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Do ISPs Deserve Protection Against Competition?

Do ISPs Deserve Protection Against Competition?

The latest chapter in the ongoing battle over the best way to deploy broadband access across the country has landed in the North Carolina legislature. Both houses in Raleigh are considering identical legislation — Senate Bill 1004 and House Bill 1252 — that, if passed, would make it more difficult for North Carolina municipalities to install and run their own broadband networks as public utilities. Both bills are dubbed the “Level Playing Field/Cities/Service Providers” and, in theory, would artificially handicap public Internet service providers with the same financial constraints that private companies would incur from building and running a new high-speed network.

Those handicaps would include submitting the same taxes, fees and surcharges to the city that a private company has to pay; and the public utilities could not undercut private providers by pricing the public service below cost. To achieve this so-called equity between public and private enterprises, the public Internet provider would have to submit to auditing and accounting practices that a public company would not, such as an annual audit to prove it is handicapping itself properly in accordance with the proposed legislation. North Carolina’s communities would also be prevented from reallocating any profits earned from running their own Internet service to benefit other city projects like improving schools, roads, or public parks.


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