President Obama said Wednesday that he wants to help cities build their own alternatives to Comcast, Verizon and other traditional Internet providers. These so-called municipal broadband projects, he said, would help juice competition and drive down the cost of Internet access for Americans living in rural and mid-sized cities.
But it's what the president didn't say that could wind up having a huge impact on the fate of city-run Internet. In particular, Obama chose not to unveil a legislative proposal — a significant departure from his other initiatives of the week. And his policy suggestion on broadband did little to address local regulations established by cities themselves, which many companies see as a barrier to private investment in Internet infrastructure.
The omissions have already become a source of criticism for the administration as it tries to use the Federal Communications Commission to promote municipal broadband.
One of Obama's biggest steps on the issue Wednesday was to write a letter to the FCC asking it to intervene against state laws that prevent cities from building their own public networks. Supporters of muni broadband say the agency has all the authority it needs to preempt those laws, under a part of the Communications Act known as "Section 706." That part of the law recognizes the FCC's ability to promote the deployment of broadband, and the theory here is that nixing the anti-municipal laws would serve that goal.
"706 already gives the FCC enough to do what it needs to do," said John Bergmayer, a senior staff attorney at the consumer advocacy group Public Knowledge.
But there's another side to this coin. Critics of the FCC (including some within the agency itself) argue that it actually doesn't have the power to get between states and their cities. Federalism, and all that. Some analysts believe that's why Obama didn't bring up the prospect of legislation on municipal broadband; if the FCC's authority to act is being questioned, asking Congress for its blessing would simply undermine that authority further.
The White House probably "didn't want to give the impression that there was not federal authority already," said Harold Feld, senior vice president at Public Knowledge.
In fact, Senate Republicans are signaling that they may try to legislate against Obama's muni broadband proposal.
What about the other bit about local regulations? Well, among Obama's announcements Wednesday was a new coalition of mayors who've pledged to expand and support community broadband, which could take the form of city-run Internet or involve public-private partnerships or other models. Some of these mayors would presumably offer incentives to Internet providers so that they would be more inclined to collaborate. But Obama didn't make any specific pronouncements about local regulations, which worries some policy analysts who believe private investment (think the likes of Google Fiber) offer a better alternative than government-run Internet.
"The thing Congress actually could fix is that Google Fiber currently doesn't get non-discriminatory pole attachment," said Berin Szoka, president of the libertarian-leaning think tank TechFreedom.
Non-discrimina-what? To understand what's going on here, let's take a look at what happened when Google Fiber went into Kansas City. Before it could lay down high-speed fiber optic cables that serve customers like you and me, Google had to get permission from the city to string fiber along utility poles and access other property owned by city hall. Google actually got a very favorable deal, but few companies are so large and powerful that they can strike the same kind of agreements that Google did.
In other cities, the poles may be owned by a single utility company, and private Internet providers might be charged a fee to install cables on those facilities. Depending on the municipality, there may be other rules that need to be dealt with, too. In short, having to conduct complex negotiations over how an Internet provider can start laying down infrastructure is a significant burden, let alone the cost of installing the cables themselves.
"Securing access to poles from electric co-ops at fair market rates is a huge barrier to broadband deployment," said Ross Lieberman, the senior vice president for government affairs at the American Cable Association, which represents smaller and independent cable companies.
But it's unclear what, if anything, Obama's promises on municipal broadband will do to make it easier for businesses to negotiate with officials at the local level. Although the White House will be expanding federal grants and loan opportunities for those who want to build more infrastructure that competes with big, traditional Internet providers, they won't help much if the would-be competitors don't find those incentives enough to overcome the annoyance of dealing with city officials.