Municipalities butt heads with telecom companies

A city or county wanting to bring ultra-fast broadband speeds to its businesses might want to first hire a cadre of lawyers and lobbyists.

For the fourth consecutive year, officials in Wilson (NC) -- a city of 50,000 east of Raleigh -- fought an attempt to keep the city out of the Internet business. Until two years ago, when Wilson's citywide fiber network went live, businesses and residents made do with what were seen as slow upload speeds, said public affairs manager Brian Bowman. Now, Wilson is among the 680 cities and small companies that have gotten into the business. They account for only about 1 percent of all broadband but about 25 percent of all super-fast fiber-to-the-home connections. Verizon accounts for almost all of the rest. Some of these small providers are municipalities, like Wilson. Others include rural telephone companies and real estate developers. But Internet providers argue that local governments have unfair advantages. Because governments do not have to pay taxes, it is cheaper for them to borrow money, and they can use taxpayer money to undercut competitors.