Appeals Court Decision Kills North Carolina Town’s Gigabit Internet, Could Your Town Be Next?

In early August, we reported that 6th Circuit U.S. Court of Appeals ruled the Federal Communications Commission (FCC) had no authority to prevent states from imposing restrictions on municipal internet. This was a result of the FCC stepping in last year in an effort to use its authority to “remove barriers to broadband investment and competition”. However, the courts sided with the states, which said that the FCC’s order impeded on state rights.

In the end, this ruling was not a win for the consumers, but clearly favored firmly entrenched big brand operators like Time Warner Cable, Comcast, and AT&T, which lobby hard to keep competition at bay (see Google Fiber’s fight in Nashville, Tennessee). The federal ruling specifically barred municipal internet providers from offering service outside of their city limits, denying them from providing service to under-served communities (which would also, in the process help to offset the cost of providing that access).

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FCC Chairman Tom Wheeler blasted the appeals court ruling, writing, “Over 50 communities have taken steps to build their own bridges across the digital divide. The efforts of communities wanting better broadband should not be thwarted by the political power of those who, by protecting their monopoly, have failed to deliver acceptable service at an acceptable price."

The fallout from the federal court’s rejection of the FCC order to extend a lifeline to municipal internet providers has claimed another victim. The small community of Pinetops, North Carolina — population 1,300 — will soon have its gigabit internet connection shut off. Pinetops has been the recipient of Greenlight internet service, which is provided by the neighboring town of Wilson. Greenlight ventured out beyond the borders of Wilson to offer the under-served community better access to high-speed internet. Given that residents and businesses had previously been relegated to accept rudimentary data speeds (sub-10Mbps) from CenturyLink DSL, they were happy to sign up for up to symmetrical 1Gbps speeds.

The town of Wilson has been providing electric power to Pinetops for the past 40 years, and had already deployed fiber through the town in order to bolster its smart grid initiative. As a result, roughly 700 homes had immediate access to Greenlight service — 200 customers actually signed up for the service, which isn’t bad for a town of that size.

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A least, they tried to... [Image Source: Institute For Local Self-Reliance]

This brief taste of glorious gigabit internet is now, unfortunately, coming to an end. “Without getting into the legal options that our city attorney will discuss with the council, I’ll summarize it like this: we have not identified a solution where Greenlight can serve customers outside of our county,” said Wilson City Manager Grant Goings. “While we are very passionate about reaching under-served areas and we think the laws are atrocious to prevent people from having service, we’re not going to jeopardize our ability to serve Wilson residents.”

What’s infuriating to the Wilson City Council and to the Pinetop residents that will lose their high-speed service, is that the connections are already in place — there’s no logical reason why they should be cut off, but the state laws and the lobbyists supporting those laws have deemed what Greenlight is doing illegal. Provide power to a neighboring town — sure that's OK. Provide better internet to a neighboring town — lawsuit! It reeks of big, monopolistic strong-arming.

“The system will continue to serve a purpose, but it is extremely difficult to contemplate fiber optics attached to someone’s home, yet they aren’t allowed to use it to connect online,” Goings added. “That is like building a new highway and telling people they can’t drive on it.”

Mr. Goings went even further, talking about the bigger picture when it comes to “lighting up” poor and underserved areas of our country:

This is bigger than Wilson. This is about the rural areas, particularly in eastern North Carolina, because the majority of the area does not present enough profitability to attract the private-sector investment. As a community, a state and frankly as a nation, we need to find ways to connect these rural communities, and our city council believes strongly that our state officials should focus on being part of the solution instead of constructing barriers to prevent communities from being served.

One has to wonder; who is actually looking out for Americans that simply want access to the same fruits that those in larger cities often take for granted? The people of Pinetops practically begged for CenturyLink to provide faster internet speeds (let's face it, DSL is a joke), but were ignored because it didn’t make financial sense to invest in the area. It happens all too often across America — the incumbents refuse to upgrade their infrastructure, then a new player comes in to invest in providing residents with better service and all hell breaks loose.

In some instances, the incumbents take the hint and upgrade their own services to compete with the newcomers. But in a case like Pinetops and Greenlight, the newcomers get nuked, the incumbents don’t have to change a thing, and residents continue to suffer. Something has to give. And you should not be comfortable with the legal precedent that has been set. After all, your town could be next. 


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