[Cialug] Iowa Municipal Telecom Legisation

[Michael Osten]

On Feb 22, 2005, at 10:50 AM, Dave J. Hala Jr. wrote:

> Its another example of Republican Bush-O-nomics.  Its more legislation
> sold under the guise of "Improving the business Environment" =
Basically,
> its eliminating community players in potential Telco markets.
>
> I wouldn't be surprised if a new bill popped up saying that ISP's had=20=

> to
> use MS servers, in order to protect us from Cyber Terrorism. Its a =
such
> load of crap.
>
> Internet infrastructure should be a public utility, if a community=20
> would
> choose to have it that way... Communities should not be hampered by=20
> this
> Kind of B.S.   They don't need feasibility studies, they have the
> community to answer to.
>
> It offends me to the point where I become almost insane enough to run
> for public office.

As a disclaimer, I work for a telecom, which also happens to be the=20
largest ISP in the state of Iowa.  However, my opinions are not that of=20=

my employer.

It really isn't a case of the evil telecoms forcing over-priced=20
products on cities.

What people fail to realize the telecom industry is one of the most=20
heavily regulated industries in the country.  Telecoms are forced to do=20=

hugely unprofitable things for the benefit of public good.  Such as=20
running telephone lines into rural areas.  Sometimes running millions=20
of dollars of infrastructure to areas that serve a very small amount of=20=

people.  Such a small amount that the cost would never be recuperated=20
simply because of the regulated prices that telecoms can charge.  We=20
currently have DSLAM's in areas that serve fewer than 10 people,=20
providing the only hope these people currently have for affordable=20
broadband.  The small towns that we serve have no hope of providing=20
service to their residents, it is simply to expensive and complex. This=20=

is not profitable for us, but is the cost of doing business.   Telecos=20=

are fighting these municipalities simply because they put local=20
municipalities on a unleveled, unregulated playing field with the=20
heavily regulated, "for profit" telecos.  This really also has nothing=20=

to do with internet access per-se.  IMHO it has more to do with the=20
coming of VOIP products that are completely unregulated, and do not=20
require the infrastructure that the telecoms have been forced to put in=20=

place.  Other "for-profit" entities we can compete against, but tax=20
payer fed, and deficit running municipalities used to hemorrhaging=20
money we can not.

You also need to look at why cities would want to do this?  Is the=20
service they currently have so terrible and overpriced?  I doubt it. =20
Sure to people like us, fiber to the door would be nice, but do you=20
really think "Joe six-pack" really needs or wants to subsidize said=20
fiber, or wireless for that matter?

Below is a quote from Alan Wells, the CEO of Iowa Telecom in the Des=20
Moines paper:

Q. There is an effort to bring fiber to the home with OpportunityIowa.=20=

What are your thoughts on that?
A. You have to take a step back and say what=92s the need we=92re trying =
to=20
address =85 Is telecom and capacity on the network holding us back from=20=

economic development? I don=92t think so. If it was, I think we=92d have=20=

heard a lot more about communities coming to us or somebody else saying=20=

we have a development need. How can you help us meet it? (Fiber to the=20=

home) is an awful lot of money for cities and communities to take on=20
responsibility for without a demonstrated need.

Q. Is that a statement in opposition to OpportunityIowa?
A. I wouldn=92t say opposition. Whoever makes the decision about the =
need=20
for fiber to the home really needs to understand the costs and risks=20
that go along with it and make sure those costs and risks are=20
warranted=85 . If a community decides it=92s being held back because of=20=

telecommunications, it really take a close look whether that=92s the =
case=20
before deciding to spend millions of dollars of city money to go build=20=

something.

I think that Mr Wells is right, the only sane reason to use tax payer=20
money for infrastructure is where private enterprise would be too cost=20=

prohibitive (ie roads, power plants, etc).

Here is also something to think about, if the communities take over a=20
utility, would in the world would you complain to if it wasn't up to=20
your standards?  We all know how well government handles our tax money.





--
Michael Osten
http://www.bleepyou.com/~mosten/pgp.txt