FCC questions state laws that block cities from building their own broadband network

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WASHINGTON — Frustrated with the sluggish speed and high cost of their Internet service providers, the residents of Wilson, N.C., decided a few years ago to take matters into their own hands – they would simply build their own connection.

The city council unanimously voted in 2006 to create a fiber-to-home network that today provides affordable high-speed Internet to homes and businesses, connects schools, and even supplies downtown Wilson with free Wi-Fi.

Incumbent companies Time Warner Cable and CenturyLink were forced to lower their prices and upgrade their service to remain competitive.

Four other communities in the state also launched municipal broadband. Such enterprises irked big-time providers enough that, after years of lobbying and a million dollars in campaign cash, North Carolina in 2011 passed a cable industry-backed law that makes it nearly impossible for any other municipality to do the same. (Time Warner Cable and CenturyLink did not return requests for comment.)

Two weeks ago, the Federal Communications Commission announced that it intends to take a close look at overruling such state laws, which restrict the ability of cities and towns to build their own broadband networks in 20 states across the country.

The legal restrictions on municipal broadband are an “obvious candidate” for the agency’s scrutiny as it seeks to enhance competition, FCC Chairman Tom Wheeler said in a statement.

“This is a very big deal,” said Christopher Mitchell, director of the Telecommunications as Commons Initiative at the Institute for Local Self-Reliance, a nonprofit advocacy group. “The question will be where to draw the line – will they remove all barriers or just the ones that are really onerous?”

State laws resulting from Internet service provider-sponsored bills vary in severity across the country. Florida restricts community broadband by placing special taxes as well as profitability requirements that make it difficult to approve networks like Wilson’s. In contrast, Pennsylvania does not allow municipalities to sell broadband services at all if a “local telephone company” already provides it, no matter how high the price or how poor the service.

“These restrictions are the result of intensive lobbying by incumbent Internet companies who don’t want to see any kind of competition,” said Matt Wood, policy director for the consumer group Free Press. “They have whole armies of people representing their interests.”

Read more here: http://www.mcclatchydc.com/2014/03/04/220125/fcc-questions-state-laws-that.html#storylink=cpy

Edited March 5, 2014 by Porterhouse