripple community-owned networks ... while falsely claiming the bill was about creating a "level playing field."

This article may not have been possible without the work done by the ALEC Exposed folks at the Center for Media and Democracy.

The aptly-titled "Pssst ... Wanna Buy a Law?" article starts with the background of one of our favorite community broadband champions: Joey Durel, the Republican City-Parish President of Lafayette, Louisiana.

In April of 2004, Lafayette announced their intention to do a market survey to get a sense of whether the community would be interested in a publicly owned FTTH network run by the public utility. By that point, it was not possible to introduce new bills at the Louisiana Legislature. Or at least, that is a technicality when it comes to the lobbying prowess of big cable and telephone companies (mainly Cox and BellSouth - one of the major companies that later became AT&T).

Worried about losing their de facto monopolies, they tapped State Senator Winnsboro to take an existing bill, delete all the words from it and then append their anti-community broadband (anti-competitive) language.

The lobbyist brought back to Lafayette a copy of what would become Senate Bill 877. It named telecommunications as a permitted city utility, then hamstrung municipalities with a list of conditions. It demanded that new projects show positive revenue within the first year. It required a city to calculate and charge itself taxes, as if it were a private company. Cities could not borrow startup costs or secure bonds from any other sources of income. The bill demanded unrealistic accounting arrangements, and it suggested a referendum that would have to pass with an absolute majority. It also, almost word for word, matched a piece of legislation kept in the library of the American Legislative Exchange Council. The council’s bill reads, “The people of the State of _______ do enact as follows … ”

According to Ellington, he substituted the bill after a lobbyist for several of the state’s cable companies approached him, concerned about Lafayette’s project. Ellington’s district did not have plans to run fiber. Nor did any other city or parish in the state. “We were just making sure that the field was level,” he says. “We weren’t trying to keep them from doing what they wanted to do, we just wanted to make sure the public entity couldn’t go in and shortstop the private entities.” Ellington is probably sincere about that. The lobbyist who came to him probably wasn’t. The bill was not designed to level the playing field. It was designed to keep new teams on the sidelines.

The story goes on to track this bill back to Utah in 2001 (when Comcast and US West (later Quest and now CenturyLink) wanted to outlaw communities from building their own networks -- often in areas the private companies had refused to offer access to the Internet anyway). ALEC serves to spread those bills around the nation. When enacting corporate agendas, legislators prefer to get their bills from a nonprofit (ALEC) as opposed from directly from the corporations. Nevermind that the same corporations still write the bills and fund ALEC. It is sufficiently removed for what passes for democracy in America.

LUS Fiber

The bill passed. Lafayette managed to remove some of the ALEC bill’s barriers to entry but, as Huval had predicted, the law embedded into Louisiana code a set of handholds for future litigation. BellSouth and Cox Communications called for a referendum in Lafayette, which the law only suggests. The city’s attorney determined that the petitions to force a referendum did not meet the city’s standards, and BellSouth sued. Lafayette lost on appeal, paid for a referendum, and BellSouth ran ads against approving the project. (According to KLFY, a local television channel, Cox paid for a phone poll that suggested a government-owned provider might ration television on Tuesdays, Thursdays, and weekends.) Lafayette tried to issue bonds, and BellSouth challenged them. By 2007, when the Louisiana Supreme Court upheld the bond issue, Huval estimates that the city had paid $4 million in legal fees, more than the cost of the original fiber ring. A spokesperson for AT&T, which now owns BellSouth, says the company has backed away from BellSouth’s aggressive approach. But the damage is done. As with Utah, no other city in Louisiana has attempted to follow Lafayette.

According to data provided to Bloomberg Businessweek by the Sunlight Foundation, which posts government information online, state legislators who have signed on to sponsor the ALEC bill limiting municipal telecommunications have tended to receive donations from local cable and phone incumbents, as well as rural telephone associations. The pattern is consistent across states. In North Carolina, where the bill passed in May of this year after four attempts, these companies and groups consistently gave more money to the bill sponsors.

Noble Ellington hasn’t followed what became of his bill. “I just hope we fixed it,” he says, “so private industry and the city and parish were satisfied with what we did.” Terry Huval and Joey Durel both travel around the country now, talking to other small towns about how to get wired. Durel believes it’s going to get worse before it gets better. Huval is working with towns in nearby states but won’t say where. When a plan goes public, he explains, a bill—that bill—is not far behind. ALEC’s model bill on municipal broadband works because the idea of a city providing Internet access is alien to even most lawmakers. If a bill shows up at the right time, in response to one or two cities, it smothers an idea that hasn’t yet gathered many defenders. “I tell people this is not for the faint of heart,” says Huval. “If you don’t have the drive, don’t even start.”

We deeply covered the fight in North Carolina's legislature funded by Time Warner Cable. The bill in North Carolina was carried by ALEC members.

Most of the state laws restricting community broadband initiatives are included on this preemption map.

This is the kind of story that should be forwarded to elected officials. We are likely to see more of these cable and phone company attacks on local freedom next year than we have in any other year since 2005. We need to prepare and educate ourselves.

You can read our previous coverage of Lafayette here.

Susan Crawford Identifies Problems/Solutions with Broadband in America

Susan Crawford published an excellent essay in the New York Times presenting her Looming Broadband Monopoly argument as a discussion of the coming digital divide between those with access to next-generation networks and those without.

These numbers are likely to grow even starker as the 30 percent of Americans without any kind of Internet access come online. When they do, particularly if the next several years deliver subpar growth in personal income, they will probably go for the only option that is at all within their reach: wireless smartphones. A wired high-speed Internet plan might cost $100 a month; a smartphone plan might cost half that, often with a free or heavily discounted phone thrown in.

The problem is that smartphone access is not a substitute for wired. The vast majority of jobs require online applications, but it is hard to type up a résumé on a hand-held device; it is hard to get a college degree from a remote location using wireless. Few people would start a business using only a wireless connection.

She identifies the problem as a lack of competition in the market while highlighting the role of lobbying from the wealthy cable companies to keep it that way:

The bigger problem is the lack of competition in cable markets. Though there are several large cable companies nationwide, each dominates its own fragmented kingdom of local markets: Comcast is the only game in Philadelphia, while Time Warner dominates Cleveland. That is partly because it is so expensive to lay down the physical cables, and companies, having paid for those networks, guard them jealously, clustering their operations and spending tens of millions of dollars to lobby against laws that might oblige them to share their infrastructure.

In this essay, her preferred solution is better federal regulation that would require companies that own networks to share parts of their infrastructure with competitors (to significantly reduce the problems of natural monopoly). Unfortunately, she did not explicitly discuss the solution of the communities building their own networks - a topic she has discussed at great length elsewhere in very positive terms. Her essay ties in nicely with the paper we highlighted looking at the growing costs of network exclusion.

While we recognize the benefits of open access policies that require infrastructure owners to share their network rather than monopolizing it and profiting from the scarcity of these essential connections, we believe the best solution is to allow/encourage communities to build publicly owned networks -- particularly those that are open to independent service providers.

Even if the Obama Administration had the courage to take on powerful companies like AT&T and Comcast, the next administration could easily reverse any policies meant to encourage competition. Better to build community-owned infrastructure that is not as susceptible to the massive lobbying dollars of big cable and telephone companies.

Update: For those who saw the a subsequent response to Crawford's column in the letters-to-the-editor from Verizon's Chairman, he flat out lied in several of his rebuttal points.

AT&T Defunds 9-11 To Undercut Competitors

There are definitely times when you learn of a business practice where you think, "Wow, my opinion of AT&T could not go any lower." And then, BOOM. You find out that AT&T was intentionally underfunding a 9-11 call center in order to undercut its competitors in bids.

Yikes.

Did we mention that this is not an isolated case? AT&T has been busted in several jurisdictions for this practice.

Hat tip to Stop the Cap! for bringing my attention to a lawsuit brought by Hamilton County against AT&T for its practice of under-reporting the number of business lines it provides.

This practice allows it to undercut all competitors in the market, including the community fiber network run by Chattanooga's Electric Power Board. From the Times Free Press article:

The lawsuit claims that, since at least July 2001, AT&T has filed monthly and annual reports listing fewer business phone lines than they actually provide. Under Tennessee law, phone companies must pay $3 per month per line to pay for 911 access.

...

In a March phone service bid proposal for Hamilton County, AT&T stated it would not collect the $3 rate and instead collect $2 per line per month. That allowed the company to underbid the next lowest bidder by 69 cents per line per month, “unlawfully increasing its profits at the expense of revenue to support the critical emergency services that” 911 provided, according to court records.

A difference of $.69 may not seem like much, until you consider they may be providing 1,000 lines - which is a difference of $690/month or $8,280/year.

911.gif

It is an incredible racket. AT&T gets more high-margin customers, pays less in fees than competitors, and the only people who get hurt are those who depend on 9-11.

Just when you think AT&T is brilliantly evil (an accusation I tend not to make against many corporations no matter how much I disapprove of their practices), you have to consider how incredibly incompetent they are. They freakin' including this fraudulent activity in a bid for county services!!!

AT&T has settled out of court with other counties in Tennessee and Madison County, Alabama, for similar pratices.

Remember folks, AT&T is one of the of companies on whom Congress, the President, and FCC, are expecting to invest in America to build the broadband networks we need and run them in a way that does not cripple our economy. That is not a plan, it is an abdication of responsibility.