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AT&T Makes Good On Threats, Sues In Nashville

AT&T lawyers filed suit against Nashville just two days after Mayor Megan Barry signed the new One Touch Make Ready (OTMR) ordinance into law. The Metro Council passed the proposal for the final time, and sent it on to the Mayor, on September 20th.

Seeking Out Streamlining

OTMR was proposed by Google Fiber, which wants to enter the Nashville market by deploying an aerial fiber network. In order to do that, they need to attach fiber-optic cables to utility poles around town, but the current process is cumbersome and will significantly delay the rollout. OTMR streamlines the procedure but would allow some one other than AT&T to manage the rearrangement of wires on all poles in the Nashville rights-of-way. The telecom giant owns about 20 percent of the poles in Nashville; the city’s electric utility, NES, owns the rest.

Three Arguments

AT&T seeks a permanent injunction to stop the city from enforcing the new ordinance. They argue the city does not have the authority to enforce the ordinance - that role is within federal jurisdiction through the FCC.

They go on to state that the Metro Council does not have the authority to pass the ordinance because, according to the city charter, only the Electric Power Board the has the right to pass regulations that deal with issues related to equipment, such as poles and the cable on them. 

AT&T also asks that the court grant a permanent injunction on the basis that they already have a contract with the city relating to AT&T’s wires that are on NES poles. The contract allows the company to handle its own wires and enforcing the ordinance would basically nullify that component of the contract.

What This Is Really About

AT&T filed a similar suit in Louisville earlier this year when the Metro Council there passed OTMR; that suit is still ongoing. Google Fiber wants to serve both communities and, in typical AT&T fashion, the telecom giant is attempting to use the courts to put a block on them. Even before the final Metro Council vote, AT&T threatened to sue if the measure passed. “The short answer is the One Touch Make Ready proposal Google has offered is a proposal that we expect would result in litigation,” said Joelle Phillips, President of AT&T Tennessee. Mayor Barry had asked that the ISPs and NES all work together to come up with an agreement but AT&T was determined to slow Google Fiber’s deployment, hindering its success.

Lawyers On Loan

Google Fiber has offered assistance to Nashville in the form of its legal team. Before the final vote, Google’s parent company Alphabet had already committed to helping out:

“Google Fiber is disappointed that AT&T has threatened to go to court in an effort to block Nashville’s efforts to increase broadband competition should the OTMR ordinance pass,” Fleur Knowlsey, senior counsel of Alphabet’s Access group, which manages Google Fiber, wrote in an email to the council on Monday.

“We believe the city's commonsense initiative will be upheld in the face of any litigation. We know, however, that litigation can be challenging and expensive. In the event of OTMR litigation, Google Fiber will therefore be glad to share the capabilities of its in-house and outside attorneys, including some of the most experienced and accomplished regulatory attorneys in the industry.”

Read the complaint here.

Mr. and Mrs. Monopoly Seek Treatment with Competify

Check out this new video from the Competify coalition. The short 2-minute feature introduces viewers to Mr. and Mrs. Broadband Monopoly, who are clearly suffering from "chronic broadband access control."

Meet Mr. and Mrs. Broadband Monopoly

Competify focuses on raising awareness about the long term damage caused by lack of high-quality Internet access competition. Our livelihoods suffer when a small number of huge corporate telecommunications providers control connectivity. The coalition provides hard information on how these de facto monopolies and duopolies negatively impact our lives and how a more competitive environment can help.

Here is a statement from Competify and the Partners for the Cure:

The largest data collection ever conducted by the FCC and almost a decade of advocacy by those throughout the broadband economy have finally brought us to this long-awaited milestone — the FCC’s review of the high-capacity broadband market. As the incumbents struggle to come to terms with the fact that their own behavior has given them chronic broadband access control, they seem to be trying to blame the high-capacity broadband lines they sell for their very own conduct. Here at COMPETIFY, we have a message for those critical high-speed broadband lines: from powering schools and libraries to 5G to the Internet of Things, we think you are pretty “special.” And today is a major step toward your freedom.

It’s important to note that a very common symptom of chronic broadband access control is confusion. Indeed, the large incumbent companies have gone to great lengths to explain why the lines providing vital broadband service to our businesses, hospitals, schools, government buildings, banks and countless other indispensable institutions are “not very special anymore” and are “obsolete.” By all means, if those interests insist on that point of view, then they should have no concerns whatsoever about this proceeding, as they have obviously moved on to more “special” technologies.  In the meantime, the rest of the broadband economy anxiously awaits the FCC’s efforts to finally cure this diseased marketplace.

Visit the Competify website to learn more and to sign the petition asking the FCC to take action to encourage competition through smart policies.

Seniors, Low-Income, Disabled Communities Pay the Price in St. Paul

For seniors, low-income residents, and the disabled in Saint Paul, Minnesota, a Comcast discount within the city's franchise agreement is not all it was cracked up to be. The Pioneer Press recently reported that, as eligible subscribers seek the ten percent discount guaranteed by the agreement, they are finding the devil is in the details - or lack of them.

This is a warning to those who attempt to negotiate with Comcast for better service. Comcast may make deals that it knows are unenforceable. 

"No Discount For You!"

For years, Comcast held the only franchise agreement with the city of St. Paul. In 2015, the city entered into a new agreement with the cable provider and, as in the past, the provider agreed to offer discounts for low-income and senior subscribers. Such concessions are common because a franchise agreement gives a provider easy access to a pool of subscribers.

It seems like a fair deal, but where there is a way to squirm out of a commitment, Comcast will wriggle its way out. 

Comcast is refusing to provide the discount when subscribers bundle services, which are typically offered at reduced prices. Because the contract is silent on the issue of combining discounts, the city of approximately 298,000 has decided it will not challenge Comcast's interpretation:

The company notes that the ten percent senior discount applies only to the cable portion of a customer's bill. Comcast has maintained that it is under no legal obligation to combine discounts or promotions, and that bundled services provide a steeper discount anyway.

Subscribers who want to take advantage of the discounts will have to prove their senior status and/or their low-income status. In order to do so, Comcast representatives have been requesting a copy of a driver's license or state issued i.d. 

CenturyLink Picks Up the Baton

In November, the city approved an additional franchise agreement with competitor CenturyLink. That agreement also provides that seniors, low-income households, and disabled residents are eligible to receive a ten percent discount. CenturyLink can, in the alternative, offer a discount of $5 off a subscriber's cable bill if a subscriber applies for the low-income discount. In order to receive this discount, the subscriber must prove they are enrolled in a public assistance program. CenturyLink is not compelled to provide both the $5 reduction and the ten percent discount under the terms of the agreement.

The CenturyLink contract states that bundling discounts will not forfeit the $5 discount but does not say the same for the alternative ten percent discount.


Seniors on the Chopping Block

Discounts for low-income seniors are at risk in the CenturyLink contract reports the Pioneer Press. The contract offers the company an "out" by allowing it to exchange a senior discount to residents for free gigabit per second (Gbps) service at centralized locations. Rather than offering a ten percent discount to senior subscribers at their homes, CenturyLink can provide the high-speed connectivity to two St. Paul senior centers or to one senior center and a community center and present two training session per year on using the Internet.

My own parents, who are elderly and leave the house less frequently than they have in the past, depend on their Internet connection to stay in touch with their kids. A number of elderly folks are lower-income. Ten percent, a modest sum to a profit machine like Comcast, could be the tipping point for whether or not elderly people living on fixed incomes subscribe.

Would I rather have Mom trudging through the St. Paul snow to wait in line at the senior center to Skype in a noisy room filled with other seniors? No. Will Mom go to the senior center? Probably not. This trade-off is not equitable.

When You're All Lawyered Up, It's Easy to Break Promises

As franchise agreements expire across the country, communities like St. Paul will be negotiating new contracts or considering other options. Companies like Comcast and CenturyLink, backed by armies of lawyers, have turned backhanded negotiating into an art form. Cities like St. Paul employ smart, capable attorneys, but telecommunications is highly specialized; few communities have legal staff experienced in this field.

Lose The Big Companies, Gain Control

Contrary to the typical behavior of Comcast and CenturyLink, publicly owned networks have a history of lowering prices or increasing speeds for free. When we ask why, decision makers usually tell us they make the change because it's good for the community. Subscribers are the shareholders when a network is publicly owned.

Communities that invest in municipal networks shake off dependence on big providers like Comcast and CenturyLink. By investing in their own infrastructure, they spur economic development, save public dollars, and become more self-reliant. 

Missouri Legislature Off to Another Anti-Muni Session: Pick Up Your Phone and Call!

If you pay attention to state laws affecting municipal networks in Missouri, you are experiencing an unsettling feeling of deja vu right now. On January 7, Representative Lyndall Fraker introduced HB 2078, a bill much like last year's Senate anti-muni bill. Fraker is Chair of the House Utility Infrastructure Committee, where  the bill is now awaiting a hearing, so it has a good chance of being heard sooner rather than later. 

Your Phone Call Required! 

Time to call Members of the Committee, especially if any of them represent you, and let them know that you expect them to vote against this bill. It is anti-competitive, opposed to local authority, and prevents new investment. Bad bill! 

Preventing Partnerships to Maintain The Status Quo

This bill would not only make it extremely difficult for local communities to invest in publicly owned Internet networks, but would complicate and delay public-private partnerships. A number of communities across the country already own infrastructure and are exploring ways to partner with private providers who want to use it to serve schools, businesses, and residents. If a community wants to lower telecommunications costs or obtain better services, this legislation would have them first jump through a series of obscure, expensive, and cryptic hoops. This legislation creates barriers that serve no purpose except to erect hurdles that discourage local communities from finding better providers.

The requirements in HB 2078 and its companion bill SB 946 are clearly intended to limit competition - to maintain the existing de facto monopolies and duopolies within Missouri. As we have seen in places like Westminster, Rockport, and in Missouri's North Kansas City, partnerships are filling a gap in places where incumbents don't feel justified investing or communities are not ready for their own high-quality Internet networks. A key benefit to allowing partnerships is the establishment of competition in areas where there is only one provider who has no reason to work to please its subscribers.

According to HB 2078, before a community can even consider offering any type of service:

"...the competitive service is not being offered to fifty percent of the addresses by any combination of service providers within the boundaries of such city, town, or village."

In other words, existing de facto monopoly status in places where there is only one provider can be easily preserved by the Missouri State Legislature if this piece of legislation passes.

State Lawmakers Impose Their Will On Local Decisions

The bill also dictates specific criteria for feasibility reports, waiting periods, and fiscal impacts. HB 2078 directs the city on specific loan requirements, limits borrowing to $500,000, and dictates interest terms. Along with other restrictions, the bill shackles local governments to the point where investing in better infrastructure is not practical.

Give the Locals What They Want!

Once again, state lawmakers are stepping over the line when they should be stepping back from it. Missouri has existing barriers that discourage publicly owned networks and negatively impact rural communities overlooked by large corporate providers. Rather than perpetuate this harmful state of affairs, state lawmakers should look to the future, strike down the state's existing barriers, and give local communities full authority to decide their own connectivity future.

Local Governments and Internet Access Debate - Community Broadband Bits Episode 185

For this week's Community Broadband Bits podcast, we are trying a discussion/debate format between myself, Christopher Mitchell, and Ryan Radia, Associate Director of Technology Studies at the Competitive Enterprise Institute. We have debated previously and prefer a style of seeking to flesh out the argument rather than merely trying to win it.

We start by discussing the role of incumbents in limiting competition and what might be done about it. Next we move to bandwidth caps. On both of those points, we have pretty significant disagreement.

We finish by discussing the role of conduit and poles, where we have some agreement. If you like this show, please do let us know and we'll try to have more in this style.

The transcript from this episode is available here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 22 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

You can can download this Mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music, licensed using Creative Commons. The song is "Warm Duck Shuffle."

Happy Halloweek from MuniNetworks!

This time of year, goblins and ghouls are in plentiful supply. There is, however, a much scarier prospect than kids in rubber masks and bad Halloween candy: the reality of our monopolistic internet service providers. Enjoy the following images designed for Halloween and feel free to distribute widely.





Comcast Merger Wrap-up and Anti-Monopoly Policy - Community Broadband Bits Episode 148

In the aftermath of the Comcast/TWC merger being effectively denied by the Department of Justice and Federal Communications Commission, we thought it was a key moment to focus on antitrust/anti-monopoly policy in DC. To discuss this topic, we talk this week with Teddy Downey, Executive Editor and CEO of the Capitol Forum as well as Sally Hubbard, Capitol Forum senior correspondent and expert on antitrust.

We start off with the basics of why the Comcast takeover of Time Warner Cable posed a problem that regulators were concerned with. From there, we talk more about the cable industry and whether other mergers will similarly alarm regulators.

We end with a short discussion of what states can do to crack down on monopolies and the abuse of market power. Along the way, we discuss whether DC is entering a new era of antimonopoly policy or whether this merger was just uniquely troubling.

We learned about Teddy and Sally from Barry Lynn at the New America Foundation, who we had previously interviewed for one of my favorite shows, episode 83.

Read the transcript from our discussion with Sally and Teddy here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 24 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

Listen to previous episodes here. You can can download this Mp3 file directly from here.

Find more episodes in our podcast index.

Thanks to Persson for the music, licensed using Creative Commons. The song is "Blues walk."

Remembering David Carr, and His Writing on Monopoly Power

Stacy Mitchell, Co-Director of ILSR and Director of the Community-Scaled Economy Initiative, took a few moments to look back over the work of David Carr. Carr's work included investigating monopolies in the telecommunications space. Stacy's story, re-posted here, originally ran on

What will we do without David Carr, the brilliant media columnist at the New York Times who died last week? At ILSR, we will especially miss his writing on monopoly power, Amazon, and the book business. Below we’ve excerpted and linked to a few of his best recent pieces on those subjects.

In Modern Media Realm, Big Mergers Are a Bulwark Against Rivals — July 16, 2014

Comcast’s bold strategy of acquisition kicked off a wave of defensive consolidation, fueled by a combination of fear and abundant capital in the media realm.

I talked to the head of one company that creates television and movies, who expressed a common sentiment. “When Comcast decided to get bigger,” he said, “we all had to ask ourselves, Are we big enough? We all have to think about getting bigger.”

And why not? No one is stopping them.

With big data, a Big Brother government and now big media, size creates its own prerogatives. When Amazon used its market dominance to limit access to Hachette books over a price dispute, regulators yawned. When AT&T and DirecTV propose a tie-up in response to Comcast, the market issues are just another deal point. Cable companies slowed down content from clients (which are also competitors) like Netflix, and it was treated as a business dispute.

For the most part, the current government has passed on regulating potential monopolies, and as citizens, we have become inured to the consequences of bigness.

Amazon Absorbing Price Fight Punches — June 1, 2014

Someone forgot to tell the book business that it was dead. Last Thursday afternoon, I walked over to the Javits Center in Manhattan, where a throng of people had gathered for BookExpo America, the industry’s annual campfire — so many people that I wondered if there was a free whiskey concession…

The immense space was brimming with a surprising amount of optimism: After years of downward spiral, the industry seems to have found some kind of equilibrium.

It has also watched with a mix of giddiness and anxiety as the Hachette Book Group, one of the big Manhattan publishers, has taken on Amazon in a bitter dispute over pricing. Hachette is suffering big losses because Amazon is delaying delivery of Hachette titles while also eliminating discounts. (Its authors are getting clobbered in the process.) Amazon is taking a reputational hit for not putting its customers first, which has long been its guiding philosophy.

Hachette is the first big publisher to enter talks with Amazon since the last round of negotiations, and book people have rejoiced watching the bully get sand — a heap of negative press — kicked in his face.

Amazon, beloved by Wall Street (until recently) and its customers for putting growth and low prices ahead of profits, is getting a bit of an image makeover right now, and the results have not been pretty.

On one level, this is just one corporate giant fighting with another — Hachette is owned by Lagardère of France — over the share of e-book profits. So why the fuss? The answer is that books are different from the thousands of other products Amazon sells.

As the uproar grows, Amazon is learning that while it may own the publishing industry with a 40 percent market share of all new books sold, according to Publishers Weekly, it doesn’t own the debate….


Growling by Comcast May Bring Tighter Leash — Sept. 28, 2014

Comcast has a long corporate tradition of smiling and wearing beige no matter what kind of criticisms are hurled at it. That public posture is in keeping with the low-key approach favored by Brian L. Roberts, the company’s chief executive, as he seeks to take over the world. It’s worked very well so far.

But in a filing submitted to the Federal Communications Commission last week in defense of its proposed merger with Time Warner Cable, the company lashed out uncharacteristically at its critics. And David L. Cohen, Comcast’s chief lobbyist, continued the salvo in comments to reporters and in his written remarks.

Watching Comcast’s ballistic response to opponents of its $45 billion takeover bid was a bit like watching a campaign debate go off the rails. The front-runner, ahead by 20 points, is besieged by ankle-biters who suggest he is a lout and a bully. He finally loses it and goes off on his opponents in a fury, generally acting like, well, a bully.


Questions for Comcast as It Looks to Grow — April 6, 2014

It is hard to say how rugged the questions will be when Comcast goes before the Senate Judiciary Committee on Wednesday to defend its proposed megamerger with Time Warner Cable.

We do know that Comcast is feeling pretty confident about its chances. In a recent interview with C-Span, David Cohen, an executive vice president at Comcast and the man who will represent the company, said, “ I have been struck by the absence of rational, knowledgeable voices in this space coming out in opposition or even raising serious questions about the transaction.”

Really? How can the largest cable company in the country bid to buy the second-largest and gain control over 19 of the country’s top 20 markets — corralling a 30 percent market share in cable and a 40 percent share in broadband — and there be no serious questions?


Why Barnes & Noble Is Good for Amazon — July 14, 2013

Having a bookstore in your neighborhood, as opposed to one that is bookmarked on your browser, is an invitation. Not long ago, I was walking by an airport bookstore and thought, “What if this was the only place to buy books?” Similar to Hollywood, only the blockbusters would get shelf space…

Bookstores offer discoverability, not just the latest Dan Brown or Carl Hiaasen book on the front table, but sometimes treasures deep in the stacks, a long tail of midlist authors and specialty books. Even as the book business consolidates, the physical object displayed in an actual place will continue to be an important part of the ecosystem.

Let’s hope it survives.


Telecom’s Big Players Hold Back the Future — May 19, 2013

Ms. Crawford argues that the airwaves, the cable systems and even access to the Internet have been overtaken by monopolists who resist innovation and chronically overcharge consumers.

The 1996 Telecommunications Act, which was meant to lay down track to foster competition in a new age, allowed cable companies and telecoms to simply divide markets and merge their way to monopoly. If you are looking for the answer to why much of the developed world has cheap, reliable connections to the Internet while America seems just one step ahead of the dial-up era, her office — or her book — would be a good place to find out.


Navigating a Tightrope With Amazon — April 29, 2012

Mr. Bissinger, who has built a franchise on journalistic excellence and rhetorical intemperance — see his Twitter account — managed to choose his words carefully when talking about how his e-book ended up as a bug on the windshield of Amazon’s relentlessness on pricing.

That may have a little something to do with the fact that he has a great big book, “Father’s Day,” being released by Houghton Mifflin Harcourt in just two weeks. It would be a bad time to stick his finger in the eye of a company that sells more books — including his — than any other company in the world.

“It’s a shame that the e-book was not on sale at Amazon,” he said. “Amazon is a crucial outlet for any author, and when you lose them, it’s terrifying. It’s a killer for ‘After Friday Night Lights’ because it was just gaining momentum and books have a very small window of opportunity.”

Like Wal-Mart, Amazon is big enough to set prices in certain categories. Suppliers are left to scramble to meet those objectives or pass up the opportunity to work with the largest retailers in the world. Amazon’s might when it comes to pricing will only grow as the impact of the Justice Department’s lawsuit begins to emerge. But sometimes the company’s tactical aggression lands hard on the people who supply it.


Book Publishing’s Real Nemesis - April 16, 2012

The Justice Department finally took aim at the monopolistic monolith that threatened to dominate the book industry. So imagine the shock when the bullet aimed at threats to competition went whizzing by Amazon — which not long ago had a 90 percent stranglehold on e-books — and instead, struck five of the six biggest publishers and Apple, a minor player in the realm of books.

That’s the modern equivalent of taking on Standard Oil but breaking up Ed’s Gas ’N’ Groceries on Route 19 instead…

But pull back a few thousand feet and take a broader look at the interests of consumers. From the very beginning and with increasingly regularity, Amazon has used its market power to bully and dictate. It leaned on the Independent Publishers Group in recent months for better terms and when those negotiations didn’t work out, Amazon simply removed the company’s almost 5,000 e-books from its virtual shelves. The Seattle Times just published a series with examples of how Amazon uses its scale not only to keep its prices low, but also to keep its competitors at bay…

After a week of watching the Justice Department and Amazon team up, I’ve learned that low prices come with a big cost. Maybe I’ll order it at my local bookstore instead.


Photo of David Carr by Ian Linkletter.

Greater Minnesota Partnership Focuses on Non-Metro Need - Community Broadband Bits Podcast 136

Like many states, Minnesota has a major metro area that generally has higher quality Internet access than non-metro communities. The Greater Minnesota Partnership, a coalition of businesses, chambers, nonprofits, and cities from across the state, have made improving Internet access a major priority in their efforts to influence the state legislature.

This week, we talk with Dan Dorman, Executive Director of the Greater Minnesota Partnership. He is also a former Minnesota state Rep and remains a small business owner. We discuss the need to improve access even as major cable lobbyists fight in the capital to preserve the status quo. The Partnership believes state barriers to community networks should be removed.

Dorman offers a unique perspective as a former member of the Minnesota Legislature. He knows what it is like to be lobbied constantly by one side of the issue but rarely hear from the other. Fortunately, the Greater Minnesota Partnership is working to provide that other side as best it can.

We previously discussed the Border-to-Border fund in episode 119.

Read the transcript from this conversation here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 28 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

Listen to previous episodes here. You can can download this Mp3 file directly from here.

Find more episodes in our podcast index.

Thanks to Persson for the music, licensed using Creative Commons. The song is "Blues walk."

Checks and Balances

The Supreme Court unanimously rejected efficiency as an excuse for industrial dictatorship when it ordered the breakup of Standard Oil despite the fact that the company had lowered the cost of a gallon of kerosene by more than half. The Supreme Court unanimously rejected the efficiency argument again in 1935 when it ruled President Roosevelt's National Industrial Recovery Act unconstitutional. In every case, the American people embraced not efficiency but freedom and moved to protect that freedom through the erection of intricate systems of checks and balances designed to scatter power.