The Objective: Access to High-Speed Broadband

  The NTIA's report on broadband access by market size shows that there is a huge difference in speed (download and upload) and number of providers between urban and rural communities.  Largely because of the huge upfront costs, private firms, like Comcast, Time Warner Cable, Verizon, and AT&T install/upgrade equipment in markets where the return on that investment is faster and more assured.  As a result, 94% of urban residents have wireline download speeds between 25-50 mbps and 70% have access to greater than 100 mbps.  For rural residents, the percentages drop to 51% and 33% respectively.   A large part of what creates that disparity is the average number of competitors in each market type.  Approximately 92% of urban consumers have two or more providers to choose from (cable, fiber, DSL), while only 53% of rural residents have a choice for wireline broadband.
broadbandmap.gov

If we believe that all Americans, regardless of what state (or community) they reside, should have reliable access to high-speed broadband. then we must figure out how best to achieve that objective.  Recently, President Obama has stated that he wants the FCC to preempt states from blocking or limiting municipal broadband deployment.  Currently, 19 states have some type of restrictions on the books.   (The restrictions range from fairly insignificant in Michigan to very onerous in Texas.)  Putting aside the legal arguments for a moment, is the expansion of municipal broadband beyond the 400 or so communities where it exists today, the most efficient way to achieve the objective?  After all, there are 31 states without restrictions, yet less than 2% of U.S. communities have municipal broadband.  (In seven of those states, there are no municipal broadband networks.)  In most cases, the economics of the government projects don't work...the tradeoffs are too great.

Increased competition in broadband is absolutely necessary.  But, instead of encouraging municipalities to engage in businesses they might not know a whole lot about, why not incentivize private enterprise (Google Fiber, Verizon FIOS) to expand their networks into underserved communities?