Hands off our Wi-Fi network!

By Dianah Neff
Posted on ZDNet News: Feb 15, 2005 1:18:00 PM

Commentary--Why are Wireless Philadelphia and other city wireless programs such a big threat? More precisely, why do the big boys keep trying to kill our Wi-Fi networks?

Tell me who among incumbent local exchange carriers (ILECs)--have deployed ubiquitous, high-speed wireless networks that support roaming/mobile capabilities. No ILEC. Who provides high-speed, broadband, ubiquitous services at dial-up rates for the underserved populations? No ILEC. Who is working to get equipment and training into the homes of low-income and disadvantaged portions of our community? Again, no ILEC.

No, they'd rather charge the city governments with having an unfair competitive advantage because of the governments' access to tax-exempt financing. But who says we are financing Wireless Philadelphia with tax-exempt funding? What about all the incentives the ILECs have received the past two decades? When was the last time they were elected to determine what is best for our communities? If they're really concerned about what is important to all members of the community, why haven't they built this type of network that meets community needs or approached a city to use their assets to build a high-speed, low-cost, ubiquitous network?

For all the money they've spent lobbying against municipal participation, they could have built the network themselves. The truth, of course, is that the incumbent local exchange carriers want unregulated monopolies over all telecommunications.

On this point, Dr. Mark N. Cooper, research director at the Consumer Federation of America, notes that about 95 percent of high-speed Internet access service customers are served by ISPs associated with cable or phone companies. In a paper he wrote for the Journal of Telecommunications and High Technology Law, Cooper found that this dominance was the result of leveraging control of physical facilities, not the result of winning in a competitive market.

"Cable companies have not sold Internet service in any product and geographic market where they do not control a monopoly wire," Cooper wrote. "Telephone companies have done very poorly as ISPs in the dial-up market. Consequently, 95 percent of the customers in the dial-up market take their service from independent ISPs--treating AOL as an independent in the dial-up market. In other words, incumbent monopolists have a 95 percent market share where they can leverage their market power over their wires, and a 5 percent market share where they cannot."

Since the 1980s, ILECs have been talking about installing fiber as long as they were given incentives to protect their investments. Now, in Pennsylvania, they've been given another 12 years, and they promise to upgrade some share of the homes passed to fiber optics if, and only if, they don't have to let competitive local exchange carriers (CLECs), Internet service providers or video program providers onto their network. (And by the way, let's prohibit governments from serving their community with low-cost Internet access to strengthen economic development in the neighborhoods, to help overcome the digital divide or to help families with children better communicate with teachers and the administration to improve their kids' education.)

Who says the government is going to be the ISP or build the network? What about the old public-private partnership models? Maybe--just maybe--they should see what the City of Philadelphia is proposing before they attack.