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Private Telecomm Companies Seek to Block Broadband Competition and Consumer Choice

Municipal Electric Broadband Expansion Bill Would Bring Local Control, Local Decision-making, and Fastest Internet Speeds Available

Tennessee Municipal Electric Power AssociationBrentwood, TN – Tennessee’s private telecommunications companies are seeking to block legislation that would bring competition and consumer choice to broadband, the new utility of the 21st century.

“If a community wants better broadband service, faster speeds, more competition, and more choices, it should have access to them,” said Jeremy Elrod, Director of Government Relations for the Tennessee Municipal Electric Power Association (TMEPA). “Whether the service is from a private or municipal provider, a local community should be able to decide for itself how broadband is offered. Right now the private incumbent providers are deciding for communities and consumers, telling them to be happy with whatever they get offered.”

Legislation (SB1134/HB1303) will be heard in House and Senate committees tomorrow that seeks to remove the territory restriction on broadband services offered by Tennessee’s municipal electric systems.

This change in the law would allow municipal electric broadband to expand to more areas where it is needed if those communities want it. TMEPA is supporting the legislation.

At least 422,000 households across Tennessee don’t have access to landline internet speeds that meet the FCC definition of high speed broadband, 25 mbps download/3 mbps upload.1 While wireless and satellite providers cover much of the state, many customers do not prefer them for home, business, commercial or industrial use because of monthly data caps and signal/connectivity issues.

“Private telecommunications companies are seeking to block legislation that would help bring service to unserved areas, yet they are refusing to offer the service in those areas themselves,” said Elrod. “It’s similar to a dog guarding a haystack. He doesn’t want to eat it, but he doesn’t want any other animal to eat it either.”

Estimates are 1.6 million Tennessee households are served by only one provider.2 Oftentimes this results in the incumbent provider having little motivation to invest in its facilities, offering competitive prices, or being responsive to the local community. In areas with multiple broadband providers, consumers are the ones that benefit.

When municipal electric broadband is offered, incumbent provider investments increases, speeds get faster, and pricing gets better.

“Tennessee’s private telecomm providers claim they offer ‘world class broadband infrastructure,’’ said Elrod. ”Tennessee students are sometimes forced to go to a fast food restaurant’s parking lot so they can connect to the internet and complete their homework. Some business owners have $300 a month internet bills for slow, unreliable service with data caps. Slow DSL and dial-up is still the only option for many Tennesseans. This is far from ‘world class.’”

All municipal electric broadband providers offer speeds that exceed the FCC broadband standard, with five providers3 offering 1 gigabit per second download/upload speeds, the fastest internet speeds in the country. The seven municipal electric broadband providers with community-wide fiber networks are accessible to 732,451 Tennesseans.

40% of the households with access to municipal electric fiber broadband networks are signed up as subscribers. More communities and consumers are asking for municipal electric broadband service and the gigabit speeds it offers, but private telecomm companies are standing in their way.

“The private telecomm providers are more focused on protecting their bottom line than serving more Tennesseans,” said Mike Vinson, Executive Director of TMEPA. “Because Tennessee’s municipal electric are governed locally, they are focused on and responsive to their communities’ needs. Municipal electric broadband offers the fastest speeds available backed up with local customer service. It should be an option for local communities seeking to offer modern services and utilities.”

1 www.connectednation.org/sites/default/files/connected-nation/files/tn_providerdensity_comparison_012615.pdf
2 www.connectednation.org/sites/default/files/connected-nation/files/tn_providerdensity_comparison_012615.pdf

About the Tennessee Municipal Electric Power Association

TMEPA is made up of the state’s 60 municipal electric systems which serve 2.1 million homes and businesses, or 70% of Tennessee’s electric customers. Eight municipal electric systems offer broadband service.

For more information on TMEPA visit www.tmepa.org


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