Tag: "competition"

Posted June 27, 2011 by christopher

We have an answer to the question of what a city gets when it commits the bare minimum to improving broadband access: more of the same. We were skeptical of Seattle's approach of using city-owned conduit to spur serious improvements to broadband and, it turns out, correct.

Only one company bid on the project, Comcast, a provider in much of Seattle already -- and a much maligned one at that. So Pioneer Square will have better access to the Internet, but from the dominant provider of high speed access in the City.

Seattle just helped Comcast consolidate its monopoly just a bit further. This is a small step forward for Pioneer Square, and a larger step backward for the City as a whole. With FiOS available in the suburbs, offering much faster and more reliable connections for the same prices, Seattle has done very little to stem the flow of techies to the burbs.

The RFP set certain requirements for use of the City's conduit, as noted in the Seattle Times article but one has to wonder if Comcast might be able to negotiate that down - few are better at exercising monopoly power than the Nation's largest cable and Internet provider.

Comcast is slated to pay $78,000 in one-time fees to cover part of the cable's installation, plus $4,057 in annual leasing fees, according to city documents.

The City elected a Mayor who promised to improve broadband access, but it seems the City Council is standing in the way of actually doing anything that would bring residents and businesses a meaningful choice in providers.

Photo, used under creative commons license, courtesy of Jeff Hathaway

Posted June 10, 2011 by christopher

Access Wisconsin, a group of telephone providers working with AT&T to kill a network essential for schools and libraries across the state, claims that using taxpayer money is unfair competition. It is a fascinating argument from a collection of companies that rakes in various state and federal subsidies.

The Milwaukee Journal Sentinel reported these statements from Access Wisconsin this week:

"This is by far the greatest assault we've ever felt from the University of Wisconsin Extension," said Mark Weller, president and CEO of Access Wisconsin, which represents 30 mostly small, rural telecommunications providers. "It's totally inappropriate.

"When services are available through the private sector at a competitive rate and we have to compete against yet another entity that is being funded by the taxpayers, that's just not fair."

Those statements came after increasing outrage around the state following the news that their lobbyists waited until the 11th hour to suddenly insert a provision into an omnibus bill that would kill WiscNet and require the state to return multiple broadband stimulus awards expanding telecommunications services in unserved areas.

But back in February of 2010, when Access Wisconsin was receiving a similar broadband stimulus award, it had a different attitude.

“The Recovery Act grant will bring fiber optic broadband to areas where it would otherwise be too expensive to build.  There aren’t enough customers to justify the cost of the investment without the help of these funds," Weller said.  “The federal grant, along with a 20% state match, is providing the kind of infrastructure for rural schools and libraries that will meet their needs for decades.”
 
The new fiber optic broadband connections will provide new education and economic opportunities in 380 largely rural communities across Wisconsin.  Schools and libraries in those communities will gain dramatically expanded telecommunications access, while the installation of new infrastructure will help make broadband access available for businesses and residents.

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Posted June 6, 2011 by christopher

Information Week has alerted Chief Information Officers (CIOs) that they need to pay attention to community broadband networks. Jonathan Feldman's column explains "What North Carolina's Broadband Battlefield Means to You."

The lessons have little to do with North Carolina and everything to do with the future of broadband Internet access. Community networks offer higher speed, more reliable, and more affordable connections to businesses and other entities than incumbent operators.

Feldman opens with a North Carolina business owner emailing him about wanting to duplicate Chattanooga's amazing broadband options and futuristic smart grid. Too bad North Carolina's Legislature just passed a bill to effectively prohibit NC towns from doing that.

MuniNetworks.org frequently decries the lack of choices among service providers, so it is gratifying to see Feldman make the same point:

Those of us who approve telecom budgets, whether in North Carolina or other states, know there really isn't a broadband marketplace. In contrast, we can choose among 50 providers of Web hosting services, and they're all trying to differentiate themselves based on quality and features. THAT'S a marketplace. What exists today in broadband telecom is essentially a choice between the telco and the region's cable operator.

And further on, a strong endorsement for communities that have made public broadband investments:

Unless you're a telecom carrier, you should be interested in doing business in a region where the government is building out next-generation broadband infrastructure. Whether you work for a large business that requires fiber optic capabilities (or "lambdas," which are virtual fiber pipes), or whether you simply need IP service, the lower price/performance levels of such regions are highly attractive.

Be aware of the telecom regulatory environment in any state your company is expanding into, especially as other states follow North Carolina's example. It may not be a make or break consideration, but it's one that you should bring up with your board when discussing site selection.

Feldman notes that these networks are not easy to build (a point that resonates with us - communities build these networks because they have to, not because they want to).

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Posted June 2, 2011 by christopher

On June 1, the Information Technology and Innovation Foundation held an oxford-style debate over the proposition: "Governments should neither subsidize nor operate broadband networks to compete with commercial ones."  

Jim Baller and I spoke against the proposition while Rob Atkinson and Jeff Eisenach defended it during the 2 hour, 15 minute session.  I was unable to be in DC and thus participated by the magic of modern telecommunications.  

This is a long but valuable and unique discussion.  We left talking points behind, actually responded to the points raised by the other side, and presented both sides of this debate in a reasonable manner.  In short, this is exactly the kind of discussion we would elected officials to consider before legislating on the matter.  But it very rarely happens -- nothing even remotely close to it occured in North Carolina when Time Warner Cable pushed its bill through the Legislature to enact a de facto ban on muni networks in the state.

You can watch it here.

 

Posted May 31, 2011 by christopher

Sign up for a live webcast (or if you are in DC, please attend) of Jim Baller and Christopher Mitchell engaging in an Oxford-style debate on the subject of community broadband with Rob D. Atkinson and Jeff Eisenach on June 1 at 9:00 EDT.

The statement to be debated is: "Governments Should Neither Subsidize nor Operate Broadband Networks to Compete with Commercial Ones."  Guess which side Jim and I will take?

Posted May 29, 2011 by christopher

Government Technology has run an excellent article discussing the passage of Time Warner Cable's bill in North Carolina. We couldn't pass up reposting some of the quotes used in "Municipal Broadband Networks Slammed in North Carolina."

“Essentially this bill is a cable monopoly protection bill,” said Doug Paris, assistant city manager of Salisbury, N.C., another city with its own broadband service. “It protects Time Warner Cable and ensures they will continue to do what they’ve been doing for decades, which is serving where they want to serve and not serving where they don’t want to serve.”

And though it may be tacky to quote myself, I do quite like the quote…

Christopher Mitchell, director of the Telecommunications as Commons Initiative for the Institute for Local Self-Reliance, a nonprofit economic and community development consulting group, agreed and said that there is “almost no chance” another community in North Carolina will be able to build a new broadband network under the law.

“The Legislature, in passing laws like this, shows just how out of touch they are,” Mitchell said.


 
“It’s very clear to me that North Carolina’s legislators don’t understand the difference between a slow DSL connection and a modern, reliable fiber-optic connection. They don’t understand that what Time Warner [Cable] and CenturyLink are selling isn’t helping communities be competitive in the modern era.”

I hope communities and activists around the country have taken note of the power incumbents wield and are starting to talk to elected officials to educate them and build the relationships necessary to counteract all the money in politics.

Posted May 23, 2011 by christopher

Last year, we put together a report with graphs showing how superior the community fiber networks are compared to incumbent operators like AT&T and Time Warner Cable. When we released the report, we noted that Time Warner Cable would almost certainly push legislation in 2011 to limit local authority to choose to build locally owned networks.

Sadly, we were right. On Friday, North Carolina's Governor Perdue bowed to the pressure of TWC, CenturyLink and other companies that want to limit competition. She refused to veto a bill written by those companies, for those companies, that will ensure local businesses and residents will have fewer choices and higher bills when they connect to the Internet.

In February, we dug into TWC's H129 to explain how it threatened the future of broadband access in the Tar Heel state. It was the first of more than 30 posts we wrote since, reporting very closely on its path through a legislature effectively controlled by big-money corporations.

North Carolina has become the first state in perhaps 5-6 years to enact new barriers to prevent communities from building their own broadband networks, even when the private sector has refused to invest. Advocates of the bill pretend it exempts rural areas with little broadband access, but that section was carefully amended by lobbyists to effectively apply to no one.

Below, you'll see the video we produced that shows the real threat TWC and CenturyLink were responding to - the embarrassment of offering anemic, overpriced services compared to networks like Salisbury's Fibrant and Wilson's Greenlight.

We hope that voters will remember whether their elected officials, including Governor Perdue, represented the people and small businesses of the state or simply parroted talking points from an industry that has dumped millions of dollars into the Legislature to buy new regulation to kill the only likely source of broadband competition.

nc-gov-perdue.png

Governor Perdue ignored more than 2,000 phone...

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Posted May 21, 2011 by christopher

With so many community broadband stories breaking this week, I did not dig into an update to Boston seeking authority to regulate some cable rates in response to the many rate hikes they have endured from Comcast. Boston's mayor has previously complained about basic cable rate increases.

The Ars Technica story offers some good regulatory background that limits the power of Boston to do much about rates.

According to the City, Comcast's 2011 Basic Service Rate change went from $13.30 to $15.80 a month. This came in the wake of previous rate hikes—to $9.05 in 2008, to $10.30 in 2009, and to $13.30 in 2010.

That all adds up to "more than 60%, on a service that is supposed to be affordable and is identified in the industry as ‘lifeline service'," Boston says.

"In addition, when comparing Boston to neighboring communities that have rate regulation, Comcast has over-collected approximately $24 million from Boston's Basic Subscribers during the four year period from 2008 through 2011," the City's statement claims. Its own research indicates that neighboring cities that are still regulated, such as Cambridge, have cheaper rates.

This has led the Boston Globe to editorialize "If cable firms act as monopolies, cities should be able to regulate.

When the Federal Communications Commission took away Boston’s power to regulate basic cable rates almost a decade ago, the assumption was that competition for pay-TV services would hold prices down for consumers. That assumption has not panned out. Comcast Corp., the successor to Boston’s original cable franchisee, still dominates — not least because its former monopoly status conveys lingering advantages that hamper competition even now. Those advantages help explain why Comcast’s charges for basic cable — now $15.80 a month for a package of 35 channels, according to a city report — have risen by 75 percent since 2008.

We are strong proponents of public ownership (via local government, coops, or nonprofits) in part because the regulatory environment leaves communities practically no...

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Posted May 17, 2011 by christopher

As readers know, we have devoted a lot of effort to educating everyone about Time Warner Cable's Bill in North Carolina to kill local authority to build broadband networks. As time runs out for NC Governor Perdue to kill this terrible legislation with her veto pen, we have seen many more calls on the Governor to act on behalf of local businesses and residents rather than on behalf of TWC and CenturyLink.

We've written more on this legislation than almost any other topic (all of it available here), so we want to highlight other recent posts.

Some notable recent calls to action come from Larry Lessig's Rootstrikers:

North Carolina has one of the nation's most impressive community broadband movements. Locally owned, state of the art networks are delivering fast, cheap Internet across the state. Big telecom companies--Time Warner Cable in particular--are not happy with their success. They've spent millions on lobbying state lawmakers. Now, the North Carolina legislature has passed a bill that bans competition from community broadband networks. Under this legislation, local communities would be held hostage to the corporate broadband networks that have given America second-rate networks everywhere.

Josh Levy of Free Press wrote the following in Ars Technica:

Predictably, the big cable companies view these municipal upstarts as major threats. Companies like Time Warner Cable and CenturyLink may be unwilling to extend their networks to communities like Cedar Grove, but they don't want anyone else doing it either—such an incursion would pose a threat to North Carolina’s de facto cable duopoly. Ironically, the weapon these traditionally regulation-shy companies have turned to in order to fight the municipal broadband effort is regulation.

Doc Searls also weighed in:

Here’s a simple fact for Governor Perdue to ponder: In the U.S. today, the...

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Posted May 16, 2011 by christopher

Rick Karr, a correspondent with PBS' Need to Know, travels to Europe to investigate why some countries there have surpassed the US in fast, affordable, and reliable access to the Internet -- with a real choice among service providers to boot! Video is approximately 12 minutes.

This video is no longer available.

Additional materials from the video are available at its website.

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