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San Francisco Proposal For Tenant ISP Choice - Community Broadband Bits Podcast 231
Cities across America are implementing policies that create friendly environments for Internet Service Providers in order to encourage competition. In San Francisco, the Board of Supervisors is now considering legislation that will create choice for residents or businesses in multi-welling units, or MDUs. In episode 231, Mark Farrell, a member of the Board of Supervisors, joins us to discuss the proposal.
City leaders have worked in various ways to chip away at the digital divide and have discovered that a number of MDU building owners do not allow more than one ISP access to their buildings. As a result, residents have no option but to subscribe to the ISP of the owner’s choice, or have no service at all. The proposed ordinance will put an end to that practice by ensuring that building owners do not deny tenants choice and do not deny ISPs access to their buildings.
In this interview, Mark discusses the need for the ordinance and what city leaders hope to achieve with this new policy. When they investigated the issue, they realized that it impacted a significant number of stakeholders. Mark acknowledges the care of the city’s approach in encouraging competition, supporting responsible entrants, and doing so in a community with a range of old and new structures. The city is eager to improve their connectivity and this policy is one step in a larger plan.
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Mark Farrell: The MDU access policy is truly part of a broader scope here in San Francisco of work around Internet connectivity and Internet access.
Lisa Gonzalez: Welcome to episode 231 of the Community Broadband Bits Podcast from the Institute For Local Self-Reliance. I'm Lisa Gonzalez. Residents of apartment building or other types of multi-dwelling units don't always have their choice of Internet service provider, even if they're two or three companies competing in their neighborhood. Owners of the buildings they live in have been known to restrict access to the buildings to one provider. As a result, tenants who want Internet access have no practical choice at all. In episode 231, Mark Farrell joins Christopher. Mark is from the San Francisco Board of Supervisors and has introduced legislation that would create an ordinance to allow competing ISPs access to multi-dwelling units. Mark explains the ordinance and why the city needs to implement it. He also describes how this policy is only one part of the city's greater effort to improve connectivity for all its residents. Now here's Chris talking with Mark Farrell, supervisor from the San Francisco Board of Supervisors about a new proposal to remove restrictions of subscriber choice for people who live in multi-dwelling units.
Christopher Mitchell: Welcome to another edition of the Community Broadband Bits Podcast. I'm Chris Mitchell. Today I'm speaking with Supervisor Mark Farrell of the San Francisco Board of Supervisors. Welcome to the show.
Mark Farrell: Thanks for having me.
Christopher Mitchell: I think I'd like to jump right in and just ask, you're proposing a law that deals with condo and apartment buildings. What would your law fix?
Mark Farrell: Right now in San Francisco we have a huge number of multi-dwelling unit buildings, or MDUs as they are called, where tenants have not been able to get access to the Internet service providers that they want. We obviously have a number of larger incumbents here in San Francisco, but fundamentally from my perspective, Internet access has to be viewed in today's world as a economic right. It's no longer a nice to have, it's simply part of functioning in our every day lives. This fits along the theme of expanding Internet access, certainly across our country, but more specifically here in San Francisco, and making sure that when there are Internet service providers that want to access these larger buildings that our laws are as flexible as possible to make sure that that happens and we can facilitate that.
Christopher Mitchell: You actually are aware of circumstances in which there are people in these buildings that cannot get access to the provider of their choice?
Mark Farrell: Absolutely. We have had a number of Internet service providers that have started to work in San Francisco over the past number of years including Google that have documented tens of thousands of tenants in our city that want access to different ISPs, but are not able to gain access because of landlord or other building rules. Again, we want to to work with our building owners. We want to work with our tenants, with our Internet service providers including the major incumbents here in San Francisco to really put forth legislation that facilitates access across the board. Ultimately, buildings are going to be better off, right? If you think from a building owner's perspective so long as we put the right provisions in place, if they are wired with more ISPs, better connectivity, the value of their buildings are going to increase as well. It's certainly a tenant issue in particular here in San Francisco and I'm simply a strong believer in making sure that we facilitate Internet access as much as possible here in our city through laws like this and other mechanisms as well.
Christopher Mitchell: Just briefly, I saw that the number of buildings that could be impacted by this is in the hundreds.
Mark Farrell: Absolutely. I don't think that I realized when we dug into this issue how pervasive the matter is here in San Francisco, how many it actually could affect. But when we did a lot more research and again, worked with both building owners and ISPs and doing our own research here at the Board of Supervisors, realized really how large the issue is here in San Francisco and wanted to make sure we did everything possible to correct and facilitate once again Internet access and the ease of Internet access for residents of San Francisco across the board.
Christopher Mitchell: Now, one of the things I find interesting is the different providers that are involved. I saw that Caltel is consulting with you on this. You're working with some of the local providers. You mentioned Google. I have some sense that there's a little bit of hesitation from the incumbents who presumably have more of these contracts that would potentially be voided through this legislation. But it sounds like there's a real discussion. This isn't something that's sort of just the Board of Supervisors pushing it on the city. This is something where there's a real ecosystem discussion going on.
Mark Farrell: Having worked on a lot of connectivity and Internet access issues over the last two years and we have a pipeline of issues that we're going to continue to push in this arena here in San Francisco. Fundamentally that we're the innovation capital of the world in San Francisco, yet our download speeds on average are on par with Mexico City is simply a shame. We need to be much better. We need to be a lot more forward thinking here in our city. I am happy to and eager to push the envelope on these issues to make sure that we really capture a lot of the really ethos of our city and make sure that the technology that is making our city so famous right now is coming down to roost and really to the benefit of everyday residents in our city. Even if they're not involved in the technology industry. Once we've dug into this issue and how many residents it did affect, from my perspective I'm not one to work on legislation without consulting that it affects. From building owners to tenants to incumbents ISPs to ISPs that are attempting to create a market here in San Francisco, I want to make sure that we did something that everyone was aware of. We've had multiple meetings with every constituent group that this affects. We'll continue to do so and we've amended the legislation to make sure that we reflect certain questions or concerns. Make sure that if there was any oversight on our end that we, while keeping obviously the core of the legislation intact that we were able to do things to make sure that people could support the legislation as well.
Christopher Mitchell: Speaking of oversight, one of the things that I found interesting is that I couldn't just show up at an apartment building and say, "Let me in. I'm an ISP." There's a procedure and an ISP has to register with the California Public Utilities Commission. Is that something new or is that just you're taking advantage of something that's already been happening?
Mark Farrell: This has already been happening. That is one provision we're continuing to look at here at the Board of Supervisors and potentially subject to amendment, but the basic principle is that we want to open up the market in San Francisco to serious ISPs. We don't want to be a mom and pop or Supervisor Mark Farrell out there with his new consulting business or new ISP business, a one-man shop and opening up a ton of liability issues or otherwise or enabling people who are not seriously in this business. We want to make sure there's a threshold level here of ISPs. That people have the right licenses, have the correct approvals, whether it be at the state level or otherwise, to make sure these businesses both tenants and building-owners know are legitimate. That they're coming into these buildings because ultimately we don't want this to be fly by the seat of their pants, fly-by-night businesses that disappear. When we're talking about wiring, we're talking about other things, infrastructure inside of buildings. We obviously want to incentivize companies and ISPs that are built to last and that are going to continue to take their ISP responsibilities seriously for years to come.
Christopher Mitchell: Something I want to note again is that we're talking about proposed legislation. My impression is that this is something that has support, but is still be amended and you just made a comment to that. We'll talk toward the end of the conversation in a couple of minutes just about what the next steps are. But I wanted to get into a few of the details. One being, one of the things I've found as I learned about this industry is that internal wiring can be a mess I'm curious how your legislation deals with all the different situations from a building that may already be set-up for multiple ISPs to a building that is only set-up for one ISP today. How does your legislation tackle that?
Mark Farrell: It's a great question. Pretty core to the actual implementation of this bill. What we want to do is provide access for a broad range of ISPs to come in and compete. We obviously are not prioritizing one or the other. We want to just enable competition and hopefully from our residents perspective that ultimately will mean better service and cheaper prices. When an ISP comes into a building, they have to first of all provide all insurance and indemnification if there's any construction or any connectivity that they're going to have to -- Or work they have to do on the building or connecting to the building, that is all the responsibility of the new ISP that comes in. In terms of once they're in the building, I think there's obviously going to be a question here, do they use existing internal wiring, existing utility boxes. If they do so, they're going to have to pay what's called just and reasonable compensation and that's a defined term under state law that will have to -- Those details will be worked out between the new ISP or the building owner. We want to make sure, again, that we enable competition, but at the same point in time, any ISP that comes in is going to have to bear the financial responsibility both from a construction or what have you. Compensating people for using their utility boxes or tapping into existing wiring, but also making sure that they're the ones bearing the indemnification, other insurance costs of all the work that goes involved.
Christopher Mitchell: You mentioned the just and reasonable compensation, which was one of the other points. You mentioned it's already codified in state law. It's a known concept. But would that allow a landlord to demand $10 per month per subscriber or something along those lines?
Mark Farrell: We wrote the law on purpose to make sure it complies with state law. If we did anything different and if we got more proscriptive, it would subject the law a lot of legal vulnerability. I think that is one part of the legislation that we will have to see what happens in the open market. Obviously, if ISPs come in and strike a relationship or a financial arrangement with a building owner without the use of our legislation, more power to them. We'd actually very much encourage that. Our legislation is there to be relied upon if need be and I think the cases are very much there and the need is there today, but if it goes down that road, it's going to be a private negotiation and hopefully it's something that the parties can settle. Ultimately, could a court weigh in here? Absolutely, but it was not going to be prudent for us and this legislation to actual prescribe anything more than the state law provides.
Christopher Mitchell: I think it's wise to provide that floor and to let others build on it. One of the articles that I read suggested that over time we'll see what happens as I think the courts deal with this, if there's disputes and people aren't able to solve their issues amongst themselves.
Mark Farrell: Exactly. In many facets of life, if the courts don't have to be involved, but if they do obviously that's what they're there for and we want to make sure that we're doing everything we can to set-up the legislation to be middle of the road, to be just. Ultimately, again, if the courts have to weigh in, they do.
Christopher Mitchell: One of the things that a lot of Next Century cities, San Francisco being one of the many Next Century cities in the organization. One of the things we've seen from cities is that they're really interested in this, but their abilities to pass these sorts of laws really depend on the state that they're in. What is it about California law that allows you to do this? I think you already mentioned that you're kind of within a narrow area and bounds that you have operate within, but how do we know that San Francisco is allowed to do this under California state law?
Mark Farrell: I think what we've seen is across the country in a number of states, some of the larger incumbent telecom players pushing legislation that prohibits local municipalities from either pushing larger fiber projects on their own or really implementing any law they're under. We simply don't have that here in California. It's truly the absence of prohibitive legislation at the state level that allows us to do this. It's the status quo here in California. Obviously we don't want to see that in Sacramento. I have a strong sense that would never pass in our state. If you see some of the states that have passed these laws, they're heavily red states across our country and I simply think it would be a massively bad idea from a public policy perspective. But we have to be realistic that other states do have this prohibitions in place and the states that do are severely constricted in terms of what they can do at the local level. Fortunately, that's not the case with us in California and which allows us here in San Francisco to again be progressive about the issues that we're going to push.
Christopher Mitchell: I think that's one of the benefits of home rule that my organization so beloves. Just as we wrap up, what are the next steps for making this happen?
Mark Farrell: We had the legislation act committee last week on November the 30th and it will be in front the full Board of Supervisors this afternoon and in order for a law to pass here in San Francisco, it needs two votes of the Board of Supervisors. Obviously our hope is that by the end of the legislative session here in December we will have the law passed and it will start to be implemented early next year.
Christopher Mitchell: Great. Well, I think that's really exciting. This is going to be a wonderful precedent. Is there anything else you want to tell us about what San Francisco's doing or what you'd like to see the city do?
Mark Farrell: From my perspective, this MDU access policy is truly part of a broader scope here in San Francisco of work around Internet connectivity and Internet access. Internet access is simply a fundamental right and it should be viewed as such in today's world. It has been reclassified at the federal level as utility. I actually was able to pass legislation earlier this year in 2016 to make sure that any future broadband or fiber efforts in San Francisco, across the city is actually housed under a public utilities commission. It's really time as a country and certainly as a city that we start talking about it in those terms. More importantly, in our city the digital divide is very much a part of our city today. As we are the innovation capital of the world, as we have such a technology revolution happening in our own city, we still have over 100,000 San Francisco residents without Internet access at home, which is crazy from my perspective. Another 50,000 residents that have dial-up speeds. This is a fundamental issue that we very much have to work on here at home. This is a piece of the puzzle, but it's part of a broader picture that I think very much we need to address as a city. If we're going to both be serious about lifting those up that need our help in our society in our city, without Internet access I simply don't know how people function in today's world, or certainly how we're expected to give people a leg up in today's world without Internet access at home. More importantly, from an infrastructure perspective, we want to continue to be the innovation capital of the world for decades and generations to come and if we continue to have lying infrastructure from business perspective, that's also a problem. There's all the reason in the world to work on this issue. There's all the reason in the world to push this issue hard. This legislation again will be a piece of the puzzle, an important piece from my perspective, but it's certainly part of a broader topic that we're going to continue to push here inside of City Hall.
Christopher Mitchell: Great. Thank you so much for taking the time today and also for being a real leader on these issues. This is the first time we've seen legislation like it and it's terrific.
Mark Farrell: Thanks for having me on today and I look forward to continuing the discussion.
Lisa Gonzalez: That was Mark Farrell, a supervisor with the San Francisco Board of Supervisors, discussing their proposed ordinance that will allow more competing ISPs access to multi-dwelling units. Check out the San Francisco tag at MuniNetworks.org for more on this story and other developments in the city. Remember we have transcripts for this and other Community Broadband Bits Podcasts available at MuniNetworks.org/BroadbandBits. Email us at podcast@MuniNetworks.org with your ideas for the show. Follow Chris on Twitter. His handle is @CommunityNets. Follow MuniNetworks.org stories on Twitter, where the handle is @MuniNetworks. Subscribe to this podcasts and all of the podcasts in the ILSR family on iTunes, Stitcher or wherever else you get your podcasts. Never miss out on our original research by also subscribing to our monthly newsletter at ILSR.org. Thank you to Admiral Bob for the song Turbo Tornado, licensed through Creative Commons and thank you for listening to episode 231 of the Community Broadband Bits Podcast.