Muni Broadband is Still a Net Money Loser, says Reason

A shift to more interventionist government has led

…several states, mindful of the checkered financial history of such efforts, and fearing the fiscal liability they pose, have been drafting legislation to rein in these projects which, when they fail, leave taxpayers holding a multimillion dollar bill.

says, Reason Foundation – ANALYSIS: Despite Glossy Reports, Muni Broadband is Still a Net Money Loser.

In a subsection to Reason’s Annual Privatization Report 2013 Steven Titch reviews a number of continuing muni failures across the country including Chattanooga, UTOPIA, Ashland OR, and Click Network in Tacoma WA…here’s a bit on Click:

The supply chain inexperience of Tacoma’s Click Network, for example, was responsible for a big blunder. After lining up three ISPs to handle retail sales of its muni service, and selling them large blocks of wholesale bandwidth to resale Tacoma consumers, the Click Network decided enter the retail business itself. Competing with your own retailers is a mistake learned in Marketing 101; you don’t undercut your own sales channel. Tacoma’s decision to do so was all the worse because it hurt the local small businesses that it had hoped to nurture with its network, while angering and alienating marketplace allies and all but killed a major source of revenues for its operation.

 

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This entry was posted in Click Network, government competition, government-owned fiber, government-owned networks, Municipal broadband, Municipal finance, Overbuilding, Tennessee and tagged , , , . Bookmark the permalink.

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