NASHVILLE — Gov. Phil Bredesen is proposing to allow Chattanooga’s EPB and six additional municipal electric services to offer advanced broadband services outside traditional service areas.
The administration proposal also would let all units of local government when “appropriate” construct advanced broadband infrastructure using pubic money and public debt on the condition the network be made available on an “open access” basis to other providers including cable television and telephone companies.
A municipality’s legislative body or applicable supervisory body would be required to approve any service area extension.
The administration’s proposed Advanced Broadband Infrastructure Act of 2010 is included in a budget reconciliation amendment that may be reviewed by the Senate Finance Committee as early as today.
Powerful cable industry interests and AT&T are opposed to the proposal. There are provisions EPB and other municipals unsuccessfully have pressed lawmakers to approve in the past.
Deputy Gov. John Morgan said the administration was inspired in part by EPB, which now offers 10 megabits per second telephone, Internet and cablelike video services on its high-speed, advanced fiber-optic network.
“Chattanooga’s a great example of all the things we think would be in demand across the state,” Mr. Morgan said, noting EPB’s offerings are comparable or soon will be to those offered in Tokyo and Seoul, South Korea, among the world’s most-wired cities.
Chattanooga EPB President and CEO Harold DePriest noted that both Comcast and AT&T are “franchised monopolies, natural monopolies” much like EBP, which controls the local electricity market.
He said the idea that “government ‘can’t compete with them’ makes sense unless you happen to think that broadband is an infrastructure that is crucial to our communities’ growth and survival.”
The proposal’s language says “state of the art” broadband “is in the public interest and vital to the development of educational, health care, economic development and other opportunities” across the state.
AT&T Tennessee spokesman Tom Jerkovich said Sunday that the telecommunications giant is “opposed to this proposal because it represents an unprecedented expansion of government, using taxpayer dollars, into the telecommunications industry.
“It distorts the playing field to favor government at the expense of the private sector which will strongly discourage investment and undermine job creation,” he argued.
Stacey Briggs, president and CEO of the Tennessee Cable Telecommunications Association, said the group, whose members include Comcast, oppose the Bredesen plan. She argued that an appropriations bill is not the way to handle such a policy issue.
Asked if the push was influenced by the cable industry’s opposition to a Bredesen plan to raise $21 million by applying state sales taxes to the first $15 of a cable bill, Mr. Morgan said, “I certainly hope they don’t make that assumption.”
But he said the objections did make the administration worry that “if that kind of increase in the cable bill is going to be detrimental to a business plan of the cable company and really impact their ability to deliver a service, it really does make you wonder if it’s feasible for those companies to make the bigger investment in much higher broadband services for a lot of folks in the state.”
He said some communities may decide to make the public investment “to grow the economy and improve the quality of life.” Advanced broadband, he said, is “really transformative.”