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« New Satellites Offer Broadband Competition for Connexion | Main | MBOA, WiMedia Alliance Merge UWB Organizations »

March 2, 2005

Texas Towns Fight Anti-Muni Bill

Testimony on banning municipal networks drew 2 1/2 days of testimony (annoying registration required): The chairman of the committee that originated HB 789 is Texas state representative Phil King. He's blunt about where his idea came from: "It was just me, sitting in the hearings," listening to industry representatives talk about broadband, he said. At least he's being upfront about it.

Rep. King is also blissfully clear about his ideology: "It's the idea of a free enterprise system," King said. "As a matter of public policy, we can't let the public sector compete with the private sector."

After weeks of sock puppets and obfuscation, it's so refreshing to hear someone simply state the origin of their assumptions. It's now possible to debate the merits of that proposition. The question to be posed now is whether municipal networks at any price (free, subsidized, or market rates) are public sector competition for free enterprise, or whether monopoly control of broadband in Texas creates a situation in which there is no potential for competition.

Later in the article, Rep. King is quoted stating that he'd like to provide incentives for competition. But I think he misunderstands how powerful SBC really is. There's no way for competition to gain access to communities without using SBC equipment and lines for wireline or digging new trenches. If they go wireless, they'll still be paying and using SBC for backhaul. It's tricky for small competitors to work with giant incumbents that face fines years later for activities deemed anti-competitive. The competitive DSL market in the US essentially died except Covad--which went through bankruptcy, shedding its previous debt and structure--because of efforts by the ILECs to prevent it from blooming.

This is why I keep writing that municipal networks are the choice of last resort, not first. If real competition existed and if competition were protected against predation with aggressive and quick action, then towns and cities would have little to no interest in getting into the market.

The Austin American-Statesman article notes that 16 Texas counties have no broadband service and 93 have a single provider. In rural areas, there may be extremely little broadband availability, too.

Rep. King uses an interesting analogy to describe his position on municipal broadband: A city shouldn't get into the grocery business, even if there's none in town, he said. Instead, he said, the state should provide incentives to companies in places where there is no competition.

But that's not quite apt. It's more like if there is no grocery in town and no farms nearby and no water to irrigate the crops, and a company 500 miles away has legislation passed to prevent irrigation, farming, and grocery stores in that town. Really, we're talking about bandwidth starvation and the legalization of starving these communities through this bill. That's in those counties with no broadband.

If you look at the 93 counties with monopoly broadband providers, it's like saying, the town is okay if there's a single grocery store in the center of town, even if everyone has to drive 5 to 50 miles to get to that store and the store charges a high price for its goods that people can't afford even though in similar towns with other grocery stores they charge much less.

Municipal networking is about feeding people a little bandwidth, most of the town. Sure, there are ambitious fiber-optic projects, too, but most of the attempts to add networks to towns and cities these days are about providing a lifeline for commerce and communications to underserved populations. Even a modified Texas bill would still keep those people with their digital ribs poking out, and would ensure that rural towns in Texas get smaller and poorer day by day.


"This is why I keep writing that municipal networks are the choice of last resort, not first. If real competition existed and if competition were protected against predation with aggressive and quick action, then towns and cities would have little to no interest in getting into the market."

There is no competition for the City of Philadelphia? Or San Jose? Or San Francisco? Sorry, but vendors are falling all over themselves to sell into the big city market.

Maybe there is a legitimate case to be made in the rural market. I like the incentive idea. I dislike monopoly, either government or private sector.

Chuck, among small the Texas towns with wireless projects that I've spoken to, it's a common story that they didn't have broadband until the community started a project. The community begs for service for years. Then, after the community net goes live, then the incumbents suddently arrive.

Dallas is looking to add wifi coverage for its convention district, giving business travelers continual connectivity. Like convention centers and promenades, it's a legitimate way for a city to attract travelers and tourists.

I've read that 40% of Philadelphians didn't have broadband access (Glenn probably has the fact closer to hand). Providers engage in "digital redlining" -- they build out rich neighborhoods first. That's why projects like Houston's Technology for All ( are needed.

There are many different legitimate cases and financial models for city-supported networks. Prohibiting them with the blanket ban in HB789 is overkill. And narrowly carving out permitted models -- apparently Rep. King is looking to exempt libraries -- is overregulation.

As the US slips to #14 in broadband penetration, it's not a good time to try and further restrict useful ways to light the last mile.

Adina Levin (Texas)