Government Owned Internet Will Cost Savannah Taxpayers

Government Owned Internet Will Cost Savannah Taxpayers

By Louie Hunter –

Is Savannah getting ready to embrace a government-owned internet network? It looks like that might be the case. This summer, the city, with Colorado-based broadband consultant Magellan Advisors, has been surveying residents’ and local businesses’ broadband “needs” and it appears building a taxpayer-funded network that will directly sell internet service to residents could be an option.

This option, city-owned and operated broadband, is one that Magellan Advisors is known for suggesting. Why? Because the group stands to benefit financially. On its website, Magellan boasts that it has “experts at all levels of broadband, municipal and telecom network design and engineering” and that it is “the only professional consulting firm that has planned, built and operated broadband networks, from startups to large operators.”

Just because Magellan can build it, however, doesn’t mean that a municipal internet network is a wise idea for Savannah leaders, either politically or fiscally.

According to a recent survey and study from a national taxpayer watchdog group, most voters aren’t likely to support a city-owned network—probably because it could leave the city in significant debt.

In its study, the Taxpayers Protection Alliance (TPA), a nonprofit, nonpartisan group, estimates about 450 communities across the United States have “some form” of government-owned internet. About 80 of these sell service internet service directly to customers.

The group’s study looked at just 12 government networks—the “Dirty Dozen”—and found that they cost the public $2 billion. The “Dirty Dozen” list includes Chattanooga, Tenn.’s network, which, over the next two decades will cost the city’s electric customers $2,276 each. (In all, the network will cost taxpayers and electric ratepayers $550 million.) The list also includes Memphis, Tenn.’s government system, which the city sold and on which Memphis residents lost $20.5 million.

Readers might say, $2 billion is an enormous number, but TPA looked at just a small percentage of the nation’s total pool of government networks and ask, “Did the rest succeed?” Hardly. The report notes the “Dirty Dozen” are simply the “most unsuccessful, wasteful and flawed state and local internet projects” and that “they are far from the only examples of failed government-owned internet networks.”

If TPA’s study doesn’t give pause to Savannah’s mayor and city council, perhaps TPA’s survey of voter attitudes toward government-owned broadband will.

Last month, TPA asked 800 Americans how they feel about their current internet service, and how involved government should be in providing internet service to all Americans. Only 26 percent of respondents said that access to high-speed internet was a major issue facing lawmakers. That response landed this issue dead last in terms of importance. Respondents were twice as likely to say high taxes, poor infrastructure such as roads and bridges, and poor teacher pay were major issues. It makes sense then that only one percent of those polled said access to high-speed internet is an issue they want elected officials to prioritize. If that’s not enough to convince Savannah leaders: two-thirds of those polled oppose their local government incurring debt to provide a high-speed internet network.

There is precedent for cities undertaking studies like the one Savannah’s completing now and rejecting government internet. In fact, one of the most tech savvy cities in the nation—Seattle, Wash.—did just that.

Seattle has considered creating a municipal network several times, most recently last summer. Each time it has discarded the notion. Last year’s study concluded a full-service, citywide network would cost somewhere between $400 million and $600 million and that even with the incredible demand for internet service in that high-tech hub, the city was not likely to attract enough subscribers to be able to cover annual operating costs. Some members of the city council, including one self-proclaimed Socialist, are still promoting the idea, but her colleagues have continued to wisely say no.

Savannah should also say no. There’s no reason to listen to a consultant from Colorado when it comes to our city’s needs, especially since that firm could financially benefit from the decision to build a city-owned network.

Taxpayers don’t want to go into debt for government owned broadband, the leadership should listen to them!