‘Innovation’ Think Tank Pushes Lazy Smear Of Community Broadband

Here at ILSR we’re no stranger to telecom monopoly-backed efforts to mislead the public about the significant benefits of community owned broadband access.

That’s why a new “study” by the industry-backed Information Technology and Innovation Foundation (ITIF) maligning municipal broadband doesn’t come as much of a surprise.

The study professes to take a look at a very small number of municipal broadband networks, then makes sweeping and patently false claims about the entire sector.

“In most cases, local governments have neither the competence nor the economies of scale to deliver broadband as well as private ISPs,” the study concludes. “So, favoring government-owned networks wastes societal resources, creates unfair competition, and is frequently unsustainable in the long run.”

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There’s numerous problems here. One being that the survey only looked at 20 municipal broadband networks in a country where more than 450 community broadband networks – serving close to 800 different communities – now pepper the American landscape.

The study author acknowledges the study’s sample size was “too small for the data to represent all U.S. [government-owned broadband networks] reliably,” then proceeds to make broad sweeping assumptions unsupported by any actual evidence.

The study’s claim that community-owned networks are a “waste of societal resources” would be news to residents of Fairlawn, Ohio, where residents have access to gigabit fiber connections for as little as $55 a month thanks to the city’s municipal network, which has operated so successfully that in 2022 FairlawnGig announced it was slashing prices and increasing speeds. Or residents of North Kansas City, where KCFiber offers free broadband to locals.

In Chattanooga, Tennessee, the local electric utility EPB, has won awards for its expansion of affordable gigabit fiber and was found to have reaped the city a $2.7 billion return-on-investment in its first 10 years of operation.

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In Utah, the UTOPIA Fiber open access network has brought competition to bear in more than 21 previously underserved cities.

Data has long proven that open access fiber networks in particular result in faster, better, and more affordable broadband service in the markets where they operate. Calling that a waste of societal resources is an unfound smear that strains credulity.

A Level Playing Field For Whom?

A key claim of the ITIF study is that community broadband access somehow results in a “tilted playing field” or “unfair competition.” But most American communities are dominated by politically powerful telecom giants that spend $320,000 every single day on lobbying the federal government in exchange for policies that harm deployment and mute broadband competition.

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That in turn has resulted in market failure, resulting in high prices, spotty access, and abysmal customer service. Community broadband is an innovative, grass roots response to market failure and playing fields that were tilted at the behest of monopolists a generation earlier, something a think tank purportedly interested in “innovation” might appreciate.

“The most laughable conclusion in this paper is that ‘[t]here is no gaping market failure in need of repair’ by community broadband networks,” American Association For Public Broadband Executive Director Gigi Sohn said in a statement. “Tell that to the tens of millions of U.S. households that cannot access, afford, or use a broadband connection. Community broadband networks have arisen because big cable and telecom companies refuse to serve some communities with affordable and robust broadband.”

Another false claim repeated in the paper is that municipalities lack the “economies of scale to deliver broadband as well as private ISPs.” That intentionally ignores trends in states like Vermont, where municipalities are bonding together to form Communications Union Districts (CUD) in a bid to tackle fiber projects too arduous for individual municipalities to conquer alone.

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This claim – long made by those who defend the telecom monopolies with the worst records – fails to grapple with the hundreds of communities where AT&T, Verizon, or CenturyLink DSL service barely works or was recently turned off due to poor maintenance and a lack of investment.

“The ‘research’ in this paper is full of assumptions completely unsupported by real evidence,” Sohn said. “It’s full of weasel words and meaningless phrases, e.g., that community broadband networks ‘generally lack scale economies, expertise and experience’ to build networks, that there might be a ‘temptation’ to ‘selective deployment and cherry-picking,’ and that community networks are ‘likely to waste the resources they employ.’”

Municipal broadband isn’t a panacea – though in the Front Range cities of Colorado, those award-winning municipal networks not only pass every serviceable location in those cities, Loveland’s Pulse Fiber has met with so much success it is now expanding into neighboring communities.

Nevertheless, municipal broadband projects are like any other business plan, requiring careful planning, intelligent financing, and thoughtful, informed leadership. But no matter how many times telecom industry backed proxies push the lie, they aren’t inherently doomed to be taxpayer boondoggles.

When A Free Market Isn’t

Many so-called “free market” think tanks willfully ignore that U.S. telecom isn’t a functioning competitive market. It’s a collection of government-pampered regional monopolies coddled by significant state and federal corruption, propped up by no limit of questionable tax cuts, regulatory favors, merger approvals, and billions in poorly tracked taxpayer subsidies.

Monopoly providers enjoy pushing the narrative that they’re operating in healthy and competitively vibrant markets, and that community broadband is somehow tilting the playing field in their favor. This ignores that the playing field was never level in the first place.

“ITIF conveniently forgets that big cable and telecom companies have benefited to the tune of tens of billions of dollars from federal and state coffers and from the benefits of the use of local rights of way,” Sohn notes. “Those same companies collected billions of federal dollars from the Connect America Fund or Affordable Connectivity Program, and are lining up for Broadband Equity Access and Deployment (BEAD) funds as well. To suggest that incumbent ISPs somehow operate in a purely private ‘market-driven’ world is to ignore reality.”

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The study also professes that community broadband networks – restricted in 16 states thanks to monopoly provider lobbying – benefit from a “favoritism” resulting in “duplicative or inefficient networks.” That smugly downplays not only the popularity of these networks, but that they’re driving affordable gigabit fiber into hundreds of U.S. communities for the first time in history.

Such deployments don’t just lower local broadband access costs and drive competition into stagnant markets. They deliver additional benefits to communities long stuck on the wrong side of the digital divide due to market failure, whether in the form of expanded education opportunities, or giving a leg up to remote American entrepreneurs.

Increasingly, state and local officials have to come to the conclusion that community residents should be in charge of their fates, not monopoly executives or think tankers living half a world away. Most municipal broadband networks see broad bipartisan support locally; routinely the only real opposition comes from taxpayer subsidized monopolies and their surrogates trying to keep the broken status quo intact.

Finally, it should be noted the paper conveniently comes as $42.5 billion in BEAD funding prepares to head to the states. ITIF supporters like AT&T, Comcast, Verizon, and Charter would certainly prefer that the lion’s share of these generational grants wind up in their pockets, and far away from popular innovative community-owned broadband competitors.

“ITIF asks that the incoming Administration put its thumb on the scale in favor of Comcast and against communities’ ability to connect all of its residents with the network of their choice,” Sohn laments. “Given President-elect Trump’s professed desire to tame big media and promote competition, AAPB urges his administration to decline ITIF’s pleas and allow communities to decide their own broadband futures.”

Header image of No BS graphic courtesy of Wikimedia Commons, Attribution-ShareAlike 3.0 Unported

Inline image of EPB Fiber deployment courtesy of EPB

Inline image of happy Pulse Fiber subscriber courtesy of Pulse Fiber