Towns Win Capitalism; Telecoms Sore Losers

11 07 2008

I heard a funny story today. Telecommunications companies are suing cities that want to install municipal fiber optics for communities outside major metropolitan areas. These cases are happening all around the country.

According to an article in the national law journal:

Attorneys for cities say the telecommunications suits, whether brought under state law, the Federal Telecommunications Act or other laws, are veiled attempts to stop construction of competing public systems providing an essential utility in the digital age.

“It’s a national playbook. The longer they [telecom companies] delay things, the better for them,” said Patrick Ottinger, general counsel for Lafayette, La.

Attorneys for telecommunications companies say the litigation is needed because municipalities with the ability to borrow money cheaply — and not hobbled by the need to return a profit — have unfair competitive advantages.

These court cases should be thrown out for frivolity and sheer ridiculosity, and the telecoms should be required to pay the legal fees for wasting the public’s time and money. These multi-billion dollar companies are doing everything they can to make sure they can control and profit heavily from the internet, while not providing adequate services.

They’re arguing that you can do to much for the good of the public. Horrors, right? I mean, one of the outcomes of publicly accessible internet would be that more poor people and minorities would have better internet access.

Of course, various right wingers think this is far too socialist for the likes of US:

So the solution, in the eyes of the folks from the New America Foundation, is increasing the level of socialism in America and undermining the free market. After all, if cities offer for free (or at cut rates) what private businesses have spend billions developing and building, we will quickly see the vast improvements in internet connectivity come to a screeching halt. After all, why invest in improving the ability to access the internet when the government is going to strip you of your market?

This is clearly not about the free market. In most of these places, there is no real competition. Consumers are often forced to choose between one of two providers who offer little variation in service. In some places they either have to choose one provider or… nothing. I can think of other public services that killed the private sector — buses, schools… It’s funny how when cities started offering buses, taxis and limos just disappeared! And the public university killed the private college right dead. Shame on them, right?

By offering faster, better, more reliable service and higher bandwidth, telecoms could easily turn a profit, even when faced with the socialist horror that is a public service.

These companies could stand to shave off a couple billions anyway. Some of them have enough money pay random people to stack FCC hearings — so they can encourage the FCC to allow schemes that will make them even more money, and allow them to shut out whoever they want.

Those shenanigans, apparently known as the free market our right wing friends seem to like gone horribly wrong. They’re using money to do away with this silly ‘democracy’ business. Speaking of making more money, Time Warner is apparently exploring a metered bandwidth system. Use too much bandwidth, and they slap a higher rate on you.

Says the Save the Internet blog:

“Why Internet for all? I think Internet access is required for full participation in society today. Maybe it’s not as basic as water, but it’s definitely as basic as hot water,” Robin Chase, the founder of Zipcar, said.

According to Chase, Internet access is fundamental to maintaining a high quality of life and for addressing such pressing social problems as America’s energy dependency.

“When you add the amount of money the average American spends on Internet bandwidth and their cell phones, it’s almost as much as Americans spend on energy, their cars and heating oil,” Columbia Law Professor Tim Wu said.

The oil problem has similarities to our bandwidth problem, Wu added. “Production is controlled by a tiny cartel that sets prices high and keeps them there. And so we have a similar economic and structural problem … and something needs to be done about it.”


Thanks to apophenia for the link to that piece of black humor.

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