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San Mateo County: Companies Push Ban on Free Wireless

In a move that could affect San Mateo County's plans for a regional wireless initiative, opponents of city-run wireless networks are urging Congress to bar such projects, saying they compete unfairly with private Internet providers.

Redwood City, seat of San Mateo County

In a move that could affect San Mateo County's plans for a regional wireless initiative, opponents of city-run wireless networks are urging Congress to bar such projects, saying they compete unfairly with private Internet providers.

Setting up a government-owned network is like having "City Hall opening a chain of grocery stores or gas stations," said Douglas Boone, chief executive of Premier Communications, a phone company in Sioux Center, Iowa.

"They typically require heavy taxpayer subsidization, which minimizes any net benefit to local residents," said Boone, who was speaking for the U.S. Telecom Association.

Government-owned networks "often neglect innovation, which leads to technological stagnation," he told the Senate Commerce Committee, which held hearings this week on how best to update the 1996 Telecommunications Act.

State and federal lawmakers are under pressure from telephone companies and broadband providers like AT&T and BellSouth to scale back the growth of municipal-backed networks, which give residents access to the Internet at little or no cost.

More than 100 U.S. cities have explored launching such networks, while 14 states have passed laws restricting or prohibiting them.

Peninsula Plan
San Mateo County is on the cusp of providing broadband wireless service to its residents in a project orchestrated by the Joint Venture Silicon Valley Network.

More than 1.5 million residents in San Mateo, Santa Clara and Santa Cruz counties will have the option of surfing the Web anywhere, anytime, using an Internet provider other than those commercially available.

As of Tuesday, all 20 cities in San Mateo County had signed on.

San Mateo County Telecommunications Authority Chairman Brian Moura said telephone companies' objections were based on fear of direct competition.

"For many years, the telephone and cable companies have had a monopoly. It's not surprising that they would lobby against (this)," he said.

Moura said the Silicon Valley initiative differed from city-run networks in a major way: It would be set up and maintained by wireless companies without charge and would not be a burden on taxpayers.

A number of cities in San Mateo County have already been approached by smaller Wi-Fi companies offering to hook them up for free.

"This is not a city-run network, but opponents are trying to paint this as though it is," said Moura.

Moura said that a request for proposals would be released in April or May.

Depending on the proposals received, there could be one or many Wi-Fi providers for the whole region. Service could be free or fee-based, according to what a city chose.

Moura predicted that Google and EarthLink would likely bid on the project, since they already had Wi-Fi agreements with cities like Philadelphia, Anaheim and Mountain View.

Competing Bills
Many local government officials are joining EarthLink in urging Congress to pass the Community Broadband Act, authored by Sens. John McCain, R-Ariz., and Frank Lautenberg, D-N.J., which would prevent states from blocking municipal networks.

On the other end of the spectrum, Sen. John Ensign, R-Nev., has proposed rewriting the Telecommunications Act to give incumbent broadband service providers the right of first refusal before a local government could offer such service using another company.

"I don't like to see local government competing with the private sector," Ensign said.

Rep. Pete Sessions, R-Texas, a former executive at SBC, has introduced a House bill similar to Ensign's.

Moura said such efforts were misguided, and could even be destructive in the long run.

"We understand that people like Mr. Ensign, who has gotten a lot of contributions from phone companies, would like to slow this down, but we think he's wrong," he said.

Although no bills have been proposed at the state level limiting the expansion of wireless networks, Moura said many legislators were under enormous pressure from telephone companies to submit one.

"It would be tragic if state or local government were to create legislation to prevent people from having these choices," he said.

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This article is reprinted with the express permission of The San Mateo County Times as it appeared in their publication on Wednesday, February 15, 2006 under the title "Firms may spoil free web in region," written by staff reporter Julia Scott. Web site: insidebayarea.com.

Photo reproduced under GNU Free Documentation License.