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Report: 26 States Now Ban or Restrict Community Broadband

Many of the laws restricting local voters’ rights were directly written by a telecom sector terrified of real broadband competition.

by Karl Bode
Apr 18 2019, 6:58pm

A new report has found that 26 states now either restrict or outright prohibit towns and cities from building their own broadband networks. Quite often the laws are directly written by the telecom sector, and in some instances ban towns and cities from building their own broadband networks—even if the local ISP refuses to provide service.

The full report by BroadbandNow, a consumer-focused company that tracks US broadband availability, indicates the total number of state restrictions on community broadband has jumped from 20 such restrictions since the group’s last report in 2018.

Frustrated by slow speeds, limited availability, high prices and terrible customer service, more than 750 communities across the country have built their own broadband ISPs or cooperatives. Studies have shown these locally owned and operated networks tend to offer lower prices, faster speeds, and better customer service than their private-sector counterparts.

Instead of competing by offering better service—private sector telecom giants like Comcast and AT&T have routinely turned to a cheaper alternative: easily corrupted state lawmakers. In exchange for campaign contributions, lawmakers frequently and uncritically pass on model legislation written by industry and distributed by organizations like ALEC.

Often the restrictions are buried in other, unrelated legislation to try and avoid public scrutiny. For example in 2016, AT&T lobbyists attempted to include community broadband restrictions in a bill intended to address regional traffic issues.

BroadbandNow’s report looks at each state’s restrictions individually, and found that while some states simply banned community broadband outright (a notable assault on voters’ democratic rights), others impose clever but onerous restrictions on precisely how a local network can be funded, who they can partner with, or how quickly (and where) they’re allowed to grow.

In Tennessee, for example, state laws allow publicly-owned electric utilities to provide broadband, “but limits that service provision to within their electric service areas.” Such restrictions have made it hard for EPB—the highest rated ISP in America last year according to Consumer Reports—to expand service into new areas.

“During the 2017 legislative session, a bill considered by state lawmakers would have enabled municipalities to expand broadband infrastructure to residents,” the report notes. “Instead, lawmakers passed a bill that offers $45 million in subsidies to private Internet service providers to build the same infrastructure.”

The problem: throwing taxpayer subsidies at private ISPs often doesn't fix the problem. A recent study by the Institute For Local Self-Reliance (ILSR) found that a combination of terrible broadband maps, local and federal corruption, and regulatory apathy often means funds are doled out to companies that not only fail to follow through with deployment, but face no meaningful government repercussions for not doing so.

Community broadband isn’t a magical panacea, and like any effort it depends on the viability of the underlying business model. But such efforts can often motivate private ISPs to improve local prices and service, as Comcast was forced to do in Tennessee.

“In a time when communities need as much investment as possible to build strong economies, these states are more focused on protecting the monopolies that are investing too little,” ISLR’s Christopher Mitchell told Motherboard in an email. “Many of these states are actually using taxpayer dollars to subsidize privately owned networks when they will not let local taxpayers decide to build their own network—which is often done at no cost to the taxpayer!”

Mitchell said his own organization pegs the total number of hard state-level restrictions at around 20 states, and argued the state-level restrictions serve no valid purpose outside of protecting natural telecom monopoly revenues from democratic disruption.

“There is no legitimate justification to limit local authority to build essential infrastructure,” Mitchell said. “Even where a community is supposedly well-served by a cable monopoly, [the local community-run ISP is] the most knowledgeable and where additional investment is needed.”

You’d be hard pressed to find many consumers who believe that a Comcast-written law should supplant their local voting rights as it pertains to local infrastructure, even if they don’t agree that their town or city should pursue the option. But ISP lobbyists and lawmakers have grown adept over the years at obscuring such efforts from public scrutiny.

“Unfortunately, despite how unpopular these restrictions are with certain community members, they remain very under-the-radar to the public at large,” Tyler Cooper, consumer policy expert and editor at BroadbandNow, told Motherboard.

Cooper noted that the only way to thwart such efforts is for consumers to pay closer attention and get involved with politics at a “hyper local level.”

“Community members can get engaged with the regulatory process in their home state, telling their representatives that they want municipal broadband to be available to as many residents as possible,” Cooper said. “Showing up in groups to town hall meetings can really move the needle. Many of the anti-muni laws can be overcome if enough community support is present,” he said.