The Playing Field

April 29, 2009 11:14 AM

In the town of Wilson, North Carolina, an ISP battle is underway that could have implications across the entire United States. When Greenlight began offering cheaper and faster internet service to the town's residents, Embarq and Time Warner couldn't compete. So they responded by sponsoring legislation that "would effectively either cripple or ban the service all together", and backing this up by phoning local residents to urge their support. The city of Wilson has responded: "[Embarq and Time Warner] don't want to level the playing field. They want to be the only team on the field." Time Warner defends the legislation, saying in part that, "Cities can cross-subsidize their service, using income from water or electric service fees to pay for the system. We can’t solict door to door. They can." (Via)
posted by Marisa Stole the Precious Thing (59 comments total)

Stick it to those socialists! No more gummint interference in Time Warner's regional monopoly! The only good government interference is the kind that prevents competition for those stupid shitbags at Time Warner!
posted by Mister_A at 11:20 AM on April 29 [3 favorites]

I forgot to mention, by the way, that, as owner of AOL, Time Warner really ought to eat whatever bowl of dicks life offers.
posted by Mister_A at 11:21 AM on April 29 [10 favorites]

Verizon pulled the same stunt in Pennsylvania, setting up a municipal ban on public networking services, after Philadelphia tried to get WiFi set up throughout the city. When they can't compete, these are the best laws that telecom lobbyists can buy.
posted by Blazecock Pileon at 11:22 AM on April 29

This is socialism. Evil European socialism.

Just like public roads and bridges.
posted by orthogonality at 11:23 AM on April 29 [4 favorites]

So corporations are angry that they can't monopolize a public good because the government is handling it better? Is that what this has come to? I might have had some sympathy for TWC if Wilson, NC hadn't laid their own phat pipe.
posted by cimbrog at 11:23 AM on April 29 [1 favorite]

And to think I've been pining for Verizon to offer Fios where I live, so I can finally tell Comcast to get out of my house.

[snarkasm]
Once again, inefficient Big Government screws up the Glorious Free Market.
[/snarkasm]
posted by Kirth Gerson at 11:25 AM on April 29

If there was one thing I learned from reading The Shock Doctrine (and I learned many things, all of which were extremely depressing), it was that any time a large corporation says they want to "level the playing field," or words to that effect, it means they want to wipe everyone else off the map playing field.
posted by The Card Cheat at 11:29 AM on April 29 [7 favorites]

More than a decade ago, the telcos begged the United States government for a variety of tax cuts and the like, your typical package deal, totaling hundreds of billions of dollars. In exchange, they would bring amazing high-speed internet, fiber speeds, to all homes. Today, I've got a friend who lives not too far away; he can't even get DSL.

I think a nationalization or two might get them to perk up and take notice.
posted by adipocere at 11:30 AM on April 29 [13 favorites]

I long for the day when telcom services have become commodities.
posted by hupp at 11:34 AM on April 29 [7 favorites]

So they responded by sponsoring legislation...

Show me where in the North Caroline Constitution it says that Time Warner can sponsor legislation.

Time Warner defends the legislation...

It's pretty sad that they are able to buy laws in the first place and even sadder that they don't even deny it.
posted by DU at 11:35 AM on April 29 [8 favorites]

I forgot to mention, by the way, that, as owner of AOL, Time Warner really ought to eat whatever bowl of dicks life offers.

Perhaps not for much longer. On the ownership, that is. Not the dick part.
posted by jquinby at 11:36 AM on April 29

101Mb/s internet as a commodity for $99.95
posted by blue_beetle at 11:37 AM on April 29

The key here is that the government rolled out the fiber. In the case of FiOS, Verizon paid to roll out all that fiber themselves, and even then, FiOS from Verizon costs the same as this Greenlight ISP for the same services.

Also, Time-Warner might want to check the headlines. If it's okay for the government to own over 50% of General Motors and significant percentages of the nations largest banks, there will be no argument against the government offering ISP service.
posted by Pastabagel at 11:37 AM on April 29 [2 favorites]

101Mb/s internet as a commodity for $99.95

A commodity is something for which there is demand, but which is supplied without qualitative differentiation across a market.

Also: launch set for next month across its entire New York-area footprint.

Well, across the whole New York-area footprint. That's really great news to people outside of that area footprint.
posted by DU at 11:40 AM on April 29 [1 favorite]

I forgot to mention, by the way, that, as owner of AOL, Time Warner really ought to eat whatever bowl of dicks life offers.

FYI, Time Warner Cable is no longer affiliated with Time Warner/AOL:

Time Warner, under Jeffrey L. Bewkes, who became chief executive officer in December 2007, has become a stripped down media conglomerate focused on producing content, rather than the delivery of it. This year the company, which was once the world’s largest media company, spun off its cable division, Time Warner Cable, in to a separate publicly traded company.via
posted by phatkitten at 11:43 AM on April 29

posted by Mister_A as [the] owner of AOL, Time Warner really ought to eat whatever bowl of dicks life offers.

You've Got Fail!
posted by mattdidthat at 11:43 AM on April 29 [1 favorite]

I don't see why society owes Time Warner or Verizon a chance to compete. If they can, that's great but the entire argument for capitalism is that it provides goods and services more efficiently. If it doesn't in this case, screw them.
posted by Tashtego at 11:44 AM on April 29 [6 favorites]

> 101Mb/s internet as a commodity for $99.95

God damnit I miss Optimum Online.

The have always been spending their money and resources on providing the best services possible with reasonable margin for themselves, instead of the other cable companies business plan which is apparently "being a bunch of cocks."

I wish we could get those guy in congress to testify how it is possible for them to provide such a level of service, when Comcast and Time Warner keep saying they need more money to provide broadband to the masses.
posted by mrzarquon at 11:45 AM on April 29

Ahh thanks phatkitten. Still, dicks to them!
posted by Mister_A at 11:45 AM on April 29

If they can, that's great but the entire argument for capitalism is that it provides goods and services more efficiently. If it doesn't in this case, screw them.

Defending capitalism is great news...for socialism!!!
posted by DU at 11:45 AM on April 29 [1 favorite]

Former Wilsonite here. Hunt High School, Class of '92.

I lived in Wilson from 1991 to 1994. 1993-1994 was college, in Austin, TX and then in Chapel Hill, NC. (From Chapel Hill, I'd drive home every 2-3 weekends or so to visit the parents.) Back then, from the parents' house in Wilson, I had to use dialup into some local number at Barton College, then telnet to the stuff at UNC I wanted to see. (It was all text.)

Nice town, but . . . goddammit, talk about living in the right place at the wrong time. :-(
posted by CommonSense at 11:48 AM on April 29

This is why I worry about network neutrality laws- the folks running the network neutrality decisions will be the lovely fellows at the FCC, who are blatantly captive regulators for the big telcos and cable companies.
posted by jenkinsEar at 12:04 PM on April 29

This all comes right back to the arguments about getting corporate money out of our legislatures. Take a look at the anti-competition bill sponsor, Drew Saunders, whose campaign was partly paid for by AT&T and Embarq. Corporate campaign contributions need to not only be made illegal but made a felony - - I don't care how much it costs to finance a campaign.
posted by crapmatic at 12:24 PM on April 29 [4 favorites]

TWC has the worst customer service I've ever experienced (and insanely poor connectivity and speed, from my perspective.) When I lived in NC I would have to call them repeatedly because of service interruptions. Every single damned time I called I would be met with a message: "You are calling from outside our service area and we are unable to take your call." Then it hung up.

When I finally did get through (by getting an alternate number from a TWC employee I cornered while he was setting up cable at another house) I was informed that no such message existed and there was no way I was being hung up on when calling. Even though it happened every damn time.

I was never a big fan of Comcast (we raise your prices annually, because we can!) but I was damn happy to leave NC and get out from under TWC's thumb.

If there is only one choice in cable, in one location, it's a monopoly. Monopoly is only legal as a board game. How they manage to convince the government there's freedom of choice, I'll never understand (oh wait, the answer is MONEY. Now I get it.)
posted by caution live frogs at 12:26 PM on April 29

This, by the way, is essentially the same arguments you'll hear more of when we get into the health care debate this summer. Medicare operates with a 3% overhead. Health insurance companies don't want Medicare to be available to all because there'd be no way they could compete and still pay billion dollar bonuses to their executives.

In a true free market, competition is supposed to drive profits to a minimum over time. Any extremely profitable business has either released such an innovative product as to temporarily be a monopoly, or is gaming the system in some way.
posted by heathkit at 12:32 PM on April 29 [7 favorites]

You're right on the money there heathkit. Wilson NC can operate their internet pipe at low cost because they don't have to make a profit on it. The same can not be said for TWC. So, too bad TWC!
posted by Mister_A at 12:35 PM on April 29

Speaking of Austin, the city wanted to install municipal broadband way back in 1996. Texas also happens to be home to AT&T (then Southwest Bell), which bought itself some legislation outlawing municipal broadband.
posted by adamrice at 12:39 PM on April 29

If Time-Warner is trying to use North Carolina as the staging ground for their run as Epic Douchebags of the Century, they're doing a great job. First the bandwidth caps (which they decide against, but only after customers threatened to drop them altogether). Even so, TWC is now saying it won't rollout DOCSIS 3 modems (because of all the mean customers who won't let them charge usury!!! WAAHHHHH!!!) Then this nonsense in Wilson.

caution live frogs has it right: the cable company (or as the commercials always lie, "cable companies", plural) is a monopoly, plain and simple. There is nothing about ordering, using or paying for cable service in the US that is even moderately fair to consumers. Forced bundling, exorbitant fees bordering on usury and the worst technical support this side of Dell are all par for the course. If I were closer to Wilson I'd be rioting in the streets for my open source broadband.
posted by littlerobothead at 12:40 PM on April 29 [1 favorite]

I have little love lost for TWC. The reason I am struggling with a DSL line is because TWC has so screwed up my television service that the only channels I can get are the Discovery Channel, the History Channel, IFC, Sundance, the Food Network, and occasionally BBC America. I cannot get any network stations. And I cannot get this repaired because whichever circus chimp they hired to set up my television connection ran the wire to connect to a hub in a completely different building three doors down the block, and the only way I can get a serviceperson in is on THAT BUILDING'S schedule. So I have to work around the schedule of total strangers.

I don't trust TWC any further than I can throw them.

As for this issue -- this is sounding an awful lot like the furor over the TVA in the 1930's. Things really do never change, do they?
posted by EmpressCallipygos at 12:42 PM on April 29

This happens frequently with public transit, as well. In both Philadelphia and Washington, DC, private bus lines (that charge $15-20 for a trip from a city point to a sports arena/stadium on game days) sued to literally ban the public transit system from offering service there on the grounds that they "can't compete with government-subsidized transportation costs."

But remember, we keep forgetting that the U.S. is the one industrialized nation on the planet where subsidized health care just won't work either.
posted by XQUZYPHYR at 12:48 PM on April 29 [1 favorite]

...or is gaming the system in some way.

Yes, exactly. I believe the term we are looking for is rent seeking. Not a fabulously-written article, but the basic concept is explained okay.
posted by Maximian at 12:51 PM on April 29 [2 favorites]

It's pretty sad that they are able to buy laws in the first place and even sadder that they don't even deny it.

These two, specifically.

Here are the motherfuckers that sponsored the bills:
Ty Harrell
Earl Jones
Marilyn Avila
Thom Tillis
David W. Hoyle
posted by Civil_Disobedient at 12:52 PM on April 29

My highspeed service hasn't changed (other than a price increase and a lower upload cap!) in 10 years. Die telcos, die. (That's german for "the telcos, the")
posted by mek at 1:02 PM on April 29 [4 favorites]

In related news...

Cablevision has fastest Internet speeds for cable

"Cablevision Systems Corp. on Tuesday unveiled the fastest Internet speeds available from any cable or phone company.

Starting May 11, the Bethpage, N.Y.-based cable operator will offer speeds of up to 101 megabits per second downstream throughout its service area, and 15 megabits per second upstream.

That means a 4-gigabyte, high-definition movie can be downloaded in 5 1/2 minutes. It would take two minutes for a 1.6-gigabyte standard definition movie.

Cablevision, which has 3 million subscribers in the New York metro area, also plans to double the downstream speed of the Wi-Fi Internet service it offers at 'hot spots' in New York's Long Island, Connecticut and Westchester County, and in parts of New Jersey."

posted by ericb at 1:05 PM on April 29

Just wondering here, if this legislation passed, exactly how does it get enforced? I mean, exactly what happened if this city and their internet service just refuse to shut down? It seems that the main objective here for both the cable companies and the legislators backing this bill is avoiding a lot of attention, seeing as how "securing the right for a cable company to charge you more money" doesn't seem like an election-winner.

I find it amazing that consumer issues over cable/internet service aren't a larger deal. I realize that, for example, heat and water are far more significant than internet access, but when gas bills went up last summer it was a story every damn day. My Comcast bill is more expensive than all my other utilities combined.
posted by XQUZYPHYR at 1:08 PM on April 29

Or, what blue_beetle said!
posted by ericb at 1:12 PM on April 29

TWC may not be owned by AOL, but there are plenty of reasons for them to choke on dick life cereal bowls. (?)


Excuse me while i go fire up 20 torrents on our 5 computers.
posted by fontophilic at 1:18 PM on April 29

Just wondering here, if this legislation passed, exactly how does it get enforced?

The legislation would basically enforce how the internet service is paid for - that it would not be able to receive cross-subsidizing from other municipal services, to "impute the costs that would be incurred with private providers", prepare an audit of "competitive activities" and be subject to the same laws private providers need to abide by.
posted by Marisa Stole the Precious Thing at 1:19 PM on April 29

I just forwarded this story to the Mayor of our city.

I hate the Cable companies (Cablevision/OptimumOnline here) and wish I could get FiOS here, but on the other hand, I am not sure I want the government to be responsible for services where the state of the art change so rapidly. Its also important to remember that someone has to deploy the capital to deliver the infrastructure to support this. I'm not an expert in Telcom tech or financials so I'll defer to others...in short, I'm not sure what I think about this.
posted by sfts2 at 1:28 PM on April 29

The city I live in offers cable internet service. It is cheaper, faster, and more reliable than anything (Comcast, Astound) available in neighboring cities. The monthly fee has gone up $3.00 since I moved here. It's easy to see why the media conglomerates are worried about this.
posted by oozy rat in a sanitary zoo at 1:35 PM on April 29

"That means a 4-gigabyte, high-definition movie can be downloaded in 5 1/2 minutes. It would take two minutes for a 1.6-gigabyte standard definition movie."

That's GREAT, Cablevision! Now what's the upload speed?

Oh, nobody told you the internet is a two-way communication system? Gosh, imagine that.
posted by caution live frogs at 1:39 PM on April 29

> That's GREAT, Cablevision! Now what's the upload speed?

15Mbps, if you rtfa. Yeah, not symmetrical, but considering the upload speed is faster than most ISP's top level download speed, I'd still take that.
posted by mrzarquon at 1:41 PM on April 29

"Real fast cheap internet? Lower phone and teevee bill? Lots of local jobs? No more dealing with AT&T or Comcast?"

[calls city commissioners]
posted by humannaire at 1:42 PM on April 29 [1 favorite]

> I hate the Cable companies (Cablevision/OptimumOnline here)

Dude, you have access to the best broadband provider in the country. Yeah, they may be kind of a pain, but you don't know how good you have it until you have to deal with other carriers.

That oh so wonderful FIOS service actually means you are going to be a verizon customer for life, as they remove the copper pairs and make it hard to roll back to traditional service in the future.

And yes, I know they managed to cripple their cable boxes with their guide software, but other than that, the rest of the service options are top notch compared to any other carrier I have ever had to deal with, especially when you factor in the price point.
posted by mrzarquon at 1:49 PM on April 29

"...the entire argument for capitalism is that it provides goods and services more efficiently."

Well, at this point, throwing a few thousand at a state legislator is a lot more efficient (for them) than actually improving their service and/or infrastructure, isn't it?

The problem here is not TWC, the problem is the whores that have been elected to "serve" the public.
posted by mr_crash_davis mark II: Jazz Odyssey at 2:02 PM on April 29 [2 favorites]

I am not sure I want the government to be responsible for services where the state of the art change so rapidly

I don't mean to call you out personally here, sfts2, but I did want to highlight this thought. It's a common idea, and ties into the pervasive American belief that government is intrinsically and unavoidably slow, unresponsive, and inefficient.

I'm not saying that's never the case but, as an example, the government-run military is a service with a rapidly-changing state of the art. The internet itself started as a government project. Meanwhile, the state of the art in broadband hasn't seemed to change at all in the past decade - the cable internet in my apartment in Seatlle is only marginally better than what I had in 2000, and the only DSL service to my apartment is ISDN-level bandwidth! That's hardly "rapid".

It's like we have this conflation in this country between "competitive" and "privately owned". Just because something is private doesn't make it more competitive, and just because something is publicly owned doesn't mean it can't be competitive. Government is us, and any service it provides is as responsive as we are vocal.
posted by heathkit at 2:11 PM on April 29 [4 favorites]

I forgot to mention, by the way, that, as owner of AOL, Time Warner really ought to eat whatever bowl of dicks life offers.

phatkitten already mentioned it, but TWC became an independently traded company a couple of months ago and isn't officially part of Time Warner anymore. ("Officially" as opposed to "in actuality". I'm sure there are a lot of people who share power in both companies at the top.)

Personally, I hope Greenlight does really well and forces TWC to reevaluate their model. Right now the cable companies don't have a lot of serious competition and in some cases it's causing them to stagnate on the high speed data side of things. Someone who can offer much greater product at a significantly lower price would cause the R&D teams to frantically put together new plans to try to compete, and since I'm in an area that tends to test new technologies, I might see it sooner rather than later.

Oh yeah, it's all about me!
posted by quin at 2:14 PM on April 29

Okay, so we've established that it might be time to start thinking about broadband Internet as a necessary public service, possibly to be regulated by a public utilities commission.

So what do we do here? Whom do we contact over in North Carolina, or up in D.C. or wherever, to express our thoughts on the subject? Whom do we flood with concerned phone calls/e-mails/letters who is actually interested in listening and will act on our behalf?

help
posted by jeeves at 2:15 PM on April 29

Well, at this point, throwing a few thousand at a state legislator is a lot more efficient (for them) than actually improving their service and/or infrastructure, isn't it?

The problem here is not TWC, the problem is the whores that have been elected to "serve" the public.

I think that's a great way of putting it, but I don't think it's reasonable to attribute this to graft or corruption.

The simple truth is that it costs millions of dollars to run for the Senate in the US. If you can't raise tens of thousands of dollars every day during your term, you won't be coming back. With a couple notable exceptions, elected officials aren't getting rich of of their offices (at least, not until they leave government and start working as highly-paid lobbyists). However, in order to simply be an elected representative, they essentially have to run a multi-million dollar marketing business. Given that the cost of holding office is so high, is it any wonder there's a market for political influence?

Maximian, thanks for the link by the way, I've never heard of that term. It's my new favorite phrase.
posted by heathkit at 2:22 PM on April 29

What's bullshit is that these companies operate as local monopolies. If you don't like it, you're fucked! Frankly, I would rather see network access managed by cities, and handled the same way roads are. Why exactly should this particular piece of infrastructure be handed over to for-profit companies, when water, roads, etc. are handled by the government? There's no reason it couldn't be upgraded frequently if that's what voters wanted.
posted by delmoi at 3:30 PM on April 29 [1 favorite]

It seems to me that broadband pipes are very similar to sewage pipes. There's a huge cost to entry, and it doesn't make sense for there to be multiple pipes running side by side. So why not have the municipalities own them?
posted by ShadowCrash at 5:33 PM on April 29 [2 favorites]

So what do we do here? Whom do we contact over in North Carolina, or up in D.C. or wherever, to express our thoughts on the subject? Whom do we flood with concerned phone calls/e-mails/letters who is actually interested in listening and will act on our behalf?
posted by jeeves

NC Senate Bill 1004 and House Bill 1252, both pages have links to the contact info for the sponsors. Of course, I'm not sure about the "actually interested in listening and will act on our behalf" part of your question.

I was talking to someone who was at one of the hearings on one of the bills, when the Senator or Rep got a question they couldn't answer they referred it to a TWC exec who was there. It quickly became clear that TWC had written the legislation.
posted by marxchivist at 6:02 PM on April 29 [3 favorites]

i can't get dsl from verizon in Fall River, MA but 10 miles south of here it is avaialble since they upgraded their swithing facility in the weathist local town.
posted by lemuel at 6:05 PM on April 29

when water, roads, etc. are handled by the government? There's no reason it couldn't be upgraded frequently if that's what voters wanted.

And, I actually think voters would want this quite often. You get road maintenance every once in a while, and the city will put in newer, smoother roads. This makes your drive more enjoyable. The drive is more pleasant and you can drive slightly faster. But imagine if your town could upgrade your roads such that you could drive ten times faster with no additional risk of accidents, for only a few percentage points more in cost of the original roads.

I think most people would be pretty happy about that!
posted by delmoi at 6:13 PM on April 29

...they upgraded their swithing facility in the weathist local town.

How about Ethel? That's her name. Ethel Thayer. Sounds like I'm lisping, doesn't it?
posted by ericb at 6:15 PM on April 29

I would be wrong o me to let this go by without tossing in a comment about my hatred for Comcast. HATE HATE HATE.
It's not directly relevant to this discussion, but i feel slightly better now. Thank you.
posted by cccorlew at 7:36 PM on April 29 [1 favorite]

Wilson NC can operate their internet pipe at low cost because they don't have to make a profit on it.

Well, that's part of it, but where I think there's a legitimate concern is if/when they start operating it at a loss.

It's not Time Warner's concern, though; they can go suck a bag of dicks — no argument there. But I think municipalities and voters need to consider very carefully how much skin they want to have in the game: I could easily see a well-meaning muni wifi project becoming a political hot potato if it became a serious cost center for a local government. If such projects aren't managed well and forced to break even, they'll always be vulnerable to cutbacks in the future, which could be disastrous if the project is dependent on tax revenue and has managed to supplant all the private-sector alternatives.

The best municipal projects that I've seen proposed involve the municipality laying or providing loan guarantees in order to have the basic infrastructure put down, and retaining ownership of it all the way from a central switching location to the customer premises. In other words, you let government control the part of the network that's most likely to be a 'natural monopoly': the last mile. Then, this infrastructure, along with space in a central switching facility, is made available on a non-exclusive basis, at cost, for companies to offer service across.

(This is similar to the arrangement that the FCC required incumbent telcos — Baby Bells — make with CLECs and DSL providers in the late 90s, until the Bush administration gutted it. Although in the case the last-mile wires weren't truly public, they were owned by heavily-regulated entities.)

By owning the last-mile infrastructure you eliminate the high barrier to entry that causes telecommunications to tend towards monopolization, but by offering that to various service providers you avoid having a "one size fits all" solution and get the benefits of private-sector competition and service innovation. (And this is an area that has the potential for a lot of innovation, in terms of services delivered; I don't think we've really scratched the surface. Some people might want nothing but raw packet delivery, while others might want packages built around content, like IPTV or VOD service. There's probably a thousand ISP-like startups waiting to be born, if you didn't have the last-mile barrier there.)
posted by Kadin2048 at 10:03 PM on April 29 [3 favorites]

> By owning the last-mile infrastructure you eliminate the high barrier to entry that causes telecommunications to tend towards monopolization, but by offering that to various service providers you avoid having a "one size fits all" solution and get the benefits of private-sector competition and service innovation.

After having to configure and coordinate a metro ethernet install for work, I keep going back to the idea of why don't more places do this. Instead of the ISP, the municipality just owns the last mile local fiber network between POP offices run by various ISPs, and the customers houses. Changing networks is as easy as change vlan IDs. (I realize this is a gross simplification of various network topologies, but im tired and ranty).

If it then also means I can connect to and communicate with my neighbors, schools and local resources over our own gigabit network, instead of having everything go through AT&T at whatever rate and speed they feel is adequate for their ledgers.
posted by mrzarquon at 11:56 PM on April 29 [1 favorite]

I was talking to someone who was at one of the hearings on one of the bills, when the Senator or Rep got a question they couldn't answer they referred it to a TWC exec who was there. It quickly became clear that TWC had written the legislation

I used to work at a council in the UK where a national cable company asked for permission to lay some pipes in a massive local housing estate to sell them cable TV.

The Council said, "sure you can, while you're at it you can connect up all the council-run offices in the town and provide the council with leased-line internet access all for free"

The Cable company said, "No Way! We can't justify the hundreds of thousands of pounds annual cost of that!"

The Council said : "that's a shame, come back when you can."

So they did.
posted by fullerine at 9:21 AM on April 30 [1 favorite]