Draft legislation to make life difficult for community broadband in South Carolina has resurfaced this week in the state Senate Judiciary Committee.  The legislation, H. 3508, would hamstring communities from setting up fiber networks that are attracting hundreds of millions of dollars of new investments from digital economy businesses like Amazon.com in the nearby state of Tennessee.

Lobbyists from AT&T are aggressively pushing the measure, and no doubt Time Warner Cable will also deliver its support.

The protectionist legislation, which delivers all of the benefits to status quo providers like AT&T inside the Palmetto State, guarantees local officials cannot pitch advanced, community-owned fiber networks to companies like Amazon, Google, and other billion-dollar businesses that are expanding across the southern United States.

The implications are so dire, the South Carolina Association of Counties and the Municipal Association of South Carolina vociferously opposed the legislation last year.  On the ground in rural Orangeburg County, administrator Bill Clark understands first hand the implications of broadband scarcity.  He was shocked to discover the bill considers any connection that achieves the woeful speed of 190kbps would qualify as “broadband,” no doubt to allow AT&T to claim its 3G wireless broadband service already “well serves” the state of South Carolina.  If AT&T can demonstrate it delivers at least 190kbps service in South Carolina, even if capped to just a few gigabytes of usage per month, the company can claim South Carolina does not have a broadband problem.

Stop the Cap! readers inside South Carolina regularly complain about the state’s lousy broadband on the ground.  Our regular reader Fred in Laurens is stuck between a broadband rock and a hard place, navigating poor service from Frontier Communications, AT&T, and bottom-rated Charter Cable.  He can’t wait for a community provider to set up in South Carolina.

Unfortunately for Fred and other South Carolina residents, special interests in the telecommunications industry have gone out of their way petitioning state government to set up obstacles to community broadband while providers do little or nothing to upgrade broadband in the rural corners of the state.

Back to push more special interest legislation to keep community-owned broadband from taking hold.

Now AT&T is back to push for even stronger restrictions, and as Chris Mitchell from Community Broadband Networks wrote during last year’s tangle, this legislation will effectively make any local government ownership of telecommunications facilities impossible:

The bill is blatantly protectionist for AT&T interests, throwing South Carolina’s communities under the bus. But as usual, these decisions about a “level playing field” are made by legislators solely “educated” by big telco lobbyists and who are dependent on companies like AT&T for campaign funds. Even if AT&T’s campaign cash were not involved, their lobbyists talk to these legislators every day whereas local communities and advocates for broadband subscribers simply cannot match that influence.

We see the same unlevel playing field, tilted toward massive companies like AT&T, in legislatures as we do locally when communities compete against big incumbents with their own networks. Despite having almost all the advantages, they use their tremendous power and create even more by pushing laws to effectively strip communities of the sole tool they possess to ensure the digital economy does not pass them by.

South Carolina’s access to broadband is quite poor — 8th worst in the nation in access to the the kinds of connections that allow one to take advantage of the full Internet according to a recent FCC report [pdf].

Some of the provisions on display are remarkably transparent for AT&T’s own interests:

No reasonable provider will invest in expensive broadband infrastructure in an unserved area if it must stop providing communications services within 12 months of a Commission finding that a private provider has begun to offer at least 190 kilobits per second to more than 10 percent of the households in the area.

Public sector entities will be subjected to “the same local, state, and federal regulatory, statutory, and other legal requirements to which nongovernment‑owned communications service providers” are held. This is similar language we see in North Carolina and other states, betraying the total lack of ignorance on telecommunications policy among legislators and their staff.

Requiring public communications providers to comply with all applicable local, state, and federal requirements would be appropriate, but requiring them to meet the same requirements that non-government entities must meet would be tremendously time-consuming, burdensome, and costly for public entities. It would also lead to endless disputes over which requirements public entities should comply with and how they should do so. For example, incumbent local exchange carriers, competitive local exchange carriers, Internet service providers, cable companies, private non-profit entities, and other communications providers are all subject to different requirements.

Requiring public communications providers to comply with all requirements that apply to private communications providers will not achieve a “level playing field” unless private providers are simultaneously required to comply with all open records, procurement, civil service, and other requirements that apply to public entities.

Call to Action: Contact these members of the South Carolina Senate Judiciary Committee right away and let them know you oppose H.3508:

(click names of individual members to obtain direct contact information)

Points to Share:

• While South Carolina ponders another bill tying the hands behind the backs of our community leaders, Tennessee’s community fiber network in Chattanooga just helped that state score thousands of new jobs for an Amazon.com distribution center.  Amazon is investing hundreds of millions in the state and local economy, creating new high quality jobs.  They chose Chattanooga because it had the digital infrastructure at a price that made that community too attractive to ignore.  Meanwhile, AT&T and other companies do not offer this level of service without a huge upfront commitment and lengthy delay to provision facilities.  That’s time for companies to look to states like Tennessee instead, where they can get the right service at the right price in days, not months.
• South Carolina delivers the country’s 9th worst broadband.  What high tech company will consider coming to our state when broadband service is so lacking?  Since private providers have had ample opportunity to deliver service themselves, and failed to do so, why can’t local communities decide what is best for themselves, free from special interest interference from big companies like AT&T.
• Why is AT&T setting the broadband bar so low in South Carolina when other states are enjoying fiber to the home service at lightning fast speeds?  The bar is set so low at 190kbps, it leaves South Carolina in the dust.  Our schools, public safety networks, health care facilities, and economy deserve better and could get a major economic boost from construction of networks similar to that in Chattanooga.  If it doesn’t make sense, communities won’t build it. If it does, why are we letting AT&T effectively make the final decision?
• Public broadband does not have to risk taxpayer dollars.  Successful fiber networks are being built in communities across the country at no risk to taxpayers.
• South Carolina must compete in the high tech economy.  We cannot do that with low speed wireless networks and DSL.  H. 3508 is corporate protectionism at its worst and will leave South Carolina without the flexibility to compete with states like Tennessee for future private sector investment.  What is more important — protecting AT&T’s incumbent copper wire facilities or attracting hundreds of millions of dollars in investment from private companies like Google and Amazon?

Chattanooga’s investment in community fiber broadband is beginning to pay dividends as the city benefits from an increase in high-paying, high-technology jobs.  Unfortunately for cities like Knoxville, Chattanooga’s gains are their loss.

“In a lot of places, you can get the same kind of high speed service as Chattanooga.  The difference is the price,” Dan Thompson of Knoxville-based IT company Claris Networks told Knoxville TV station WBIR.  “Connectivity there for us is about eight to ten times cheaper in Chattanooga than it is versus Knoxville or other cities.  That’s a huge deal when you’re comparing $100 a month or $800 a month.”

As a result, Claris is skipping the pricey service on offer from AT&T and Comcast and is moving jobs down I-75 to the city of Chattanooga, where publicly-owned EPB Fiber has invested in a fiber-to-the-home network that beats the pants off the competition.  Claris has found gigabit broadband in Chattanooga that can be installed in days at a fraction of the price charged by the companies they deal with in Knoxville.  Now Claris can invest the savings in bigger data centers and the jobs that come with them.

“Here in Knoxville and other cities, you may have to pay a premium to get speeds fast enough to support that,” Thompson said.

While companies like AT&T, Time Warner Cable, CenturyLink, and Comcast have had Chamber of Commerce support opposing community broadband in other states, Chattanooga’s local Chamber knows a good thing when it sees it.  Garrett Wagley, vice president of policy and public relations for the Knoxville Chamber, tells the Knoxville station investment in infrastructure is important when recruiting new businesses to town and keep existing ones growing.

Investment in high technology networks is an important topic for the evolving economies of the mid-south region.  Formerly dependent on tobacco farming, textiles, and manufacturing, states like Tennessee and the Carolinas are now investing to compete for high-technology, digital economy jobs.  Public investment in broadband comes as part of that effort, and typically only after appeals to existing commercial providers fail to bring necessary upgrades.

That “other places first” upgrade mentality continues to this day in states like South Carolina, which waited years for Time Warner Cable and local phone companies to deliver broadband speeds states further north have been receiving for several years.

For companies like Google and Amazon.com, the choice of where to locate regional data and distribution centers is often dependent on available infrastructure.  Chattanooga is in a strong position to argue it already has a broadband network in place that can meet the needs of any high-tech company, at prices too low to ignore.  Economic investment, jobs, and tax revenues follow.  Even better, much of the revenue earned by EPB Fiber stays in Chattanooga, paying off network construction costs and allowing the public utility to invest in smart-grid technology, which could benefit electric ratepayers as well.

Christopher Mitchell at Community Broadband Networks notes Chattanooga is not alone seeing significant job gains from investment in public broadband.  Just 100 miles to the northeast is Bristol, Virginia, another city that is transforming itself to support 21st century knowledge economy jobs.  Bristol’s public fiber network delivers service across most of southwestern Virginia, across an area long ignored or under-served by larger commercial providers.

For cities stuck with whatever AT&T, Comcast, and Time Warner Cable decide to offer, the trickling job migration to better-wired cities could eventually become a fast-running stream.  That’s why WBIR-TV questioned Knoxville city officials about why they abandoned consideration of their own public fiber network.

The City of Knoxville’s chief policy officer, Bill Lyons, told 10News there has been some discussion about constructing network infrastructure in the past.

“We did discuss this general topic very briefly early in the last administration and did not pursue it,” wrote Lyons.  “There was no systematic assessment, but rather a sense that the associated investment in infrastructure was not needed given the service that was already available.”

[…] “The question we as citizens need to ask is this something we’d be willing to spend money on,” said Thompson.  “I think you’d have to ask if you built this kind of network would more businesses come here.  And if they would, do the tax dollars [gained by attracting news business] offset the cost that we as citizens would have to pay.”

Good-enough-for-you broadband at take-it-or-leave-it sky high prices has been the state of broadband across the mid-south for years.  Unfortunately for Knoxville and other cities in Tennessee and the Carolinas, high-tech businesses are quickly discovering they don’t have to take it anymore.  What cities like Knoxville lose, Chattanooga gains.

[flv]http://www.phillipdampier.com/video/WBIR Knoxville Chattanooga Fiber Attracts Jobs 12-27-11.mp4[/flv]

WBIR in Knoxville explores Chattanooga’s success in broadband, which is now starting to come at the expense of other Tennessee cities who don’t have the infrastructure to compete.  (3 minutes)

Cable subscribers paying ever-increasing television bills for hundreds of channels they never watch may find some relief if Comcast decides its experiment in “a-la-carte” cable-TV is a success.

The company is testing a new way of selling service that delivers a basic package of channels for a lower price and then offers customers bouquets of add-on channels sold in “theme packs” for $10 apiece.

Comcast is testing what it calls MyTV Choice in parts of Connecticut, Massachusetts, Vermont and Charleston, South Carolina, and plans to expand it to the Seattle area soon.

Here’s how MyTV Choice works:

Customers start with a basic package of channels that Comcast calls “Get Started” ($24.95) or “Get Started Plus,” which sells for $44.95 a month.

What differentiates the two options are the networks they contain.  Inexpensive cable networks turn up in Get Started — A&E, Discovery, C-SPAN, Animal Planet, Daystar, Food Network, home shopping, and The Weather Channel are among the 32 channels that accompanies a basic package of local channels.

Get Started Plus includes all of those networks plus sports — the budget-busting networks that help keep cable bills growing.  ESPN and other regional sports channels are included in the more expensive package.

Missing from the basic package of channels are kids shows, news, movies, and niche networks.  That’s where Comcast’s “Choice” packs come into play.  Customers can add a 19-channel News & Info pack, 31-channel Entertainment & Lifestyle pack, 16-channel Movie pack, and/or an 11-channel Kids pack for $10 each.

That’s where the “choice” ends.  Customers cannot skip the basic channel package to select only one of the theme packages, individual channels are not for sale, and anywhere outside of Charleston, customers also have to buy phone and Internet service from Comcast. HD also costs extra.

So much for a lower bill.

In fact, Comcast sells a digital cable package incorporating a full lineup of basic cable channels for just under $60.  If your family loves sports, has kids, and needs news channels, sticking with the digital cable package is actually cheaper than MyTV Choice.  That’s because the latter will require a $44.95 base package, plus three theme packs for an additional $30 a month.

Comcast denies their experimental a-la-carte package has anything to do with cord-cutting Internet viewers.

“It’s more or less responding to feedback from customers that they want more choice,” Comcast spokesman Bill Ferry told the Post & Courier.

While Ferry and others argue the pay-per-channel is not economically feasible, Christopher C. King, a telecom analyst for Stifel Nicolaus in Baltimore told the newspaper that is the trend.

“Certainly the industry’s moving more toward an a la carte model,” King said.

Theme-packs are not a new concept for some pay television viewers.  In the 1980s and 1990s, consumers owning large 6-to-12 foot satellite dishes routinely encountered the channel bouquet concept.  Customers would purchase a basic package and then select from a dozen or more mini-tiers, usually made up of networks owned by one company.  Want TBS and TNT?  Turner Broadcasting sold an add-on with those two channels.  Wanted a superstation package?  Channels uplinked by cable companies like TCI from Denver could be purchased as a small package.  So could stations like WSBK in Boston, WWOR and WPIX in New York, KTVT in Dallas and KTLA in Los Angeles.

Comcast has “simplified” things with a much smaller set of choices.  But that also dramatically limits any potential savings.

The concept of a-la-carte cable horrifies cable companies and their Wall Street shareholders, because a true “pay-per-channel” offer would dramatically cut the average revenue earned per subscriber if customers took a hatchet to the bloated channel packages most customers receive today.

Cable operators have resisted the concept because every channel would have to be encrypted to sell individually, billing would become more complicated, and the business model of niche-oriented networks supported by more popular fare would end.  That’s why programmers hate the idea as well.  While A&E, TNT, and CNN would have no trouble surviving, networks like Current TV, TV One, Hallmark, Cloo, and LOGO probably would not.

More importantly, many subscribers might find savings elusive from a-la-carte, because the most expensive cable programming networks also happen to be among the most popular.  ESPN and Fox News Channel, for example, have dramatically increased their rates to cable companies, who helpfully pass them along to you.  But if cable operators suddenly stripped those networks out of basic packages, while leaving the much cheaper networks together in broad-based theme packages like “lifestyle and entertainment,” subscribers may howl in protest or accuse the cable operator of playing politics.

It gets even harder when the cable companies selling the big packages of channels customers never watch also happen to own some of the networks found within those packages.  Comcast shareholders may not like the cable side of the business kicking lucrative NBC-owned and operated cable networks like The Weather Channel, USA, E!, Cloo, and other owned networks to a-la-carte Siberia.  Every cable subscriber pays for Cloo and E! today.  How many will choose to pay for those networks under an “a-la-carte” model is an open question.

Only two cable operators have expressed an interest in switching to a true, a-la-carte model to date — Suddenlink and Mediacom — both small, regional players that have no programming interests and lack sufficient buying power to score the kinds of discounts available to companies like Comcast and Time Warner Cable — discounts they can have if they agree to keep as many channels bundled in one digital cable package as possible.

In the fall of 2009, South Carolina’s Budget and Control Board approved a fire-sale deal that leased out 95 percent of the state’s public wireless broadband spectrum to two private companies in a 30-year contract valued at $143 million, with the promise South Carolina would enjoy better broadband as a result.

Two years later, South Carolina’s broadband standing has been called “a Corridor of Shame” according to one provider that is trying to expand service while Clearwire and DigitalBridge — the contract winners, sit on their respective hands.

Both companies secured access to the statewide Educational Broadband Service spectrum they get to control with near-exclusivity for less than $5 million annually — around $1 a year for every South Carolinian that could eventually be served with improved broadband.  But nobody is getting service from either provider, indefinitely.

Columbia’s Free-Times notes neither company has concrete plans to bring broadband to anyone in South Carolina.  Clearwire, now in financial trouble, provides no service in the state and DigitalBridge refused to comment for the newspaper’s story.  Free-Times reporter Corey Hutchins could not find anyone able to provide any definitive information about either company’s short or long-term plans to hold up their end of the bargain.

Khush Tata, chief information officer for the S.C. Technical College System suspects one might not even exist.  So long as these two companies maintain a lock on the spectrum, nobody else can deliver the wireless service either.

“I haven’t seen any big cohesive strategy since [the leasing] at all,” Tata told the newspaper. “I think that it’s still based on market and business viability for each provider so they’re sort of on their own. Each provider, they invest based on their return on investment, which is good for their business, but as a state there isn’t any overall planning or approach — and I think the leasing of spectrum provided the largest overall strategy opportunity, which is a pity that it hasn’t panned out yet.”

Don’t tell that to industry-connected Connected Nation, whose South Carolina chapter claims the state is doing better than most providing broadband service.  The group has published maps, based entirely on data provided by the state’s phone and cable companies, that suggest most residents not only get the service, but have a choice in providers.

“That’s just plain bull,” says Stop the Cap! reader Jeff Lodge, who lives outside of Columbia.  Not only does the local cable company pass him by, but there is no DSL either.  He relies on an unlimited wireless data plan from AT&T and does most of his web browsing during breaks at work.

No Plans

“I live in a community of 22,000 people and only those along the main streets in this community have access to broadband,” he says. “The cable company doesn’t go far off the beaten path, and the here-and-there DSL some get is dreadful.”

Even Connect South Carolina acknowledges broadband speeds in the state are often woefully behind others in the region.  Many well-populated census tracts have no wired broadband at all.

With the pervasive lack of broadband, incumbent providers have been heavily lobbying the state to keep others off their spartan turf — pushing for the same type of legislation effectively banning community broadband networks that North Carolina passed earlier this year.

“It’s Time Warner Cable and AT&T… again, that are behind most of this effort, and those two companies treat South Carolina like a forgotten bastard child now,” Lodge says. “Can you imagine the arrogance of big cable and phone companies to keep competition away even when they, themselves, won’t compete?”

No Comment

One company trying to make a difference: GlobalCo and their partner On-Time-Communications.  A review of the under-developed website of the latter suggests neither entity is well-positioned or backed to deliver broadband without significant financial assistance.  But at least they recognize the problem.

“In South Carolina there’s 10 counties that made [the FCC’s report on broadband unavailability] and the majority of them come out of what’s commonly referred to as the ‘Corridor of Shame’,” Ronnie Wyche, GlobalCo’s vice president of sales told Free-Times.

None of this comes as a surprise to Brett Bursey, director of the South Carolina Progressive Network, who opposed the spectrum sell-off.

“The bargain basement lease of the nation’s only statewide broadband system was a theft from, and insult to, the taxpayers who built and own the system,” Bursey told the paper. “The system is not being developed by the companies who won the lease and the Legislature is ideologically opposed to public ownership.”

New Englandia. Upstate New York. Northern California. Carolina. Missipiana.

None of these are actual states, but based on the people we communicate with who share our interests, perhaps they should be.

Researchers at MIT’s Senseable City Lab, AT&T Labs-Research and IBM Research are revealing new research that redefines regional boundaries in the United States, using patterns of social connectedness across the country derived from anonymous and aggregated cell phone data.

The results, based on numbers called and the geographic destinations or text messages, are predictable in some places, surprising in others.

The Connected States of America (click to enlarge)

Take New Jersey for example.  The state is remarkably divided between the northern half, whose people are socially linked with metropolitan New York City, and the southern half which almost entirely ignores the Big Apple and Long Island, maintaining closer connections with southeastern Pennsylvania and Delaware.

Some other highlights:

• Socially, most of North and South Carolina are indistinguishable from one-another.
• Chattanooga has more in common with Alabama and Georgia than the rest of Tennessee.
• Southern California’s sprawl is to the east, not to the north.  The influence from Los Angeles and San Diego now extends into Arizona, Nevada and even Utah.  Northern California sticks to itself with one exception — it has connections towards Reno, Nevada.
• Upstate New York, mostly above the Hudson Valley, is socially similar all the way west to Lake Erie, with the exception of Chautauqua County, which is culturally closer to Appalachian areas in western Pennsylvania and West Virginia.
• New England maintains close ties with the exception of northern Maine and New Hampshire, which may be closer to Atlantic Canada.
• Standalone states that mostly keep to themselves include Florida, Texas, Colorado, Michigan, Indiana, and Ohio.  With interest, many of those states are also politically defined as “swing states.”

The “Connected States of America” provides a more natural delineation of regions that follows relationships between family, friends and business partners.

“Sister states” emerge, such as Georgia and Alabama, Mississippi and Louisiana, and Tennessee and Kentucky, among others.

Metropolitan areas often form pockets of influence that extend into neighboring states or communities; for example, Chattanooga, Tenn., is more closely linked to communities in Georgia and Alabama than to the rest of Tennessee. Pittsburgh, Penn., and West Virginia form a new “state,” while St. Louis, Mo., exhibits an expanded reach that splits Illinois into two regions.

New Jersey and California also divide into two distinct regions due to large cities. In contrast, Texas remains whole: Despite the potentially splitting influence of cities such as Dallas, Houston, San Antonio and Austin, the researchers found that there is enough inter-city communication to hold the state together.