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As Cities Push For Their Own Broadband, Cable Firms Say Not So Fast

Jan 17, 2015
Originally published on February 2, 2015 12:19 pm

Americans increasingly see decently fast Internet as more like a functioning sewer line than a luxury.

And a number of cities are trying to get into the Internet provider business, but laws in 19 states hamper those efforts. President Obama announced this week that he wants to lift those restrictions, and supporters of what is known as municipal broadband can't wait.

During a speech in Cedar Falls, Iowa, the president presented a plan promoting high-speed Internet for the country's more remote cities and towns. The executive director of Next Century Cities, a coalition promoting high-speed Internet, Deb Socia, says dependable high-speed broadband has become a social justice issue.

"This is about people, and people in communities who need resources for businesses, for e-government, for participatory democracy, for health care, for transportation, for education," she says. "Everything we do is related to our access to technology."

Anyone who's waited for a page to load or a stalled movie to resume wants faster Internet. But the major Internet service providers don't face much competition in many places, so they're not that motivated to upgrade. Faced with that, some towns have gotten into the Internet service business themselves.

"They started their municipal electric utility over a century ago, long before we had computers and toasters and microwave ovens, on the faith that this electricity thing was going to be important to the local economy," says Mikel Kline, who works for a municipal broadband company in Chanute, Kan. "Well today, the city fathers have that same vision about this broadband network."

Chanute's broadband network runs about 100 times faster than typical American Internet. Kline says it's given his remote Kansas town one of the fastest growing junior colleges in the country, and connected its hospital to distant specialists.

Kline, who's an engineer, says all of this was feasible because Chanute already ran its own electric utility.

"They already have line workers, they already have utility poles, the rights of way. The infrastructure is largely in place," he says.

But the cable industry has a warning for towns that don't have that ready-made infrastructure, says Brian Dietz of the National Cable and Telecommunications Association.

He says there have been "several examples where government-run networks have failed because they aren't able to compete effectively with private-run networks."

Dietz points to Provo, Utah, which spent more than $39 million building a fiber network. The system lost money, and the city wound up selling it to Google for $1. Dietz says Internet service providers have invested more than $230 billion nationwide building networks.

They've also been pretty successful at convincing state legislators that taxpayer-funded municipal broadband is a bad idea. Nineteen states now prohibit or at least discourage public involvement in the broadband business.

"We've got the largest city-wide, robust, gigabit network in the country," says Ken Hays, who works with the gigabit network serving Chattanooga, Tenn.

The city built it on its publicly owned electric utility, just like in Chanute. Chattanooga wants to expand service to outlying areas, where Internet speeds plunge, but it ran into one of those prohibitive state laws.

"Our electric utility actually petitioned the [Federal Communications Commission], along with Wilson, N.C., to ask the FCC to use their authority to override the legislatures," Hays says.

That's what Obama wants in all 19 states, but Internet service providers and some Republican members of Congress say the FCC has no authority to meddle in the way states regulate the Internet.

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Americans increasingly see reliably fast Internet as being a utility - more like a functioning sewer line than a luxury. A number of cities are trying to get into the Internet provider business, but laws in 19 states hamper that. President Obama announced this week that he wants to lift those restrictions. And supporters of what's known as municipal broadband can't wait. Frank Morris of member station KCUR reports.

FRANK MORRIS, BYLINE: While President Obama talked in Iowa about municipal broadband, an auditorium full of people in Kansas City, attending something called a Gigabit City Summit, cheered him on.

(SOUNDBITE OF SPEECH)

PRESIDENT BARACK OBAMA: Leaders from 50 cities and towns across the country - it's a coalition called Next Century Cities.

(SOUNDBITE OF CHEERING)

MORRIS: It's a coalition promoting high-speed Internet. Its director, Deb Socia, says fast, dependable broadband has become a social justice issue.

DEB SOCIA: This is about people and people in communities who need resources for businesses, for e-government, for participatory democracy, for health care, for transportation, for education. Everything we do is related to our access to technology.

MORRIS: Anyone who has ever died a little waiting for a page to load or a stalled movie to resume wants faster Internet. But major Internet service providers don't face much competition in many places, so they're not that motivated to upgrade. Faced with that, some towns have gotten into the Internet service business themselves. Mikel Kline works for one of them - Chanute, Kansas.

MIKEL KLINE: They started their own municipal electric utility over a century ago, long before we had computers and toasters and microwave ovens, on the faith that this electricity thing was going to be important to the local economy. Well, today, the city fathers have that same vision about this broadband network.

MORRIS: Chanute's broadband network runs about 100 times faster than typical American Internet. Kline says it's given his remote Kansas town one of the fastest-growing junior colleges in the country and connected its hospital in high def to distant specialists. Kline, who is an engineer, says all this was feasible because Chanute already ran its own electric utility.

KLINE: They already have line workers. They already have the utility poles, the rights of way. The infrastructure is largely in place.

MORRIS: But the cable industry has a warning for towns that don't have that ready-made infrastructure, says Brian Dietz with the National Cable & Telecommunications Association

BRIAN DIETZ: So there's been several examples where government-run network have failed because they aren't able to compete effectively with private-run networks.

MORRIS: Dietz points to Provo, Utah, which spent more than $39 million building a fiber network. The system lost money, and the city wound up selling it to Google for a buck. Dietz says Internet service providers have invested more than $230 billion nationwide building networks. They've also been pretty successful at convincing state legislators that taxpayer-funded municipal broadband is a bad idea. Nineteen states now prohibit, or at least discourage, public involvement in the broadband business.

KEN HAYS: We've got the largest, citywide, robust, gigabit network in the country.

MORRIS: Ken Hays works with Chattanooga, Tennessee's, 600-square-mile gigabit network. The city built it on its publicly owned electric utility, same at Chanute. And Chattanooga wants to expand service to outlying areas where Internet speeds plunge, but it ran into one of those prohibitive state laws.

HAYS: Our electric utility actually petitioned the FCC, along with Wilson, North Carolina, to ask that the FCC to use their authority to override the legislators.

MORRIS: That's want President Obama wants in all 19 states. But Internet service providers and some Republican members of Congress say the commission has no authority to meddle in the way states regulate the Internet. For NPR News, I'm Frank Morris in Kansas City. Transcript provided by NPR, Copyright NPR.