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Alex Marshall Coming to Humphrey School at U of Minnesota

Six months ago, I wrote about a book by Alex Marshall, the Surprising Design of Market Economies. In a few weeks, he will be presenting to a small group at the Humphrey School of Public Affairs at the University of Minnesota. You can learn more about the event and register here.

I am looking forward to this - Thursday, October 24, at Freeman Commons in the Humphrey School on the West Bank campus. 11:30 - 1:00.

In a thesis that has implications for policy wonks, economists and planners of all types, Marshall shows how government creates the essential institutions necessary for economic life, and how the typical debate between those who value the market and those who value government regulation is a false one. Marshall, a Senior Fellow at the Regional Plan Association in New York, is the author of two other books on urban planning, and is a former newspaper reporter. He was also a Loeb Fellow at Harvard University. His work has been published in many places, including The New York Times Magazine, Bloomberg View and The Washington Post.

Alex Marshall Examines Electricty / Internet Parallels

“My answer has been, as it is tonight, to point out these plain principles,” Roosevelt told the crowd. “That where a community -- a city or county or a district -- is not satisfied with the service rendered or the rates charged by the private utility, it has the undeniable basic right, as one of its functions of government, one of its functions of home rule, to set up ... its own governmentally owned and operated service.”

While FDR was referring to electricity in 1932, he could easily be speaking about today's critical need for Internet connectivity. Fortunately for a growing number of people in our country, many local leaders share his sentiments and those communities are investing in community owned telecommunications networks.

Government Technology recently reposted a Governing article by Alex Marshall, a Senior Fellow at the Regional Plan Association in New York City. The Director of our Telecommunications work, Christopher Mitchell, tells me he just bought Alex's new book from a local bookstore and has put it at the top of his reading list: The Surprising Design of Market Economies.

Marshall sees fiber optic connectivity as the utility of today and tomorrow. He explores the question of who should provide access - public institutions or the private market? In his research, Marshall finds that many local communities are not waiting for an "official" answer to that question and are taking control of getting their citizens online.

Marshall spoke with Nick Braden from the American Public Power Association (APPA):

“As was the case when America was electrifying a century ago, many unserved or underserved communities are ready, willing and able to take matters into their own hands, if necessary, to deploy the sophisticated broadband communications networks that will enable their communities and America to continue to be a leader in the global economy,” says Braden. “Many have already done so.”

Marshall notes the private sector's intense efforts to stop local public invest and how those efforts have permeated nineteen state legislatures, even contrary to overwhelming evidence of success. While court battles often end in the defendant's favor, when the private sector sues to stop municipalities and loses, the next step is money and lobbyists. Marshall talked to our own Christopher:

Given that the evidence shows that cities could offer better service at better prices than private companies, the logic behind these laws makes little sense. “They are the kind of arguments that can only work when accompanied by an army of lobbyists and large campaign contributions,” says Mitchell.

While the question will, of course, be debated far into the future, Marshall suggests a look back at 1932 for the right approach:

If the politicians falter, they should remember FDR’s words. It’s clear that fiber networks are a natural monopoly and need to be either run directly by the government, or so heavily regulated that it amounts to the same thing.

Susan Crawford, Captive Audience, and How to Kill the Cable Monopoly

Susan Crawford, author of the just-released Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age, is our guest for the 29th episode of the Community Broadband Bits Podcast. A former adviser to President Obama, she has been a leading figure in the struggle to preserve an open Internet.

Susan has long been an advocate of communities deciding for themselves if a community owned network is a wise investment and recognizes the benefits of smart government policies to prevent big companies like Comcast from dominating the telecommunications arena.

We talk about her book and reactions to it -- big cable and telephone companies are attacking her under false pretenses by either putting words in her mouth or misrepresenting her main points. But we also discuss the steps concerned people can take to bring force some accountability on the big monopolies.

We have previously noted Susan's words and presentations here and we noted some Captive Audience reviews here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below. Also, feel free to suggest other guests, topics, or questions you want us to address.

This show is 17 minutes long and can be played below on this page or subscribe via iTunes or via the tool of your choice using this feed. Search for us in iTunes and leave a positive comment!

Listen to previous episodes here.

Thanks to mojo monkeys for the music, licensed using Creative Commons.

Susan Crawford's Captive Audience Book Reviewed

I quickly read the just-released Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age, and came away quite excited by Susan Crawford's new book.

Susan Crawford has been supportive of community owned networks and a loud voice against the poor policies that have allowed a few massive cable and telephone companies to monopolize our telecommunications. Her new book is a good resource for those just getting interested in this issue.

After the book was released last week, Susan Crawford appeared on the Diane Rehm show -- an excellent 50 minute interview that comes highly recommended. Be aware that the cable/telephone industry is engaging in character assassination to prevent Susan's message from reverberating around the country.

The book led to Sam Gustin's article in Time, "Is Broadband Internet Access a Public Utility?"

State and local laws that make it difficult — if not impossible — for new competition to emerge in broadband markets should be reformed, according to Crawford. For example, many states make it very difficult for municipalities to create public wireless networks, thanks to decades of state-level lobbying by the industry giants. In order to help local governments upgrade their communications grids, Crawford is calling for an infrastructure bank to help cities obtain affordable financing to help build high-speed fiber networks for their citizens. Finally, U.S. regulators should apply real oversight to the broadband industry to ensure that these market behemoths abide by open Internet principles and don’t price gouge consumers.

Art Brodsky also reviewed the book on the Huffington Post. He leads with a reminder of the damage done by the NFL's replacement refs, an apt comparison given how poorly the FCC and Congress have protected the public.

Susan will be our guest for the Community Broadband Bits Podcast (episode 29) on Tuesday, Jan 15, and I will be offering periodic thoughts on passages from the book in coming days/weeks.

Tubes Offers an Internet Tour

If you have been trying to find a book that offers an engaging explanation of how the Internet physically works and the various networks interconnect, search no more. Tubes: A Journey to the Center of the Internet by Andrew Blum has done it.

The author was featured on Fresh Air way back in May, but not much has changed with Internet infrastructure since then.

In Tubes, journalist Andrew Blum goes on a journey inside the Internet's physical infrastructure to uncover the buildings and compounds where our data is stored and transmitted. Along the way, he documents the spaces where the Internet first started, and the people who've been working to make the Web what it is today.

He was also just on C-Span's "The Communicators."

I enjoyed the read and learned a few things along the way. Those looking for a dry, just-the-facts-ma'am approach may not enjoy the frequent musings of Blum on his experiences. But I did.

One of his trips took him to a community in Oregon called The Dalles, where a municipal network allowed Google to build its very first "built-from-scratch data center." More on that in a post to come soon...

Those who are doing their reading on tablets now will be interested to know that the eBook is temporarily priced at $1.99. The deal lasts until New Years according to the author.

New Book Investigates How Big Companies Like AT&T Rip Us Off

A  recent book by David Cay Johnston, The Fine Print, examines specifically how big companies have found ways to take advantage of the tax and regulatory systems to their benefit and to the detriment of consumers. The sad part - we don't even realize it.

Johnston discusses how big companies and their leaders exploit tax rules to re-distribute wealth upwards. Johnston also examines how this exploitation is almost never covered in the media, encouraging big companies to stoop to new lows in ripping off consumers. Telecommunications is one of the industries he covers in the new book.

In the first chapter (read the first chapter via Democracy Now!), Johnston describes how friend and journalist, Bruce Kushnick, came across twenty years' worth of telephone bills in his elderly aunt's possessions. Kushnick tracked the changes in her bills, systematically reviewing and comparing every charge. Kushnick found an array of confusing and cryptic "fees," "charges," and "taxes." The end result:

When he cross-checked his aunt’s telephone bills over the years, he could hardly believe the numbers. His aunt paid $9.51 for her local phone service in 1984. By 2003 her bill had swollen fourfold to $38.90. In the two decades since the breakup of the AT&T monopoly, even after adjusting for inflation, his aunt’s telephone cost $2.30 for each dollar paid in 1984. And that was without any charges for long-distance calls.

Johnston notes the method used by telecoms to increase prices over time:

Bit by bit, the line items grew, and others were added. It was easy to miss the escalating prices because they came separately over time—a nickel on one line of the bill, a quarter or two on another. With many small line items, people tended not to notice how the total was creeping upward much faster than the rate of inflation or the size of their income.

As we continue to watch, big telcos like AT&T take every opportunity to ensure their monopolistic advantage so they can continue these types of activities. Our readers know about the millions invested in lobbying to prevent municipalities from taking steps to providing the means to encourage competition. We see over and over again how any whiff of potential threat to a monopoly will bring swift and heavy retribution.

Johnston also spoke with NPR in a recent interview on Fresh Air. During the conversation, he talked about how the drive to bring benefits of ubiquitous connectivity has fizzled:

We've paid, between cable company rate increases and telephone company rate increases, over a half-trillion dollars to get the Internet.

But what quietly happened without much attention is that the Internet, the standard that these companies had to meet, was a very low standard, far below the quality of the Internet that people have in other modern countries. America invented the Internet, so by the fact is it started out as number one. We now rank 29th in the speed of our Internet, according to Pando Networks.

LUS Logo

In the interview, Johnston talks about Lafayette, Louisiana, and how AT&T, Verizon, and other big telcos have used legislatures and influence to twist regulations as a way to maintain their monopolies:

We are paying super-high prices for low speeds and poor quality, and a number of cities that did not have quality high-speed Internet have built municipal systems. And a good example I tell in the book is about Lafayette, Louisiana. The town fathers there were not going to get electricity over 100 years ago, so they created a municipal electric system.

Well, they also built a municipal Internet, and it is so high-powered and so fast that a lot of the work done for the Pixar animated movies is done, not in Hollywood, but in Lafayette, Louisiana.

Well, the response from AT&T, Verizon, Cox, Time Warner and the other cable and telephone companies has been to go to the legislatures and say we want a law passed that either blocks or makes virtually impossible to build municipal systems. That's competing with our business interests. And that's part of the whole strategy they have: We want to be monopolies without competition; we want to run the system in our interest to maximize our profits, with no regard for the overall economy of the United States.

We wrote the definitive case study of Lafayette's fiber network in our Broadband at the Speed of Light report. Also from the NPR interview:

So what I'm arguing in the book is we need to have a balanced policy. We need to have a policy not just written by and for telephone and cable companies but written to promote the entire economy. If we wired our whole country with a super-fast Internet that can handle all telecommunications services, and we charged appropriately so that the companies earn a respectable profit for it, and the customers pay a reasonable price, I think you would see industries, that no one can imagine today, arise.

In his book, Johnston also covers how big companies and the very wealthy exploit the tax system to avoid contributing to the tax roles. There are even issues of public safety - utility companies receiving waivers to avoid inspecting gas lines due to slack regulations - that have resulted in catastrophe and that are almost never covered in the news.

Democray Now! describes the book:

"The Fine Print: How Big Companies Use "Plain English" to Rob You Blind"... claims you are being systematically exploited by powerful corporations every day. He writes that these companies squeeze their trusting customers for every last cent, risk their retirement funds, and endanger their lives. And, says Johnston, they do it all legally. We’ll ask him to explain the fine print.

The book has also been noticed by VentureBeat's John Koetsier, who focuses on what this type of environment does to our Internet situation:

Slower Internet than Bulgaria. Data rates 38 times more expensive than Japan. And only 5 percent of the upload speed generally found in France.

In his new book The Fine Print, Pulitzer Prize-winning journalist David Cay Johnston tell us, among other things, what’s wrong with the Internet in America. The answer is fairly depressing: It’s too slow, too expensive, and … too controlled by a duopoly of AT&T and Verizon.

Here are two interviews with Johnston, who talks about his book, his findings, and the state or corporate power in the Unted States.

Book: Network Nation

The book Network Nation looks extremely good.  You can learn about the major themes from this event with the author.

Video: 
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