Usually State 29 does better research than this. But for some reason he seems to think that HF 861 (previously HSB 182) is about preventing Clark McLeod from getting taxpayer money. He refers to a letter from a Mediacom representative about Clark McCleod siphoning taxpayer dollars. I’m not sure someone from Mediacom is a reliable source for answers on this topic. The letter is really just Mediacom trying to preserve its monopoly status.
A little context helps to understand why HF 861 is coming up right now. The Telecommunications Act of 1996 was supposed to bring all kinds of competition for telecommunication services – and it did for a little while. But by the end of 2001, the capital markets had dried up. And no one would give money to companies building facilities-based telco networks (These are networks where the company digs to lay fiber and buys equipment to pump waves of light down that fiber). Many small telcos then went down the route of renting lines from the very people they were competing against, the RBOCs (Qwest, Verizon, SBC, BellSouth, etc). But by the end of 2004, the FCC had pretty much removed the requirement that the RBOCs rent out their lines for close to cost. The FCC’s decisions ended the competitive market and left many communities with only the RBOC or CableCo (if they had upgraded their network) for phone and internet service.
Along comes Wi-Fi (802.11b) and telecommunication networking becomes a commodity in the unlicensed 2.4GHz spectrum – i.e. cheap. The city of Philadelphia decided they could get better internet service for their citizens if they built a high-speed wireless network. They grew tired of waiting for Verizon to finish building high-speed internet to all the city. But Verizon went to the Pennsylvania state legislature to get a state law enacted that would prevent cities from building their own telecommunication networks – thus preserving their monopoly.
Suddenly, the CableCos and RBOCs realized this could happen across the country. So they began petitioning state legislatures to put in place restrictions on cities building telecommunications networks. There are now bills in 14 states the would limit municipal telecommunications networks. Thus we got HF 861 in Iowa. In fact, the original HSB 182 (the predecessor bill to HF 861) required 2 city wide votes, each with 60% super majority, to build and fund a city telecommunications network. Sounds like someone doesn’t want cities to have any chance of building telecommunications networks. As I’ve said before, legislation should not be a solution to protect profit margins for a small number of companies.
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