Municipal Broadband: An Idea Whose Time Has Finally Come

Per Kevin Drum, the Federal Communications Commission has done more than simply establishing net neutrality rules this week, as reported by the Wall Street Journal‘s Thomas Gryta:

The Federal Communications Commission will allow some cities and towns to set up and expand municipal Internet services, overruling state laws that had been put in place to block such efforts.

The commission granted petitions by Chattanooga, Tenn., and Wilson, N.C., to overturn laws that restricted the ability of communities in those states to offer broadband service. In all about 20 states have passed such laws. The panel’s 3-2 vote was along party lines.

The decisions don’t affect the other states, but they do set a precedent for consideration of similar petitions in the future.

FCC Chairman Tom Wheeler and President Barack Obama have said towns need to be free to build their own networks if they decide it makes sense. Towns that explore the option generally do so because they believe private sector development of broadband hasn’t kept pace with their needs.

As Kevin notes, this is a major inducement to the big internet providers to play pretty.

And it’s an argument that should be familiar to long-time WaMo readers, who may remember a 2006 piece by John Podesta and Robert McChesney on the promise of municipal broadband.

Community Internet has the potential to revolutionize and democratize communications in this country. And that may be the reason why big cable and telephone companies and their political allies have launched a sophisticated misinformation campaign. These companies and their coin-operated think tanks generally make three paradoxical arguments against municipal broadband. First, they contend that municipalities have no place in the “free market.” Of course, the cable and telephone giants don’t mention that their own monopolies–which control 98 percent of the broadband market–have been cemented with extensive public subsidies, tax breaks and incentives (as well as free rein to tear up city streets). Verizon, for instance, didn’t complain last fall when Pennsylvania handed them subsidies for broadband deployment worth nearly 10 times what Wireless Philadelphia will cost. Neither did Comcast object when Philadelphia approved a $30 million grant to build a skyscraper that will house its headquarters. To the incumbent providers, “unfair competition” means any competition at all.

Opponents also warn that municipalities will “crowd out” more efficient private players. In reality, most municipal networks are a last resort by desperate local governments. Often their choice isn’t between a municipal system and a private one, but between municipal and nothing. (Of course, that doesn’t stop the phone and cable companies from trying to outlaw Community Internet even in areas where they don’t currently offer service.) A recent study by the Florida Municipal Electric Association found “no evidence” to support the argument that municipal systems limit private investment. On the contrary, these systems appear to spur investment by bringing entrepreneurs and new competition into the market. Even threatening to build a system has a funny way of encouraging the incumbents to improve service and lower their prices.

The same critics of Community Internet claim that cities are too “lazy” or inefficient to manage complex systems and will be unable to adapt to changing technologies. But municipalities have a long track record of successfully and efficiently operating power plants, sewage systems and subways. It’s hard to imagine that the broadband networks–most of which will actually be operated by private contractors–are any more complex. Perhaps the more obvious question is: If these systems are destined to fail, why are the telephone and cable companies expending so much energy trying to stop them?

Well, that’s all history now. Municipal broadband is an idea whose time has finally come.