Some Good News: FCC's Wheeler Claims FCC Will Preempt State Laws Blocking Broadband Competition

from the now-make-it-so dept

We’re still fairly skeptical about FCC boss Tom Wheeler’s claims that (1) his new open internet rules will actually protect net neutrality or (2) he’s ready to go even further if they fail. However, in his latest attempt to claim that he’s really a defender of an open internet (at a cable lobbying event, of all things), Wheeler also said that he’ll have the FCC preempt state laws blocking municipal broadband competition. If true, this actually could be a big deal. The big broadband players have fought hard against municipal broadband for years, pushing bills in many states. It’s so obvious that these bills are written by the broadband players, that some politicians don’t even hide it.

However, since the Supreme Court said that it was okay to ban muni broadband a decade ago, broadband lobbyists have had a field day, passing such bans in 20 states. For years, we’ve been arguing that the threat against net neutrality is a symptom, not the real problem. It’s a symptom of the lack of competition. And one way to attack the competition problem is via municipal broadband. Yes, some muni broadband projects have failed, but many have been quite successful — and opening up the possibility of competition tends to do amazing things in making the incumbents actually sit up and realize that they need to do a better job.

Given all that, it is a fairly big deal to see Wheeler flat out say that he’s going to knock down those muni broadband bans:

[F]or many parts of the communications sector, there hasn’t been as much competition as consumers and innovation deserve. Given the high fixed costs and consequent scale economies, this isn’t especially surprising. But that makes it all the more important that we knock down public and private barriers to competition and avoid erecting new ones. It is equally important that we encourage competition wherever it is possible.

One place where it may be possible is municipally owned or authorized broadband systems. I understand that the experience with community broadband is mixed, that there have been both successes and failures. But if municipal governments—the same ones that granted cable franchises—want to pursue it, they shouldn’t be inhibited by state laws. I have said before, that I believe the FCC has the power—and I intend to exercise that power—to preempt state laws that ban competition from community broadband.

We’ll see what actually happens. As Jon Brodkin at Ars Technica notes (in the link above), there is still wiggle room, since many of those 20 state bans aren’t technically “bans” — but rather put up huge, impenetrable obstacles to muni broadband. Still, if Wheeler is serious about creating competition this is a very good place to start (though, not nearly enough on its own). Of course, doing so will require fighting the broadband players who, given how much they spent on getting those laws in place, will fight back hard.

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Comments on “Some Good News: FCC's Wheeler Claims FCC Will Preempt State Laws Blocking Broadband Competition”

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27 Comments
Anonymous Anonymous Coward says:

Good

As you say, we will see what happens. If it isn’t in writing, it isn’t, and even then…

Good, because this will open up fiber to the home, for the whole country. Sounds like an economic project with some possibilities. Microwave could be used to reach hard to get to places. Of course there will be those that just don’t want it.

Let us not forget that the industries reach is much further than the state level. I can see, well lets call them industry storm troopers, showing up in any municipality that might consider such a move, with plenty of cash for, and maybe some dirt on local politicians.

Anonymous Coward says:

yes they have spent a lot but that was public money that was supposed to give more people (everyone) better broadband (decent connection speeds) to at least stream and receive streaming video! as for what he says he’ll do, i’m inclined to wait and see. give praise where and when it’s due but not until and make sure it is deserved!

Anonymous Anonymous Coward says:

Competition

There is a point about competition that needs to be made. The FTC is as culpable as anyone. Thinking that 2 or 4 players is a competitive market. They allowed Ma Bell, they allowed single provider for cable and called a telco the competitor, they allowed the wireless market get down to four instead of creating a level playing field so the smaller guys could expand, and therefore compete.

The FCC is not out of this as they allowed the big players to take all the bandwidth, and could have set different rules.

How we got here is not my point. That we are here, and that those are the two agencies with the responsibility to act.

My pessimism extends to, I don’t think that they will. Too much money in the system.

Anonymous Coward says:

What about townships and counties where private franchise monopolies have already been granted to private broadband ISPs, such as Comcast and Verizon.

Will these existing franchise licensing agreements prevent the building of municipal broadband projects? Will existing franchise licensing agreements still prevent other private broadband ISPs from moving into an area and offering competing services? Such as allowing Cox Cable and Comcast Cable to compete in the same franchise licensed area?

It sounds to me like deceiving weasel words from our current commissioner/lobbyist at the FCC, Mr. Wheeler. If Wheeler is serious about competition, he would declare regional franchise licensing agreements as anti-competitive and illegal.

If history is any kind of gauge of FCC commissioner sincerity, then we need look no further than former FCC commissioner Meredith Attwell Baker. Four months after approving the 16.7 billion Comcast NBC Universal merger, she immediately took a lobbyist job at Comcast.

History paints a dim picture of the future for American broadband subscribers.

Mason Wheeler (profile) says:

I’ve said it before, but it bears repeating. In today’s society, broadband service shares certain characteristics with electricity and water: everyone (within epsilon) uses it, losing service would have an immediate adverse impact on quality-of-life, and technical and economic factors tend toward natural monopolies with high barriers to entry.

Let’s call a spade a spade. ISPs fill the role of public utilities; let’s legally recognize (and regulate) them as such.

Anonymous Coward says:

“For years, we’ve been arguing that the threat against net neutrality is a symptom, not the real problem. It’s a symptom of the lack of competition.”

Competition won’t fix a damn thing. ISPs stand to make a lot of money by having both ends of a TCP connection as their paying customers. They will never act against each other in such a way as to reduce their customer base back to what it was under network neutrality rules. They will compete in other ways, but they’ll never kill the goose with the golden egg.

Anonymous Coward says:

Competition

“For years, we’ve been arguing that the threat against net neutrality is a symptom, not the real problem. It’s a symptom of the lack of competition.”

Competition won’t fix a thing. ISPs stand to make a lot of money by having both ends of a TCP connection as their paying customers. They will never act against each other in such a way as to reduce their customer base back to what it was under network neutrality rules. They will compete in other ways, but they’ll never kill the goose with the golden egg.

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