Proposed Law Would Bar State-Run Broadband

A proposed US law would ban states and local governments from offering broadband services. Supporters of the bill say "municipal broadband" crowds out commercial providers, while critics say such services only exist to fill the gap left by the commercial market.

If passed, the bill would become law as the CONNECT (Communities Overregulating Networks Need Economic Competition Today) Act. It would ban any state or political subdivision (such as a city) from starting to provide "retail or wholesale broadband Internet access service." (Source: house.gov)

This would apply whether it was provided to the public or to a business, including on a wholesale basis. That would appear to rule out building a broadband network and then leasing it to a cable company or other telecommunications company.

State Lines Enforced

States which already offer broadband would have to stop unless there were the only one and/or there were no commercial providers in their area. In this case the state could continue but would have to tell all users if a new commercial provider entered the market. They'd also be barred from providing service to anyone outside of their state or area.

For some reason, the bill specifically excludes the state-owned Tennessee Valley Authority from its measures.

The Register notes there are twenty-two states that already have local laws which either ban or restrict municipal broadband. However, many states have some form of government-backed broadband provision, often in areas where telecommunications businesses have chosen not to invest in building networks. (Source: theregister.com)

Philosophical Differences

The debate on the bill is likely to involve both philosophical and practical arguments. To some it's about the principle of whether government should involve itself in commercial matters and what effect that has on competition. To others it's a question of whether broadband counts as necessary infrastructure where public funding is necessary for situations where there's not enough profit potential for the market to provide.

Given the current political makeup of Congress and the White House, the bill appears extremely unlikely to first pass and then either be signed into law by the President or a veto be overturned.

What's Your Opinion?

Should states or local government be allowed to set up or offer broadband services? Does such action plug gaps in the market or deter more efficient commercial provision? Should this be a state-by-state issue or is a national ban appropriate?