In all the talk of the need for competition in broadband (or in the mobile space), there is remarkably little attention paid to the difficulties in actually creating competition. A common refrain from the self-interested industry titans (and their many paid flacks) is: "keep the government out of it and let the market decide."
Unfortunately, an unregulated market in telecom tends toward consolidation at best, monopolization at worse. Practicioners of Chicago economics may dispute this, but their theories occur in reality about as frequently as unicorn observations. In our regulatory environment, big incumbents have nearly all the advantages, allowing them to use their advantages of scale to maintain market power (most notably the ability to use cross-subsidization from non-competitive markets to maintain predatory pricing wherever they face even the threat of competition).
The de-regulatory approach of telecom policy over the past 10 or more years has resulted in far less competition among ISPs, something Earthlink hopes to change with a condition of the seeming inevitable NBC-Comcast merger. Requiring incumbents to share their lines with independent ISPs is one policy that would greatly increase competition - but the FCC has refused to even entertain the notion because big companies like AT&T and Comcast are too intimidating for the current Administration to confront.
In the Midwest, Windstream is cutting 146 jobs as part of its acquisition of Iowa Telecom. When these companies consolidate, they can cut jobs to lower their costs... but do subscribers ever see the savings? Not hardly. The result is less competition, which leads to higher prices. Consider that Comcast is the largest cable company, but they are known better for their poor record of customer service than low prices enabled by economies of scale.
We need broadband networks that are structurally accountable to the community, not private shareholders located far outside the community. The solution is not more private companies owning broadband infrastructure, but more private companies offering competing services over next-generation infrastructure that is community owned by coops, non-profits, or local governments.
Photo by therichbrooks on Flickr - used under Creative Commons license.
At a recent Martinsville City Council meeting, the council offered unanimous support for a phased expansion of the city’s Municipal Internet Network (MiNet). What exactly the expansion will look like, and how it will be funded, very much remain a work in progress. Despite having been first constructed in the 1990s, Martinsville’s MiNet only has about 376 customers in a city of nearly 14,000 residents. There’s roughly 20 users currently on a multi-month waiting list, eager to get access to affordable fiber at speeds up to a gigabit per second (Gbps).
Golden, Colorado has struck a new right-of-way agreement with Google Fiber that should expedite the competitive delivery of affordable fiber to the city of 20,000. The deal gives Google Fiber non-exclusive access to public right-of-way to build a commercial broadband network, though it delivers no guarantee of uniform access across the entire city.
In January, we released our new census of municipal networks in the United States for 2024, and the significant growth that we've seen over the last two years as more and more cities commit to building Internet infrastructure to add new tools for their local government, incentivize new economic development, and improve connectivity for households. The trend has not gone unnoticed by the monopoly players and their allies, and a new short documentary by Light Reading does a great job of outlining the stakes for local governments, residents stuck on poor connections, and the incumbents as the wave of municipal networks grows.
Eagle, Idaho is preparing to connect the first of the city’s 32,000 residents to a new, municipally-owned open access fiber network. The project, which the city says will take between five to 10 years to complete, is being heavily funded by federal grants, and aims to meaningfully boost broadband competition – and affordable access – citywide.
Boulder, Colorado officials have issued a new request for proposal (RFP) seeking partners for their ongoing quest to deliver affordable fiber to the city of 104,000. The city is offering potential partners a long-term lease of city-owned dark-fiber backbone infrastructure and a right of way agreement for the construction and operation of a network delivering gig speed or more to all Boulder homes and businesses.
Windstream Communications and local nonprofit electrical cooperative Colquitt Electric Membership Corp are partnering on a $32.5 million fiber deployment that will bring fiber optic broadband to 17,000 homes and businesses in Colquitt County, Georgia. Once completed sometime next year, the partnership should help deliver last-mile fiber access to roughly 70% of Colquitt County residents, many of which either have no current broadband access, or have long been stuck on sluggish, expensive, and dated digital subscriber line (DSL).