The FCC should topple NC limits on public Internet networks

Published February 23, 2015

Editorial by News and Observer, February 22, 2015.

This Thursday the Federal Communications Commission may improve North Carolinians’ chances of getting inexpensive, high-speed Internet access without having to go through cable and telephone companies.

In a ruling that could vastly expand high-speed Internet access here and across the nation, the FCC will respond to petitions from the cities of Wilson and Chattanooga, Tenn., seeking permission to expand their municipal broadband networks. The two cities have established successful networks that deliver low-cost, high-speed Internet access, but their ability to serve customers outside their borders is limited by state laws passed at the behest of commercial Internet providers.

A green light from the FCC would allow the two cities to serve customers outside their boundaries who are clamoring for Internet access that is both faster and cheaper than what they get from commercial providers. It would also help rural areas gain high-speed access to the Internet, bolster local schools and help local businesses.

Prospects for approval are good. President Obama favors municipal broadband and FCC Chairman Tom Wheeler said in June that communities that want to provide their own broadband service “shouldn't be stopped by state laws promoted by cable and telephone companies that don't want that competition.”

However, the public option may not become more widely available in North Carolina even if the FCC asserts that municipalities can build their own networks. In 2011, the General Assembly passed legislation making North Carolina one of 20 states that restrict municipal broadband network. The North Carolina law’s sponsor, state Rep. Marilyn Avila (R-Wake), says she expects the state to sue to preserve the ban if it is overturned.

In 2009, Avila unsuccessfully sponsored a bill restricting municipal networks with then-state Rep. Thom Tillis (R-Mecklenburg). They argued that it was necessary to “level the playing field” because municipalities had unfair cost advantages in competing with commercial Internet providers. After Republicans took control of the General Assembly in 2011, Avila pushed the bill through by emphasizing a different rationale – local taxpayers should be spared the risk that a municipal network might fail.

Avila, who has received $13,000 from Time Warner’s PAC over the past four years and another $2,000 from AT&T, says her concern is protecting taxpayers, not commercial providers. In any case, she says, North Carolina municipalities receive their authority from the state and the state should be able to limit their ventures.

“We’ve gone beyond the question of municipal broadband right or wrong. It’s now a question of state sovereignty,” Avila said.

Avila would prefer to make the debate turn on legal concepts rather than the state’s awkward effort to hold back its municipalities from better serving their residents. But rarefying the issue won’t justify what is clearly legislative water-carrying for cable and phone companies. Indeed, the very strength of the commercial opposition testifies to the consumer appeal of municipal broadband networks.

The FCC should knock down this state-sponsored protection for commercial providers and set Wilson and all municipalities free to give their residents high-speed Internet access at the lowest cost possible.

Read More NC SPIN >>

February 23, 2015 at 9:25 am
Norm Kelly says:

It's easy to tell just from the headline that this editorial appeared in the N&D. It supports government expansion into private business. Only a socialist believes that governments should be in ANY business. Witness the state ownership of ABC stores. Who controlled the state when ABC was implemented? Libs! Is it necessary for the state to OWN the stores in order to control alcohol sales? Of course not, but libs default desire is to remove private business at every opportunity. Again, witness socialized medicine. This is only step one, and the libs/socialists have told us so!

'at the behest of commercial Internet providers' AND those of us who understand the difference between choice of service providers and being trapped by another government agency! Will allowing government to be in the Internet BUSINESS improve competition, improve price, offer better speeds? Based on WHAT government agency/action, exactly? Even die-hard socialists can't show examples of how government interference in ANY market has improved anything for consumers.

'that is both faster and cheaper than what they get from commercial providers'. Is this because government service NEVER has to show a profit? Is it because ALL taxpayers will pay for this service even if they choose not to subscribe? Or will every taxpayer in the district be FORCED to either join this service or have no service at all? We all know that government REMOVES all competition in every market they get involved in - they take over or they don't get involved. Will it be faster because the government can spend money to put in fiber without care of the cost whereas private business has to justify the expense of fiber? Will it be cheaper because the tax base will offset the cost of the service? Will the employees who support, implement, sell the service be government employees who's payroll doesn't come from the service but from general tax funds? Will the benefits to these employees come out of income from the service or will the benefits come from general tax funds? These are important questions to know the answers to in order to determine if it's actually a better deal or if it's just ANOTHER shell game played by politicians.

'help rural areas gain high-speed access to the Internet, bolster local schools and help local businesses'. Wow, so much wrong with this statement it's hard to know where to start! First, rural areas. This is so wrong, such a lie, since EVERY phone bill in the nation is charged a federal government fee in order to support rural area implementation. For years, the feds have been sucking money from all of us who have a phone bill to pay private companies to run wires throughout the nation. So, if the GOVERNMENT is in the business of providing phone wires, or data service, to rural areas, what would allowing GOVERNMENT to be in the Internet provider business do to this existing scheme? How would this affect my phone bill? Would the existing federal charge go away if local governments are allowed to start providing service? Be real, you know that's a pipe dream! Bolster local schools how? Again, government at every level insures that private business is forced to support this effort. Allowing government to 'compete' with private business as an Internet service provider would NOT change this at all, it might even reduce service at a higher actual cost! Currently, Internet service providers, private businesses, offer Internet service to local school districts at reduced cost. If government provides this service, will it be free? If it's free, which is almost guaranteed, where does that cost go? Trick question; every lib/socialist will get it wrong! Help local business? This is the responsibility of GOVERNMENT? The truth is that the more GOVERNMENT gets out of the way of PRIVATE BUSINESS the better it ALWAYS is for business and usually the consumer. The best approach is to allow private business to make a profit so that it's worth continuing to expand their business and provide better faster cheaper service to EVERYONE who wants to pay for Internet service. Government involvement in Internet business will ruin it for more people than it 'helps'! I used to pay $24.95 per month for dial up service. I can now get high-speed, always on, instant Internet access for as little as $19. How did government interference in the market make this happen? Did private business implement this better, faster, more reliable service on it's own, or was it forced by government edict? What part of government interference in the market will make this better? At a better actual cost!

Here's a surprising statement: 'President Obama favors municipal broadband'. No kidding! What socialist scheme does the unqualified socialist community organizer occupier NOT favor? His 'net neutrality' plan has nothing to do with improving service to anyone, reducing cost for anyone, it's just another socialist scheme to get government control of a private business. Kinda like his idea/scheme that socializing health insurance will reduce costs, improve service, provide MORE coverage, allow me to keep my doctor, allow me to keep my current policy. That kind of socialism doesn't and can't help anyone!

'because municipalities had unfair cost advantages in competing with commercial Internet providers'. And?! Can you prove this statement wrong? No! Why? Because it's a TRUE statement. Reference my above notes. Truth hurts. Usually it hurts socialists, but that's just one more fun aspect of being truthful!

Again, since this post supports expanding socialism in the nation, it's obvious that it ran in the N&D. Conservative ideas get very little play in the N&D. Socialism, and socialist candidates/politicians, tend to get a lot of support from the N&D. Can the N&D show how existing municipal Internet service has improved anything for anyone? Can the N&D, or any other socialist organization, show statistics for how municipal Internet service is paid for, how the employees are paid, how employee benefits are handled, and what the true cost of the service is, both to those who USE the service and to those who are taxpayers in the municipality, pay taxes, but don't take advantage of the service? Can the N&D show how much taxpayer money is spent on this venture, and how it's being paid back by the profits of the service? Of course, the answer is 'no' because the service will not be profitable. They may be able to play with the stats but the truth will be obvious anyway. The municipality won't charge the actual cost of the service to those who use the service, and eventually the private business will not be able to afford to remain in the area because of unfair, taxpayer-supported government intrusion into the business. Kinda like mass transit. Taxpayers support this forever. Riders never pay for the cost of the service. Those of us who don't use the service pay for it anyway through our taxes. Another socialist scheme that will cost taxpayers dearly! Nothing about government getting into the private business arena makes sense. Socialism fails every time, every where its tried. Just open your socialist eyes and do some research of your own. Mike Moore tried to show us how communist medical care in Cuba was better than ours, but he actually proved his theory wrong. Cuz it's impossible to compare freedom to socialistm/communism and have freedom lose!

February 23, 2015 at 9:59 am
Richard Bunce says:

Only if the local government sets up the Internet service as a standalone utility service whose only source of revenue are Internet service customers, uses no government owned assets such as land/buildings, and the government units taxpayers are not liable for any debt incurred in setting up the service.

This would make it unlikely that such a service could be set up as finding investors would be unlikely without the backstop of the taxpayers.

Instead review NC Statutes and Local government ordinances to make sure there are no impediments to private internet service providers from establishing new service in an area with existing providers. Opening up additional frequencies available for this service would help to avoid the cost of laying additional cable/fiber.