AT&T: Municipal Broadband Should Be Banned Anywhere Private Companies Might Want To Do Business Later


It’s no secret that AT&T and other big ISPs are no fans of municipal broadband projects. There are laws on the books in many states that block the expansion of municipal networks, but the FCC is considering using its authority to override those laws and let communities build networks if they wish. AT&T is also no fan of this proposal. In fact, says AT&T, not only should public networks be barred anywhere there is already a private option, but also they should be barred in any place there might possibly be a plan to build a private option in the future.

First, a quick recap of the situation: Approximately 400 communities nationwide offer some kind of publicly-owned or -operated cable or fiber broadband network to residents. Traditional ISPs — Comcast, Time Warner Cable, AT&T, Verizon, and so on — feel deeply threatened by this competition, and have sponsored or lobbied for states to pass bills heavily restricting or prohibiting such networks. About twenty states have such laws on the books.

North Carolina and Tennessee are among the states that have passed laws in that vein. Two communities with municipal networks, Wilson, NC and Chattanooga, TN, have petitioned the FCC to preempt the state laws so that they can expand their service.

FCC chairman Tom Wheeler has spoken in favor of preemption, and since then members of both the House of Representatives and the Senate have gotten involved on both sides.

The FCC has been accepting public comments on the two petitions, as it does with most of its processes. AT&T has thrown in their two cents and, as you might guess, they think the status quo is juuuuuuuuust fine as is.

In their comment (PDF), AT&T says that not only should government-owned networks be outlawed anyplace a private solution has already been put into place, but also they should stay out of any place a private company might eventually get around to putting a network in place.

Specifically, AT&T says, public networks “should be used, if at all, only in areas where advanced telecommunications infrastructure has not been, and is not likely to be, deployed on a reasonable and timely basis.”

After spending a few paragraphs saying that public entities are terrible at ever getting anything built anyway, the company says that deploying public networks outside of areas that are 100% unserved by private entities will “provide less benefit, pose[] greater risk of stranded investment of taxpayer funds, and potentially harm consumers by discouraging private sector investment.”

That comes with something of a threat, as AT&T continues, “Certainly, any commercial entity will be concerned about further investment in an area in which it would be forced to operate at a competitive disadvantage, including with regard to access to and rates for rights of way, and the use of taxpayer funds to subsidize a competing service.”

In other words: if there’s a publicly-owned system available in your area, we (and other companies) will refuse to come to town because we will have to compete with it.

AT&T champions the fact that ISPs (like noble paragon of community and investment AT&T) spend more money per consumer in the United States than in other nations as if it were an unalloyed good. But the flip side is that American consumers also spend much more on much slower and less reliable service than many of our global counterparts.

In order to prevent the supposed harm that consumers will suffer from facing an actual abundance of offered services, AT&T suggests, the FCC should make sure that all communities are subject to certain specific conditions. Among these are assertions that private companies should have “right of first refusal” to build communities’ broadband networks for them, before governments are permitted to consider public options, along with a demand that public networks should “not receive any preferential tax treatment” — but “tax incentives or exemptions should be provided … to private sector firms to induce them to expand broadband deployment.” Got that? Spending taxpayer money on public projects = bad. Spending taxpayer money to get private companies to come in and charge you more money = good.

AT&T insists that without legal protection from the big bad threat that individual cities and counties pose to international business, they would be in trouble. And if AT&T is in trouble then clearly consumer harm follows. “Without these protections,” they write, “there is a real risk that the deployment of GONs will harm competition and consumers by deterring private sector investment that otherwise would occur.”

Of course, there is no mention of what consumers are supposed to do, other than perhaps idly twiddle their thumbs, while waiting for a private company like AT&T to find their community worth the effort to run wires to.

This is a consistent position for AT&T: when an AT&T executive was challenged at a Senate hearing earlier this year, he responded that communities should only be able to roll out broadband when there’s “been no private solution,” and added, “we don’t believe that private companies should actually compete against public-taxpayer cost to capital in that market.”

When consumers have options, incumbent companies have to improve service, add new lines, and lower rates in order to attract and retain subscribers. And all of those things cost money. So it’s easy to see why they prefer as competition-free an environment as they can legally muster.

Most consumers still don’t have many (or any) options for broadband service, though. And if the existing big ISPs get their way, consumers never will.

[via Ars Technica]