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The FCC Can't Help Cities Trapped By Predatory Internet Deals With Big Telecom
Jason Koebler writes: At least 20 states have laws that make it illegal for communities to offer local government-owned high speed internet access. Wednesday, Federal Communications Commission Chairman Tom Wheeler threw consumers a bone by suggesting that the agency could make it easier for cities to skirt those laws. That's a great first step — but many cities have locked themselves into telecom company-caused messes the FCC probably can't fix. The FCC's power becomes much less certain once you drill into the other major reason—besides state laws—why cities can't offer broadband to their constituents: local, long-term agreements with internet service providers.
And you're bound to get burned.
If the FCC is seemingly so impotent to regulate the industry, just what the hell are you guys paying it to do?
If God forks the Universe every time you roll a die, he'd better have a damned good memory.
When you get to this level, it's not really the FCC's mandate anymore. It's the FTC's mandate, as it has become a federal trade/transport issue. When a municipality can't transport data to another municipality because of a contract with an infrastructure provider who is interstate, that's FTC territory.
Plus, I think you'll find there's only one state where this is illegal; in all the other states, it's just legislatively prohibitive (following the laws, it would cost too much to provide to the community).
Title 47
http://www.ecfr.gov/cgi-bin/te...
I don't particularly want to understand the FCC's area of authority, so here is Title 47.
Your local governments made sweetheart monopoly deals to get cable money. Now you think the solution is for your local government to make a different kind of sweetheart monopoly deal for municipal internet access?
Open up local wired infrastructure to competitive use instead. The wire is in the ground. End monopoly access to it. Let companies compete for subscribers.
I wouldn't have expected the FCC to be able to do anything about this. They are mostly toothless when it comes to many of the problems with the Internet, which isn't necessarily a bad thing considering they have abused their power in favor of incumbents in the past. This is a problem that really needs to be attacked at it's source: telecom's ludicrous lobbying power. I hate to sound like a shill for Lawrence Lessig, but I really hope the May One super PAC is a success. American "democracy" really is pay-to-win.
The local governments, the politicians, made those deals because it gave them what they want (campaign money). They aren't over a barrel, they are perfectly happy with the arrangement. When a citizens' group ASKS them what they think about the public getting screwed, they'll SAY they don't like it. They made the deal willingly, though. It's the public that they stuffed into the barrel.
I'm not a tea party member, so maybe I shouldn't speak for them, but I'm pretty sure they are AGAINST having the government outlaw competition like this. I think the Tea Party way would be that anyone who wants to offer better, faster service should be allowed to do so, and the government shouldn't stop them. Currently, local governments outlaw competition. I don't think that's what Tea party people want.
These deals that provide a kickback to the municipality are effectively a tax. California restricts what taxes can be imposed without the approval of the electorate. Perhaps the deals could be challenged on the basis that they are illegal taxes?
The real "Libtards" are the Libertarians!
I'm not a tea party member, so maybe I shouldn't speak for them, but I'm pretty sure they are AGAINST having the government outlaw competition like this.
Here's the 10 Senators who signed a letter to the FCC Chief (PDF)
Republican:
Deb Fischer
John Barrasso
Pat Roberts
Lamar Alexander
Tom Coburn
John Cornyn
Tea Partier In Bad Standing:
Ron Johnson
Tea Party:
Ted Cruz
Marco Rubio
Tim Scott
Mike Enzi
FYI - Some of the Republicans on that list are being actively targeted by Tea Party groups in the mid-term elections.
[Fuck Beta]
o0t!
You were all right until this bit: "Currently, local governments outlaw competition." No local government outlaws competition. Deals can be made for several reasons, but they usually involve enticing companies to offer services where they wouldn't otherwise, or granting privileged build-out rights in exchange for promises of cheaper service or better service or service to less profitable areas. Nowhere do they ever outlaw competition, that would be ridiculous, but granting the privileged rights companies demand (and, to be fair, sometimes genuinely require) implies by their privilege that a competitor would at a minimum be at a disadvantage.
You are doubtless right that the Tea Party way would be towards greater anarchy. I've heard quite a few people lately just blanketly denouncing all regulation, apparently in the hope that the absence of laws will somehow lead to better treatment.
The Tea Party people want whatever the Koch brothers tell them to want. If the Koch brothers have a stake in telecom, I bet most teabaggers support these contracts.
Oops, I forgot that we don't have any actual capitalism in the USA any more, because the regulators are all controlled by industry groups. Forget it. Your cable/phone/ISP bill is going to continue to go up far faster then inflation, and your service will suck even more. And there is nothing you can do about it.
Nothing to see here, move along. No capitalism, no competition, no democracy.
Why is Snark Required?
They are against having the federal government stick its nose in the business of local government. The FCC's only job should be to pass out enough rope to the local governments so they can hang themselves.
Google the term "cable franchise". Most places have them. It is an agreement whereby the local government gives one company the EXCLUSIVE right to serve customers in that city . It is illegal for another company to come in and compete.
Like say a Credit Union. Everyone signs up, pays a small amount for the share which is then used to start the company then once its rolled out each person in the city that signed up pays a certain monthly amount and has shares in the company.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
These contracts are for like 30-100 years of service (no kidding). The providers would have to get 30y worth of monopoly-based income (eg. a city may have 500k customers which they can now charge $60 more per month than if there were competition for 30 years amounts to a contract worth $10B).
Custom electronics and digital signage for your business: www.evcircuits.com
It's a grant of privileged status where "privileged status" means "allowed to run cabling". I guess technically it's not illegal to provide service, it's just unlawful to having cabling to run that service on.
The competitor is at a disadvantage so great as to make their business non-viable.
Washington state used to have a law that made it illegal to sell distilled liquor in grocery stores. People voted on a ballot initiative and the law changed. Even if bought politicians stay bought, people can change the politicians. A city might find that a contract is void because the former politicians who made it were not acting in good faith with regard to the public's interest.
Yes, and tea party mentality says that once you have an incumbent service in place, let them bleed the populace blind until someone builds an entire replacement network out in order to compete. Eventually the prices will rise high enough to justify having 2-3-10 competing players! I mean hell, if it costs $1000 to connect to an important service, a lot of competitors will eventually pore in millions of infrastructure to fulfill it! Plus all the trickle down economics on hardware and fibre/copper producers, etc.. its like bonanza v2. Why didn't they think of this sooner!! Its not like these fixed costs are paid by tax payers as handouts to people capable of providing said services. They didn't spend one cent to contribute to their campaigns, and nothing ever goes wrong in this magical lolly pop land.
Bye!
It's not unlawful to run cabling, it's just really difficult. Making it easier for one company is not the same thing as outlawing other companies from doing it.
No doubt. Unfortunately, the way it works in the US is that almost everything, including a lot of infrastructure, is privately owned. So despite the fact that building out that infrastructure is so difficult that it can't really be done without assistance, thus precluding real competition, we have statements like these: "I think the Tea Party way would be that anyone who wants to offer better, faster service should be allowed to do so, and the government shouldn't stop them." And the guy is probably right. That probably is the stated ideal of the Tea Party, no matter how foolish it is.
The Tea Party people want whatever the Koch brothers tell them to want.
Yes, because they're our Vampiric Masters* and we cannot refuse their any whim. (Catches fly.)
Just remember that we're nice and good but they're pure evil. And the nice thing about that is: you print it out once and push it out everywhere!
* Vampiric Masters -- Ex: George Soros, Al Gore.
Suspected: Rush (Not the band.)
--
"I can call spirits from the vasty deep."
If the universe is someone's simulation -- does that mean the stars are just stuck pixels?
I think the tea party borrowed that ideal from Objectivism. The tendency to idealise the free market as the solution to all problems, while being blind to the flaws of a free market approach.
In the case of internet, there's more of an issue with first-to-enter-wins. Whoever cables up an area first must make a huge investment, but they also get 100% of the market - enough to recoup their investment and then make a tidy profit. Whoever follows has to spend just as much, but by that point all of their potential customers have already signed up with the first entry - and it's very difficult to convince people to switch provider, as it does bring a lot of hassle. That means that there is little hope of turning a profit by building a network in an area where another is already operating, and so many areas have only one broadband ISP available. It's essentially a natural monopoly.
There's some prospect of things like wimax fixing that by greatly lowering the cost of network consturction, but the technology is just at a fundamental disadvantage there. A wireless connection can never be as fast or as reliable as a wired one, and will always have to deal with contention. It's inherent in the technology.
It's not unlawful to run cabling, it's just really difficult. Making it easier for one company is not the same thing as outlawing other companies from doing it.
You are grossly mischaracterizing the situation, where municipalities have granted monopoly right-of-way under the guise of preventing service issues due to cable cuts and the like.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
> In the case of internet, there's more of an issue with first-to-enter-wins.
Yep, and the phone companies were the first, since they already had both local and long haul cabling. So everyone used isdn and dial up. Until someone offered something better and cheaper (cable modems). Most people used cable modems until someone offered something better.
Local franchises (government enforced monopolies) meant that you weren't allowed to offer a better cable modem service, because the government granted one company the exclusive right to offer cable modems. It was under these franchises that new companies could come in only by offering a completely new technology. In a few areas, there are no such government restrictions and there actually are two cable companies competing with each other.
It's easy: Make franchise deals (cable *and* Internet deals) in cities and towns illegal to open up competition. Done.
Nothing easy at all about that. Franchise agreements exist primarily to regulate access to public right-of-way easements. So that you don't end up with an unholy mess of wires all over the damn place. And in order to make them illegal, you'd have to gut and re-work entire city charters and how State, Federal, and Local laws and powers work with/against each other.
And on the way, you'll have to dismantle Homeowner's Associations, and completely change how multi-unit complexes are allowed to operate. Because in many places, the city franchise is only part of the problem- many subdivisions, HOA's, apartments, condos, etc. have their own lock-in agreements with specific providers.
Not saying it shouldn't (or couldn't) be done, but it would not be simple, nor easy.
Weren't those contracts made with the promise that $telcom would provide decent internet access? Even if it was just a verbal contract. I think the cities should sue them for breach of contract, to recover those excessive costs and lost revenue due to having crappy internet connections.
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways