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Telco Sues Municipality For Laying Their Own Fiber
unreceivedpacket writes "Ars Technica reports that a company called TDS Telecom is attempting to sue the town of Monticello, Minnesota for deploying their own fiber network. Shortly after the town voted to lay the fiber, TDS Telecom filed suit and notified the town that they would be deploying their own fiber network. The telco has recently responded to Ars Technica, saying they only sued to save Monticello from itself, apparently feeling that the municipality is unprepared for the onerous costs of maintaining such a network, and would lack the expertise to do so."
Expect to see the telecom draw out this lawsuit as long as they can possibly take it (think SCO here) and deploy their own network in the meantime, then sue the town again if they try to lay their own network thereafter for tortious interference with business practices or other such legal BS (IANAL and don't know what statutes they could use).
Craziness. I hope a judge knocks this down quick, but I'm not optimistic.
It's basically the company telling the town, "Stay the fuck out of our business or it'll cost you dearly. It's our monopoly, dammit."
It's better to vote for what you want and not get it than to vote for what you don't want and get it.
- E. Debs
In a nutshell the telco is suing the city with the justification that they are protecting the city from itself? I think I would have a lot more respect if they just came right out and said they didn't want the city as competition. If you're going to be a greedy soulless corporation then be one for crying out loud. Knock off the fake altruism because no one is buying it. And I recommend they hire a better legal team. Every soulless corporation requires a top notch crack team of lawyers to distort and manipulate the law in their favor. "any utility or other public convenience from which a revenue is or may be derived." I know next to nothing about law but even I can see this is cut and dry. The city raised bonds to provide what is definitely a public convenience, yet the telco sues anyway. Unfortunately I think their tactic is to try and get an injunction then keep the case in court for the next two decades.
I read TFA and I still have no idea what the legal basis of this claim is. Does anyone have any idea on what grounds they are suing?
On the basis that any suit will cost the town more than it will the telco, if not in dollars then in time. The article explains this quite clearly (make sure you read both relevant Arsicles).
Why let a town build a network with taxpayer money when you can build a network with that same money, then charge them again for using it? It's the classic telco business model.
The city decided to lay cable. Bridgewater Telephone interrupts, "Too bad, because that would put you in direct competition with our cable. The word `incumbent' is probably the reason this argument won't work. Bridgewater's cable did not exist at the time of the city's decision and, in fact, it does not exist now. But according to TFA you say you've read, that's the legal basis of the claim.
My boss lives in a town that has had their own utilities for over a century and they have stellar service and prices are lower than the crappy monopolies provide. It started with their own power station and over the years they added phone, cable, and fiber internet services. If they need service they get local people that actually care about fixing their issues and local students can get internships that teach them marketable skills. All this and they pay much *less* than the government granted/privately run monopolies in most surrounding areas. A good example of the non-financial benefits this has provided include the fact that they were one of the few communities to have power during the great NE blackout of 2003. Basically it comes down to the fact that there is a certain cost of building and maintaining the infrastructure, and if you let a monopoly private business run it you have to pay those costs over time plus the profits that are expected by the owners of that company.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
Well yeah it's a fuckin' joke, just not the "ha ha" kind.
Towns already run their own water pipes, sewer pipes, fire alarm systems, roads, etc. What is one more cable?
I call BS if you say running fiber takes more expertise than running water and sewer pipes. Electrons can go uphill of their own accord, water needs help.
Revenue bonds.
The telco is saying that the town would not be able to -even- -think- about building a fiber network if it was taxpayers money footing the bill(many of whom may not utilize the service).
Because bonds are being used, and the business model pays for itself with little financial risk to the town, the telco is saying its an unfair business advantage.
Imagine that... a town with the intellect and means to provide a service the people actually want, and are willing to provide it the way the people actually want it.
suddenoutbreakofcommonsense
I hope the town wins. Hard, and fast.
I recall, decades ago, when Ann Arbor was about to repave Division street - the main north-south drag for the core city. They were going to do it up properly so it would last.
They'd had a lot of trouble with utilities tearing up the roads to work on their underground stuff, then not restoring them adequately. (In southern Michigan winters this resulted in frost heaves that soon tore the road back open, resulting in the need for more repairs - sometimes over and over. By which time the information about which utility had torn it up originally had been lost.)
They couldn't really ban them from digging up the street to work on their stuff.
So they passed a new ordinance that would result in a MAJOR cost for any company that tore up the street AFTER it was redone, for a decade or so, and gave 'em some large number of months to get their underground installations fixed up and upgraded before the repaving. (I think they imposed some "fee" - read "fine" or "tax" - but don't know the details.)
That street was dug up all summer as the several utility companies rebuilt everything under it and installed new conduit and manholes for future expansion. (Better to get it in now, while there's no special issues on doing the work, than take the chance that the city's post-repaving gotchas would stick in court - or cost more in court fees to get them struck.)
And that road surface stayed pristine for years.
Now it seems to me that, if this telco wants to play hardball, this municipality could find similar stuff to do to them. B-)
Granted that the courts might eventually strike down whatever the city does as unfair competition, too. But it would still cost the telco more money to get that to happen - and tit-for-tat is well recognized as a very successful strategy.
Downside is it needs to be done in a way that doesn't end up stalling both projects while the citizens sit on their thumbs waiting for an internet connection.
= = = =
Also: Didn't a federal court just strike early-termination fees for cell phone providers? Might be possible to go after that if the telco does a long-term contract lockin to try to keep the citizens on their net once the delayed city net is live.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
Much of the populated areas of Monticello resemble an industrial park. Whoever is in control of that fiber is in for some serious cash from the plants that have setup shop there. This will be a damn interesting battle, the city will fight this tooth-and-nail.
Sorry, wrong. The *federal* government should do as little as possible. Regulate interstate commerce, defend our borders and coin money, specifically.
This is a perfect example of something a *local* government should do, if the local populace votes and approves of it.
I live in Big Lake, MN which is just a few miles away from Monticello, MN. The story misses a few things. First of all Monticello approached the Bridgewater to build the fiber network, and Bridgewater decided not to. So Monticello went ahead and decided to do itself. The second thing people should know is that Monticello does not have a normal small town finance system. Monticello Nuclear Generating Plant provides a huge cash influx to the city, allowing it to pursue large projects.
dont_forget
...would be to build as just a foundational infrastructure. It would be fiber all the way from each home and business to the various connection points. These would be buildings, not little pedestals. These fibers would then be leased out to any company wanting to provide services over them. There would be 4 actual optical fibers to each home and business (more for special cases), so it would be possible for "light up" providers to offer only one type of service, and customers could get their phone, TV, and internet, from different providers if they so choose. Or people and businesses could lease them directly to have a very high speed point to point service wherever they want.
It's not competing against the telco ... it's providing them with a fiber based infrastructure they can use. It's not competing against cable TV ... it's providing them with a fiber based infrastructure they can use. It's not competing against broadband services ... it's providing them with a fiber based infrastructure they can use.
It's just a road. The city and state generally build roads and let people use them. The directions the telcos and cable TV companies are trying to go is the equivalent to not only them building the road, but also them building all the vehicles and allowing no other vehicles on the road, and them restricting what parts of town people are allowed to even go to.
Cities often provide public transportation. So some basic default services is not out of the question, anyway. But it might get structured so it is not a major competition. For example, it might provide connectivity only within the city itself and not to the world internet. It might carry only over-the-air TV stations, and not all those satellite based national channels.
I'd bet a lot of business would love to jump in and provide services over an infrastructure they don't have to pay all that up front cost to build. Whether it's paid for by leasing the fibers, or by taxes, is something the city would have to decide.
now we need to go OSS in diesel cars
I agree that government should play a role in infrastructure but if they're going to do it at all, then they should spend the additional money to make those channels as large as possible. If they need an eighteen inch channel, then maybe they should do a twenty-four inch one, and so on. If they're planning to spend the money to dig up streets, create utility vaults, and so forth, then let them spend the money to do it right the first time and create a right of way that will then be available for other services. The more space they put in now, the less money they'll have to spend later on and the easier it gets to do maintenance without digging up the streets again.
If it were up to me, municipalities all over the place would be putting in precast, modular component tunnels under major streets that would be big enough to stand inside and to carry telecom lines, electrical lines, gas lines, and so on, all on top of water and sewage lines. This would cut monopoly power waaay down and massively decrease the cost, likelihood, and problems related to breakdowns, not to mention make things like greywater processing much more practical.
It's all about the information. And what we do with it.
You don't have unregulated capitalism. That would actually be a good thing. While there is a government there is no unregulated capitalism. without a government this wouldn't even be an issue.
sorry, wrong.
I live in the southeast.
Whenever a hurricane hits the gas prices shoot up a buck because the republicans killed off the regulations on oil speculation, and refuse to punish oil cos when they go-a-gouging.
The last time we had "unregulated capitalism", snake oil salesmen made people wary of medication, meat was as hazardous as nuclear waste, and we had a stock market crash that put 30% of the populace into hoovervilles.
The correct answer is "proper regulation".. the kind that places big business and the government at loggerheads.
When big business and government fight each other making no gains, the little guy wins.
VLC FOR MAC IS DYING! IF YOU DEVELOP, PLEASE SAVE IT!!
I Live in Monticello, Mn. and have been following this for some time. I'm fully in favor of this and believe it's in the best interest of the community. It'll benefit home users, but it's even more critical to attract big business and help grow the town.
Just a couple of things I want to set straight.
First, Monticello is being sued by Blackwater Communications (TDS) for using bonds to pay for the city fiber network. They can't stop the city from putting it in, but they're trying to make it painful. Originally it was to pay for itself and not cause additional taxes. The mayor has now openly said it may take taxes to do it, but the city will see it through.
Second is that several years ago, TDS, as well as the local cable co. were approached by the city to partner in this effort. Both flat out said no.
Third, only after the city was about to break ground did TDS decide to put in there own fiber network. Which by the way, I don't believe is truly fiber all the way to the wall. Seeing that the cities network fails is the only way to control pricing as the city had already stated what services would cost and trust me, it blew TDS out of the water!
Fourth, TDS has also begun a misleading campaign calling local residents, including myself, telling them about how the cities network will be under par and how business services are superior. Funny, cause I work in IT and am pretty technical; BS always smells! It's all about what "Joe Schmoe" doesn't know and how they usually believe what they are told. Oh ya, and the idiots accidentally called the mayor pitching the bull; oops! They've also started blanketing the neighborhoods with 1-year free broadband offers. Read the fine print cause if you bite your screwed! It's another way to lock things up by removing potential customers for the cities network. I get these adds in the mail literally every couple of days. I'm so sick of it I'm considering calling them and telling them not to mail me.
Personally I can't stand TDS anymore and won't even consider using them for anything EVER again. My land line with them has been dropped, my internet switched to cable (until the cities fiber is available), I use my cell and Skype. This is a prime example of corporate greed hurting the community!