Cable Lobby Working Hard To Ensure Biden Broadband Plan Doesn't Encourage Real Competition

from the do-not-pass-go,-do-not-collect-$200 dept

While the Biden administration’s $2 trillion American Jobs Plan set aside $100 billion for broadband infrastructure, the details of how that money is to actually be spent remains murky. Enter cable industry lobbyists, who are hard at work attempting to dictate who gets access to those funds, while also trying to make sure the funds aren’t used for anything that could threaten their regional monopolies. They’re particularly worried about the Biden administration’s promise that a big focus of the effort will be on giving aid to locally owned and operated broadband networks, as detailed in this good piece by Issie Lapowsky at Protocol:

“Comcast, Charter, AT&T and their respective industry associations have spent years beating back municipal broadband networks in states across the country, lobbying for laws that prohibit such networks and arguing that government-funded broadband puts the thumb on the scale of competition. With potentially $100 billion in federal funding on the line, the last thing the cable lobby wants is to see those restrictions lifted and funding diverted to cities, not their own coffers.”

Granted as we’ve noted for years, these communities aren’t getting into the broadband business because it’s fun. They’re doing so as an organic, voter-backed response to decades of market failure and regional monopolization. Said monopolization is obviously hugely profitable, and the cable industry lobby is working overtime to prevent anything upsetting that broken status quo. As Lapowsky notes, Charter and Comcast alone spent $7 million on lobbying Congress last year, and that doesn’t including the millions in additional dollars spent by their policy and lobbying organizations like the NCTA (run by former FCC boss Mike Powell).

Nor does that tally include the millions spent annually by AT&T and Verizon on an army of consultants, lobbyists, think tankers, academics, and astroturfers, all of whom are now working overtime to ensure a lot of that money goes into their pockets, and not the pockets of regional community broadband networks threatening to bring real competition to bear. Networks that wouldn’t exist if America’s entrenched telecom monopolies actually cared about things like competition and consumer welfare.

Historically, the telecom lobby has had success after success when it comes to ensuring the U.S. government doesn’t take regional monopolization and corruption seriously. But as Protocol notes, COVID (specifically news stories showing toddlers having to huddle in the dirt just to get online for class because home broadband either isn’t available or is too expensive) has changed the dynamic and really showcased the harm of monopolization and corruption:

“But as this fight moves from the states to the federal level, local broadband proponents have some advantages they haven’t had before. They don’t just have the backing of the White House and support of Democrats who control Congress. They also have more than a year’s worth of examples of how people on the wrong side of the digital divide in both cities and rural America have struggled during the pandemic ? and how cable giants have failed to fill the gap.”

Even then, some community broadband proponents are expressing concern that the telecom lobby is already having a negative impact on the important terminology being used at departments like Treasury to dictate where U.S. government funding is going to go:

“Earlier this year in March, the Biden Administration signed the American Rescue Plan Act, which included, among many other things, multiple sources of funds for broadband infrastructure. The U.S. Department of Treasury was tasked with writing the rules of how local governments can spend the various funds. The Interim Rule has been published and it appears to significantly limit local ability to invest in needed networks.”

While community broadband is framed by telecom as “socialism run amok” or a “government takeover of the internet” to try and encourage partisan division, being pro-competition and pro-accountability is yet another subject that isn’t actually partisan. Most community broadband networks have been built in conservative areas with the support of local voters. And again, the telecom lobby has a 25 year history of fighting tooth and nail against all broadband competition, not just community-run broadband. While getting slathered in tax breaks and subsidies for networks they routinely half deliver.

It has taken a quarter century to even get the U.S. broadband policy conversation to the point where we can admit (barely!) that monopolization and regulatory capture (corruption) are the two primary reasons U.S. broadband is expensive and mediocre. It’s not clear how many more decades it will take to actually do something about it.

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Comments on “Cable Lobby Working Hard To Ensure Biden Broadband Plan Doesn't Encourage Real Competition”

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18 Comments
Anonymous Coward says:

It’s not clear how many more decades it will take to actually do something about it.

Solving the regulatory problem needs to start with eliminating the short termism and political patronage at the top of the regulatory agencies. As that involves a loss of political power, I am not sure how you go about achieving such changes in an overly political country like the US.

Anonymous Coward says:

Re: Re:

yeah, the real problem is widespread corruption in government legislators and regulators.

it takes 2 to Tango

Big corporate lobbying $$$ don’t work UNLESS the government guys can be bought (which obviously happens routinely)

(P.S. where’s Biden getting that $2 Trillion to toss around? Of course, the Federal Reserve creates it from thin air — Happy Inflation days ahead for us all)

This comment has been deemed insightful by the community.
Anonymous Coward says:

Re: Re:

Overbuilding results in expensive services, as the cost of the unused infrastructure has to be recovered from somewhere. Turn the infrastructure into a regulated monopoly that any ISP can use, the model used by most of the rest of the world, and you can start to solve your problems.

Uriel-238 (profile) says:

Re: Re: Re: Socialism

The market failure of the broadband industry and its regional monopolies is a total indictment of capitalism.

The broadband market has made a case, now for over a decade, that anything would be better than a capitalistic approach, and maybe the states should eminent domain the broadband companies and make them a state-run service.

The state would have to try really hard to do worse than what the public deals with today.

Anonymous Coward says:

Re: Re: Re: Re:

A regulated infrastructure provider for communications does not give the government an ability to regulate the Internet, but only to regulate the pipes that allow you to connect to your choice of ISP. Also, any infrastructure provider overbuilds their networks so as to have the capacity for spare circuits and expansion for the next 10 to 20 years. Duplicating building for equipment, underground duct work, and pole attachments on the other hand is expensive, and if all networks are not fully provisioned some users forced to use the only provider in their area with space capacity.

Anonymous Coward says:

Re: Re: Re: Re:

Every example of overbuilding resulted in far cheaper services.

Most of that effect is the result of competition, not overbuilding per se. Mandated third-party access to the infrastructure—as with the UK’s Openreach, for example—provides a lot of that benefit. It’s possible, even then, that overbuilding would lower costs enough to pay for itself; but I’m not convinced of that.

This comment has been deemed insightful by the community.
That One Guy (profile) says:

'Socialism is terrible! Now about those subsidies...'

While community broadband is framed by telecom as "socialism run amok" or a "government takeover of the internet" to try and encourage partisan division, being pro-competition and pro-accountability is yet another subject that isn’t actually partisan.

Funny how quickly the cries of ‘Socialism!’ disappear when the government’s handing money to huge companies that don’t actually need it, and the gnashing of teeth over ‘government takeovers of the internet’ only seems to apply to infrastructure-level regulations rather than platform ones…

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