Task force: Leave Internet service to private sector

BYLINE: By NATE JENKINS, Associated Press Writer

DATELINE: LINCOLN Neb.

A special task force whose work could help shape the future of high-speed Internet in the state will recommend to lawmakers that power companies and other public entities not be allowed to spread the technology.

Proponents of letting them do so have argued that the state should use its unique web of power districts to help provide low-cost, high-speed service to even the most rural corners of the state.

Nebraska is the only state in the country where all electric customers are served by publicly owned power utilities.

A burgeoning technology, coined broadband over powerlines, could let customers get high-speed Internet by plugging their computers into common electrical outlets.

But a majority of the task force was not persuaded that allowing power utilities and other public entities in the high-speed realm, by leasing space or capacity on its lines and other infrastructure to private companies, would significantly improve service.

Approving public-sector involvement, the task force concluded, could dampen private investment in broadband services.

"Allowing the public in the private sector is a no-no," said task force member Mark Graham, executive of a market-research company and owner of a company that advises business on how to better use data.

The task force wrapped up its work earlier this month and is now putting the finishing touches on the report that must be handed to Gov. Dave Heineman by the first week of December.

It follows a law passed last year by state lawmakers that banned public entities from providing telecommunications services, such as broadband, on an indirect, wholesale basis for two years, until the end of 2007.

Public entities are forever banned from providing the services on a more direct, retail basis.

Legislators will look to this report when deciding whether to end the moratorium or keep the ban in place.

In recent years, the cable and telephone industries successfully got laws passed barring or restricting local governments from getting into telecommunications in Nebraska and 14 other states.

But court decisions invalidated or weakened some of those laws.

If Nebraska lawmakers make a decision based on the report, it will be relying on the work of a group that approached the question with a closed mind, said task force member Bob Heinz, who complained that the report does not give adequate space to the minority opinion.

"All we were really wanting is a look at how we could work together to use the infrastructure we have rather than a duplication of efforts," to help deploy broadband, said Heinz, general manager of Dawson Public Power District, based in Lexington.

Utilities will install equipment in the normal course of business that could also be used for broadband in cooperation with the private sector, he said.

"But they just didn't want anyone to hear it. They just looked at it as 'you would be competing with us' and all they really wanted to say is no," Heinz said. "I don't believe there was much of an open mind on the committee."

Graham called the complaints of Heinz and others sour grapes.

"We didn't want government in private-sector business," he said. "Nobody on the public side, quite honestly, has put forth a business plan on how they would do it," he said about public groups helping to provide broadband. "There's adequate coverage throughout the state. We didn't find enough lack of coverage to justify somebody putting out another service in the state."

A survey conducted by the state Public Service Commission found that more than 91 percent of incorporated areas in the state had broadband access, or 99.6 percent of the population.

Another survey by the Brennan Center for Justice at New York University found that many rural residents only have access to satellite service, which is typically more expensive than other types of high-speed Internet.

A report from the Nebraska Telecommunications Association, which represents private telecommunications companies, found that 40 communities in the state with a total of about 2,000 people had satellite service as their only option.