There is a scary history of cable and telecom companies lobbying for laws to prevent local cities to offer broadband service. In Telco Lies and the Truth about Municipal Broadband Networks (.pdf link) Ben Scott and Frannie Wellings take several instances where cites and telecom companies have been at loggerheads and provide a rebuttal to the disinformation campaigns that have been mounted by the telcos. From the Executive Summary:

The attention of policymakers in both parties is now focused on the question of how to promote competitive broadband markets that will deliver high-speed Internet access to all Americans at affordable rates. It is a difficult problem. Present estimates are that around 30% of US households subscribe to DSL or cable modem service. This compares to over 70% in countries like South Korea. Virtually every rural state remains underserved and uncompetitive. In urban areas, many families are priced out of the market. The telecom and cable kings of the broadband industry have failed to bridge the digital divide and opted to serve the most lucrative markets at the expense of universal, affordable access. As a result, local governments and community groups across the country have started building their own broadband networks, sometimes in a purely public service and more often through public-private partnerships. The incumbents have responded with an aggressive lobbying and misinformation campaign. Advocates of cable and DSL providers have been activated in several state capitols to push new laws prohibiting or severely restricting municipalities from serving their communities. Earlier this year, Verizon circulated a “fact sheet” to lawmakers, journalists and opinion leaders proclaiming the so-called “failures” of public broadband. Many of the statistics come from a widely discredited study of municipal cable TV networks published in 1998. This paper debunks these lies case by case, juxtaposing information direct from the city networks with quotations from the telco propaganda. The results are unequivocal and damning.

 My own experience in this contretemps was about a month ago, when I testified at a public service board hearing in favor of a certificate of public good that the local municipal broadband company was seeking to offer cable television programming over its no-yet-actually-existing fiber network. Their idea is that they’ll bring fiber to the home. They will offer telephone service, broadband internet, and cable tv over the fiber. And they will allow other content providers, including commercial providers like Verizon and Adelphia access to the fiber as well. The company, Burlington Telecom, is a subsidiary of the local municipal electric company, that is, it is run by the city on a non-profit basis. As an electric company, they have provided some of the lowest rates in the state, some 10–20% less than the other state utilities. 

Since the local company is offering competition, and not replacement for Adelphia and Verizon, you have to wonder what the naysayers are thinking when they say this is unfair. Its not as if they are providing comprehensive broadband at all, in fact, many outlying areas are still using dialup. With DSL limited to three miles or so from a central office, and Adelphia cable years behind in their deployment plans (and the company is bankrupt), the municipal projects are just what the doctor ordered.