NC Governor Allows Anti-Community-Broadband Law

zerocore writes "North Carolina governor Bev Perdue will not veto a bill that will limit small town municipalities' ability to create community broadband when private industry will not go there. 'The governor said there is a need to establish rules to prevent cities and towns from having unfair advantage over private companies. But she said she was concerned that the bill would decrease the number of choices available to consumers. The bill would require towns and cities that set up broadband systems to hold public hearings, financially separate their operations from the rest of government operations, and bar from them offering below cost services. They also couldn't borrow money for the project without voter approval in a referendum.'"

Comments

Ummm

[maugle]

Is there a problem here? If the bill is truly what the summary (read the article? never!) makes it out to be, it sounds quite reasonable.

Re:Ummm

[hedwards]

No, it isn't. Even if it is just what the summary says, you have to adjust for the fact that the person who says it is almost certain to believe that any time the government provides a service at any price that it drives businesses out of business clear across the country.

I fail to see how communities creating their own broad band in areas where commercial ISPs aren't willing to create the service is going to create an unfair advantage to those communities. The main motivation behind the bill is pandering to a greedy and incompetent telecommunications industry.

If there were some reasonable hope of commercial ISPs going there, then yes this might be a problem. But I live in Seattle and we're likely to have to go this route because the ISPs refuse to provide us with decent affordable service. I'm fairly lucky where I live to only have to pay $50 a month and have the privilege of getting 5mbps for that, whereas in other parts of the country it's trivial to get 40mbps for $55 a month.

I think that if we were going to do it, these sorts of regulations would make some sense, but even there if the community is making a broad band network that works, I fail to see why we need commercial ISPs at all.

Re:Ummm

[demonlapin]

Based on TFS, though, the killer is the requirement that the system be run as a separate entity, unsubsidized. If a municipality wanted to do this, it would make sense for the municipal network to fall under the city's IT department. It looks like that's not possible. Furthermore, why should the state care? If a city wants to do this, surely the locals can figure out whether it's worth the taxes or not.

I'm a big fan of private business, but this is akin to the laws that prevent the government from competing with private business for anything - so instead of having electronic tax filing provided for free at the IRS site, we have to pay a private entity to do the filing for us. The IRS still has to have a back end paid for with tax money.

Re:Ummm

[Dachannien]

The problem is that it's anticompetitive to run the service using tax dollars. If Business A (run by the city) is tax subsidized, then nobody will choose Business B's service. If they did, they would have to pay Business B more for the same service even though they're already essentially paying Business A through their taxes. This pretty much ensures that Business B will never expand service to that area, even if it would have been profitable otherwise.

If you instead do what this bill appears to propose, then the city government can ensure that their service goes to places that the private companies won't go right now, but it still leaves the door open for the private companies to go there later once the population grows enough to make it worthwhile.

Re:Ummm

[hedwards]

This isn't a competitive industry. I'm sorry, but I'm not sure where you got the idea that internet service was competitive. Somebody owns the wires going to your house, and they get to charge whatever they like for that knowing that there are at most one or two other options.

Around here the mayor wanted to do something like this 6 years ago and was told by Qwest that they'd be doing something about the problem in the near future. Well, it's 6 years later, the infrastructure still sucks and Qwest hasn't done jack shit about it. They just keep taking people's money because we don't have other options. Comcast managing to be even worse than Qwest.

When you take into consideration the fact that these towns weren't profitable to provide service in the first place, I'm really curious as to what the justification for pretending that treating broadband as a utility is so bad.

Re:Ummm

[Kongming]

The article does not mention what I consider the most burdensome aspect of the bill. In addition to requiring the approval of the local community, any municipality hoping to set up service requires the approval of the state Public Utilities Commission: (3) Upon the request of a communications service provider, the Commission shall accept written and oral comments from competitive private communications service providers in connection with any hearing or other review of the application. (4) In considering the probable net revenues of the proposed communications service project, the Commission shall consider and make written findings on the reasonableness of the city or joint agency's revenue projections in light of the current and projected competitive environment for the services to be provided, taking into consideration the potential impact of technological innovation and change on the proposed service offerings and the level of demonstrated community support for the project. (5) The city or joint agency making the application to the Commission shall bear the burden of persuasion with respect to subdivisions (1) through (4) of this section. These criteria are sufficiently vague that if corporation-friendly commissioners are appointed (likely in this state), the Commission has plenty of leeway to reject whatever applications it wants, especially given the tone set by the burden of proof clause in article 5. I personally see no benefit to giving state governments the power to restrict services that local communities wish to offer with the consent of their citizens. I find this issue to be another example of the fact that neither major party in the US actually supports the principle of strong and independent local governments; they simply claim it when it happens to be convenient given the particular issue at hand.

Re:Ummm

[joocemann]

Great point, now they only need to pass the same restrictions and barriers for capital ISPs to do business there as well and then there will be no unfair advantages, right? Agree with me or look like a fool.

Re:Ummm

[MightyMartian]

I'm going to go out on a limb here and state I don't thinkt it's possible to create a passenger system that could pay for itself. Even when railroad networks became the primary means of long distance mass transit, freight actually paid the bills.

What's more, I'll wager that road systems don't pay for themselves and require considerable taxpayer support.

Re:Ummm

[Xeranar]

First off this law is about dismantling broadband services provided by the municipalities above cost and were turning a profit but still cheaper than the large telecoms. Under no circumstances were these loss-leaders, so don't go believing the BS the republicans were peddling in this case, they intentionally dismantled the public service to prevent private services from having to compete. This is why by definition public services are definitively better at pricing than private, they need to merely break even to prove worth while while private services need to turn a profit. The less people in North Carolina have access to the internet the better in the eyes of conservatives.

That being said, on the subject of mass transit systems, in a world where the middle class drive cars most of the time the poor and urban require mass transit. In turn they can't afford to subsidize the bus themselves. So as part of the grand scheme of capitalism the richer people need to give the poorer people atleast a modicum of access in order for their life blood to grease the wheels of society. In other words: sometimes you just need to pay for shit so the underclass can keep serving your undeserving ass.

In most cases the only mass transit system available is a bus which is a costly item to run and tends to take up road surface in highly congested areas. Light rail is more efficient but costs more upfront. So either way somebody who never uses it is going to have to pay for it to help everybody else out. But as I stated above, something you just have to do certain things.

Re:Ummm

[coaxial]

Ha! The potholes, the bridge collapses, the American Society of Civil Engineers, the Economist, and pretty much anyone that has ever seen a road in the United States, knows that that America's transit infrastructure, it's roads, it's mass transit, everything is shit. Yes, it was once the envy of the world, but that sixty years ago.

While it is true that roads are paid for with gas an vehicle taxes and fees, the amount of revenue being generated under the current regime is demonstrably insufficient, and has been for decades. After 30 years of repeated tax cuts, with increased demand for basic services, we do have a self-imposed revenue problem.

Re:Ummm

[drsquare]

But once everyone rides transit, who is going to fund its losses?

Who funds the losses of the roads? Unless you live in Europe or somewhere with similarly high fuel taxes, your roads are probably subsidised by the government. But that's one form of socialism that Americans have no problem with...

If everyone used public transport, there's no reason it couldn't be run at cost.

Double Standard

[iluvcapra]

If a town wants to start a new bus line, or double the number of stops, or open a new school, or put water fountains on Main Street, they just hold a vote at a city council meeting.

If a town wants to hang some antennas to offer a public amenity on Main Street, probably costing about as much as the water fountains, they gotta go through the equivalent of a consent decree. This sounds like broadband provider protectionism to me. That a municipal utility can provide better service than a private utility is an open question and a lot of cities do very well with publicly-owned electric grids and traction transit; adding hoops to jump through for broadband wifi in particular is just a way of protecting Comcast's fiefdom.

Re:Oh No!!!

[hedwards]

Damn straight, we all know that corporations are good and that gubmint is evil and providing quality services will ultimately lead to us all being slaves to the all power President.

But its ok for an unfair advantage for companies?

[grapeape]

I am so sick of seeing this happen. The municipal wifi project in my town was canceled by time warner. The end result was that 3 years later there is still no public wifi downtown, half of the surrounding neighborhoods still dont have coverage for anything but dial up and the people living here have exactly 1 choice for internet. My cable/internet bill is $178 a month for basic cable and 5/1 internet service.

Allegory

[Dracos]

Someone should write an Onion article about states banning/hampering municipal water systems because Coke and Pepsi demand it.

Re:Ummm *facepalm*

[Anonymous Coward]

Right. More public projects should have to comply with requirements like these. Transit systems being an excellent example.

Transit systems are a completely different beast. The cost savings for the city are only found when you look outside the system. More productivity when workers can get to work because they aren't in traffic. less road rage. less accidents. less emergency runs for car accidents meaning police have more time for looking for criminals. less road repair. Firemen putting out fires instead of carrying the jaws of life to cut some guy out of his SUV rollover.

If you don't understand how the system works, go to New York. Or Shanghai, or London. Just try owning a car in one of those cities.

Public Works?

[spire3661]

Can we jsut get community wide IT infrastructure labeled as public works please? During the New Deal era, were toll road operators suing to prevent the national highway system? The idea that we should worry about private enterprise profits at the cost of public works is retarded.

Re:So, err, WTF?

[QuantumRiff]

My company gets our internet to our servers via a small town utility... it is excellent service. I have a 15Mb/s fiber directly into the server room. At the same time, Verizon gives a few bundled T1's and tells us we should be grateful. We want more speed from them, and they tell us we would have to pay thousands and thousands to trench some fiber out to us. (we told them we would consider it, if we got to share revenue from ANYONE else that connected to that fiber that we would have paid for in our large business park, and they stopped talking to us).

Meanwhile, both verizon and charter are fighting hard to stop the utility from expanding service. They went into a neighbourhood, and started offering a few megabits for something like $25/month, which was enough for the utility to make a profit (they don't have to pay for lobbying, or for TV stations, etc). 75% of the residents in that neighbourhood switched within 2 months! Many paid the cancellation fees to get out of contracts, because the service was cheap, worked well, and actually gave the advertised speed.

Restrictions seem reasonable

[gman003]

Public hearings - local governments hold these for everything. Proposal to change the date for holding the public hearing on changing the amount of dues for sewage fees? Yeah, let's hold a hearing on that, too.

Financially separate operations - I'd honestly be angry if they weren't separate.

No below-cost service - Again, reasonable. Because doing so would either mean other tax money is being used, or that the government is borrowing to support it. Neither is good.

No borrowing without a referendum - A bit restrictive, but not too much so. Besides, since when has democracy been a bad thing?

I can easily imagine private companies being able to compete with this without absolutely dominating. Community broadband will likely be relatively slow - there's no incentive to go beyond what most people will use. A small business could probably work by providing higher-speed access at higher cost - those who want more speed will pay for it, but those who just need "good-enough" internet will be fine on community broadband.

Now, the one thing I am worried about is potential censorship. Certain highly-conservative communities might try to ban, say, pornography. Hyper-liberal communities might try to limit other things (a gaming curfew, similar to the recent Korean law, might be one of them). As far as I'm concerned, both are completely unacceptable. And also very likely to be tried - American politics tends to be very polarizing, even in homogeneous-party communities. I imagine most courts will throw the laws out, but you never know.

Re:Restrictions seem reasonable

[stdarg]

Financially separate operations - I'd honestly be angry if they weren't separate.

So should the internet division have its own revenue collection department and its own call center rather than adding a line item to the existing tax bill? That's adding inefficiency... why?

No below-cost service - Again, reasonable. Because doing so would either mean other tax money is being used, or that the government is borrowing to support it. Neither is good.

But that doesn't make sense. Aren't telecoms today required to provide below-cost service in e.g. rural areas? Isn't there some government funding (tax money) to help make that happen?

No borrowing without a referendum - A bit restrictive, but not too much so. Besides, since when has democracy been a bad thing?

The democratic part is where the community says "Hey let's have community internet."

The undemocratic part is where outside companies that don't even have a vote in the community say "Nope you have to go through this checklist of crap first."

We're talking about local municipal broadband, not state or federal. This isn't a central government building a service for people who are only loosely connected to them. It's small towns where everybody knows the mayor and the city council. They go to barbecues together.

Now, the one thing I am worried about is potential censorship. Certain highly-conservative communities might try to ban, say, pornography. Hyper-liberal communities might try to limit other things (a gaming curfew, similar to the recent Korean law, might be one of them). As far as I'm concerned, both are completely unacceptable.

I agree, but they do a pretty good job with stuff like electricity and water. I've never heard of an electric utility say "Sorry we won't provide power to a strip club" or "If you play bad games on your computer we'll cut your power because we don't like that."

Re:The best legislators money can buy

[DurendalMac]

Another toolbag who didn't read the article, much less the summary beyond the first sentence. It does not prevent municipalities from creating community broadband. It requires them to get public input before getting involved and to set up the finances to reduce the chances of it becoming a money sink.

Re:Open Source Broadband

[SuricouRaven]

Because the annoying laws of physics say you can't make equipment from nothing, and you can only squeeze so much data through a finite wireless spectrum.

Re:What an intolerable burden!

[hedwards]

No, it's not a ban, in the same way that I'm not banned from parking in handicap spaces, it's just really unaffordable to pay all those tickets and those pesky impound fees.

What the bill does is make it unaffordable for municipalities to set up their own broadband. Keep in mind that these are small municipalities where the normal ISPs refuse to provide service.

Re:Open Source Broadband

[straponego]

Like Fon?

Re:Practical example exists

[zyzko]

Nice that you bring Finland in discussion - but in totally wrong way. The waste collection went wrong and there was abuse of the system, but those examples you cite are not problems with broadband when done right. And in Finland municipal broadband has been done right in many communities were there was no interest from commercial entities to build the infrastructure (and old phone companies went even so far that they teared town the old phone cables and installed GSM voicemail systems instead so that offering DSL wasn't even possible if someone would have wanted to take the risk; we have "must lease" clause in the law so that the last mile must be leased to competitor for "fair compensation" is the competitor wants to start operating DSL POP at the area). Communities (not necessarily even owned or operated by tows) build the infrastructure and offer ISPs to come to POPs with same terms for everyone and the end-user can choose which ISP to buy the actual service from. This solves the problem that ISPs don't have interes in areas where they might have just few customers at one POP and they still had to invest in everything.

Sweden went even further and built masses of fiber network for operators to lease - everyone with same terms. And last time I checked they were doing very well regarding broadband even in rural areas.

The idea is not to regulate anything but instead offer chance for businesses to enter the market (all with same terms) where they are not "naturally" interested because of the initial investment and risk of losing that investment (or some other bullshit/business reason).

Yay for Bev!

[Issarlk]

Community broadband? More like COMMUNISM broadband. Thank God America still have some people like Bev Perdue to protect it from the reds.

Re:Makes sense

[tftp]

Actually, if you are talking *local* government, they would probably be *more* answerable to their customers than the huge telecom conglomerates.

My experience shows that the local government is not answerable to anyone. Ever tried to get a building permit? They tell you to jump and you only can ask how high. This is because if you displease them and they become picky, your only recourse is ... no, not even the court. You have no recourse. It is not against the law for a clerk to get back at you by requiring documents that are issued on third Friday of a century. You can get mired in health department's approvals, in geology approvals, in grading approvals ... or the clerk can just look at your plan and say "Well, I could have asked for @foo but I see that you are doing everything right, so here is your stamp and you may be on your way to start building."

If that happens with a private company (and it does, occasionally, when they aren't cooperating) you simply walk away, into another company in the same market, just across the street, and forget that the first company even exists.

The problem with the government is that there is only one government that is in charge of your property, and within that government there are just a few specific employees (you know them by name) that can make or break your project, and they are legally entitled to go either way, just as they please (officially it is "based on my expert knowledge, skills, training, etc.") They better be your friends, or else your activities will be seriously curtailed. I know more than one sad story about all that. Messing with a police officer is safer than messing with a government clerk - clerk's duties are not clearly described in laws, so bureaucrats have a lot of leeway.

Re:Open Source Broadband

[VortexCortex]

How about the Open Source crowd figuring a way to deliver broadband for free or close to free? Why not!

It's hard to do -- I've made a few experimental wireless mesh networks using Linux firmware on a bunch of wireless routers. We're working on it, but really, no one with much power/money wants us to succeed...

There are many problems to overcome -- the main three problems are: latency (many small hops over low powered wireless -- need to use longer range, but those frequencies are strictly regulated), congestion (limited available frequency ranges -- cooperation required for a "rolling" frequency allocation, easy to disrupt), but mostly the problem is the fact that you want something totally different that what we can really offer.

The previous stated problem is better defined as such: You want "Broadband Internet" -- which is far more a specific requirement than "Broadband Network"; The former requires a choke point whereby lots of distributed traffic enters and leaves a hard-line connected to the Internet (at no cost!?!), the latter does not have the requirement but has to iron out many many issues before commercial entities will get on board.

One big problem is adoption. Will you be willing to give up your current ISP, and the entire Web it allows you to access? If not, will you be willing to foot the bill for a node so that the free (as in freedom) network can operate along side, and in addition to your current ISP hardware? If so, will you be willing to bridge the two, despite rediculous "end user" threats (when you're really an ISP)? If not, will you publish content on the free net with a license that allows everyone to copy it infinitely?

My mesh network had adequate speed for most uses (email, chat, voip), but streaming HD video did not scale well (100+ routers over 4 square blocks servicing approx. 80 "homes") -- no caching servers implemented yet... (do you want to host data that's not yours? If so, can you get the copyright license to do so? If so can everyone get that license for free? -- copyright law has no place in modern technology, we must copy everything all the time, and we need the legal restrictions lifted so that we can! Note: ISP routers already to this with indemnity, but our distributed "torrent" like network will face legal threats.)

There has to be a global or at least national solution to connectivity (how easy will it be to buy & install a node/host), identity (how will someone send you a packet from many hops away?), privacy (how will intermediaries be trusted to pass on your data), integrity (how will we ensure no one can DoS via jammer or firewall that targets you.)

We've almost got a solution for the node identity problem (routing) via a distributed DNS like system w/ distributed hash tables (.torrent style) and PGP -- though more efficient encryption is needed to provide TOR style anonymity (this is needed to prevent the above fire-walling issue), and the cert database gets huge quickly, so we need to come up with a self organizing system sans database, using only the web of trust...

The problem with TOR style routing is that you have to know the certs of every node that will be between you and the destination -- If any link goes down, alternates can not take over, the connection must be re-established; Conversely, with a less strict system we can just forward data in the general direction it needs to go, each node can decide the "best" route, and failure of a node results in the next best node being used (next packet -- no resending except from end-points, otherwise the network explodes!).

Once such a network is operational, much like the end of the BBS prevalent days, there will be bridges between the two networks for a long while, sadly, the ISPs have the upper hand in this respect -- it's already installed (see: Windows vs Linux or OSX), they have better speed, reliability (bugs will take a while to work out), and probably pricing (for node hardware)...

Re:Again Proof RepubliCONS are not about small gov

[PoochieReds]

Bev Purdue is a Democrat.

So how do you feel about eminent domain?

[jeko]

I get your point, I really do. If you feel this way about property taxes, how do you feel about eminent domain? How do you feel about easements? What about squatter's rights?

Also, I know of medium-sized towns where every square inch of property in the town is owned by one family. Let me assure you these places are not bastions of freedom where the blessings of liberty apply to all. How would you feel if $some_trillionaire bought an entire state? An entire country?

Also, if the government (government, as in We the People, of by and for) doesn't ultimately control the land, then what is your claim to it? You say this is your acre of land? How? Oh, you paid someone for it? How did they get it? They paid someone for it, and so on? Hmm, Mr. Running Crow here says you've received stolen property, that he was driven off his land by force, by the Government. Just because you paid for stolen property doesn't mean you haven't committed the crime of receiving stolen property, else we'd have to let every professional fence out of jail.

Oh, you live in Europe? In say, Scotland? Clan MacDonald would like a word...

Thank you, Ms. Palin. Yes, you live in Alaska on land so barren no human being has ever laid claim to it, not even the Inuit? This land is yours because you got to it first? OK, so the Moon, or at least the Sea of Tranquility, belongs to the United States? How do you lay claim to this land? Did you make it?

Oh, you claim it because you have lived here so long, and your family has worked this land and has fought for it. Fought for it by serving in the government's army, you mean?

You've stumbled into an old, old argument the philosophers have been chewing over for literally thousands of years. Ultimately, it boils down to this. You own this land by agreement. This is your land because everyone else in the group agrees it is, and if they don't, then the best you have is a house under siege. The ability to demand, defend and grant rights over real estate is in fact referred to as sovereignty, and that is a function of government. Those few individuals on Earth who can claim that they own this land, and can back that claim up without appealing to some other authority, are referred to as "kings."

Like it or not, "private property ownership" is a function of government. Ultimately, this is your land because the guys with the most and biggest guns say it is. The only other logically consistent argument is the one Thomas Paine espoused, basically that no one can claim to own any part of a world that they had no hand in creating.

Yeah, I know, this means Ayn Rand was a spoiled little rich girl who sat around bemoaning the loss of the family fortune and smoking crack. Shocking, I know.

Re:Open Source Broadband

[TeknoHog]

Finite wireless spectrum?!? What are you talking about? Let's talk Mhz:

There is Ghz spectrum between say, 2.4 and 3.4 Ghz, which seems limited. So you might break it out into 1 mhz bands, giving you 1,000 usable frequencies. Or break it more finely,into .1 mhz bands giving you 10,000 usable, or .01 giving you 100,000 frequencies, or...

A 0.01 MHz band does not give you much capacity, perhaps something of the order 0.1 Mbps. While bandwidth is not the same thing as data rate, they are proportional.

http://en.wikipedia.org/wiki/Shannon%E2%80%93Hartley_theorem

Spread spectrum technology, first developed by military for secretive radio communications, send information in short bursts in pseudorandom frequencies. This frquency hopping allows for far more efficient use of existing radio frquencies with minimal disruption. Numerous studies show this type of technology could extend the available bandwidth a billionfold or more.

By definition, spread spectrum uses a lot of bandwidth ;) The problem with data rate is that when everyone uses spread spectrum, noise floor goes up, and thus the signal/noise ratio gets worse. This, in turn, means a smaller data rate per bandwidth, as explained by Shannon.