Only a fraction of Americans have multiple broadband providers to choose from; 42 million citizens cannot get broadband internet at all at home, apart from satellite connections. The US government provides billions in grants to municipalities and counties that want to build or promote local access networks. However, municipalities and counties are surprisingly often prohibited from doing so by state law. On Tuesday, voters in three US states gave a clear rejection of these restrictions.
Municipal utilities in particular already have lines to most properties, adding fiber optics would be relatively cheap and quick to do. Yet in 17 US states By law, municipalities and their municipal utilities are not allowed to offer internet access, even if citizens are begging for a connection. In four other states there is no explicit ban, but there are significant restrictions on broadband expansion by the public sector. The corresponding laws of the states were passed at the instigation of the large Internet Service Providers (ISP), who use them to keep competition at bay.
In some places, municipalities are even strictly forbidden to support private companies. This means that the billions in subsidies from the federal budget remain unused and the corresponding jobs are not created.
For example, the Alabama Constitution prohibits the state and any local government from giving anything of value to private entities. But there would be $276 million from the federal budget that municipalities and counties could use to upgrade their infrastructure, including broadband networks. That sum even persuaded Republicans in Alabama’s legislature to change the constitution. This still had to be confirmed by the people. Tuesday’s result is clear: 79 percent of voters agreed that subsidies for broadband expansion should be legalized (counting status 98 percent of the votes cast).
Don’t hold your breath
The situation in New Mexico was similar. There, 65 percent of voters voted for a constitutional amendment (count 98 percent). According to this, the legislature can now pass a law that allows public investments in infrastructure for basic utilities such as internet, energy, water, sewage and the like for households. Before subsidies can be approved, however, a basic law must still find a majority in both houses of parliament.
This can take a while. The deputies who do not receive a salary meet only once a year for 30 days (even years) or 60 days (odd years). This is not enough time to work through all the issues. Ideally, the basic law could come into force next June. As a result, subsidy programs could be decided, followed by tenders, which then subsequently lead to the planning of construction measures … the shrewd reader can imagine that this will take some time. “Don’t hold your breath,” says the American.
In Colorado, telco lobbyists got a law in 2005 that bans local governments from either offering broadband Internet or paying out subsidies for improving private broadband networks – unless a local referendum approves it. The law does not seem to be popular : Since 2008 have more than 100 municipalities in Colorado hold such referendums held and with one single exception in 2009, the citizens have always given the go-ahead. The failed vote was repeated in 2011 and was then also successful.
Only in November 2020 did the citizens of the capital Denver lift the ban. This week voters from Douglas County (79% of the vote according to the preliminary final vote), City of Castle Pines (83%), City of Lone Tree (83%), Pueblo County (72%) and City of Pueblo (74%) followed suit. However, the ban remains in place in more than 150 Colorado municipalities.
FCC failed with ban ban
The fundamental problem changes little. Republican-dominated North Carolina has repeatedly emphasized that it will remain tough. State decision-makers would rather forgo hundreds of millions of dollars from the federal budget than allow local governments to invest in their own broadband networks. Under US President Barack Obama, the US regulator FCC fought for more broadband competition. She voided the bans in North Carolina and Tennessee. The affected states defended themselves in court, with success.
The court argued in 2016 that the FCC’s order would shift the authority to decide whether a municipality offers broadband connections from the state to its municipalities. However, the FCC may only intervene in the domestic division of competences if it is expressly authorized to do so by federal law. The general statutory mandates to promote competition and remove investment barriers are insufficient for this.
This US judgment means a severe setback for broadband expansion. Since then, only two US states have lifted their bans: Arkansas and Washington last year.