The Battle over Public Internet Access

April 29, 2013

Public WifiUrged forward by companies that provide broadband Internet access, 19 or more states have enacted legislation which limits the ability of cities, towns, and counties to build broadband networks or offer broadband services.  Efforts to impede development of public broadband networks are apparently motivated by the desire of the private companies to maximize their potential revenue.  Those efforts are contrary to the public interest.

Many communities, particularly those in regions where broadband access is not offered by private companies, have begun to build their own broadband networks and to offer access to those networks to all residents and businesses in the communities at affordable rates.  Often, these public networks are outgrowths of broadband networks originally developed to connect government and other public institutions, including schools, libraries, public safety services, and hospitals.

Increasingly, community governments, schools, and other local public service providers recognize that broadband access is vital to effective operations.  After investing in development of those networks, the communities frequently find that it is economically efficient to offer network access to all individual residents and local businesses subject to nominal rates.

Many commercial broadband service providers view these local public networks as unfair competition.  They contend that the networks are built using public funds and ultimately offer service to consumers in competition with the private providers.

Local governments respond that many of these public networks are developing in regions not served by the private companies.  Additionally, they note that the public networks are often more effective as they will connect all relevant local institutions (e.g., all public schools in the community), while commercial service companies often leave gaps in the networks they provide as they are unable to serve profitably all of the local institutions.  Finally, local governments often argue that the total costs associated with taking service from commercial providers can be higher than the total cost of building and operating a public network.

The need for improved and expanded broadband access in the United States is recognized by most key stakeholders.  For example, Google launched its “Google Fiber” Internet broadband program in 2010 by offering service to residential customers in Kansas City.  The company recently announced its intention to offer Google Fiber service in Austin, Texas beginning in 2014.

Google and other providers of online content and services have substantial interest in expanded and improved broadband access.  The content and services offered by Google and its peers increasingly require greater broadband capacity.  In order to maximize their profitability, those companies require that broadband access be available to all consumers.

As part of the federal economic recovery legislation enacted in 2009, several billion dollars were allocated for use to help finance broadband network development using both public and private programs.  That legislation clearly anticipated local and regional public investment in broadband systems.

State legislation that impedes local broadband development initiatives is a mistake which runs counter to the interests of local communities.  Although public broadband networks may not be necessary or appropriate for all communities, every community should have the ability to consider and pursue the public broadband network option.