Tuesday, November 06, 2007

Vinehout: Gimme DSL, Cable AND Healthcare

Ms. Vinehout, a Wisconsin State senator with a serious FIB complex, not only wants state-run healthcare; she also wants subsidies to obtain cable service or DSL (maybe T-1???) for her area.

"We have a huge difference between access to technology in rural areas and urban areas," said Vinehout, who said the only options available to her Alma farm are dial-up service or installing a satellite dish.

So she wants "Big Telecomm" (actually, RATEPAYERS) to pop for $75 million in subsidies.

And she wants even MORE money sent to the local gummints: 6% instead of the current 5%.

Jeff Plale doesn't like her ideas.


John Foust said...

Jeff Plale would rather have lunch with ATT lobbyists who will tell him what to do next.

If you're concerned about ever lowering the popular 5% franchise fee, this bill isn't the way to do it. ATT digs local streets and hangs local wires, why not retain some local control? Under the current system, with local control over the franchise fee rate, your local City Council sets the rate. At least you'd have a chance of lowering it. This moves the decision (and many other aspects of control) to an understaffed and underfunded bureaucracy in Madison, whose previous task was administering the banks. They didn't want to give it to the PSC, who has decades of actual experience overseeing telecom.

Yes, it does seem stupid to give state control and then add 1% to every city's subscriber's bills to fund PEG channels. On the other hand, it's more stupid to remove local control with this bill. Some communities did choose to use separate PEG taxes like this to fund their PEG channels. Most communities didn't - they earmarked some fraction of the 5% they were already getting.

Because ATT wasn't stupid enough to threaten to remove the 5% franchise fee revenue from city budgets, the 1% got added as a sop to the communities who'd previously chosen to use a separate PEG fee. ATT wants a one-size-fits-all, so in this case their heavy lobbying has added a tax to everyone's bill. But they're concerned about competition - right, right.

Similarly, this bill won't magically make rural markets more profitable for ATT - although ATT sure likes to give people the impression they'll be bringing this nifty service to their community. In fact, this law eliminates the coverage requirements most communities have now, thereby allowing ATT to cherry-pick only the neighborhoods who are eager to pay $120+ a month for a bundle of services. As for Vinehout's request, perhaps she's remembering ATT's promises from a decade ago, the last time they asked for deregulation. At that time, they promised high-speed to everyone's doorstep, then reneged. This company has received the benefits of decades of government subsidy and monopoly. You're old enough to remember that, right?

Sitting down with lobbyists isn't a good way to make laws. If Plale thought that telecom/cable laws needed reform, he should've been a admirable leader and invited everyone to the table. Instead, Montgomery and Plale dined with ATT for months and purposefully excluded many other stakeholders from the table. We started with a draft from ATT and it's been Frankensteined since then. I say throw it out and start over. Or model a bill after the Illinois version that passed recently - it has far better control.

Dad29 said...

Frankly, John, I hold no brief for ATT nor the cable firms. Both have purchased almost all the Government they want, and are reaping the results. I agree that the term "competition" in a regulated environment usually means "oligopoly" in plain English. (Keyword 'oligopoly' on my blog-search function...)

ATT loves to make the argument that they put up all those poles, and all that wire, and it's theirs(!!)

I argue that the poles and wires were paid for YEARS ago by ratepayers, and only the maintenance is chargeable--but that's another story.

(By the way, locals have no "control" over cable companies--if they did, do you REALLY think that cable outlets would carry 9 "shopping" channels and only 1 "Common Council Propaganda" channel??)

Vinehout doesn't remember jack-squat about ATT's promises in Wisconsin--she's an Illinois activist, recently transplanted here. That's why she yaps about "Illinois solutions." She's also stupid enough to think that Wisconsin residents think highly about "Illinois solutions," which should tell you something.

And I remind you that cable and DSL are not "necessities" as are basic telephone and electricity, so the argument from 'monopoly-grants' lacks force.

John Foust said...

In the existing process, cities do hammer out franchise agreements with cable television companies. These are contracts that spell out the obligations of both sides, including the number of public access channels. Most only have one or two, of course.

Of course piped-in television isn't a necessity. Never said it was. Why are telephone and electricity a necessity? Is Internet a necessity?

With its latest service linked to their push for this bill, they're running new fiber to neighborhoods. They're still using the old copper from the homes to the neighborhood boxes.

This bill doesn't make sense for anyone who wants a chance at lower taxes or who thinks it'll bring lower-cost cable, television or phone service. It turns over more power to a state agency that'll be easier for ATT to control. The laws passed in Illinois and even Texas are better than the one that'll come to a vote on Thursday in Wisconsin. Can't you imagine that ATT will push any state legislature as far as it can? In Wisconsin, they didn't encounter any consequential resistance, so we're getting screwed more than other states.

By the way, a T-1 actually offers less download speed than your average DSL or cable modem connection. One advantage is that it is symmetrical (upload and download speeds are equal, where cable/DSL often have 1/8th for upload) and you pay a lot more for it, so the service is better. When my T-1 goes down, they call me. But then again, I pay more than ten times what the average cable user pays.