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Written comments of Chanelle Hardy, Legislative Counsel, Consumers Union; Beth McConnell, Director, PennPIRG; and Frannie Wellings, Program Director, Free Press before the Pennsylvania Senate Communications and Technology Committee regarding Community Internet and Act 183.

November 7, 2005

Consumers Union, PennPIRG and Free Press are pleased to offer the following comments, urging Committee members to give towns and cities throughout the state of Pennsylvania the opportunity to offer Internet access to their residents without first getting permission from private telecommunications giants.  We believe community internet networks can provide an affordable and competitive alternative for communities that are currently served by the telecos, and offer access to communities which lack broadband access entirely. 

A Need for Affordable Broadband Access

Much has been made of the power of the Internet to revolutionize the way we learn, communicate and transact business.  In fact, access to information has become a new national currency and those of us with high-speed internet in our homes and places of work are able to conduct our banking online, to access employment tools and job applications, to research and apply for schools and take courses online, and to make low-cost phone calls via Voice over the Internet Protocol (VoIP) technology.  The Internet has even allowed many of us to become producers of information ourselves, by creating websites and blogging.  Yet today many millions of Americans are still not part of this information revolution.

Recent studies by Consumers Union, the Consumer Federation of America and the National Telecommunications and Information Administration have demonstrated that the “Digital Divide” between broadband haves and have-nots persists, and that those Americans that are of color, low-income, disabled or from rural communities are more likely than the rest of the nation to lack at-home access to broadband.  Still, living in an urban environment, where broadband deployment is easier, does not guarantee that a low-income community will be properly served.  Specifically, these reports found that income is the key factor in having broadband at home:  almost half of all households with incomes above $75,000 have broadband, only 17% of households between $25,000 and $50,000 have broadband, and less than 10% of those with incomes below $25,000 have broadband.  And because so many people of color are also low-income, more than 50% of African-Americans and 63% of Hispanics do not have Internet access at home.  Unless broadband service becomes more affordable, those most in need of the benefits of at-home access to broadband will continue to be left behind. 

In addition, recent studies indicate that availability of broadband has a positive affect on local economic activity.  In a paper entitled, “Measuring Broadband’s Economic Impact,”  Sharon E. Gillett, William Lehr, and Carlos Osorio of the Massachusetts Institute of Technology, and Marvin Sirbu of Carnegie Melon, estimate that communities with mass-market broadband experience growth in employment, the number of businesses, even in property values. 

America currently ranks 16th in the world for broadband penetration.  The average cost of broadband is $30 to $45 per month.  That’s in addition to the cost of cable or local phone service necessary to get broadband.  Affordability is directly tied to the lack of competition in the telecommunications industry, with the majority of Americans having a maximum of two options for broadband service:  the cable company or the telephone company.  Cable and telephone companies bundle telecommunications services, charge inflated rates for these packages and don’t compete with one another enough to lower costs to consumers. 

Community Internet as a Solution

Community Internet has been defined as “affordable, universal broadband access provided by local governments, schools, public/private partnerships, non-profits or community groups via new wireless and wired technologies.”  Community wireless networks, such as the Wireless Philadelphia project, are built using WiFi, or “Wireless Fidelity,” a standard technology that provides wireless Internet connections via unlicensed spectrum.  WiFi uses the same unlicensed airwaves that cordless telephones use to transmit data and microwave ovens use to heat food.  These networks are being built through public/private partnerships, by local governments, non-profit organizations, volunteer cooperatives and educational institutions.

Because telecommunications giants have left so many communities behind, hundreds of towns and cities are solving the problem themselves by launching their own high-speed networks to serve all of their residents.  And for many of them, Community WiFi networks are the most affordable way to do it: they don’t require communities to dig up rights-of-way and lay expensive fiber.  Instead, they simply rely on cheap, off-the-shelf antennas and other equipment to create a WiFi “cloud” over an entire community instead of in a single coffee shop or city block.  Anyone in the community with a computer with a wireless chip can connect.

Communities in Pennsylvania have joined communities across the nation in working to provide affordable internet service to their residents when telecommunications giants have not.  In addition to the widely-known Philadelphia Wireless project, other Pennsylvania towns and cities have begun to offer internet service to their residents.  For example, the county of York (1) has deployed a fixed-wireless network connecting over 80 buildings, replacing an expensive array of leased T-1 lines.  This network saves the city $200,000 in annual communications costs.  In Pittsburgh, the Duquesne Light Co. is conducting a pilot BPL (broadband over powerlines) program in the suburb community of Monroeville.  The utility currently provides almost 3000 customers with high-speed internet connections at prices equal to, or lower than, their big name competition.  Hometown Utilicom, in the town of Kutztown, provides internet access to almost 800 residents at a cost of $15 per month and has issued an RFP to provide wireless to the entire town.

Pennsylvania Communities Need an Opportunity

Last year, the Pennsylvania legislature enacted Act 183 which sets a deadline of January 1, 2006 for Pennsylvania communities to deploy a wireless network in their area.  After that date, city and town leaders interested in extending the benefits of wireless broadband technology to their residents will have to ask the local telephone provider to build the network first and give them up to fourteen months to do the job.   Communities like Lewisburg, Upper Dublin, Wilkes-Barre and York County, are rushing to meet the January 1, 2006 deadline and deploy important wireless broadband projects. 

This week, hundreds of Pennsylvanians have urged this Committee to repeal Act 183 or, at a minimum, to extend this deadline by at least one year.  We hope the Committee will heed this advice and move forward to allow community wireless to flourish throughout the State.

(1) For more on these, and other community internet projects in Pennsylvania and across the country, see the Free Press interactive community internet map or the Consumers Union’s page dedicated to community internet.