How President Obama Wants To Tackle Slow Internet

January 18th 2015

ATTN: Staff

The president is expected to speak on Tuesday during his State of The Union address about getting us cheaper and faster internet. A few days ago, he was in Cedar Falls, Iowa, where he called for an end to laws that outlaw municipalities and states from building their own, publicly owned broadband networks. Cedar Falls has a publicly owned internet utility that provides gigabit speed internet service. Here's a video where the president previews his speech:

What is publicly owned internet?

You probably get your water, electricity, gas, and garbage service from either a government-owned entity or some sort of government-regulated private company. Some people think that Internet service is now so essential that we should treat it like a utility and allow cities and states to build their own high-speed networks. Some municipalities, like Cedar Falls, have created fiber networks, which produce faster internet speeds than what most people are getting from their broadband package.

Why is that controversial?

Privately owned internet service providers (ISPs) --  like Comcast or Time Warner Cable -- don't want to compete with government-owned internet service. They say it would be unfair to force a for-profit business to compete with a non-profit government entity because the government does not have to turn a profit for shareholders. The result, they argue, is that municipal internet service will kill off private sector internet and thus also kill off potential innovation. 

Consequently, ISPs have lobbied to pass 19 laws banning municipalities and states from laying their own internet cable. North Carolina has banned municipal broadband, for example. In Texas, there is a law that prevents citizens from accessing already-existing, government-owned fiber, such as a fiber network in San Antonio. 

What's the best argument against municipal broadband?

Outside of the competition argument above, ISPs argue that turning the internet into a utility will limit innovation in internet delivery. Instead of doubling down on the technologies we have now, we should be allowing private business to create new, faster technologies.

It’s a fair argument. The problem, though, is that we’re not seeing the ISPs investing in new technologies. Fiber internet, for instance, is available to very few Americans. The lack of investment in upgrading our technology has left the United States way behind Europe and Asia in internet speed.

Statistica Internet Chart

So what can the president do?

He'll likely urge the FCC to use its authority to to preempt these bans on municipal broadband. Republicans won't like it -- they'll call it a government takeover of the internet. Look for the Republican Congress to attempt to strip the FCC of any authority to take action.