It looks as though the big telecoms that provide
internet service in North Carolina -- Time Warner Cable, AT&T, etc. -- will
score a major victory in their assault
on municipal internet. This victory has been made possible thanks to Governor
Beverly Perdue's indecisiveness on the matter.
I. Governor Beverly
Purdue Chooses Inaction over Ruffling Feathers
Purdue issued
the following statement on Friday in regards to House Bill 129 (H.129):
I
believe that every school, household and business in North Carolina – no matter
where they are – should have access to efficient and affordable broadband
services.
There
is a need to establish rules to prevent cities and towns from having an unfair
advantage over providers in the private sector. My concern with House
Bill 129 is that the restrictions the General Assembly has imposed on cities
and towns who want to offer broadband services may have the effect of
decreasing the number of choices available to their citizens.
For
these reasons, I will neither sign nor veto this bill. Instead, I call on
the General Assembly to revisit this issue and adopt rules that not only
promote fairness but also allow for the greatest number of high quality and
affordable broadband options for consumers.
Since Governor Purdue has chosen not to sign the bill, it
will automatically become law in North Carolina.
II. H.129: “No Soup
for You!”
H.129 would put restrictions on cities that
currently provide internet service to its citizens (Wilson, Salisbury,
Morganton, Davidson, and Mooresville), and would significantly hinder any
efforts by other cities to pursue their own municipal internet services.
H.129 ensures that companies like Time Warner Cable and AT&T will continue to
be the dominant players in most N.C. markets, even with higher pricing and speeds
that often lag far behind what cities themselves can provide for its residents.
Some of the provisions in H.129 state that cities:
- Shall provide nondiscriminatory access to
private communications service providers on a first-come, first-served basis to
rights-of-way, poles, or conduits owned, leased, or operated by the city unless
the facilities have insufficient capacity for the access and additional
capacity cannot reasonably be added to the facilities.
- Shall not use city resources that are
not allocated for cost accounting purposes to the city-owned communications
service to promote city-owned
communications service in comparison to private services or, directly or
indirectly, require city employees, officers, or contractors to purchase city
services
- Shall not subsidize the provision of
communications service with funds from any other noncommunications service,
operation, or other revenue source, including any funds or revenue generated
from electric, gas, water, sewer, or garbage services.
- Shall not price any communications service below
the cost of providing the service, including any direct or indirect subsidies
received by the city-owned communications service provider and allocation of
costs associated with any shared use of buildings, equipment, vehicles, and
personnel with other city departments.
Companies like Time Warner Cable say that they simply can't
compete with the lower-priced offerings from municipal-based services. For
example, 10Mbps Road Runner service will cost you $57 per month. A competing
plan from Greenlight (run by the town of Wilson) only costs $35 per month.
III. Citizens Suffer,
Lawmakers and Telecoms Reap the Benefits
This “non-action” by Governor Purdue represents a
significant blow to N.C. residents who live in underserved communities when it
comes to broadband access, or are simply looking for cheaper alternatives. The rise of
municipal internet in N.C. was a direct result of the major telecoms dragging
their feet when it came to providing services or boosting broadband speeds. Then, when the cities decided to take matters into
their own hands, the telecoms stopped dragging their feet and started
running to lawmakers for help.
However, this outcome shouldn't be too surprising. Rep.
Julia Howard (R-Davie, Iredell) proposed H.129 and sure enough, she
received $6,250 total in campaign donations from Time Warner, CenturyLink,
and AT&T. Likewise, Time Warner's political action committee (PAC) has
provided over $214,000 to state lawmakers since 2008. As for Governor
Purdue, she received $3,000 in her winning gubernatorial campaign in 2008 from
Time Warner. Time Warner also gave $10,000 to the Democratic Governor's
Association -- which Purdue hosted -- in April.
Reuters recently reported that the United
States ranks ninth out of 29 countries when it comes to broadband adoption (63
percent penetration). In addition, download speeds lag behind other countries.
New York City residents, for example, average download speeds of 11.7 Mbps.
Residents in Seoul, South Korea, however, are enjoying average download speeds
of 35.8 Mbps.