IN RESPONSE: Don’t trust the legislature to improve rural internet
Author: Colorado Politics - January 4, 2018 - Updated: January 4, 2018
In a recent article, Colorado Politics’s Joey Bunch writes about potential legislative efforts to cobble together some version of net neutrality at the state level. This is a direct response to the FCC’s recent controversial reversal of Obama-era internet regulations.
“One of the most important things we can do for the economy of rural Colorado is to make sure they have access to high-speed internet,” Congressman/gubernatorial candidate Jared Polis states in the article.
As somebody who lives in rural Colorado, I couldn’t agree more with Mr. Polis. High-speed internet access will likely help diversify the economies of towns who have grown weary of the boom-and-bust cycles of the energy markets.
But here’s the rub: I am skeptical that state legislators can do anything to help that cause; in fact, they can arguably do more damage.
Before accelerating into this next legislative session with new internet legislation, the Colorado General Assembly should pump their brakes and take a look in the rearview mirror. Hindsight reveals cases of regulatory capture and cronyism, where the legislature was wielded as a bludgeon for the highest-paying industries — especially the big telecoms.
Flashback to 2005 when a little-known piece of legislation — one that would forever change the digital landscape in Colorado — was signed into law. This new law was Senate Bill-152.
SB-152 outlawed local municipalities from providing advanced telecommunication services to their residents. In addition, the law granted first rights of refusal to “incumbent providers”— namely, the Qwests and Comcasts. Established internet monopolies were able to deny market entry to any outside competition, leveraging their deeper pockets to simply outspend the smaller ISPs during the appeals process.
There are two components of this law that should not be a shock to anybody. First and foremost, this law was literally written by telecom lobbyists. “They didn’t even try to hide it,” writes David Hughes who covered the committee review of SB-152.
Second, SB-152 further entrenched existing internet monopolies throughout the state. What little competition existed before was decimated in a matter of years. Colorado’s ISP marketplace looked so bad that Google Fiber passed up our state to launch its unique business model elsewhere.
But SB-152 wasn’t all bad. It did have one useful provision: the ability to opt out of it. Tucked away inside the bill’s legalese is a safeguard loophole that allows local governments to place a question on their ballots asking voters whether or not the law’s restrictions applies to them. According to the Colorado Municipal League, 30 of the 64 Colorado counties and 86 of 270 Colorado municipalities have voted to opt-out.
Free market advocates can rest easy: Opting out of SB-152 is not necessarily a green light for local governments to take over as your local internet provider. Several communities unequivocally asserted that — despite being granted the authority to do so — they would not touch last-mile internet provision with a ten-foot pole. Living outside of SB-152’s authority grants communities more leeway in applying for funding to build middle-mile infrastructure or accessing excess capacity — all of which can be leveraged by private providers for last-mile provision.
If we want to fix the internet in Colorado’s hinterlands, we need to address why it is so bad in the first place. ISPs and local governments are locked up in détente where both sides refuse to bend. ISPs won’t invest in the costly endeavor of extending miles and miles of broadband infrastructure to sparsely-populated rural centers where returns on investment are slim. And one of the biggest expenses to overcome are pre-deployment barriers such as securing public right-of-ways and perfecting easements. Until both sides of this equation come to the table to negotiate, we can expect more of the same.
Communities like Kansas City and Austin expedited the permitting process for Google Fiber, providing right-of-way access to the internet giant for an affordable price. The end result: Google was able to better meet the demand for affordable and abundant high-speed internet. More importantly, the competitiveness of the marketplace was enhanced by Google’s entry, forcing other ISPs to provide a better product. Those who benefit the most from competitive markets are usually consumers.
To be perfectly blunt, the internet was dreadful in rural Colorado well before net neutrality regulations, and it will likely continue to remain equally dreadful well afterwards. Legislating some piecemeal version of net neutrality at the state level will not improve internet access to rural Colorado.
Only until competition becomes more abundant in the ISP marketplace will rural Coloradoans get the opportunity to join the modern digital economy.