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March 21, 2005

The State of Texas Refuses to Block Municipal Broadband

It appears that people are listening to the voices of the cities and their citizens, who are asking state legislators to say "no" to special anti-competitive provisions being asked for by incumbent carriers and MSOs.  Recent language in a Texas bill was  removed, thanks in part to a large grass roots movements in Texas.  Let's hope it doesn't re-emerge as an amendment on the floor. Texas joins Indiana and Illinois as key states that have voted in favor of consumers and broadband.  Let's hope others follow suit.

The battle now moves to Colorado, where the current language is perhaps the harshest ever seen.  This proposed bill, in its original form, would prohibit a city from helping any new carrier whatsoever get started.  It's a pure and blatant anti-competitive move.  It's been modified slightly, but it is still one of the harshest proposals of any state, and once again created only to help the incumbent carriers by removing competition.  Consumers do not benefit from this language.

Let's hope the state legislators in CO have the same sense as those in Texas and Indiana.

Posted by Bill Gurley on March 21, 2005 at 10:36 PM | Permalink


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Posted by: Frank | Apr 7, 2005 7:25:47 PM

Michael, that would be logical, but the game doesn't play completely by logic.

The main argument that the telcos use is that muni broadband is the city competing against them. Using VOIP as the argument would make a case that ubiquitous internet will take down traditional telephone service. Legislators, who are close to the telcos, will run screaming.

Legislators understand the benefits to their own districts -- urban, rural, etc. They notice the calls and visits of their constituents, and act to protect them (hence the shortsighted "carveout" approach with the Texas House bill.

But "disruptive technology" doesn't mean a thing to most legislators.

Posted by: Adina Levin | Mar 23, 2005 9:50:35 PM

Way to go Bill! Blog is looking good, and you had good results with state legislature.

Posted by: anselm | Mar 23, 2005 1:24:11 PM

Amusing that barely a day later, the Texas AG decides to sue Vonage.

Posted by: Craig Hughes | Mar 23, 2005 12:12:35 PM

Curious if to your knowledge any of the pro-municipal access groups in any of the states have used Internet telephony/VOIP as an additional benefit of, and justification for local/state government supported broadband Internet access.

Given that much of the argument for traditional telco monopolies at the beginning of the last century had been making telephony available in rural communities, one would think that a similar approach using Internet telephony could be used for local/state funded wireless and wired broadband at the beginning of this century.

Posted by: Michael Parekh | Mar 22, 2005 6:51:07 AM

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DISCLOSURE: The information contained Above the Crowd has been obtained from sources believed to be reliable but is not necessarily complete, and its accuracy cannot be guaranteed. Any opinions expressed herein are subject to change without notice. The author is a general partner of Benchmark Capital, a venture capital firm in Menlo Park, Calif. Benchmark Capital and its affiliated companies and/or individuals may have economic interests in the companies discussed herein. © J. William Gurley 2005-2006. All rights reserved.