Friday, March 04, 2005

Chamber Made

In October 2004, the U.S. Chamber of Commerce released a report ironically called “Sending the Right Signals: Promoting Competition Through Telecommunications Reform.” The report is a romantic tribute to the telecommunications industry. It bemoans that regulation has caused the industry to sink into “a depressed economic condition.” It calls for closing networks to sharing, ending regulated wholesale prices, giving valuable spectrum to commercial wireless operators, ending common carrier rules and raising funds for universal service from general tax revenues.

Just as I was choking on this pabulum, I came across a story in the British newspaper, the Guardian (March 3, 2004) reporting that municipal wireless projects are starting to take hold in the U.K. The story compared Great Britain’s efforts to Philadelphia’s plan for a muni-network.

“These tiny, cooperative projects are in remote corners, but what they have in common with Philadelphia is that they have been established in the wake of the market's failure to deliver affordable high-speed internet connections to everyone who needs it. The rural outposts going wireless are those that feel they are poorly served by BT.”

BT is Britain’s largest telecommunications corporation. Even more interesting in the story is a quote by BT’s Chris Clark, chief executive for BT Wireless Broadband saying that they would not be taking the same approach as Verizon.

“The community wireless projects, which started in an environment of concern about rural service, are evolving into providing all sorts of innovative services,” he says. “It would be a pity to see such innovation stifled. More recently, a number of metropolitan wireless projects have been in the pipeline. BT is fully supportive of these initiatives.”

Say what? A telecom giant supportive of municipal roll out? What in the world could be going on across the big drink? Have they lost their minds?

That got me thinking about the experiential differences between us and the Brits. And I think we could easily credit Samuel Adams and the Sons of Liberty for the British mindset in this regard.

Most of us think the Boston Tea Party happened because the colonists objected to being unfairly taxed on tea. But it happened because the Parliament eliminated the tea tax in order to give the British East India Company an unfair advantage against colonial tea importers (many of them smugglers). The Tea Act of 1773 actually lowered tea prices in order to promote East India as a monopoly and save it from bankruptcy. The colonists didn’t like being forced to accept the government supported monopoly, thus they boycotted the tea, dumped it into Boston Harbor, burned ships in Annapolis and generally wrecked havoc on the Brits up and down the Atlantic seaboard.

What a difference 232 years make. Had the Chamber of Commerce issued a report on “tea” in 1773, the East India Company would still be around today, subsidized by taxpayers and delivering shoddy products at a premium price.

The Chamber’s own report says the U.S. now ranks 11th globally in broadband deployment. The U.S. is not falling behind because regulation has strangled competition, it is falling behind because all of the reasons I have cited numerous times on this blog: cherry picking, redlining and the industry’s success in thwarting communities through lawsuits and legislation.

I would never suggest we don outrageous costumes and start dumping our laptops into the Potomac, but I will say to the Chamber of Commerce and their sweethearts in the industry, you’d better pull up anchor while you still have the chance because there’s a revolution coming your way.

(Attorney Jim Baller of Baller Herbst, has compiled a list of current state legislative attempts to block municipal telecom projects. View or download this document at:

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