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Study: State should have public broadband option

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By NANCY HICKS / Lincoln Journal Star

Monday, May 22, 2006 - 10:25:08 am CDT

Nebraskans who use dial-up Internet services creep along like old men with walkers. Dial-up is slow, tedious, frustrating and entirely impractical for business purposes, according to a study released Monday.

But many Nebraskans have no access to fast broadband service or if they do, it’s pricey because there’s no competition.

The state should allow local governments and public utilities to offer broadband so all Nebraskans have access to inexpensive service, recommends the report prepared by  the Brennan Center for Justice and the NYU School of Law.

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See the study

The report offers information  and advice to a state task force created by the Legislature to study Nebraska’s broadband issues.  It recommends modifying or repealing the current restrictions on government provided broadband.

That task force is “looking at what is best for Nebraska.  How do we assure that services are provided,” said Lt. Gov. Rick Sheehy, chairman of the group.

The technology is there.  Broadband can be provided over power lines and other public infrastructure, he said.

The task force will look at two public policy issues, he said.  Should public entities be allowed to compete with private?  And if so, how should competition be governed?

The Brennan Center report was submitted by a coalition of organizations that includes the Center for Rural Affairs, Common Cause, Free Press, Media Access Project, the Nebraska Appleseed Center for Law in the Public Interest and the Rural Policy Research Institute.

The report focuses on rural Nebraska needs.

Almost half of the Nebraskans living in small towns or on farms and ranches do not have access to broadband.  And many others have only one broadband provider, according to a 2005 Nebraska Telecommunications Association report.

An NTA report of  2006 indicates that  7.4 percent of Nebraska towns (44) have no broadband provider and 44.8 percent (267 towns) have a monopoly broadband provider. 

About 31.4 percent of Nebraska towns (187, including the 16 largest population centers) have three or more providers.

Those with dial-up service —sometimes dubbed World Wide Wait — had many complaints. 

* Farmers reported difficulties reaching commodities markets, breeding and USDA Web pages

* Some people were unable to upload grant applications

* Auction transactions were hard to complete.

* It is impossible to use job training software that requires streaming video. 

Nebraskans responding to a Brennan Center poll reported paying $9.50 to $50 a month for dial-up service; $20 to $60 a month for DSL; $35 to $100 per month for cable broadband, $40 to $70 per month for wireless and $50 to $70 per month for satellite Internet. 

Wireless and satellite Internet users reported paying installation fees ranging from $50 to $600.

“Private providers have failed to deploy universal, affordable broadband in Nebraska and elsewhere in the country,” the report concludes.

It recommends that the Nebraska Legislature let communities decide whether they want to build a public broadband service by repealing or modifying current law.

Both city governments and public power companies should be able to offer wholesale or retail broadband service to areas where it is now unavailable and to provide competition where there are just one or  two providers.

Hampering local communities from responding quickly could mean a loss in of jobs in Nebraska to states that allow their local governments to offer broadband.

Communities with affordable broadband will have a competitive advantage over those that don’t, the report said. 

The state can level the playing field by requiring public entities to offer services at or above costs, or by requiring local governments to pay substantially the same taxes as public companies in providing telecommunications services, according to the report. 

Reach Nancy Hicks at 473-7250 or nhicks@journalstar.com.

The broadband controversy

A heavily lobbied bill passed in 2005 creates an 18-member task force to study broadband issues and restricts the public sector’s involvement in offering broadband services.

The law prohibits local governments from getting involved in any aspect of broadband services. It prohibits public power from selling broadband services at the retail level and puts a two-year moratorium on public power companies wholesaling broadband and other telecommunications services.

The original bill’s aim was to keep local governments and public power out of the broadband business. This study and a partial ban was the compromise.

Arguments for a ban on government competition.

* It’s unfair because of public sector tax advantages.

* It stymies economic development by discouraging expansion by private companies.

Arguments against the ban.

* Private companies have not offered universal broadband services, particularly in sparsely populated areas. 

* Publically provided  broadband gives local communities an economic advantage over areas without broadband.

* Government or public utilities can provide competition where there is limited competition.


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Brilliant wrote on May 22, 2006 7:35 am:
" WOW 0_0 another brilliant idea by people who want everything from gas to food prices to be controlled by local or federal government. This would be the same idea as if we had the government step into the Telecom sector and compete with AT&T, MCI, and Sprint. The simple reason why prices in remote areas cost more then they do in major metropolitan areas is maintence costs. Broadband isn't as simple as set it and forget it. There is a lot of overhead costs associated with maintaining the infrastructure and supporting your customers. Let a capitalist country work as a capitalist enconomy without the interferiance of the government. If you think the cost of your broadband connection is high now wait and see what it would be like if you have the government step in and mandate stricter rules for how these private companies can operate their own business or if they have to compeat with a government agency. Where do you think the funding for such a program would come from as well ......... from taxes collected from people who may be using another service provider ............ which means you not only pay your bill but also part of the other consumers bill as well =/ great idea :-(. "

 Public Good wrote on May 22, 2006 12:00 pm:
" Clearly, this is an example of where private broadband access providers fail. In many areas, the cost is prohibitively expensive or there is simply no realistic competition to drive down prices. The comment by "Brilliant" seems to amount to "let unfettered market forces take care of the problem and we'll be fine." The example that "Brilliant" provides about local governments providing Internet services being the same as government stepping into the telecom sector is simply not accurate. That argument fails to recognize that there is ALREADY significant government involvement in the telecom sector in the form of laws, regulations, fees and the like. Furthermore, prior to deregulation, there used to be EVEN MORE government involvement in the telecom sector, particularly during times when the network was being built. Does anyone believe that the private sector alone would have made it possible for nearly everyone to have a telephone? Of course not; government mandated it. Government can do some things well; look at public power in Nebraska and its low rates compared to the supposedly "more efficient" privatized power companies that charge $0.15/kWh plus higher connection fees. Broadband internet is no different; local governments should be allowed to deploy broadband technologies such as municipal Wi-Fi that are low cost and could serve a lot of people (who currently get no service or are underserved) quite well. The fact that private companies have tried to prevent this from happening across the United States shows their fear of the idea and demonstrates they are only interested in protecting their high profits. After all, if government is so inefficient and slow, why do these companies fear the competition? Shouldn't they be able to out-compete a lowly municipality that wants to provide broadband access? I'd like to see "Brilliant" answer this question: if people in a municipality get together in a democratic process and decide they want their government to provide low cost broadband options, what's wrong with that? After all, the U.S.A. is supposedly a democratic country, right? "

 Brett Otte wrote on May 22, 2006 4:07 pm:
" The gov't should provide electricity, water, emergency services, police, a governing body, roads, and that pretty much encompasses everything we expect to be there. I view electricity as a modern-day REQUIRED service for anyone living in a structure of any sort as well as natural gas for that matter. I wouldn't even mind if the state got into that biz as well since I love that we have publicly owned power. People do not need radio, television, phones, or internet access to live in your home. The gov't should not be a provider of these services. The private sector can fill that want. This is a WANT and not a need. If the gov't wants everyone in the state to have access to high-speed internet then it should mandate similar to regulating phone companies being told to "go the last mile". The phone co's originally didn't want to provide service everywhere b/c it would cost a ton to get that last out-of-the-way farmhouse. Well, guess what? We all paid for that and if they wanted access into the state they had to provide service to all. There's nothing wrong with changing the RULES, but when the city/state wants to get into providing cable TV, internet, phone service, etc they are barking up the wrong tree. Period. What's next, garbage service, grocery stores, clothing? I need all those things too. The state needs to learn that there's a big difference between needs & wants. "

 Cliff Thomas wrote on May 22, 2006 7:13 pm:
" Cities such as Lincoln where access is limited pay higher fees which in turn subsidises lower rates in other cities in Nebraska and other states where competition is greater. LES has black lines that are not fully utilized. They need to be able to lease or use these lines to provide high speed access. Competition for jobs is also limited. Once of the reasons Gallup left Lincoln is because of inadequate service. Look at other much larger cities that are putting in WiFi and charging less. I am for competition. The law needs to be changed. "

 Judy Cantrell wrote on May 22, 2006 7:38 pm:
" This is not a luxury, it is a necessity. Nebraska desperately needs to move away from an agrarian based economy. Even the Old South has managed to diversify and transform itself. When someone mentions the word farmer in the South, it is said with hushed tones because they are perceived to be low income and needing subsidies. "

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