Broadband Expansion: Baltimore Latest City Getting it Wrong and Getting in the Way

The advancement and access to broadband is an important issue that TPA has been following since the federal and many local and state governments have attempted to get involved with creating broadband networks with taxpayer dollars. There is no doubt that the need for expanded broadband access is real and should be addressed. The continuing problem is that governments at all levels take it upon themselves (with taxpayer dollars) to do the work that the private sector is already doing with private funding.  And, the private sector is far more successful than anything the federal, state, or local governments are attempting.  TPA has highlighted the Chattanooga EPB as the poster child for failed taxpayer funded networks (read previous blog posting, “Is EPB’s gig service a hoax?” here)

The latest example of the public sector making an ill-conceived decision to use public resources and funds to expand broadband comes from the city of Baltimore, Maryland. As reported by the Baltimore Business Journal, “The city is hiring a broadband Internet consultant that would help the city develop a plan for expanding Internet service provider options for businesses and residents.” The effort will start with an initial study provided by the consultants, which will cost Baltimore taxpayers more than $150,000.

There is not much disagreement about the need to expand broadband access, but the clear driver of the expansion has been (and should continue to be) the private sector because the amount of money invested by the private sector has been astronomical.   The Coalition for the New Economy (CNE) notes that, “According to a March 2013 report by Charles Davidson and Michael Santorelli at New York University Law School, private broadband providers invested more than $1 trillion in broadband between 1996 and 2010 and $66 billion in 2011.”

CNE lists several of these broadband expansion successes from the private sector:

• Google has decided to expand its one-gigabit Internet service package, currently offered in the Kansas City-area.
• Additionally, according to a recent press release, “Google is negotiating with United States regulators for increased public accessibility as it looks to offer more Wi-Fi services.”
• Skyriver, which provides Internet services to businesses, announced it will expand its services in southern California.
• Rumor has it that Amazon is currently testing its own 4G LTE wireless network.
• Meanwhile, AT&T has expanded its 4G LTE service in Louisiana and Verizon has expanded service in Rhode Island.
• Additionally, AT&T has announced it will offer 4G LTE service in Hawaii by the end of 2013.

A few weeks ago President Obama announced his plan to provide high-speed internet access for all schools with a new tax (read previous blog posting here). The plan is ambitious and down right sneaky because President Obama wants to circumvent congressional approval for the new tax and pass the tax directly through the Federal Communication Commission (FCC).

One of the recent successes that TPA has highlighted is Comcast’s “Internet Essentials” program.  In August Comcast announced that they were expanding their Internet Essentials program aimed at providing expanded access and that it is the “nation’s largest and most comprehensive broadband adoption program.  It provides low-cost broadband service for $9.95 a month plus tax; the option to purchase an Internet-ready computer for under $150; and multiple options to access free digital literacy training in print, online, and in-person.”  The program is headed into its third year and the results speak for themselves.  On August 13, 2013, telecompetitor.com noted that, “in about 22 months, more than 220,000 families, benefiting an estimated 900,000 low-income Americans nationwide, now have a broadband connection at home.”

There is no question that when it comes to broadband and the continuing need for increasing access and service for Americans, there is one group leading the way, the private sector. The programs from the private sector are showing real sustainable results, while failed attempts in the public sector are yet another example of tax dollars gone to waste. TPA will continue to monitor what Baltimore and other cities are doing and we will continue to urge them and other public sector officials to get out of the way of the private sector in expanding broadband.