Comcast Forever

Two months ago President Obama made a stop in Cedar Falls, Iowa, to tout that city’s municipal broadband network. In the midst of the nationwide debate on net neutrality, the president’s focus was on “how we can give more communities access to faster, cheaper broadband so they can succeed in the digital economy.” As the President noted:

This isn’t just about making it easier to stream Netflix or scroll through your Facebook newsfeed….This is about helping local businesses grow and prosper and compete in a global economy. It’s about giving the entrepreneur, the small businessperson on Main Street a chance to compete with the folks out in Silicon Valley, or across the globe. It’s about helping a student access the online courses and employment opportunities that can help her pursue her dreams.

Cedar Falls started investing in broadband infrastructure nearly twenty years ago and is now Iowa’s first city to offer gigabit service, which is about forty times as fast as the national standard for high speed Internet. While Cedar Falls, with a population of 39,000, is tiny in comparison to St. Paul, cities like Chattanooga, Tennessee (population 170,000) also had the foresight to build an all-fiber broadband network where gigabit service, available to every residence and business, has led to dramatic strides in innovation, capital investment, and job creation. (It also resulted in a dramatic decrease in residential broadband rates, with gigabit download speeds now available for $69.95 per month compared to Comcast’s $66.95 for mere 25mb service here in St. Paul.)

One would think that the FCC’s recent vote to preserve net neutrality while also invalidating state laws that blocked municipal broadband expansion would signal a new opportunity for cities like St. Paul to break the stranglehold that companies like Comcast enjoy as the result of a near-monopoly on broadband and cable services. Unfortunately, that would require elected officials focused on innovation, progress, and transparency—something that appears to elude our current City Council.

Although Comcast’s annual cable revenues in St. Paul are estimated at $51.5 million per year (with another $35 million generated from internet and telephone services), the Council chose to hold no public hearings about the cable franchise renewal and to limit public comment to a mere fifteen minutes, equating a deal worth nearly $1 billion over the next ten years as no more important than noise variance requests sought for St. Patrick’s Day that were part of the same agenda.

Not only did the Council vote unanimously on March 4th to extend Comcast’s original 15-year cable franchise for another decade (on virtually the same terms as the original 1998 agreement), a week later they approved a contract that would pay the Philadelphia-based company $2 million upfront to upgrade the city’s internal broadband network and another $400,000 per year for the next ten years to operate that network—withholding details about the operating costs until the day of the March 11 council meeting and making the agreement part of the consent agenda with no opportunity for public input.

Thus, over the course of seven days, the council voted both to institutionalize Comcast’s abysmal customer service (“Hello, Philippines?”) and virtually guarantee that the development of high speed, affordable internet access for every home, business, or school won’t happen for decades.

(At this point, the city also has no strategy even for creating ‘dig once” polices that would ensure that any necessary conduit or fiber is put in place whenever the ground is opened up as part of a road or bridge construction project, an incredibly short-sighted approach given that an estimated 80% of the cost for installing fiber is in the trench work.)

Why should any of this matter? Simply put, speed and access are everything in today’s world, and allowing Comcast and Century Link to cherry pick the most affluent neighborhoods in which to market their services ensures that thousands of St. Paul families will be unable to meaningfully participate in the digital economy or information superhighway, further exacerbating the digital divide between rich and poor.

Of course, it’s not just the city that has been shortsighted. Ramsey County recently contracted with Comcast to spend $1.4 million for its own network expansion (and $300,000 annually to manage the network), while the School District, having decided to dedicate all the technology referendum dollars to iPad leases, continues to struggle with bandwidth issues in its buildings while many students have nonexistent or inferior internet service at home.

Chattanooga spent nearly $300 million to develop its municipal network, relying on $180 million from bond sales and approximately $111 million in stimulus funding from the federal government as part of the ARRA funding that was available in 2009 for “shovel-ready” projects. While that level of investment might seem overwhelming, consider that St. Paul will have spent nearly $150 million combined on just three recent projects—the Saints ballpark, the Penfield, and the Palace Theater renovation.

So while the mayor banks on entertainment venues as the key to our economic future—and the county and school district remain in their respective technology silos—forward-thinking cities like Chattanooga are making strategic investments in broadband infrastructure that are attracting the start-up ventures and entrepreneurs who will create the cutting-edge jobs that lead to expanded capital, ancillary job creation, and growth in the property tax base.

As a city, we can not talk honestly about equity, about racial justice, about opportunity, or about sustainability when we are doing nothing to create affordable pathways to the digital economy. Our school children suffer, our less affluent residents fall further behind, and our ability to compete with other cities for high tech investment is greatly diminished.

What’s next for the “Most Livable City in America”—a downtown Wal-Mart?

(An edited version of this post was published in the Highland Villager on March 18, 2015)