By Allan Maurer
WILSON, NC—If you live in the City of Wilson, North Carolina, you can buy superfast broadband Internet access along with cable-equivalent TV and phone service for $99.95 a month. Bills before committees in the North Carolina legislature, however, would limit the ability of municipalities to offer their own broadband services, says a Wilson City official. The matter is getting national attention in tech media and on blogs such as Slashdot.com.
Brad Phillips, vice president of legislative affairs for TWC who lobbies for the North Carolina Cable Association in favor of the bills, tells TechJournal South, “I think this has implications across the entire United States. The larger question is where do you draw the line for local governments to compete with private enterprise.”
Local governments buy gas and diesel fuel for their vehicle fleets, so “What’s to prevent them from competing with gas stations and convenience stores? They have landscaping departments for parks and such, so what would keep them from offering landscaping services?”
Superfast speeds offered
The public affairs manager for the City of Wilson, NC, introduces himself on a blog, “Save NC Broadband,” by saying, “My name is Brian Bowman…and I’ll bet my broadband is faster than yours.”
Wilson’s $28 million Greenlight Inc. system delivers 10mb uploads as well as 10mb download speeds and higher, along with 80-plus TV channels and a digital phone plan with unlimited calls in the U.S. and Canada at $99.95 a month.
Most private broadband services do not offer upload speeds nearly as fast as download speeds, which means it takes longer to post or send photos, videos, or high bandwidth data.
Frustrated by private providers when it sought faster broadband infrastructure for business development in the 50,000 population Eastern NC municipality, the City built its own system. “It is fiber optic right to your door,” Bowman says of the Greenlight system, which offers blazingly faster speeds to its business customers.
Not so, says TWC
Phillips disputes that, saying, “When they called me to see what sort of partnership opportunites existed, they had already decided to move forward. They had already started down this road.” Phillips says that Time Warner Cable heard no outcry from the citizens of Wilson demanding higher speeds.
“I think this resulted from local government saying, “Maybe we can make some money doing this. This is about the City of Wilson wanting to build its own system to create a new revenue stream.”
Current bills in both the NC House and the NC Senate could cripple future efforts by municipalities to duplicate Wilson’s system. The NC House bill goes next to the utility committee, which meets Wednesday morning.
Level the playing field
Time Warner Cable’s Director of Media Relations, Melissa Buscher, however, says the proposed NC bills would “Grandfather in Wilson,” as well as Salisbury, which is considering building its own municipal system and others who authorize a city system prior to March 2009.
Buscher and other industry spokespersons say the proposed NC bills would “level the playing field between the public and private sectors” in terms of providing Internet and other communications services.
“Municipalities don’t have to pay property or income taxes,” she says. “They don’t pay taxes on equipment or cable. Cities can cross-subsidize their service, using income from water or electric service fees to pay for the system. We can’t solict door to door. They can. Government has many inherent advantages. It’s not right and we believe it’s unfair, especially in today’s economy.”
Not a public/private thing
Bowman admits that Wilson reserves the right to cross subsidize, something he says they do anytime they borrow money for municipal projects. The city is not currently using any tax dollars to subsidize its Greenlight system, however and he insists, “We don’t see this as a public private thing.”
Phillips says the bills do not require anything more onerous on municipalities than they do on private providers. “It treats any competitive telecom as a stand-alone business. Keep a separate set of books. Don’t cross subsidize. Don’t pass ordinances that let you do thing in city limits that give you marketing advantages (such as soliciting door to door). Don’t sell below cost.”
Phillips adds that the bill has been modified so that nothing prevents municipalities from asking for national broadband stimulus monies and to ensure that cities with their own systems already in the works will not be affected by the bill.
Bowman responds, “If the cable/phone companies really want a level playing field, they’d open their books just like we do in the spirit of open meetings and open records law. They don’t want a level playing field. They want to be the only team on the field.”
Keep the law as it is
Bowman’s blog has been getting up to 1,000 hits a day and is crowded with comments from supporters in and out of North Carolina.
“We want the law to stay as it is,” says Bowman. “They’re the ones wanting to change things. We would love a level playing field.”
He says that Wilson not only does not use tax money to subsidize its service, but also, “There are several things that would keep cities from doing that in the future. Cities have to jump through hoops the way they borrow and spend money now. That’s a good thing. We have local accountability. Local officials set the agenda.”
And while he understands that Wilson would be grandfathered into the proposed bills, “We’ve been told other things like that in the past and you never know,” he says. “Would that limit us to the 3,000 subscribers we have now? Our city limits are moving all the time through annexations.”
In any event, it would prevent other municipalities, except those who duly authorize a system before March this year, from doing what Wilson did.
An essential utility
The reason Wilson built its superfast system, Bowman says, “Was for infrastructure purposes for jobs. Our goal was never to provide competition against private companies. Our city council believes faster broadband is an essential utility in this day and age.
“Wilson used to be dependent upon tobacco and textiles. They’re still important, but they’re not the future. We believe to be competitive and attract and retain jobs, we need this infrastructure in place.”
Wilson, Bowman says, was not at the top of the list for companies such as Embarq and TWC to provide high speed service. “We don’t want to run anyone out of business,” Bowman says, “ But we also don’t want to take the left over table scraps. If they had offered us what we were asking for, next generation good service, we would have happily stepped aside.”
He notes that one of the Greenlight system’s first paying customers was BB&T, the city’s largest employer. “They’ve been with us over a year now,” he says. “The way we pay it off, however, is to offer it to everyone.”
Phillips, however, says, “If you’re talking about economic development and service to new businesses or industries, I challenge any economic development group served to show me an instance where we have not sat down with local folks to talk about what we can do to help recruit industry and employ people in their community. We do it all the time. I don’t know of any situation where a community lost an opportunity because the infrastructure was not put in place by local providers.”
Online:
Bowman’s blog:
http://savencbb.wordpress.com/
An earlier article from The Independent, a weekly alternative paper.
Mighty, mighty broadband
http://tiny.pl/zfdq
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