"MI-Fi," Our Internet for All Plan

An Information Superhighway in Michigan: Net Neutrality and Public Broadband

MI-Fi - Internet for All

Introduction

Broadband is the electricity of the 21st century. Access to fast and reliable internet services is essential to economic growth, education, healthcare, and quality of life.

In communities across the state of Michigan, people don’t have the internet access they need to thrive — at least 1.2 million Michiganders do not have access to high-speed internet. According to the FCC, there are 16 counties in Michigan where at least 50% of residents have no access to broadband, and in extremely rural areas like Lake County and Luce County, 100% of residents have no access at all. 

Big corporations and internet monopolies like Comcast are more interested in their bottom line than making sure that Michiganders have access to the affordable internet that they deserve. They have become the biggest lobbyists in Lansing and D.C., taking home millions of dollars in salary and pumping millions more into corporate politicians that sell out the public.

All Michiganders deserve access to the internet. That means internet that is affordable, fast, and reliable. That’s why we are proposing first state-operated internet service provider in the country called MI-Fi.

Now more than ever, a large scale investment in building publicly owned and operated broadband is the best – and perhaps only – way to close Michigan’s digital divide and provide every resident with access to high-speed internet. 

Abdul will:

  • Prioritize the needs of Michiganders over the corporate profits of internet monopolies like Comcast;

  • Create MI-Fi, the country’s first state-operated internet service provider in the country, to expand internet access to communities across the state and close Michigan’s digital divide;

  • Protect net neutrality.

Why publicly-owned broadband?

For too long, private ISPs have controlled not only the pace, path, and speed of broadband expansion but also the price, reliability, and quality of broadband connections – even though many of these connections are subsidized by public funds through public-private partnerships. That is why the El-Sayed plan for a fully connected Michigan focuses so much on the public provision of broadband. Much like with a public health insurance option, introducing a public broadband option is the best – and possibly the only – way to break up the broadband monopolies and alter the market enough to ensure that every household in Michigan has access.

Traditional public-private partnerships leverage public funds to incentivize private ISPs to invest in areas that would otherwise be unprofitable to serve. But often these partnerships leave both the state and the people powerless. The ISPs not only own whatever broadband infrastructure is built, but also control the price and quality of the internet provided.  More importantly, public-private partnerships do nothing to change the profit motives that kept these same ISPs from serving certain areas – particularly rural areas. In the worst circumstances, these partnerships can actually help private ISPs create monopolies in previously unserved areas.  Public-public partnerships (where the state partners with local governments to establish publicly-owned broadband networks in their communities) solve the problems in public-private partnerships. They also offer significant advantages for Michiganders in terms of equity, competition, quality, and control of service.

1 Equity

Publicly-owned networks have no profit motive. Whereas private companies can – and do – refuse to serve areas and populations that are not profitable, publicly-owned networks have a responsibility to serve all customers and communities, regardless of location or income.

2 Competition

One proven mechanism for increasing Internet access, quality and affordability is to promote competitive markets. But 1 million Michiganders only have access to one provider that offers wired broadband. Publicly-owned fiber networks help foster competition, which can lower prices and lead to better quality service from private ISPs, particularly in areas that previously had only one or two service ISPs.

3 Quality

Because they have neither the profit motive nor the overhead costs of private ISPs, publicly-owned networks can invest more money directly into infrastructure – particularly fiber optic cable – which can in lead to higher speeds and better reliability. Furthermore, because these networks will be controlled either by state or local government, it will be much easier to ensure that publicly-owned networks provide even their lowest-tier of service with internet that meets FCC standards.

4 Shared Control

Even when providing service as the result of a public-private partnership, private ISPs have nearly total control over every aspect of broadband provision, from pricing to the type of cable laid. Publicly-owned networks, on the other hand, are not only much more accountable to the communities and customers they serve; they are part of the communities they serve. This means that publicly-owned networks are typically more transparent, particularly in terms of pricing. More importantly, unlike with private ISPs, residents can directly influence publicly-owned networks through voting, public hearings, and other democratic processes.

Our plan for broadband

Broadband is a utility – just like water or gas – that municipalities can provide for their residents, and the El-Sayed administration believes that the state should help facilitate those connections without relying on private internet service providers that have chosen, again and again, to abandon vulnerable communities in the name of profit. That is why the El-Sayed Administration partner with cities, villages, townships, and public cooperatives to develop publicly-owned fiber-to-the-home (FTTH) networks capable of providing residents and businesses with affordable high-speed internet.

To do this, we will:

  1. Implement net neutrality
  2. Establish the Michigan Internet Office

  3. Create a commission to develop a broadband access plan  

  4. Develop publicly-owned broadband networks at the state and local levels

  5. Invest in fiber-to-the-home networks and fiber optic technology

  6. Sponsor legislation that encourages public provision of broadband

Between the proposed public networks and existing private networks, the El-Sayed Administration aims to provide all Michigan residents and businesses access to high-speed internet by 2030.

1 Implement net neutrality

The El-Sayed Administration will move immediately to implement net neutrality here in Michigan. Internet Service Providers (ISPs) should not, absent a showing of harm or legal obligation, be allowed to restrict what users do with their internet connection.  

We pursue net neutrality in one of two ways. First, Dr. El-Sayed will sign an executive order to implement net neutrality. Next, we will work with the Legislature to draft and pass legislation that prohibits network discrimination – including slowing speeds and degrading connection quality – and requires that ISPs treat all data and content equally, regardless of its source, location, or the protocol used.

2 Establish a Michigan Internet Office

The El-Sayed Administration will establish a Michigan Internet Office (MIO) that will coordinate and manage state investments in broadband projects, secure funding for broadband initiatives, and oversee mapping and planning processes related to internet access. Most importantly, the MIO will act as a public ISP, providing retail service to municipalities who do not want to provide retail service to customers after the network is built. All communities that establish networks through a public-public partnership will have the option to provide their own retail service. The MIO-run ISP will only serve communities who opt to have the state provide service instead.

The MIO will also provide technical assistance to any public entities (ex. school districts, cooperatives, etc.) that want to establish or manage their publicly-owned broadband networks.

3 Create a commission to develop a broadband access plan

Governor Snyder established the Michigan Commission of Advanced Networks (MCAN) earlier to develop a plan for how to improve broadband access and connectivity. However, it is unlikely that the plan – due this August – includes significant investment in publicly-owned broadband networks. The El-Sayed Administration will establish a new commission to build upon the work initiated by MCAN. It will also create a plan that outlines how we can both fully connect Michigan through municipally-owned and community-owned broadband networks and contain costs by leveraging public resources (ex. partnering with locally-owned utility companies, developing regional collaborations, etc.)  

4 Develop publicly-owned broadband networks at the local levels

Communities across Michigan have already started to build publicly-owned broadband. However, municipalities face tremendous difficulties raising the money to build broadband networks, and state law can make it difficult for municipalities to serve customers outside of their boundaries. In some instances, cities have even signed non-compete agreements with private ISPs that prevent them from establishing their own broadband networks.

The state faces neither the financing nor the legal constraints of municipalities. That is why the El-Sayed Administration will leverage the full power of the state to help localities establish publicly-owned networks. This push will be two-fold. First, through the MIO, the El-Sayed Administration will issue an RFP to solicit local governments interested in either building or expanding community-owned fiber networks, with priority given to underserved and unserved communities. All accepted localities will then partner with the state (again through the MIO) to draft plans to build and finance these networks, with the requirement that the local government commit to paying at least 40 percent of the estimated costs within a jointly-decided time frame.  

Second, the Administration will establish a state-owned ISP managed by the Michigan Internet Office. The ISP will be to provide retail service for partners that install broadband infrastructure, but do not have the capacity or desire to provide retail service. We understand that limiting the state ISP in this way will likely exclude urban and suburban residents, many of whom are priced out of high-speed internet service by private ISPs. Therefore, we will work in concert with the MIO, the Attorney General’s office, and private ISPs to allow the state to lease space on their cables, so that the state ISP can provide retail service – and additional competition – in these markets.  

5 Invest in fiber networks and fiber optic technology

One of the risks of publicly financing and providing any type of technology is that we will invest tax dollars into modalities that quickly become obsolete. Technology – particularly internet-related technology – is constantly advancing, and we are under no illusion that we can predict where it is headed. That is why we will focus on making investments in the most future-forward technologies, beginning with fiber networks and fiber optic technology. 

Like the rest of the U.S., Michigan is quickly outgrowing the capacity offered by cable and DSL internet services, but only 7.9 percent of Michiganders have access to fiber-optic broadband. Fiber-optic broadband is not only the fastest and most durable form of internet available, but also the most future-proof. Unlike cable and DSL networks, fiber networks will not have to be replaced in the foreseeable future. Even if typical broadband speeds become 1000 times faster in 5 years, a single existing fiber-optic connection can still support it. However, without public funding and oversight from the state, it is impossible to assure that the new networks built in Michigan are fiber networks – even if these networks are built by public funds. 

The El-Sayed Administration will prioritize the expansion of fiber networks by mandating that at least 75 percent of all new broadband infrastructure financed by the state are fiber networks. We will also require that all cable laid as part of our proposed public-public partnerships is fiber optic cable, and that all such fiber is open access – meaning that all competitors, public or private, can use the lines to provide service. 

Although expensive in the short term, mandating the installation of fiber optic technology not only ensures that Michigan is building the backbone for long-term growth and productivity, but also that we are not investing taxpayer dollars into infrastructure that will soon need to be replaced. Perhaps most importantly, mandating that only fiber networks are established through public-public partnerships helps to prevent rural areas and other hard-to-serve communities from having access only to slower – but cheaper – forms of internet (ex. satellite internet, DSL, etc.) than wealthier, urban areas.  
 

6 Sponsor legislation that encourage the public provision of broadband

Michigan is one of 20 states with laws that restrict the development and expansion of publicly-owned broadband networks. The El-Sayed Administration will lobby to change these laws and provide a level-playing field for all internet providers, starting with the following:

Michigan Telecommunications Act (PA 179 of 1991)  – The state’s current Telecommunications Act requires local governments to solicit RFPs from private ISPs before creating any publicly-owned broadband networks. If the government receives three or more bids, the publicly-owned network cannot be established. The Act also limits localities from providing service to residents outside of their boundaries.

The El-Sayed Administration will lobby to remove the RFP requirements and limits of service from the Telecommunications Act. Private ISPs have had at least a decade to provide access to rural communities, but they have chosen not to because serving these areas will provide little to no return on their investments. Requiring cities, townships, and counties who thus have no choice but to provide internet to their communities – and to do so with their tax dollars – to again ask these companies to serve them is an insult, and is little more than a thinly veiled attempt to protect corporate interests. 

METRO Act (PA 48 of 2002) – The Metropolitan Extension Telecommunications Rights-of-Way Oversight (METRO) Act mandates that all government entities have to pay the same maintenance fees as private corporations for installing or maintaining any telecommunications facilities that are used to provide retail service to residents. 

The METRO Act is meant to level the playing field between government and private telecommunications providers. But the truth is that private ISPs have more capital to invest and fewer barriers to enter the broadband market than state and local government. The El-Sayed Administration will therefore lobby to revise the METRO Act so that no government body has to pay maintenance fees for installing or maintaining broadband infrastructure. 

HB 5099 – If passed, HB 5099 would prevent local governments from using state, local, or federal funds to provide “qualified internet service,” effectively preventing the creation of publicly-owned broadband networks. Dr. El-Sayed will veto this bill if it passes the House and Senate.  

HB 4162 – If passed, HB 4162 would allow townships to use special assessments to fund broadband and communications projects in areas that still need high speed internet. Special assessments are vital financing tools, particularly in mixed urban-rural townships like Dexter Township, where a millage that covers the whole community is neither logical nor likely to pass. However, there are few options for funding from other sources. 

HB 4162 is currently held up in committee, but The El-Sayed Administration will push to move the bill to the floor and lobby for its passage. 
 

Cost and Financing

With our proposed public-public partnerships, the state will share all of the costs of expanding broadband access with partnering local governments and public entities. Still, it is difficult to know how much it will cost to build and operate publicly-owned FTTH networks on the scale that we envision. That is because, to date, all state-led efforts to expand broadband access have relied on partnerships with private broadband providers. No state in the U.S. has attempted to close these gaps by developing publicly-owned broadband networks using public-public partnerships.        

The Snyder Administration’s 21st Century Infrastructure Commission Report offers the best estimate of what our plan might cost. The Commission recommends $2 billion in state funding over the next 25 years for broadband expansion. $500 million – $50 million per year over ten years – would be dedicated to largely to funding public-private partnerships and mapping of broadband access and adoption. The remaining $1.5 billion – $60 million per year over 25 years – would fund subsidies for private sector broadband companies to build FTTH networks in rural areas.

The El-Sayed Administration will fund broadband at the levels suggested by the Commission. However, instead of subsidizing private corporations, we will devote $1.5 billion to developing broadband networks through public-public partnerships. We understand that $1.5 billion is probably not enough to connect all of the 250,000 households without internet – at least not at the pace that we want. Nevertheless, it offers ample funding to finance the Michigan Internet Office and the state ISP, develop and initiate a broadband access plan, and finance the development of the broadband networks that result from the first round of public-public partnerships.

The role of private ISPs

Private broadband companies are crucial to internet provision. Millions of Michiganders rely on private ISPs for their internet service, and with their large reserves of capital and expertise, private ISPs are much better equipped to pilot and develop advanced broadband technology. More importantly, in areas where state and local governments truly cannot afford to install broadband infrastructure, partnering with a private ISP can be most efficient and affordable to connect residents and businesses to the internet they need.

The goal of our plan is to provide all Michiganders with fiber internet, not to establish a public monopoly on broadband provision. Therefore, we will reserve 15 to 20 percent of broadband funding for partnerships with private broadband companies – particularly small or local providers – to develop fiber networks in areas where public provision is unfeasible. However, unlike with current public-private partnerships, all infrastructure must be open access, such that any competitor can use it to provide internet service to residents and businesses.  

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