“Stir, or Get Away from the Pot”: Uncertainty Over Future Municipal Broadband Ownership is a Bad Idea

As described in the Tallahassee Democrat article “Digital Divide as City Commission Considers Utility-Managed Fiber Optics” (March 6, 2019), the following seems to be a snapshot of current City of Tallahassee policy towards the idea of municipally owned and operated high speed broadband: there is disagreement; some people are opposed, others are not; now is not the right time, maybe tomorrow; let’s be sure to study and “workshop” the issue some more.

My mother, who grew up in small towns in Oklahoma and Arkansas during the Great Depression had a favorite saying that I think I can recalibrate here as “Stir, or get away from the pot.”

Research by one of our Ph.D. students in Economics (Steven Landgraf, now a faculty member at Wittenberg University) on municipal broadband speaks to my mom’s saying. Dr. Landgraf studied the effects of the potential of future entry of municipal broadband on existing broadband services. (The uncertainty he studied was not identical but similar to the kind of “we won’t build this now but we might in the future if we just study things some more” climate described by the article in the Democrat.) What he found was that incumbent internet service providers invest less in quality (e.g. less in higher broadband speeds) when faced with this potential future threat of municipal competition. Thus, it is possible that the current state of affairs gives the residents of Tallahassee the worst of all possible worlds.

If you like the idea of municipal broadband, you’re not getting it. But all of the talk of “we might change our mind in the future” has the potential effect of degrading the quality of existing non-municipal broadband services. As an alternative, the City could formally disclaim any interest in municipal broadband and examine, in consultation with private broadband providers, if there are current city policies that are barriers to broadband upgrades. “Stir, or get away from the pot” indeed.

Dr. Mark Isaac is a the John and Hallie Quinn Eminent Scholar and a Professor of Economics.

The feature image is from Knifton Enterprises.

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