In August, we reported on the results of a report on UTOPIA by the Office of the State Auditor General of Utah. As you will recall, the results were less than favorable and presented more fodder for those opposed to municipal telecommunications infrastructure investment.
The same old arguments often rest on the financial investment in municipal networks – they are considered failures if they don’t break even or make money. Pete Ashdown, founder of ISP XMission in Utah, addressed those arguments in the Salt Lake Tribune:
UTOPIA provides broadband service in 11 Utah cities. Today, communication infrastructure is no less critical than transportation, sanitation and clean water. Government is not a business, but the infrastructure it provides contributes to a robust business environment.
Consider how private businesses rely on government funded infrastructure. Why don’t entrepreneurs clamor to build the next generation of roads? Why don’t airline companies get off the public dole and build their own facilities? Why are sewer facilities so rarely handled by anyone else but the state?
Does effective infrastructure cost? Considerably. Does it make a profit? No.
For decades now, public service entities have contended with the argument that if they are “run it like a business” they will be more efficient, productive and even profitable. While lessons from the private sector may contribute to increased efficiency at times, government is NOT a business. Applying business tenets should be done sparingly and not in the case of critical infrastructure like electricity, roads, and yes, access to the Internet.
Gary D. Brown, who lives in Orem, shared a guest opinion through the Daily Herald and drew a similar parallel between UTOPIA’s status and the business world:
When UTOPIA was first proposed, I was all for getting a fiber optic connection to every home and business in the at-that-time 17 cities. In my opinion, the original business model was sound; install fiber to each home/business and offer data, voice, and television services at the retail level.
Of course, the entrenched incumbent businesses, namely US West (it became Qwest and now CenturyLink), Comcast, and AT&T, who would face real competition, sent their lobbyists to the state legislature and after some intense lobbying, got the legislature to eviscerate the UTOPIA business plan by passing a law that prohibited community-based consortiums such as UTOPIA from offering services at the retail level.
UTOPIA will forever remain in the news because its financial struggles forced member communities to pay part of its costs through sales taxes. Though most community owned networks have not used tax revenues to support the network, we do support the right of communities to do so if they so choose.
We have covered the story of Leverett, where the community imposed a property tax increase on itself to pay for part of a new community owned fiber network. Communities that want to build networks entirely without tax subsidy should be free to do so, but those that want to pay for part of it with tax dollars should also have the right. That should be a local discussion, possibly a heated one. But it should not be decided in state capitals or Washington, DC.