First Coffee for December 12, 2005

David Sims : First Coffee
David Sims
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First Coffee for December 12, 2005

By David Sims

The news as of the first coffee this morning, and the music is an iTunes mix of today’s birthday boy, Frank Sinatra:

One reason First CoffeeSM, who’s covered everything from high school girls’ basketball to A-list celebrities, municipal water bond meetings to summits of Central Asian presidents, bodies found floating in a rural lake to oil tankers in crisis on the high seas in his ersatz career as a journalist, enjoys the business technology beat is that there’s not as much hypocrisy, fluff and just plain, flat-out lying as there is in other areas of journalism:

“Mr. City Councilman, did you know, when you bought the worthless 40-acre parcel of land out past the dump on Ladies’ Mile Road that within the year the commonwealth of Virginia would appropriate it for construction of the new maximum-security prison, and pay you ten times what you paid for it five months earlier?”

“Son, I don’t know what you’re implying, but as a proud public servant of the people of Roadkill County, I can assure you…”

“Mr. City Councilman, isn’t it a fact that the commissioner for state facility procurement is a golfing buddy of yours and a good friend?”

“Son, my golfing times are apolitical, I never discuss anything of a professional nature with anyone, certainly not anything inappropriate to the public trust the voters…”

Sometimes you want to go home, put your head in a toilet and flush. So it’s particularly disquieting to see a virulent strain of mendacious spin worming its way into what should be a straightforward, clear-cut, best-man-win field of technological progress.

We speak, of course, of the spurious, specious arguments wi-fi providers put forth against municipal wi-fi. First CoffeeSM salutes the city of Tempe, Arizona, which the Associated Press reports today is “due to have wireless Internet available for all of its 160,000 residents in February.”

The AP says “consider it a municipal status symbol in the digital age: a city blanketed by a wireless Internet network, accessible at competitive prices throughout the town’s homes, cafes, offices and parks.”

Which is wrong, of course. “Status symbol” all wi-fi would be if vendors have it their way, but the city of Tempe understands that municipal wi-fi can be a great spur to local development, a leg up for those who need it to be more productive. City officials sensibly realize that ubiquitous wi-fi will “attract more technology and biotech companies – and the young, upwardly mobile employees they bring,” according to the AP.

Philadelphia’s working on a citywide high-speed system with EarthLink Inc., the town of Wilkes-Barre, Pennsylvania is covering large parts of the city with municipal wi-fi and an ISP is building a competing system as they should. New Orleans is building free, limited-speed system. Wayne and Garth’s own Aurora, Illinois is talking about one.

Muni wi-fi’s a no-lose winner. So why do commercial wi-fi providers claim it’s the worst idea since New Coke? Two words: Compe. Tition.

For all they blather about the joys and wonders of free-market competition, and for all the untrammeled good it brings consumers, the plain fact is every single company selling any good or service in the world wants just one thing: A competition-free monopoly. Every business innovation for an edge, any exclusive offering, any competitive advantage is nothing but an attempt to work, however briefly, competition-free: If you’re the only company to think of adding XYZ capability to the JP-47, if your FirePhaser is the only one out there, or if you’re the only one with good customer service, you have a monopoly and can name your price, at least until next week when somebody copies the idea.

A bill in Congress which would make it illegal for municipalities to offer wi-fi, sponsored by U.S. Rep. Pete Sessions, R-Texas, is nothing more than a sop to an industry which hates competition as much as the next guy. Competition makes businesses work harder, offer better prices and better products than other companies in order to win consumer dollars, but it costs more and lowers profit margins. Businesses hate it, consumers love it.

Opposition to municipal wi-fi can’t be seen as coming directly from corporations who hate the competition, of course, that’s too obvious, so a report called “Not In The Public Interest – The Myth of Municipal Wi-Fi Networks” was published by the New Millennium Research Council, a supposedly “independent” policy group created by Issue Dynamics.

The connections are explained well by rabid left-wing blogger Matt Rubin (Hey, rabid left-wingers aren’t wrong 100% of the time, blind squirrels and all that): “As explains, IDI is a PR firm and lobbying outfit specializing in Astroturf (i.e. fake grassroots) campaigns on behalf of corporate clients.” In other words, financially interested corporations don’t want you to know they’re creating and bankrolling the “opposition.”

A little free wi-fi here and there isn’t getting anybody’s knickers in a twist. Chapel Hill, North Carolina is spending a couple thousand dollars to give free wi-fi to school kids living in a housing project. Nobody’s objecting, ISPs and other wi-fi providers don’t kick up a fuss although they distrust the premise, they’ll let it go because they weren’t ever going to make any money off school kids in a housing project anyway.

First CoffeeSM’s as virulently free-market as anyone, would end all nonsense like agricultural subsidies (which is just corporate welfare anyway) tomorrow morning, votes Libertarian in national elections and has never met a government program he fully trusts.

Yet there are a few things government does better than private enterprise, although the list is much shorter than most think. Building roads is one. National defense is another. And just like new mammal species in Borneo, municipal wi-fi is one of those rare, new finds to add to that list.

Because it’s precisely government’s inability to do most anything well that lets private business know when to quit the field: When there’s a rare thing government can actually productively do with the taxes it extorts, pop the champagne and get out of the way.

Sessions’s meretricious bill is titled “Preserving Innovation in Telecom Act of 2005 (HR 2726),” and it would bar state and local governments “from providing any telecommunications or information service that is ‘substantially similar’ to services provided by private companies.” As First CoffeeSM has written, you, a slow chimp and the Barbie doll in your daughter’s room recognize this as brute protectionism, as simply trying to outlaw competition.

Industry water boy Sessions is a former Southwestern Bell exec who got over $200,000 from the industry in his last election, and has gotten just under half a million dollars over his Congressional career from them, with SBC-associated donors alone kicking in over $74,000 during his five terms. And as Rich Tehrani notes, he still holds half a million dollars in SBC stock options, as well as financial interest in Verizon and Bell South, all of whom – along with Sessions – would profit greatly from killing muni wi-fi.

Municipalities advocating public wi-fi say that the services are needed to promote local business and build up areas the industries won’t invest in. They’re right. Telecoms and ISPs say it’s unfair competition on the one hand, and that they can do a better job on the other. They’re dissembling – if they can do a better job people will pay for it. They just don’t want to have to do a better job by the consumer, they’d rather get away with doing a half-assed job and charging more for it.

In other areas where public and private compete – hospitals, say – it’s been proven people who can will pay for superior private products. What telecoms and ISPs really mean is they don’t want to have to expend the time and effort to do a better job, and without competition they won’t because they won’t have to.

If you’re providing a good or service and you can’t beat the government’s quality or price you deserve to lose. If it’s true that a private company can’t build better or cheaper wi-fi systems than the government, given the inherent waste and inefficiency that’s built into anything government does, then for heaven’s sake that company deserves to be out of business.

If you can’t do better than government you might as well pack it in, go work for a major metropolitan daily newspaper or get elected to Congress, something where your nice comfortable monopoly means you don’t have to work hard to be good.

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