Bill Would Reverse Bans On Municipal Broadband

Yuppie writes "A bill introduced to the House this week would overturn bans that currently exist in several states that forbid cities and towns building and deploying their own broadband networks. The big telecoms may not be be too happy about the bill, however: 'The telecoms have historically argued that municipalities that own and operate — or even build and lease — broadband networks could give themselves preferential treatment. The Act anticipates that argument with a section on "competition neutrality." Public providers would be banned from giving themselves any "regulatory preference," which should create a level playing field for all broadband providers. Municipalities interested in getting into the broadband business would also have to solicit feedback from the private sector on planned deployments.' The full text of the bill (pdf) is available from Rep. Boucher's website."

Re:preferential treatment

[Cathbard]

As an ex long term telco employee I can confirm that telco's give preferential treatment to corporate "strategic partners" (collusion anybody?) that would boggle your mind. These corporate discounts could never be matched by a municipality due to the scale involved. The amount of pocket pissing that goes on would make your stomach turn but when a telce does it it is is simply called standard business practices. How is a council giving preferential treatment to their customers any different?

Deregulated in many parts of Europe

[DELNI-AA]

Interesting that the US is taking a rather regulation-friendly route! In Sweden, anyone can apply to each local municipality to pull your own fiber - and I have never heard anyone being denied that. In rural areas aswell as cities, many municipalities have pulled their own fibers in order to give their areas a improved competitive edge when any of the main telcos have not been up to the task quick enough. The business model many have choosen is a completely open one; the offer to lease dark fibers, wavelenghts on lit fibers, and in many cases all the way up to the IP level. And yes, they will give themselves preferential treatments by connecting schools, administrations and hospitals to a well working, high-capacity network at competitive cost -. a service level that would not have been available to them otherwise. Many individual networks are interconnected, forming regional gigabit networks. Facilities for co-location of equipment is generally also on offer. I believe most Telcos has seen this as an opportunity since it gives the access to more infrastructure at lower risk of investment. I woud attribute the high broadband penetration and low costs in Sweden partly to this de-regulation. According to recent figures 97% of the households can have at least DSL access and about 20% have a fiber to their home.

Re:what type of "regulatory preference"?

[TheRaven64]

Typically this kind of regulatory preference comes with certain extra demands. As I recall, he USPS is the only carrier allowed to take first class mail but they trade off for this is that they are required to provide equal cost delivery for everyone. Here in the UK, Royal Mail deliveries in rural Scotland are subsidised by the cost of stamps in England. The price of a stamp is set at close to an average delivery cost. If you used an unregulated private carrier, then they would charge you more for sending something from London to Scotland than to another part of London.

The rationale behind this kind of regulation is that communication is vital economic infrastructure, and the flat rate fees make the country as a whole more competitive. When the post office was in charge of telecommunications, they were required to connect a certain percentage of the population each year. A private telecoms company could have just gone after the ones that gave the biggest ROI. This is happening now; you have a lot more options for broadband in Central London, where the population is densest, than in many other areas.

Re:Screw this

[Enigma2175]

The problem is that the municipalities are granting monopolies on last-mile transport to private enterprise instead of handling it themselves. If I have to pay Comcast or Qwest for my connection, they insist that they make a profit off of it. However, if my city owns the network all they demand is that they break even on it. My current connection is 15 Mb/s symmetrical fiber. It costs me about $36/mo. Previously I was paying Comcast $45-$50/mo for a 3Mb/512Kb connection. Yes, it cost the city some money to lay the fiber but now that it is installed the maintenance is fairly cheap and EVERY house in the city has a connection to the network. There are multiple service providers for data, phone and TV so there is no monopoly pricing, if you don't like your current provider you can switch. You can rant about government pork, but the local government generally does a better job of controlling overhead and grift than the federal. You are criticizing hypothetical networks but I am sitting on a real one and from my perspective, it is sweet. I am getting way better speeds at a lower price than I was before. Yes, some of my tax dollars had to be used to build the network, but with the monthly cost savings I am coming out ahead. I am generally not for expanded government but where it comes to natural monopolies like utilities and roads, sometimes government does a better job than business.