Phoenix Questions Chattanooga as Muni Role Model

Downtown of Chattanooga, Tennessee

Downtown of Chattanooga, Tennessee (Photo credit: Wikipedia)

When it comes to municipal broadband successes, Chattanooga, Tenn., may not be the best example to cite in support of allowing the Federal Communications Commission (FCC) to preempt state laws that ban or restrict competition from community broadband, according to a recent report published by the Phoenix Center. Chief economist George S. Ford, who authored the report, says this perspective, which has been touted by FCC Chairman Tom Wheeler and the White House, does not account for Chattanooga’s unique circumstances.

Ford says the Chattanooga experience is not easily replicated elsewhere. Chattanooga‘s broadband system is constructed and maintained by the city’s municipal electric utility, which benefitted from $229 million in revenue bonds and a $50 million construction loan. Only 14 percent of Americans are served by government-owned electric utilities, usually present in rural markets where there are very high network deployment costs.

In addition, Ford notes that there is significant concern that municipal broadband deployment would discourage investment by private companies. Although investors may initially increase the amount of capital to stay competitive, the possibility of government entry into the market using public funds could result in the opposite effect, forcing out the private sector and decreasing competition. He questions whether consumers would actually see lower prices.

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About Mark Milliman

Mark Milliman is a Principal Consultant at Inphotonics Research driving the adoption and assisting local governments to plan, build, operate, and lease access open-access municipal broadband networks. Additionally, he works with entrepreneurs and venture capitalists to increase the value of their intellectual capital through the creation of strategic product plans and execution of innovative marketing strategies. With more than 22 years of experience in the telecommunications industry that began at AT&T Bell Laboratories, Mark has built fiber, cable, and wireless networks around the world to deliver voice, video, and data services. His thorough knowledge of all aspects of service delivery from content creation to the design, operation, and management of the network is utilized by carriers and equipment manufacturers. Mark conceived and developed one of the industry's first multi-service provisioning platform and is multiple patent holder. He is active in the IEEE as a senior member. Mark received his B.S. in Electrical Engineering from Iowa State University and M.S. in Electrical Engineering from Carnegie Mellon University.
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