Obama: FCC Should Push Versus Laws Curbing Broadband

Talks About Being At Whim Of ISPs Without Competition And 'Jacking Up' Rates

In a speech in Cedar Falls, Iowa, where a community broadband network, with the help of government funding, delivers 1 gigabit speed service at about the same price as the cable bundle, President Obama told a crowd of sometimes cheering Iowans that there was not enough competition to ISPs that continued to "jack up" rates, and that the government should try to encourage municipal competitors to fill that breach.

Backed by a tool board filled with pliers, hammers and other not-quite-digital age appliances, the President talked about promoting community broadband as a way to provide competition, competition he suggested was notably lacking.

He did not have encouraging words for the incumbent ISPs who have pointed out they spent hundreds of billions of dollars building out their networks and boosting their speeds.

He said in many places big companies are "doing everything they can to keep out new competitors." That was a reference to state laws limiting municipal broadband, which he said were attempting to "stamp out" competition. "Enough is enough," he said, and called on the FCC to do whatever it could to push back on those laws.

The President said that while 98% Americans had access to the most basic level of broadband, that was not good enough for all the things they would need to do with it. He said that only half of rural Americans have access to "super fast" speeds and even if they did, there was a good chance there was only one provider. So, that meant they were at the whim of whatever Internet service provider happened to be around, and and when they had problems they got stuck on hold watching a spinning icon, waiting and waiting and waiting and wondering why rates keep getting "jacked up." Ouch.

The President said he was on the side of competition and small business and that high-speed broadband was about more than streaming Netflix movies or accessing Facebook.

FCC  Chairman Tom Wheeler is already planning to call for a February vote on petitions by two cities, Chattanooga and Wilson, N.C., to preempt their state broadband laws, and he is expected to have the votes to approve those petitions.

For her part, Commissioner Jessica Rosenworcel indicated she was supported the President. "The steps announced today by the President will put us on a course to grow broadband opportunity in more communities by taking advantage of local know-how and putting a premium on competition," she said. "I look forward to working with my colleagues at the Federal Communications Commission to help make it happen.” 

To say that Mediacom Communications did not greet the President's speech with open arms would be an understatement, citing Cedar Falls' ability to cross-subsidize its service.

"Mediacom is deeply concerned with the comments made by President Obama during his visit to Cedar Falls Utilities (CFU) today," the company said in a statement. "CFU [Cedar Falls Utilities] is a municipal utility that leverages its government-conferred monopoly over electric, water and gas service to unfairly compete with private enterprises for cable television and high-speed Internet customers. The President’s remarks combined with the selection of CFU as the venue for his speech clearly show that the White House wants to waste taxpayer dollars to supplant our Nation’s private sector broadband providers with government-owned utility companies."