Should New Jersey Municipalities Supply Their Own Internet?

As part of his State of the Union Address, President Obama touched on an important new initiative that could make it easier for New Jersey municipalities to build and run digital communications infrastructures.

Under President Obama’s plan, aimed at increasing competition and innovation while safeguarding net neutrality, the federal government will provide technical and financial assistance for municipalities to provide local broadband service. Municipal networks, which are also known as “community networks”, are built out and operated by a town, city, or county.

Should New Jersey Municipalities Supply Their Own Internet?

Enabling reliable and fast broadband access is an increasingly important driver of economic growth and educational opportunities. The term “broadband” is commonly used to refer continuously accessible high-speed Internet. Broadband faster than dial-up access and has the ability to simultaneously transmit multiple signals and types of traffic. The high-speed transmission technologies used encompass multiple mediums including: cable, optical fiber, wireless, and digital subscriber lines (DSL).

In early January, President Obama first outlined the broadband initiative detailed in his State of the Union Address in Cedar Falls. Cedar Falls currently supplies some of the fastest Internet access in the whole country – nearly 100 times faster than the national average. Located in Iowa, which is one of 19 states that does not have legislation banning municipal broadband, was able to build its own cable and high-speed data network.

New legislation will be aimed at the legal monopolies provided to Internet Service Providers (ISPs) such as Verizon, in the majority of states, which makes Internet access more expensive. To help remove other regulatory hurdles that hamper broadband build-out and competition, the White House also announced that the President would ask the Federal Communications Commission (FCC) to address legal barriers that inhibit the ability of cities and town to fund and build their own networks.  The FCC has been reported to be considering a new rule that will permit established Internet Service Providers (ISPs) to offer content providers a faster track to send content, which has been seen as a roll-back on their earlier net neutrality position.

In a related measure, aimed at increasing competition, Senator Cory Booker (D. N.J.) recently introduced the Community Broadband Act. This legislation would amend the Telecommunications Act of 1996 to make it illegal for states to prohibit municipal broadband.

For more information about this case or the legal issues involved, we encourage you to contact a member of Scarinci Hollenbeck’s Government Law Group.

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