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Resource: Useful Flyers in Georgia Legislation

After AT&T began pushing a bill in Georgia to revoke local authority to decide to build a publicly owned broadband network, the Georgia Municipal Assocation (GMA) and the SouthEast Assocation of Telecommunications Officers and Advisors began reaching out to Georgia's legislators to explain how the private sector has left serious gaps in broadband coverage, which stopped the bill. Below are two flyers they report being particularly helpful.

GMA, SEATOA, and the Institute for Local Self-Reliance are among the vast majority that believe communities should decide locally if a community network makes sense to bring next-generation connections to local businesses and residents.

Georgia is a conservative state and AT&T had enlisted the support of the Senate Majority Leader in pushing their anti-competition broadband bill. Unfortunately for AT&T, their CEO was too candid on calls with Wall Street, contradicting AT&T's lobbyist talking points in Georgia.

Georgia Flyer1

Note, that AT&T was originally trying to define broadband at the absurd 200kbps level but a substitute bill would have bumped it up to a still-too-low 768kbps, which is referenced above.

The other flyer that apparently made a difference with legislators is here:

Georgia Flyer2

Rememeber that elected officials often think of broadband in binary terms. You have it or you don't. In their mind, if you have options aside from dial-up, the problem is solved. These are people that often do not know what is needed to attract economic development, work efficiently from home, or successfully compete remote education courses.

Graphics that explain why we need next-generation networks rather than simply expanding last-century DSL can be remarkably helpful.

Before talking with elected officials, consider adapting one of these flyers or even just using it to explain why communities should be free to decide locally if a network is a smart investment for them.

Georgia Bill to Kill Community Broadband Reportedly Shelved

We are hearing that SB 313 in Georgia, AT&T's bill to overrule local authority, will be turned into a study bill. Despite the strong support of the Senate Majority Leader, the bill lost support after we and others exposed the frank admission of AT&T's CEO that they had no plans to expand broadband in rural areas.

Given the strength of AT&T's lobbying and the support of the Senate Majority Leader, this is a tremendous victory. Congratulations to the communities in Georgia that successfully organized and defended their authority to decide locally if a network is a wise choice for them.

We do not consider these issues resolved until the ink is dried, but it does look like AT&T lost this round -- which means thousands of local businesses and millions of people won. They can still hope for next-generation networks and a real choice in providers.

Note: the South Carolina bill remains in play and will be discussed on Wednesday by a Senate Judiciary Subcommittee.

We have been collecting some of the news coverage of this broadband debate in Georgia, but have neglected posting until now. Here is a run-down of some of the coverage.

In the beginning of February, the AP covered an SB 313 hearing featuring testimony from rural communities:

Leaders from cities including Elberton, Hogansville, Thomasville, Monroe and Toccoa lined up to tell senators that broadband is necessary infrastructure for the 21st century economic development they hope to attract — and that they are doing what they must to keep their communities competitive.

"We cannot wait for the private sector to ride to our rescue," said Tim Martin, executive director of the Toccoa-Stephens County Development Authority.

Thomasville Mayor Max Beverly said the city's broadband network supports major employers there.

"If we have to cut them off, there's no telling what that's going to do to our local economy," he warned.

The Augusta Chronicle devoted a lot of words to both sides and made the important disclosure that telecom companies had just staffed up on lobbyists:

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.

Stop the Cap!

Stop the Cap! has continued its in-depth coverage of these important issues. In January, Phillip revealed the sudden increase in telco/cableco contributions to the bill's pusher, most notably from AT&T. He also set the record straight on many of the supposed failures of muni networks in Georgia. For example:

As Multichannel News reported in 2002, “the Atlanta suburb of Acworth, Ga., isn’t selling because business is bad. Rather, officials said they’ve received so many requests for service from outside the city limits that they’ve decided to sell the operation to an independent company that may expand beyond Acworth’s borders.”

That is where the trouble started. The city contracted with United Telesystems Inc. of Savannah, Ga., a private company, first to lease and then eventually buy the cable system, maintaining and expanding it along the way. But in 2003, United Telesystems defaulted on its lease-sale agreement, forcing the city to foreclose on the system and ultimately sell it to a second company.

Acworth’s “failure” wasn’t actually the city’s, it was the private company that defaulted on its contract.

On February 1, Phillip discussed the Columbia County Broadband Network:

If Rogers’ bill passes, the county may have to go back to begging for access from the companies that have repeatedly said it wasn’t worth the investment or their time.

County officials have been more generous, offering all along to share access to the fiber network with the very providers who are seeking to destroy it. So far, that hasn’t changed any minds.

“If we don’t own it, that means we don’t want you to have it” is standard operating procedure for the state’s phone and cable operators, even in the service areas they routinely ignore, even if it means flushing millions of dollars already spent on new networks down the drain.

On February 7, Stop the Cap! covered more of the testimony from towns against the bill:

seal-newnan-ga.png

“We started our cable system not on a whim but on a demand from our citizens to provide a higher level of service for cable TV and Internet,” said Newnan Mayor Keith Brady. “We got into the cable business originally to provide fiber optics and broadband because Charter Communications would simply not invest in our community.”

...

Brady says their community-owned system not only provides broadband where Charter would not, the cable company also was forced to reduce their rates for consumers in nearby communities, saving taxpayers across the entire city and county millions.

In Elberton, the lack of broadband was so pervasive the 4,700 local residents demanded the city provide the service themselves. Commercial providers had stonewalled the county seat of Elbert County for years until the city broke ground on a broadband project in 2001.

...

Don Cope, president and CEO of Dalton Utilities, demonstrated that municipal broadband systems are not the financial risk large telecommunications companies always claim they represent. In fact, Dalton’s system has never received a penny of tax revenue and its accounting is open to public scrutiny to prove it.

Cope noted SB 313 imposes restrictions on community providers, but completely exempts those owned by the companies pushing the bill.

OptiLink Dalton

“I would ask that you look at the private providers in the state,” Cope said. “Look at their reports, and you would see how many dollars that are provided to them from the federal government. We are talking about in the billions of dollars. All the [private telecommunications entities] that I know about have some form of government support.”

CivSource also offered an opinion about the bill:

“The private sector is handling this exceptionally well,” Rogers said in an Associated Press account. “What they don’t need is for a governmental entity to come in and compete with them where these types of services already exist. We’re not outlawing a local government entity from doing this, but if they’re going to compete, they can play by the same rules and ask the voters if it’s okay before they go out and spend all these dollars.”

Rogers claims are dubious at best. According to the National Broadband Map, Georgia ranks 20th in the nation for broadband access. According to the forward of a report by Rich Calhoun, Program Director of the Georgia Technology Initiative, “As I traveled through the state to talk with leaders in municipalities, counties and community anchor institutions, I found that many places throughout Georgia indicated that they did not have access to affordable or sufficient broadband services. Telecommunications firms who have made significant investments in Georgia indicated that in some areas of the state the return on investment would not qualify for further investment at the present time.”

Tech News Today: Georgia Hates the Internet

On Wednesday, Tech News Today on the This Week in Tech (TWiT) network had Christopher Mitchell on to discuss pending legislation in Georgia that would essentially outlaw publicly owned networks in the state.

I come on about 25 minutes, 45 seconds in to the show. Skip ahead below or watch on YouTube.

Honesty From Heartland: Munis Outgunned in Competition with Private Sector

The Heartland Institute is one of those organizations that will say anything its massive corporate funders want it to. It is embroiled in a scandal from the release of internal documents due to its work challenging the science behind climate change.

In the telecom space, Heartland's employees have encouraged laws to take decision-making authority away from communities in order to benefit the massive cable and DSL companies (like Heartland-funder AT&T).

They advocate for efforts like Georgia's SB 313 and South Carolina's H3508, saying:

  1. Muni networks are doomed to failure because of the general incompetence of government
  2. Muni networks will drive private sector providers out of the market because governments are too all powerful and have too many advantages in competition

This is why we see bills that are supposed to "level the playing field" pushed by big companies like Time Warner Cable in North Carolina last year.

If you take a gander at Heartland's telecom work, you have to wonder why the playing field needs to be leveled if they believe what they have written:

A municipal government cannot possibly hope to compete with well-capitalized broadband providers in a highly competitive market.

For those unfamiliar with Heartland, they don't use the same definitions for common words like "competitive" as the rest of us do. In Heartland's world, "competitive" means a market in which one of our funders operates regardless of how much competition exists in it.

So why do we need new legislation to make it even harder for communities to build the networks that the cable and DSL companies won't build?

Bloomberg: The Case for Publicly Owned Internet Service

Susan Crawford's op-ed in Bloomberg makes a tremendous case for publicly owned broadband networks.

She notes the importance of broadband and the failure of big cable and DSL companies to meet the growing needs of communities, just as the electrical trusts were insufficient to electrify much of America.

I'm a bit biased because she cites our work:

Today, the Institute for Local Self-Reliance, which advocates for community broadband initiatives, is tracking more than 60 municipal governments that have built or are building successful fiber networks, just as they created electric systems during the 20th century. In Chattanooga, Tennessee, for example, the city’s publicly owned electric company provides fast, affordable and reliable fiber Internet access. Some businesses based in Knoxville -- 100 miles to the northeast -- are adding jobs in Chattanooga, where connectivity can cost an eighth as much.

Though I encourage readers to read the full column, I love the conclusion:

Franklin D Roosevelt

Right now, state legislatures -- where the incumbents wield great power -- are keeping towns and cities in the U.S. from making their own choices about their communications networks. Meanwhile, municipalities, cooperatives and small independent companies are practically the only entities building globally competitive networks these days. Both AT&T and Verizon have ceased the expansion of next-generation fiber installations across the U.S., and the cable companies’ services greatly favor downloads over uploads.

Congress needs to intervene. One way it could help is by preempting state laws that erect barriers to the ability of local jurisdictions to provide communications services to their citizens.

Running for president in 1932, Franklin D. Roosevelt emphasized the right of communities to provide their own electricity. “I might call the right of the people to own and operate their own utility a birch rod in the cupboard,” he said, “to be taken out and used only when the child gets beyond the point where more scolding does any good.” It’s time to take out that birch rod.

AT&T Trying to Redefine Broadband in Georgia, South Carolina

The absurdity of AT&T's push to define broadband as 200kbps is so great, it boggles the imagination. We developed the graphic below to highlight just how slow 200kbps connections are.

200kbps is not good enough for communities

Feel free to spread it around. Higher quality pdf below.

Pay Attention to the Man Behind the Curtain: Listen to AT&T's CEO, not Lobbyists

AT&T lobbyists in Georgia and South Carolina are arguing that local governments should not be allowed to build the networks that communities need, suggesting that the private sector is primed to make the necessary connections. But AT&T's CEO had a different message for investors a few weeks ago, in an earnings call on January 26:

The other is rural access lines; we have been apprehensive on moving, doing anything on rural access lines because the issue here is, do you have a broadband product for rural America?

We’ve all been trying to find a broadband solution that was economically viable to get out to rural America, and we’re not finding one to be quite candid. The best opportunity we have is LTE.

Whoa! LTE is what you more commonly hear called 4G in mobile phone commercials. The best they can do is eventually build a wireless network that allows a user to transfer just 2GB/month. That is fine for hand-held devices but it does nothing to encourage economic development or allow residents to take advantage of remote education opportunities.

But even the CEO admits they are not bullish on LTE as the solution:

[W]e’re looking at rural America and asking, what’s the broadband solution? We don’t have one right now.

Some may be wondering about "U-Verse" -- AT&T's super DSL that competes with cable in the wealthy neighborhoods of bigger cities. U-Verse cannot match the capacity or quality of modern cable networks but is better than older DSL technologies. But U-Verse is not coming to a rural community near you.

For those who missed the fanfare last year, AT&T's U-Verse build is done. AT&T's lobbyists have probably forgotten to tell Georgia and South Carolina Legislators that the over 20 million AT&T customers without access to U-Verse are not going to get it. But CEO Stephenson made sure investors weren't worried about AT&T continuing to invest in its wireline infrastructure:

In wireline, our U-verse build is now largely complete, so we have in place an IP video and broadband platform that reaches 30 million customer locations, which gives us significant headroom now to drive penetration.

Translation: AT&T will now focus on upselling customers in markets with U-Verse. If it doesn't run through your neighborhood already, you aren't getting it.

The rest are stuck on dial-up or DSL that AT&T's CEO has previously called obsolete (correctly). While AT&T's CEO has been honest about its inability to solve real broadband deployment gaps, AT&T's lobbyists have tried to advance a bill with the ludicrously low broadband definition of 200kbps and even more absurdly, the even slower definition of 190kbps.

The business model of AT&T and other big cable and DSL companies simply does not work in much of rural America. The question is why any state would foreclose the possibility of communities being self-reliant when major companies like AT&T candidly admit they have no solution and the best they can do is deliver an obsolete product.

State legislators need to pay more attention to what AT&T's CEO says and less what AT&T's lobbyists say.

Fast, affordable, and reliable access to the Internet is essential for communities to thrive in the digital age. Not every community wants to build a community networks and most undoubtdly won't. But that is decision they should make locally. Pending legislation in Georgia and South Carolina would take this decision out of the hands of these communities by enacting a host of new regulations on public networks that do not apply to the private sector. As in North Carolina, these bills effectively revoke local decision-making authority by creating impossible hurdles for communities that are already disadvantaged in the modern economy.

NATOA Asks Georgia to Preserve Local Broadband Authority

As Georgia's Senate considers revoking local authority over whether or not to build a community network, the National Association of Telecommunications Officers and Advisers has written to the Committee, opposing SB 313 [pdf]:

Dear Senator Rogers:

The National Association of Telecommunications Officers and Advisors (NATOA) joins the growing chorus of business, consumer, and government groups and associations, such as the Georgia Municipal Association, in opposing the Broadband Investment Equity Act (S. 313). This bill will harm the state’s economic growth and do little if anything to promote competition or to bring advanced communications services to the citizens of Georgia.

NATOA has long supported community broadband networks because they offer the promise of increased economic development and jobs, enhanced market competition, and accelerated and affordable Internet access for all. Communities across America are ready and eager to bring the economic and social benefits of broadband access to their citizens. But private providers alone will not bring these advanced services to all parts of our country, especially to those communities that do not fit into the companies’ business plans.

As a result, hundreds of cities have launched community broadband initiatives, either with private partners or on their own, and many more are now in the planning stages. Communities should be encouraged to step forward to do their part to ensure the rapid deployment of broadband to all Americans, and they should have the freedom to choose what makes the most sense for their citizens. S. 313 will do nothing to encourage robust competition in the communications marketplace in Georgia.

Rather, S. 313 will tie the hands of local governments and hinder the deployment of advanced services to un- and underserved parts of the state, denying those communities the economic and social benefits that broadband services can provide. Rather than encouraging economic growth, S. 313 will simply drive more private investment capital – and good jobs – from Georgia to neighboring states, such as Tennessee.

Rather than erecting further barriers to entry, Georgia should be encouraging community leaders to develop networks that make sense for their communities, including public-private partnerships and systems wholly owned by municipalities.

Thank you for your consideration.

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.

Georgia Legislature to Revoke Local Authority to Build Networks

The Georgia Senate is considering SB 313, a bill that would overrule local decision-making authority in matters of broadband. Even as connections to the Internet have become essential for communities, the Georgia Legislature is poised to make it harder for communities to get the networks they need.

We saw very similar language in North Carolina pass last year after many years of lobbying by Time Warner Cable and CenturyLink. These massive companies use their lobbying clout to stop any form of competition they could face, and they are presently threatened by the examples of many communities that have built incredible next-generation networks. For instance, see the thousands of new jobs in Chattanooga that are credited to its community fiber network.

Community networks spur competition -- it is why Chattanooga got Comcast's xfinity service before Atlanta, despite Atlanta having long been prioritized over Chattanooga previously. It is why Cox Cable, which is headquartered in Atlanta, launched its upgrades in Lafayette, Louisiana -- they felt the competition pressure from a community fiber network.

Bill supporters are already claiming that this is just an attempt to level the playing field:

"The private sector is handling this exceptionally well," Rogers said. "What they don't need is for a governmental entity to come in and compete with them where these types of services already exist. We're not outlawing a local government entity from doing this, but if they're going to compete, they can play by the same rules and ask the voters if it's okay before they go out and spend all these dollars."

We have mapped the states that enacted barriers to community networks,written extensively about level playing field arguments, and even produced a video about the level playing field:

As for whether the private sector is providing enough competition or high enough capacity networks, I leave that to individual communities to decide.

SB 313 effectively removes such decisions from local communities. It purports to just set additional terms that the public sector must meet, but many of these terms are sufficiently onerous (especially when taken all together) that communities will not be able to build the network they need.

The bill first requires communities to ask the private sector to build the necessary network. This ignores the basic fact that community networks are operated with different incentives that privately owned networks. Due to the scarcity in the market, private providers tend to keep prices higher than necessary to maximize their short term profits. Publicly owned networks lower prices (while still paying their costs) in order to spur job creation and increase digital inclusion.

The bill requires communities to pass a referendum before building a network and requires inaccurate, damning language be included on the ballot. Broadband referendums tend to invite deep-pocketed incumbent providers to spend heavily to buy the votes necessary to stop competition - see the Longmont saga for an excellent example of how hard it is for a community to stand up to these big cable corporations.

Georgia Legislature

Communities that somehow get this far are then subject to all the regulations as are private providers in addition to numerous additional regulations imposed on them by this legislation and their inherent duty to operate in an open and transparent manner. Despite being nonprofit, they are required to pay taxes and still face additional barriers that private operators do not.

They will be restricted in how they price their services and where they offer services in ways the private sector is not.

In short, this bill will make it all but impossible for communities to build networks -- even in areas that are presently unserved. The bill purports to exempt some unserved areas, but does so in a cynically evasive way. The only way a community could meet the unserved exemption is if it vowed to only build in the least economical areas -- meaning it would have to be significantly subsidized. Serving unserved areas and breaking even financially almost always requires building a network that will also cover some areas already served (because that is where you can find the margins that will cover the losses in higher expense areas).

The bill is presently in the Senate Regulated Industries and Utilities committee. We will continue covering it and attempt to learn which interests are pushing to revoke local authority and replace it with what distant legislators think best.

Photo used under Creative Commons license, courtesy of Flickr's PhotoPhiend.