In today’s Wire Opinion, Don’t Blame Big Cable. It’s Local Governments That Choke Broadband Competition, we finally have a view of the local broadband world that begins to capture the reality facing incumbent Internet providers.
Here’s the key:
Deploying broadband infrastructure isn’t as simple as merely laying wires underground: that’s the easy part. The hard part — and the reason it often doesn’t happen — is the pre-deployment barriers, which local governments and public utilities make unnecessarily expensive and difficult.
Before building out new networks, Internet Service Providers (ISPs) must negotiate with local governments for access to publicly owned “rights of way” so they can place their wires above and below both public and private property. ISPs also need “pole attachment” contracts with public utilities so they can rent space on utility poles for above-ground wires, or in ducts and conduits for wires laid underground.
The problem? Local governments and their public utilities charge ISPs far more than these things actually cost. For example, rights of way and pole attachments fees can double the cost of network construction.
So the real bottleneck isn’t incumbent providers of broadband, but incumbent providers of rights-of-way. These incumbents — the real monopolists — also have the final say on whether an ISP can build a network. They determine what hoops an ISP must jump through to get approval….
…Localities are scared of losing revenue, but those revenues are really hidden taxes that are ultimately borne by broadband users.
The opinion goes on to address Google Fiber and ‘open access’ suggesting that:
… the fact remains that we, they, and other broadband providers do need tech-neutral deregulation.