Kansas bill would bar cities from selling cable and Internet services

02/03/2014 9:50 AM

02/03/2014 9:50 AM

The cable industry is pushing legislation in Kansas to keep cities from starting their own TV or broadband services, or partnering with private businesses for the job.

The Kansas Cable Telecommunications Association said it wants to prevent taxpayer-backed services from posing what it sees as unfair competition to private operators.

“Scarce taxpayer dollars should not be used by municipalities to directly compete,” said John Federico, the president of the KCTA.

He asked Friday for a delay in a hearing on the bill because the industry group wants to rewrite a section pertaining to an exemption to the ban for “unserved” areas to recognize the role of satellite TV companies.

The bill, introduced by the Republican-controlled Senate Commerce Committee on behalf of the cable group, has brought swift criticism from those who think it cuts off a key option for improving Internet access.

“There’s a lot of concern in governments across the state of Kansas,” said Sean Reilly, a spokesman for the city of Overland Park. The bill is “pretty broad. It would hurt a lot of services.”

The measure would not allow cities to “purchase, lease, construct, maintain or operate any facility for the purpose of enabling a private business or entity to offer, provide, carry or deliver video, telecommunications or broadband service to one or more subscribers.”

That, Reilly said, might bar a city from allowing access to public property to improve cell towers or make agreements with telephone or cable companies that want to expand or build new networks. Overland Park still lacks an agreement that would bring Google Fiber — a TV and ultra-high-speed Internet service — to that city.

On Friday, Google and a handful of utility associations condemned the bill in a joint letter to the legislative committee. Google launched its first Internet access service in Kansas City, Kan., and remains years away from completing fiber optic connections to homes in the market.

“This bill will harm both the public and private sectors, stifle economic growth, prevent the creation or retention of thousands of jobs, hamper workforce development and diminish the quality of life in Kansas,” the letter stated.

Federico said Google Fiber was not a consideration in drafting the bill. He said the legislation would not affect existing agreements the company has with Kansas cities or preclude expansion of the network.

Critics contend the bill would have a profound impact in rural areas and smaller cities — markets where cable and telephone companies are reluctant to build networks because profits can be elusive there. Chanute, Kan., for instance, has built a fiber optic network connecting city buildings and some businesses. It has plans to stretch it to homes for Internet, TV and phone service.

The bill pending in the Kansas Legislature would prevent such build-outs.

Likewise, Wicked Broadband in Lawrence is slowly building fiber optic connections to homes to deliver ultra-fast broadband. It posted a message to its website this week saying that “without access to municipal facilities and fiber, projects like ours are simply not possible.”

Time Warner Cable, the largest TV and Internet service in the Kansas City market, referred questions about the bill to the KCTA. AT&T said it was not involved in drafting the bill and took no position.

Christopher Mitchell, the director of telecommunications at the Institute for Local Self-Reliance, said 19 states have some restrictions against municipal cablelike services. He said the Kansas bill would be more restrictive than other states’ rules.

“If a city can’t be involved in expanding a network,” he said, “that means it simply won’t happen in some places.”

Republican Sen. Julia Lynn of Olathe chairs the committee that introduced the bill. She said the bill helps define regulatory rules as technology evolves.

“We don’t want to prevent competition,” she said, and the bill was not intended to thwart Google Fiber expansion. “Why would anybody want that?”

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