Horwood, James, N., Driver, Allison, L. “Legal Issues Briefing – Understanding the Challenges! Municipal Entry: What is Really at Stake?” October 2002 http://www.spiegelmcd.com/pubs/jnh_appa.htm. Link Accessed: 2003-08-14.

Keywords: municipal entry,

Abstract:

This paper examines the reasons why municipalities choose to enter the broadband communication business and the challenges faced upon such entry. The authors suggest that while municipally owned broadband communication utilities can be profitable, the focus is usually on providing quality service, customer satisfaction while at the same time conditioning market discipline through competition and providing a spur for economic development. The decision to offer broadband service is not trivial and municipalities must carefully consider the consequences of becoming a communication service provider. The authors go into detail about and suggest that municipalities have a full understanding of the following:

The authors review examples of recent legislation enacted by various states which they feel inhibits and creates barriers to municipal entry. For instance, Virginia’s 2002 telecommunication legislation which, despite vigorous lobbing by Verizon, (the local incumbent), amended a prior state law which prohibited municipal entry. With the passing of that bill, certain Virginia municipalities became eligible to offer communications but regulatory and procedural requirements were also imposed.

Local governments have important roles to play in ensuring their residents benefit from communication technologies. The authors conclude that municipalities will have to be vigilant and aggressive upon deciding to provide communication services if they are to avoid being trampled by the incumbent providers.