tv Ali Velshi on Target Al Jazeera March 8, 2016 9:00pm-9:31pm EST
cities that they will be left in the dust if they don't offer businesses and entrepreneurs superhigh speed internet service. that's why the holy grail has become the gigabit. tech in other words know that one gigabit is 100 ,000 megabits. gigabit receives is the new gold standard for broadband speed and it depends on an infrastructure built with fiberoptic signals as opposed to regular cables. existing internet providers are not willing to upgrade their system. these so-called incumbent providers, like time-warner, at&t and comcast, are explaining
their unwillingness to upgrade, 89 cities provide their own fiber broadband and about half of them offer gigabit, ultrahigh speed internet service. others are looking to get it. let me be clear. they are paying for these ultimate tra high speed internet services by sms taking this proactive aggressive approach, cities have sparked huge fights with cable and telecom heavy weights and the lawmakers those heavy weights lobby. the industry says it is unfair for them to have to compete against government entities. so companies are pulling out all the stops to prevent cities from going gig on their own. they are suing them and pushed through restrictive laws in these 19 states. it's turned into an all out
battle that pits incumbent throx companies against cities. jake ward last the story. >> today, chattanooga, tennessee is known as the gigabuilt city. through its own power utility, to do it the mayor had to battle with throks giants. >> and when you're dealing with those giants, the comcasts and stats they are reluctant to give up the market that they have. >> littlefield and city officials worked with their power utility, electric power board or epb, the hope was to provide faster cheaper service than was available. aneedlesneedless to say they wet happy. >> they paraded through my office to tell me why they didn't think chattanooga should
go into this business to compete with private enterprise. >> epb went into a $111 million government stimulus grant but not before littlefield said he offered private telecoms the opportunity to do it themselves. they said no we can't afford to do that. i said we can't afford not to do that. meanwhile, comcast sued the utility to prevent it from building out its network. unfair advantage for profit companies. >> most companies provide broadband users a fee. doesn't have to make a profit, uses subsidies, it really is unfair. >> in the end epb prevailed and to date has almost 70,000
subscribers. the city fest credits its gigabit service for creating a new stem education program. >> our rates on par are about theirs. we were simply competing on the basis of service quality. i have to say we did it right. we did not actually compete unfairly with those giants. struggling as they are financially. >> and the competition has gotten even more fierce. in may comcast announced it would offer its own two gigabit service in chattanooga one upping epb, tells us, quote, the gig city should more accurately be described as the two gig city thanks ocomcast investment. >> building a network in the absence of real competition that creates real competition. >> if that's like driving on a surface road then using gigabit internet like driving on some
futuristic highway. it takes an hour to download a two hour movie, but on two gigabit it takes only 25 seconds to pull off the same thing. investing too much taxpayer money into infrastructure that could be more than what the average user could possibly need. >> you don't need a gigabit. in general, a lot of cities have made a mistake putting money into this, consumers are not asking for these networks. >> if we build ill it will they come? that's question. >> aldona is the ceo, looking to build a network for partnership with a priechtd private can a company and there are many risks. >> people don't come right away. if a company has to make money and they've partnered with the city or the county will they come fast enough for them to
repay the loan, to repay the lease payment, whatever that arrangement was to the point where the company can make money? >> we're the kind of city that really needs to have fast internet access which is the fuel really for a university city. >> scott shapiro is a senior advisor to lexington's mayor. he sees benefits like luring new businesses bolstering new universities and hospitals and inspiring a higher stem education. >> why hasn't that happened yet? you can ask the incumbent internet providers that question. it seems there needs to be a third peat in many cities that comes in and builds a fiberoptic network. >> none of our cities really want to do this work. it's hard, scary, risky. if they are doing it it is because they have no alternatives. >> the success of a high speed internationa
internet system depends on the city. chattanooga began to see a return after 19 months. >> provo utah, or burlington, vermont, taxpayer money was at risk, these systems went bankrupt and the systems were not sustainable. >> jim baylor says most cities don't fail. >> by the time a project goes through, every number, every theory, every assumption will be tested in the marketplace. we've seen very few projects that fail, for lack of consideration. >> a large part of the expense comes from installing fiber which can be attached to telephone lines or buried underground like google fiber is doing. >> i anticipated when google came to town the game would change and there would be lot more competitors willing to step
up and that's exactly what happened. >> in kansas city and austin, texas, google is offering internet service for $70 a month. that's a lot lest than in cities where google doesn't have operations. as for lexington, kentucky, the key to its internet growth is to get gigabit service. >> this is one of the opportunities from a technology perspective where you have to make the big leap and the leap is that we will need that bandwidth. >> jacob ward, al jazeera, chattanooga tennessee. >> 56% of americans have no access to internet. can you imagine, some people voanl the option of domicile-up. coming up. one city's fight to bring internet to rural areas, and republican al jazeera america gives you the total news experience anytime, anywhere.
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>> let's face it, we all want faster cheaper internet. infrastructure themselves and offer gigabit as a utility like we get electricity. they often attempt to block them to restrict cities from expanding into the internet business. in certain cities it's become an all out battle. chattanooga, ten tennessee which last already fought this battle is in a new battle to expand gigabit service to rural areas where shockingly some people have no high speed internet. jake ward has more. >> today chattanooga city is known as the gig city that's because in 2008 then mayor ron littlefield offered superhigh speed internet through its own power utility. to do it he had to battle with telecommunications giants. >> and when you're dealing with those giants, with the cok cast and the at&ts they are
reluctantly to give up the market that they have. >> littlefield and city officials worked with their power utility, electric power board or epb, the hope was to protect entrepreneurs and other businesses for the business that was available. needless to say, the internet providers were not happy. >> they master planned 52 my office, asked why chattanooga wasn't able to compete with private enterprise. >> epb paid with bonds, a line of credit and a $100 million government stimulus grant. but not before littlefield said he offered to throw telecoms to build out the infrastructure themselves. >> they said no, we can't afford to do that.
i said we cannot afford not to do that. >> building 9,000 miles of fiber. meanwhile, comcast sued. saying cities have an unfair advantage over for-profit companies. >> most cities actually charge broadband providers a fee and then if a city comes in and uses taxpayer dollars doesn't have to make a profit uses subsidies it really is unfair. >> in the ent end he pb prevailed and has almost 7,000 subscribers. attracting businesses entrepreneurs and creating a new stem education program. >> our rights on par are above theirs. we were simply competing on the basis service quality. i have to say we did it right. we did not actually compete unfairly with those giants. struggling as they are financially. >> and the competition has gotten even more fierce. in may comcast announced it
would offer its own two gigabit service in chattanooga one upping epb. a comcast spokesman told us, the gig city should more accurately be described as the two gig city thanks to comcast investment. >> that creates real competition. >> if using expwrrnt is like driving on a surface road then using gigabit speed is like driving on some ultraspace highway. with gigabit internet it takes only 25 seconds to download a two hour movie. but cities may be investing too much taxpayer money into providing way too much service than the average user could need. >> you don't need gigabit. a lot of providers put way more
into these networks that produce more than it medias. >> aldona valecenti is the cio ever building network for partnership through a private company. one of the many options the city weighing and there are many risks. >> people don't come right away. so if a company has to make money and they've partnered with the city or the county, will they come fast enough for them to repay the loan, to repay the lease payment? whatever that arrangement was. to the point where the company can make money. >> we're the kind of city that really needs to have fast internet access. which is the fuel really for a university city. >> scott shapiro is a senior advisor to lexington's mayor. he sees benefits like luring new businesses bolsters new universities and hospitals and empowering a higher caliber of
stem education. >> why hasn't that happened yet? you can ask the incumbent internet providers that question. it seems as if there needs to be a third party in many cities that comes in and builds a fiberoptic network. >> none of our cities really want to do this work. it's hard, it's scary it's risky. if they're doing it it's because they have no alternatives. >> the success rate of municipal broadband varies by city. chattanooga's internet planned to be operating after at a loss for three years but started to turn a profit at of after 19 months. >> after burlington, vermont, they put a lot of taxpayer money into this, they went bankrupt and weren't sustainable. >> but jim baylor, aa lawyer who has been involved with 60 community projects say most cities don't surveil.
>> by the time the project goes through every number every theory every assumption will be tested in the marketplace. we've seen very few projects that fail for lack of consideration. >> a large part of the expense comes to installing fiber which can be attached to telephone lines or buried underground like google did. >> i anticipatory when google came to town the game changed and a lot of competitors would be willing to step up and that's exactly what happened. >> in kansas city and austin texas, google is offering gigabit service for $70 a month. that's a lot less than cities where google doesn't have operations. as for lexington, kentucky the key to its economic growth is to get gigabit service. >> this is one of those opportunities i think from a technology perspective where you sort of have to make the big leap and the leap is that we will need that
telecom giants like comcast and at&t have responded by lobbying for state laws to stop doing it. but this year the fcc overturned those restrictions in two states, tennessee and north carolina. i talked with u.s. representative marsha blackburn who has presented legislation in congress for the fcc ever doing that again. it's a right of sovereignty. >> we think it's a state's rights issue, we don't think fcc has the right the come in and override state and local rights. it is important for state to retain that ability to make these decisions within their borders. so it is house bill 1106 representative or senator tillis out of north carolina and i have done this legislation. but the wilson, north carolina, the chattanooga tennessee situation it would prohibit that type of intervention by the fcc.
the second point is that whether you're looking at chattanooga or utopia, which is the utah situation, you have seen a lot of public debt accrue to the citizens. >> right. >> whether they go in and try odid these. chattanooga, they each have about a half billion dollars of debt now tied to these systems. >> right now, except that chattanooga had calculated a return on investment, and i understand that this doesn't apply to everything and that return started showing up much earlier than they had planned. so while the concept of not incurring debt public debt to do things that the public sector can do i fully understand. what happens in a case where it actually is profitable? >> it should be a decision that is made by those local advertise anities andabiding by state lau. it shouldn't be the fcc coming in and preempting those state laws. >> they did ask the cable companies to do this, and the
cable companies said not at this time, they have seen the benefit of doing this. when it's a state's rights issue, what about the rights of the municipality to do what is right for its citizens? >> the municipalities have the ability to make those decisions. what they should not have the ability to do is do that, and then try oexpand tha try to expd their foot print. thaprint. that is something chattanooga is trying to do in order to have a cushion if you will. other counties subsidizing what is with chattanooga. i think jury is still out on chattanooga as to whether or not this is going to be a profitable situation or not. the assumption of that much public debt is a tremendous concern for an application of a technology and you don't know the life of that technology, and ali, i think that it is best left to the private sector and the providers who, by the way,
have invested billions of dollars in broadband expansion in this country. >> right, we've done the story on the people just outside of choofg'chattanooga's boundariest can't get the service. the cablers aren't going out there, these people can't get the high speed sphwhrant they needinternet that isin your dis. that is in your district. >> that is the other side of the state that i live in. we are all concerned about this, i have counties that in and of themselves are saying we are going to try find a provider to work with us, whether it is something that is a laid cable or a fixed-based wireless system, which is the technology that is replacing a lot of that buried cable concept. so there again, the technologies change. i think this is where you say look, fcc, you can't go in and
preempt these states. and then you can't put this burden of debt on here. and then begin to say well, but we need to let chattanooga and their board of mayor and alderman and dictate what their rate and speed is going to be. >> i know there are a lot of rural areas these cable companies don't get to in enough time. i guess i'm trying understand philosophically, i really get your idea that if fcc a federal agency shouldn't be imposing rules on a state. but in a country that's based on home rule i'm not sure why the municipality, the locality acan't decide while the government doesn't protect their interests. >> the municipality ca can decie what is best for them working within the state and within the
laws. i think it's inappropriate for the federal government to come in and say we're gl going to trump state law and we'll pick winners and losers. >> i have enjoyed talking to you over the years and i get that you have well formed opinions in these matters but you have taken $200,000 from that lobby in which $97,000 has been in the year alone. one has to wonder whether that influences your argument. >> my arguments have been well formed and going back to the period of time in the state senate when i was hard at work on this and looking at allowing local electric companies to come in and provide cable services, since that point in time you have had the convergence of voice video and data and many of our local electric power co-ops and electric power groups that wanted to get into serving these
intpts and ientities and it's vt when the federal government gets involved. >> what do you think when the people of chattanooga and the . hello, everybody, i'm david shuster. donald trump continues his march to the republican presidential nomination. he has 14 states, the latest in the state of michigan, donald trump the big winner in the state of michigan tonight, 37-25 is a wider mash begin over john kasich than many anticipated. donald trump has also won the state of mississippi. the mississippi primary also going to donald trump. this is another setback for ted cruz, who thought that he would do pretty well in southern states and has found donald trump beating him there, as well. there are also contests in i'd