City ISP Makes Broadband Free Because State Law Prohibits Selling Access (arstechnica.com)

An anonymous reader quotes a report from Ars Technica: A municipal ISP that was on the verge of shutting off Internet service outside its city boundaries to comply with a state law has come up with a temporary fix: it will offer broadband for free. The free Internet service for existing customers outside Wilson, North Carolina, will be available for six months, giving users more time to switch to an alternative. But Wilson also hopes that six months will be enough time to convince elected officials to change the state law that prohibits the municipal ISP from selling Internet service to non-residents. As [Ars Technica] covered previously, the Federal Communications Commission voted in February 2015 to preempt laws in North Carolina and Tennessee that prevent municipal broadband providers from expanding outside their territories. Greenlight Community Broadband in Wilson subsequently began offering service outside of Wilson. But officials in both states sued the FCC and in August won reinstatement of their laws that protect private ISPs from municipal competitors. In mid-September, the Wilson City Council reluctantly voted to turn off the fiber Internet service it provides to customers outside Wilson city limits. But that decision was reversed in a City Council vote last week, The Wilson Times reported. (The news came to our attention today via DSLReports.) A Wilson Times editorial reported: "City leaders are walking a tightrope as they balance their desire to keep Vick Family Farms in rural Nash County and 200 customers in the Edgecombe County town of Pinetops connected to Greenlight with their obligation to obey a federal court ruling that blocks the municipal broadband service from branching out beyond county lines. The council agreed Thursday night to provide six months of free internet access and phone service to Greenlight customers outside Wilson County while Wilson lobbies the General Assembly for permission to keep the town connected on a permanent basis."

Comments

Hurrah For Wilson

[JimSadler]

It is wonderful that no monopoly can control cable service. And it was brilliant of Wilson to invent this tactic. We also need a situation in which multiple cable companies could connect to the same home so that price competition becomes a real part of able services. I have also noticed a reduction of quality programming even on th expensive, cable channels. Content competition is slipping as more and more people get rid of their cable connections. It very much reminds me of the traditional TV channels that became so saturated with advertising as well as cheaper and cheaper content that regular TV became useless. If regular TV wants eyeballs they simply must vastly lessen advertising as well as making serious investments in top notch programming. Frankly capitalism has destroyed regular TV and our theaters are sort of belly up at the same time.

no nothing important is mising from my comment

[Anonymous Coward]

I am pro municipal internet, but selling internet access outside your territories is something else entirely. And it is not needed. If the other municipality wants to provide its citizens with internet access as well they can decide to do it themselves.
However, at that stage they should be allowed to cooperate in order to work more efficiently and safe public money.

Re:no nothing important is mising from my comment

[GerryGilmore]

Why is it " something else entirely"? First, if the extended customers in question had any viable option, this would be a non-story. Second, if the ISP is providing good service and making money, what's the problem - other than offending some "Oooo, government, oooo - BAD" ideology. Again, if the "Free Market" were up to the task in these situations, we would not be having this discussion.

Re:no nothing important is mising from my comment

[avandesande]

How do you know it's making money? Is it fair to city dwellers that paid through taxes to build the service to subsidize users outside of the city? There is a reason utilities are highly regulated in this respect.

Re:no nothing important is mising from my comment

[GerryGilmore]

Well, it being a community ISP (EMC, actually) and are directly answerable to their customers (citizens), there is a built-in mechanism for any aggrieved "city" (you obviously do NOT live in a rural area) residents to have their voices heard.

Re:no nothing important is mising from my comment

[avandesande]

Municipalities are incorporated for the benefit of the people that live in them, not to make a profit. They are not businesses.

Re:no nothing important is mising from my comment

[geoskd]

Municipalities are incorporated for the benefit of the people that live in them, not to make a profit. They are not businesses.

Any profit that municipalities make is that much less in taxes they have to levy on their citizens. Even a moron can see the benefit to a municipality's citizens when they provide a profitable service to their neighbors...

The only loosers here are the hypothetical company that wants those 200 customers in the future.

The ISPs/telcos are not fighting this because they think those particular 200 people will ever be customers of theirs (they have no plans to *ever* provide service in those locations). They are threatened by the precedent this sets, and the they worry about the day when all citizens realize they should ask their local government to do exactly this same thing, and provide local utility services directly and use the profits to offset taxes. A few rural towns and counties do it, no big deal. Pittsburg does it and all of a sudden the established players are no longer profitable at all, and all of the profit they used to get goes to the local governments instead. Ultimately, it seems like a fitting punishment for the way the huge telcos/isps have been taking public money to provide infrastructure and have instead been dragging their feet and screwing the people. To all those who believe that government should be prevented from engaging in profitable business, I have just one observation. The only thing less effective at providing services efficiently than government agencies is government subsidized private industry providing those same services.

Even better idea, Put a 3 year moratorium on municipalities entering any market segment they are not already in. If the ISPs want those customers, they have three years to get there first. After that, its fair game for any local government...

Re:no nothing important is mising from my comment

[Anonymous Coward]

I am pro municipal internet, but selling internet access outside your territories is something else entirely. And it is not needed.

Needed is different from desirable. Or advantageous. Not Needed is not even a reason to prohibit it. So tell us, what this else is entirely.

If the other municipality wants to provide its citizens with internet access as well they can decide to do it themselves.

What if there is no other municipality? Not every place is incorporated.

However, at that stage they should be allowed to cooperate in order to work more efficiently and safe public money.

What if the law doesn't allow that?

Re:no nothing important is mising from my comment

[hajile]

Sounding in from Chattanooga and EPB here.

EPB offers fiber because last-mile fiber was part of the new smart grid power system (and why not use all the extra bandwidth). The actual company offering the service is EPB Fiber Optics which leases the lines from EPB.

NOTHING keeps Comcast from leasing those same lines at the same rates (or even bringing a case to court that the cost is too high). They simply refuse and instead offer sub-par services with 300GB data caps (guaranteed to run huge overages if you're a cord-cutter). Your territory idea only works when greedy corporations with state-granted monopolies aren't in the mood to abuse the people locked into their service.

For the record, EPB is good enough at their job that they already have agreements to do the same thing in north-west Georgia and are still in talks to offer the same thing in north-east Alabama. People want and need good services from companies that aren't out to screw them over and they'll go wherever necessary to make that happen.

water or electrical service?

[avandesande]

Is it legal for the municipality to sell water or electric service outside it territory? I can see a similar set of problems and the reason the law is in place.

Re:water or electrical service?

[PrimaryConsult]

I don't know about utilities, but this regularly happens with public trains, across state lines nonetheless.

The "Massachusetts Bay Commuter Rail" serves several stops in Rhode Island, including connecting Providence to its airport. There have also been talks to expand service into New Hampshire.
The "Southeastern Pennsylvania Transportation Authority" serves several stops in Delaware.

These two are more operations inherited from predecessor private railroads, but including them for completeness' sake:
"New Jersey Transit" serves over 50 miles and about a dozen stops in upstate NY, inherited from the Erie-Lackawanna railroad.
New York's MTA serves most of the state of Connecticut in conjunction with the Connecticut Department of Transportation , inherited from the New Haven railroad.

Re:water or electrical service?

[Aighearach]

Yes, in most places municipalities can sell water and electricity to anybody. Next question.

Re:water or electrical service?

[plover]

We have police departments contracting services to nearby cities, and even leasing themselves out to a neighboring state. No laws stop them.

That will teach them

[penguinoid]

Looks like the lobby that asked for an anti-competition law didn't do a good job.

Re:

[PrimaryConsult]

If the other municipality is too small (or nonexistent, in rural areas some 'towns' are small enough that the only law enforcement is state police) why shouldn't they be able to contract to the neighboring municipality?

I think we all know this one....

[Razed By TV]

Sell a license instead of a service/product...

Re:

[Mr D from 63]

Maybe they could consider creating an intermediate entity (company) within the municipality that purchases service then sublets service outside. Depending of course on how thoroughly the law addresses that kind of thing.

Re:But Republicans believe local...

[Bookworm09]

...government is best, right? Right? Nope, actually they just suck up to the Corporations a bit faster than Democrats, sadly. If only they had not screwed up by forcing Hillary on us as the non-Trump instead of Bernie. Sigh....

Now, now. If you keep talking like that, you're going to cause migraine-inducing cognitive dissonance amongst a certain portion of the population. Although I do have to laugh at the irony of the "free market" resulting in "socialism"* as an act of defiance/desperation.

Kudos to the local City Council for coming up with this remedy, even if it's only temporary. Hopefully the absurdity of the situation will draw enough attention to it that the corrupt state lawmakers are forced to do the right thing.

Imagining the reaction of the local broadband providers' executives when they first heard about this plan makes me chuckle.

* Yes, I am perfectly aware that the "internet access"-market is anything but a free market, and the City Council's response isn't socialism.

My first business did something like this

[WillAffleckUW]

A lot of people had problems selling games by mail (this is before civilian use of the Internet was widespread, and high school grads got typewriters as gifts if they were college bound) in Canada, due to the market.

But I looked at business law and taxes and realized you could set up a game business that didn't sell the actual game, it sold the service (kind of like microtransactions, where the game is free). This meant lower tax rates, higher tax deductions, and since it was a service and not a product no problems with customs or trade barriers.

The same goes with providing Internet. Make the physical part (installation) free and have them pay later once they decide it's good enough and the morons stopping Internet competition by ISPs can be dealt with.

Anyone under 35 will go, "Cool!" Older people will think it's free cause they don't get how this works. Everyone wins!

Re:My first business did something like this

[Imrik]

Except in this case the installation is already done and the banned part is selling it as a service.

brilliant!

[Gravis Zero]

While I'm certain this will not go uncontested, I hope more cities follow their example so that corporate puppets do not attempt to prohibit municipal ISPs.

Tax assessment

[bhcompy]

Don't sell it. Give it to them. Make maintenance a tax assessment, just like sewage, roads, etc.

Re:Tax assessment

[bhcompy]

When it is no longer free market but compulsory the exact same complaints about the single seller in the market (comcast, cox, etc) now apply to the city.

If it's being classified as a utility by the government, which it is, then operating it like a utility/public good should be acceptable.

Re:Tax assessment

[HiThereImBob]

Don't sell it. Give it to them. Make maintenance a tax assessment, just like sewage, roads, etc.

The summary mentions multiple times, including in the very first sentance, that this applies to a municipality providing internet service to people outside its city boundaries. We don't let politicians levy taxes on people outside their jurisdictions, you may have previously heard this referred to as "no taxation without representation". People tend to feel rather strongly about it.

Re:Tax assessment

[Impy the Impiuos Imp]

They are using tax dollars to undercut private services. "Utilities" are usually government or government-granted monopolies under the theory infrastructure is so expensive it is good to give it to a single provider.

No such pressure exists for Internet. Other laws already allow shared access to poles and so on. This is, loudly acknowledged, an attempt to cut costs by forcing everyone to pay whether they want it or not. Hence it is nothing of the sort.

Re:Tax assessment

[bhcompy]

You've never heard of a special tax district? Are you not familiar with property taxes?

So, how's that party of small gov't

[rsilvergun]

working out for NC? On the plus side it looks like they're gonna go Blue for the presidential so it's likely they're just a victim of gerrymandering and the flood of corporate dollars into local elections...

Go Fund Me

[jwymanm]

I wonder if a crowd funding solution would still be possible? Granted I doubt everyone would contribute but it might be enough to extend it even a few more months..

how about complying with the law?

[ooloorie]

That is, either offer municipal broadband or offer for-profit broadband outside the city. What compelling reason is there for a single company to do both?

Re:how about complying with the law?

[sims 2]

Our local muni fiber considered running fiber outside of city limits even got a quote from the surrounding electric coop but they apparently wanted too much money for pole attachment as that never happened.

However they did get a wisp started that now sells service outside of the city their coverage even overlaps with the existing wisp in the area.

In one place they are even both using the same tower thats behind a hill from my house so I STILL can't get service at home.

it also resulted in some rather strange pricing oddities.
When the city started their service they were offering 20Mbps and the local wisp only offered 10Mbps
Now It's swapped the city only offers 10Mbps and the local wisp offers 20Mbps and WTH....
The local wisp was bought out 4 days ago?!!! how did I miss that?!!!!

Re:But Republicans believe local...

[Imrik]

Considering the local government is stepping in to provide a temporary solution to a problem caused by a more distant government, in this case at least, yes local government is best.

I'm shocked, I tell you!

[jenningsthecat]

State governments in the pockets of corporations? Who knew?

What's that you say? Corporations own the Federal government too? I'll be damned.

It really seems that municipal governments are the last, (but admittedly shaky) bastions of functioning democracy in North America. Heaven help us when the corporate cancer swallows them entirely as well.

As Frank Zappa said, "The illusion of freedom will continue as long as it's profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way and you will see the brick wall at the back of the theater."

purest idiotism

[l3v1]

"both states sued the FCC and in August won reinstatement of their laws that protect private ISPs from municipal competitors"

Competition at its finest, right, when the priority is to protect [i.e., give undeserved priority and undeserved advantage to] companies from municipal "competitors". Protecting companies by denying the people/communities to spend their own money to create their own services for their own benefit (which is basically, although indirectly, being done here). Dream come true, nicely done.

Re:

[Anonymous Coward]

Why introduce a new level of overhead just to make money for middlemen?