Comments on: Trouble Ahead for Municipal Broadband

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By: Meta Ho

Meta Ho — Wed, 06 May 2015 19:42:00 +0000

America’s slow and expensive Internet is more than just an annoyance for people
trying to watch “Happy Gilmore” on Netflix. Largely a consequence
of monopoly providers, the sluggish service could have long-term
economic consequences for American competitiveness.

Downloading a high-definition movie takes about seven seconds in Seoul, Hong
Kong, Tokyo, Zurich, Bucharest and Paris, and people pay as little as
$30 a month for that connection. In Los Angeles, New York and
Washington, downloading the same movie takes 1.4 minutes for people
with the fastest Internet available, and they pay $300 a month for
the privilege, according to The Cost of Connectivity, a report
published Thursday by the New America Foundation’s Open Technology
Institute.

The reason the United States lags many countries in both speed and
affordability, according to people who study the issue, has nothing
to do with technology. Instead, it is an economic policy problem —
the lack of competition in the broadband industry.

“It’s just very simple economics,” said Tim Wu, a professor at Columbia
Law School who studies antitrust and communications and was an
adviser to the Federal Trade Commission. “The average market has
one or two serious Internet providers, and they set their prices at
monopoly or duopoly pricing.”

By: Brett Glass

Brett Glass — Mon, 19 Jan 2015 00:52:00 +0000

Skorup is correct on all points. I own and operate a competitive broadband provider — the world’s first WISP, in fact — and I would NEVER consider entering a market in which I had to endure classic anticompetitive and predatory practices (because that is what they are) at the hands of City Hall, which also has infinitely deep pockets and the ability to block me from obtaining access to right of way and infrastructure. Residents of cities that opt for municipal broadband can look forward to being served (in the same way that a bull “services” a cow) by an uncaring, intransigent monopoly. When was the last time your city’s government innovated in, or upgraded, its monopoly trash collection, water, or sewer service?

Worse still, residents in rural and even suburban areas outside those cities are likely to lose their service as the municipal network undermines providers like mine, which rely on the economies of scale created by serving customers in town to make it possible to serve customers outside of it. Government will also come under pressure to censor the Net and allow spying on it (remember, City Hall also runs the police department). None of these things are good for consumers. If they know what’s good for them, they’ll fight a government takeover of the broadband business and encourage competition among private providers instead.

By: TheBrett

TheBrett — Wed, 14 Jan 2015 21:18:00 +0000

I don’t particularly care if private ISPs whine up a storm about a publicly funded alternative to their service, if it’s put in place by the elected representatives of a municipality. If they don’t like it, they can pull their money and go somewhere else – there’s no “right to make a profit” rule in US law.

If it loses money, then so what? The taxpayers will foot the bill and deal with the representatives who voted for it. In the mean-time, I’m not seeing a huge amount of regret from Chattanooga, for example.

5. A municipal network can chase away commercial network expansion and
investment. This, of course, is the main complaint of the cable and
telco players.

I sympathize more with a town willing to provide itself broadband than with the ISP thinking about maybe adding service in 5 years, at exorbitant prices.

6. When cities build networks where ISPs already are serving the public,
ISPs do not take it laying down, either. ISPs use their considerable
size and industry expertise to their advantage, like adding must-have
channels to basic cable packages.

Oh, the horror! Incumbent ISPs might have to step up their game! I thought you were in favor of competition.