This afternoon I attended the TISP session on broadband-related policy. I thought I’d share my notes asis. I did my best to capture comments and names where possible. I’m happy to get and post any corrections from other folks who were there.

TISP Forum: Legislative Roundtable on Telecommunications Policy
Wednesday, December 2, 2009
HHH Institute of Public Affairs
Description:

As we look toward the next legislative session, Rep. Sheldon Johnson, Chair, Telecommunications and Infrastructure Division, MN House of Representatives, and legislative colleagues will lead a discussion on important issues in broadband policy and economic development in Minnesota. Items up for discussion include the recent MN Broadband Report, the prospects for statewide franchising and the impact of the telephone referendum requirement on broadband entry.

Hosted by Milda Hedblom

Notes from Representatives

Rep Sheldon Johnson (67B) –

Statewide Franchising – effective date is big change 1/1/2016; main issue is notion of competition; chapter 238 is outdated it needs to be reconsidered (written in the 80s); how do we move the issue from near monopoly to more competitive? Example of problem – City of Prior Lake – recently approved Integra; city getting sued from Mediacom.

Broadband Report – Report shows that : broadband is a necessity. Ubiquity is important. Speeds are in line with reality – but more important is whether speed is fast enough for desired applications? Security, reliability, vulnerability come up. BB Advisory Council seems reasonable – it will be a point of discussion but we need some oversight. Need mapping and updates; Connect MN did a good job. Rep Juhke was instrumental in mapping.

Telephone Referendum (super majority required) – (such as what happened in Monticello) instituted in 1915 – no changes since then. It makes sense to reconsider. Pros for change = gives more power to municipality.

Rep Mike Beard (35A) –

Regulation can be a roadblock to reaching consumers. We deal with tradition and turf – we inherited it. The FCC did a good job with radio spectrum. Our job is to figure out how to tear down walls, tear up turf and get beyond rules better suited to 1915. People can get testy when you touch their turf. This is about consumer choice. 238 statement that prohibits competition is a potential problem. Incumbents feel one way; consumers feel another.

Happy to get rid of monopolistic environment want to provide choice.

ILECs can now provide video – putting them into a new market. However in video there’s an idea of territories. We have a local telco. They want to provide triple play. But their service doesn’t necessarily run with political boundaries. Technically they could provide services; but legislatively they can’t. It’s very hard to get rid of an existing statue; that’s been there for 26 years.

Rep Al Juhnke (13B) –

Telephone Referendum (super majority required) – there is a role for government. Willmar could not get BB. We had incumbents and competition but no BB. Willmar partnered with a company to provide service. Within minutes of announcing fiber, both other providers announced that they too would be laying fiber. Now there are 3 BB providers. Don’t like super majority for raising taxes; but do like it here. If it’s important enough to get into providing service; there’s no reason to not have 2/3 vote. That might help get 2/3 voters to buy service.

Broadband Report – a good document but can’t be static; we need to set up a mechanism to keep it alive – as suggested in report. Otherwise this will end up in a drawer. We need to keep mapping going. Biggest concern is wireless. Wireless is our internet connection. 77 million people per month access mobile Internet on handhelds. We can argue about 3G and 4G – but we those networks to be available to everyone. These networks don’t cover Willmar. We need solid colors on those maps – not holey coverage. Alltel is pretty good in rural Minnesota. But on the way to Willmar last night he had to redial into an hour-long conference call 3 times. He was the only car on the road – the probably wasn’t mobile congestion.

There should be no “two Minnesotas”; we need to service urban and rural.

Statewide Franchising – for a while there were big people pushing for this – but that doesn’t seem to be the case anymore. Our job is to listen, learn and respond.

We need to think about the common ground that will more us all ahead!

Comments from other elected officials in room:

Rep Phyllis Khan – how do we get a consolidated data center for so much state info? Building a data center might work if we need bonding to raise the money to create the database.

Commissioner Bob Fenwick (Cook County) – the telephone referendum didn’t pass in Cook County; though a vote for taxes to build did pass

Steve Downer (Buffalo) & MMUA – we’re interested in a simple majority for telephone referendum; interested in public-private partnership, where referendum might still get in the way; another issue is subsidies issues.

QUESTIONS

Eric Lampland – Regulation over BB has really become a discussion of services more than infrastructure. (Open access networks.) Public funding for technology seems to be in silos (such as erate) maybe we need to allow more collaboration. It’s not the view of ubiquity.

AJ – Years ago, MNConnect was a move towards open access networks. Have we come full circle on that discussion? ND is looking at building tower across the state to support infrastructure.

MB – Scott County build a network primarily for city governments and schools with a connection to the Cities; they are considering leasing excess bandwidth to providers. The county is not interested last mile infrastructure – but they have the middle mile.

SJ – If you look at the mapping we have 94 % BB coverage in the state. The last 6 percent will not get covered with market-driven solutions. We’re looking at BB as a utility – so the rural electrification plans seems even more apropos. It’s a tough year for budget.

Bob Fenwick – can we consider the 65 percent in terms of geography? In places where the telecom aren’t interested in coming into an area can we reconsider the super majority requirement?

SJ – Another glitch in the rule is that no vote becomes a no vote.

Bob Bartz BB Communications in Winona – All of our services go over IP – to make a go of business you have to have a triple. Requiring a city to vote on only one of those “plays” doesn’t make sense. We need to get the regulation up to the technology. As far as 5-10% of uncovered Minnesota, repurposing the USF might be a solution. We’ve been working with the FCC to do that.

Tom Garrison – To what extent have reps look as areas served? In Europe, once 50% of population wants service, then a city can provide service. It makes most sense when a survey has been fleshed out to the point where you would ask about interest in providing a certain service at a certain price. This might be a good way to get the holes covered.

AJ – it’s good to look at new models. But there still might be a fear of redlining where there’s a neighborhood that will not be able to afford the service at any price.

MB – They talk about services, then they talk about rights to services. A newer neighborhood has access to new services. Older neighborhoods aren’t always pleased – but it might come down to envy. In Minnesota, pretty much every house has a telephone number. SO that might be a good way to reach people with new services. But we have to think about the difference between rights and services.

Brenda Kruger (Springsted) – interested in public-private partnerships. One problem is that incumbents are only interested in working with their own plan, Is there a way to help municipalities bring more to the table?

SJ – There will always be a tension between community and private interest. We’d be open to ideas. We’d be interested in moving in that direction. We need to increase competition for better services, better prices across the state.

AJ – Partnering with a private business helps considerably. There are questions of ownership, privilege and risk. There are questions – but it’s worth discussing. We are interested in private competition. Few cities want to provide service.

SD – the Willmar example is instructive. Alexandria Light & Power is a good example too – both working through the utilities. You can move things forward by encouraging partnerships.

EL – The European Union has given incumbents 3 years to start providing services, if they don’t then others can come in.

Chris Mitchell – On the 65%, in practice you see communities who might support the effort working against incumbents who have a lot more money and voters who don’t have time to learn the issues. There are other cities who are gun shy from moving forward because there are afraid of a lawsuit. (such as experienced in Monticello)

BB – public-private partnerships – municipalities have difficulty when status of tax exemption is involved. Municipalities are required to to public RPF and must take lowest bid. That opens the door for incumbents low balling bids.

TG – studying the rules of public-private partners might be helpful. An incumbent may be shy about investment in a community when there are so many communities from which to choose – but public partnership makes a community a more attractive investment.

MB – 20 year bonds in BB may not make sense – they technology changes too fast. A company that’s coming into town with short requirement for ROI because they know the product/service is not static, it moves quickly. A large county may be able to handle this – but a smaller communities takes on a larger risk.

SJ – Municipalities think in terms of long range (15-20 years); industry is more nearsighted.

MB – We use the government to control local right-of-way. It’s a form of public-private partnership.

BF – Cook County went for fiber because it will be the economic salvation for us. TO attract people to our very livable community we need broadband.

SD – Municipal Utilities don’t want to be telephone companies but there’s a way to make this work. Our country isn’t built on fear and these arguments are.

BB – Where we’ve served we’ve reversed decades of population decline. One example is – in 2001 we went into St Charles. We built a network and now they have reached a goal set out for population growth. BB may not be the sole cause but as soon as they announced plans, housing developments sprouted up.

AJ – in the last 20-30 years we’ve shifted to a regional center model. Most of the jobs are in the center – few people will buy a house in an area doesn’t have BB. Small towns are looking for families not major employers. Paynesville is one example.

Bill Coleman – BB can be a solution or partial solution to many problems – such as access to healthcare, education, jobs… We need leadership in legislature to think more holistically about what BB can mean for Minnesota.

SJ – the Telecom committee isn’t as partisan as other committees, which is good. The goal is more, better broadband.

MB – 100 years ago this discussion centered around where the railroad would go.

AJ – we need to get these issues honed before session. We don’t need patchwork fixes for legislature – we need decisions that will build for the future.