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Municipal Pugilism
Local government vs. big business
by Karl Bode 01:03PM Tuesday Mar 25 2003
The push for municipal broadband in the Illinois cities of Geneva, St. Charles, and Batavia has gotten ugly. SBC and Comcast's PR departments have been busy trying to persuade voters that municipal broadband projects generally end in fiscal failure. Naturally the Tri-City broadband commission is angry, suggesting there would be no need for municipal broadband if these companies had shown such interest in service much earlier. While the vote looms, 'misinformation' reigns, and the city mayors claim they will push the project forward even if they face a loss.

We first mentioned the Illinois municipal broadband project during its earliest stages in February of last year, at which time the three cities had become frustrated with the service of AT&T Broadband, and were just beginning to explore their options. Using the success of other communities such as Spencer, Indiana; Thomasville, Georgia; and Palo Alto, California, as a blueprint, the Tri-City area leaders began to draft their plan and formed a research commission.

The city of St. Charles began to keep a progress log of its push to revitalize its business district, part of which would now include high speed infrastructure. After waiting through the summer of 2002, a requested 700 page feasibility study was completed for the broadband initiative, and the three cities began to plan in earnest. The proposed plan would cost $63 million and would create nearly 50 city jobs to administer and maintain the broadband network.

Naturally the plan had its skeptics from the start. The Heartland Institute, a national nonprofit research organization based in Chicago, released a scathing 22 page report that stated the project was likely to go bankrupt, and that the city would be unable to compete with the private sector. Area papers and leaders criticized the Institute, claiming that while it claimed to be bias free, it repeatedly took pro-business stands on public policy issues such as the privatization of public services.

The cities weren't fazed. One Batavia city administrator claimed that Bast and the institute did not have an "accurate understanding of the project", others arguing that since the city already ran its own electric utility, start-up and operation costs would be significantly less. "Historically, we got into the electric utility for the same reason: the residents wanted it," Geneva Information Systems Supervisor Peter Collins said at the time. "We're used to being different."

With the feasibility study completed, and area leaders convinced the project could be practical and successful, they now faced the problem of convincing voters that such a plan was in their best interests. A community vote was set for April 1st, and area leadership began to pitch the idea to area residents.

Debate began to rage in local papers over the necessity of the project. One woman wrote her local editor to complain about the local leaders trying to pitch the broadband idea as a "necessity of life". "I raised two very intelligent children without cable television and high-speed Internet", argues the woman. "Necessity of life? Whose life?"

Ironically enough, in some ways the mother of the project, AT&T Broadband, whose poor service helped to birth the plan, began to finally show an interest in the region. In a sense showing that competition was already having a positive impact on the area; the company began sending out letters to area consumers informing them that they'd be finally upgrading the area's cable system after years of unheeded complaints.

One area resident wrote us in amazement after receiving the letter. "I find it strange that, after years of putting it off, AT&T all of a sudden sends me a letter saying that they will be upgrading the cable system in my area (Geneva, IL), so that I can get enhanced services like cable broadband. AT&T has been putting off the work for years until now, when the tri-city area is thinking about doing it on their own, without the help of a big telco/ISP/Broadband provider."

As the April first vote grew closer, SBC and the newly merged Comcast began to fire up their PR machinery, trying their best to convince area voters that a municipal broadband system simply wasn't in the residents' best interests.

Both companies began by issuing surveys via telephone and mail, which asked customers questions such as "Is it appropriate to spend 62 million for broadband service when two private companies already provide that service?" and "Should tax money be allowed to provide pornographic movies for residents?" When criticized by local officials who claimed the surveys were misleading propaganda, neither company was willing to release the content of the surveys to the press. Thanks to area residents, Broadband Reports received a transcript of the questions available here.

On March 13 Comcast began running an ad (pdf copy) in area papers 'warning' voters that building such a network would be a fiscal gamble, and that residents could wind up with "higher taxes, higher utility rates, or decreased city services".

Comcast followed up that ad with another ad (pdf copy) that claimed most other nationwide attempts at local government operated broadband networks ended in failure, calling the Illinois endeavor "a long shot". The company even circulated a list of these "failed" municipal projects to area residents and leaders, all of which are rebuked at the Tri-City broadband website.

SBC meanwhile turned to its employees for support, sending them an e-mail (pdf copy) that urged them to lend their voice to oppose the broadband plan. "Despite what you may have heard from our opposition", the letter says, "SBC has welcomed competition. However, all competitors must enter on a level playing field. A government funded network relies on taxpayers' hard earned money, threatens SBC jobs and puts the municipal broadband at an advantage not afforded to other competitors."

For the first time since the plan was launched, the three mayors of Batavia, St. Charles, and Geneva stood together at a meeting yesterday evening to encourage voters to say "yes" to the April 1st vote, and to criticize both Comcast and SBC, whom they say are engaged in a campaign of "lies" and "misinformation". "We aren't trying to misrepresent anything," said Patricia Andrews-Keenan, Comcast vice president for communications, who pointed out the company was spending $50 million for upgrades in DuPage and Kane counties.

So what happens if voters say no on April 1st? According to the Kane County Chronicle, the mayors, who at one point promised they'd only move forward with resident approval, are now saying they may move forward regardless, thanks in part to SBC and Comcast's tactics in the region. According to St. Charles Mayor Sue Klinkhamer, the "economic development of our communities depends on it." According to one area resident we spoke to this morning, the Kane County Chronicle article is misleading in that while St. Charles and Batavia are or will soon be home rule, Geneva is not, and can not move forward without a proper voter victory on April 1st.

We've fired some questions at the leaders of the "Fiber for our Future Committee", who have created the Tri-City Broadband Citizen Support Group, and will post the interview hopefully this week.

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