WisBusiness: Broadband expansion support sparks debate

By Brian E. Clark

For WisBusiness.com

Broadband expansion in Wisconsin will be a major force for economic development in the years to come, a panel of experts agreed at a Madison luncheon.

But whether public funds should back that high-speed Internet service in all under-served areas sparked disagreement at Wednesday’s gathering, organized by WisBusiness.com and sponsored by the Internet Innovation Alliance and the Wisconsin Technology Council

In response to a question from Andy Lewis, from UW-Extension’s Center for Community and Economic Development, state Rep. Mark Honadel, R-South Milwaukee, wondered: at what cost?

“And does everyone deserve a $30 an hour job?” asked Honadel, chair of the Assembly Committee on Energy and Utilities. “Yeah, but the question is how do you get there?

Honadel earlier this year co-authored the big rewrite of telecommunications regulations that was signed into law by Gov. Scott Walker.

Honadel said he’s reluctant to push for any additional legislation on broadband expansion until the state Public Service Commission completes a study involving regional groups next year and the new law has had a chance to take effect. But he welcomed ideas and said his door was open.

“I don’t want to rush this,” he said. “I want to let the market work first. We should let it brew for a year while the economy comes around. We have yet to find the golden answer for the perfect balance between public and private investment. So we will be cautious.”

But others – both on the panel and in the audience – urged faster action because of the economic potential.

Broderick Johnson, a senior adviser at the mostly business-backed Internet Innovation Alliance, said the recession means both private companies and the government should both be investing in broadband.

“If we were in a better economy, this wouldn’t be so important,” said Johnson, a lawyer, ex-AT&T executive and former U.S. House of Representatives staffer. “Spurring broadband would be a great boost to the economy. I believe there is tremendous urgency.

“We need to encourage business to unleash the tremendous amounts of money that they are holding onto,” argued Johnson, who said every American should have broadband access.

Johnson said he hopes the merger of AT&T and T-Mobile, which has been blocked by the U.S. Justice Department, will go through because it will create thousands of jobs and result in billions of investments by AT&T.

Rep. Al Ott, R-Forest Junction, also said delays could hinder Wisconsin’s economy. “We should be pushing more; this can’t wait,” he said.

And Rep. Jason Fields, D-Milwaukee, expressed frustration over Honadel’s go-slow plan.

“Why aren’t we taking this and running with it, if we know this is how we need to function in the new economy?” he asked.

“What’s the holdup? To me, this should have been done yesterday.”

Brian Rybarik, administrator of the Wisconsin Public Service Commission’s Telecommunications Division, said Act 22 will lead to the modernization of the Internet in Wisconsin.

And he agreed that broadband will enable technological advances and lead to economic development. But he said PSC chairman Phil Montgomery, is “emphatic” about private-sector solutions to thorny problems like broadband access.

He noted that changes to the federal Universal Service Fund could greatly increase money flowing to the state, boosting the figure from $50 million to $90 million, some of which could be used for broadband buildout. In addition, the U.S. Department of Agriculture has made substantial grants to rural providers.

Rybarik said the PSC is currently mapping the state’s broadband service, which he said could lead to private investment in under-served areas, many of which are in rural areas. Go to http://www.link.wisconsin.gov“>http://www.link.wisconsin.gov for more on the mapping.

But David Ward, a farm-owner and former Republican Assemblyman, said not all parts of the state with poor broadband service are in farflung parts of the state. He said he can’t get high-speed Internet at his Fort Atkinson home and must rely on slow dial-up service.

“It’s not just the far Northwoods,” he said. “I live halfway between the two biggest cities in Wisconsin, and I can’t get it. When I want to download data from the IRS to do my taxes, it takes me 90 minutes. With broadband, it would take five.”

Likewise, Mike Schlicht lives between Oregon and Stoughton in a neighborhood with 90 homes that he said doesn’t have broadband. “We need some help,” he said.

The UW-Extension’s Lewis, a community and economic development manager, said he’s skeptical about what Act 22 will do to boost broadband in under-served parts of the state. “The cable companies said rates would drop because of deregulation here,” he said. “Instead, they went up by 28 percent.”

He said more broadband is needed to boost the economy and promote education in Wisconsin. But he cited a study that said Wisconsin is 45th in the nation for the number of households with access to broadband.

“Clearly the system we have is not working here,” he said. “We rank down there with Guam and West Virginia.”

“We shouldn’t have to wait for black box technologies for a fix, either,” he said. “As part of the PSC’s mapping effort, we should be asking broadband companies where they think they can provide high-level and basic service at a profit” then fill in the gaps with publicly funded service.

Added Lewis: “It is very appropriate to provide public funds to provide services to those areas where private companies won’t.”

But Jim Rabbitt, director of government relations at Cooperative Network and former director at the Wisconsin Bureau of Consumer Protection, said his members are worried that government action will undercut existing telecom services they already provide in rural areas by the customer-owned cooperatives he represents.

“If there is competition, so be it. But not supported with government dollars,” said Rabbitt.