Time Warner's timing presents super region movement a golden opportunity

Lexington, KY – Internet coverage has become an essential component in a communities’ infrastructure and a powerful economic driver.

It is so essential that a business and a household is more likely to go without a phone line than it is to go without Internet coverage. The world’s growing appetite for bandwidth is a result of American ingenuity by companies such as Google, Amazon, Netflix, Apple, Facebook and others.

Our reliance upon this digital infrastructure will only become more pronounced, as demand for bandwidth is increasing 40 percent year after year, according to research firm Heavy Reading in a report prepared for XO Communications.

Unfortunately, American infrastructure with regard to broadband delivery has not kept pace with our tech companies in both innovation and coverage. Based upon data collected by Ookla through August 23, the United States is currently ranked 30th in terms of average download speed by end users. Our ranking is worse now than it was in 2007 when President George W. Bush, Congress and the FCC set a goal for broadband coverage to be extended to all Americans. It would be easy to blame these failures on the private ISPs, but in truth the fault lies with us.

We are viewing Internet service through antiquated lenses.

In the 18th century, if a state wanted a road or bridge built, it was extremely rare for the government to build this piece of infrastructure itself; rather it would grant a chartered monopoly to a corporation to build this infrastructure vital to the growth of a burgeoning nation. This corporation was given the right to build the bridge and charge a toll to recoup their cost and provide a profit to their shareholders.

Today, it would be unthinkable for LFUCG to grant a monopoly to a corporation that would allow them to collect a toll on all vehicles utilizing New Circle Road, because our society has recognized the economic importance of a robust transportation network. Even Adam Smith, writing in the Wealth of Nations, recognized that the government is best suited to building a country’s transportation infrastructure.

Unfortunately, when it comes to telecommunications, we are still stuck in an 18th century mindset.

By relying on franchise agreements, our local governments have effectively granted a handful of corporations a monopoly over a piece of infrastructure that is becoming as important as roads and bridges.

The August 13 announcement that Time Warner is seeking to purchase Insight Communications presents our region a unique opportunity.

Coming on the heels of the announcement of Louisville and Lexington’s formation of the Bluegrass Economic Advancement Movement (BEAM) to team up and make the Bluegrass an attractive destination for advanced manufacturing and the 21st Century economy, the two largest cities in Kentucky served by Insight can boost our stock and standing even more.

We can choose to maintain the status quo and allow out-of-state corporations to continue to control our access to the Internet, or we can rescind the franchise agreements to the copper and fiber lying in the ground around our community and treat the Internet as the piece of infrastructure essential for our future economic growth that it is.

Just as public roads fueled the industrial revolution and the highways aided interstate commerce, an open and sophisticated fiber optic network can be used to attract new businesses to the Bluegrass.

Guaranteed quality service at reasonable rates can be a very powerful tool for economic development. If costs were allowable, a joint municipal service could incentivize businesses to locate here with ultra-low or no-cost high-speed access. In the world of advanced manufacturing, that can be powerful.

In the same vein, to help grow a 21st century workforce, the same low- or no-cost Internet access could be extended to families with children in Fayette and Jefferson County schools.

Most importantly, a municipal ISP would ensure that Lexington is provided with a modern network that provides quality service, which is properly upgraded and offered at a reasonable rate. This is an important consideration, for while Time Warner does not currently impose bandwidth caps upon its users, the corporation in 2009 was the first to begin exploring the idea. To date, they maintain the right to impose those caps in the future. With the aforementioned 40 percent increase per annum in bandwidth usage, this is something our community dare not disregard casually.

If we as a region make the decision to retake control of this vital piece of infrastructure, the biggest hurdle would not be technological but political. While this would socialize what is now a private industry in the area, it would be done for the sake of a competitive advantage when it comes to attracting commerce.

However, the telecommunication lobby has convinced 20 state legislatures to pass laws forbidding municipalities from creating their own broadband network. The most recent was North Carolina, whose state legislature banned municipal ISPs in late August. This push came because the City of Wilson, N.C. decided to build its own network.

This city of 55,000 had other broadband options available, but officials felt the existing ISPs were not upgrading their networks sufficiently to ensure that the city could compete in a global economy.

This fight has occurred in state after state when a municipality begins exploring building their own network.

I won’t speculate on the motives of the corporations for attempting to kill competition, but the issue of our city possessing a modern, reasonably priced, continually upgraded network is essential to our future.

This is not a fight we should shy away from. On the contrary, this is a fight we need to embrace, and it can be the lynchpin that takes the BEAM super region from a good idea to a shining success. I urge Mayors Gray and Fischer to – at the very least – explore the option of retaking control of this vital component of our infrastructure.

Roy M. Cornett, Jr. is a Lexington resident and runs the Festival of the Bluegrass at the Kentucky Horse Park.

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