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The best broadband in the US isn’t in New York or San Francisco. It’s in Chattanooga.

A student takes classes online with his companions using the Zoom app at home during the coronavirus disease (COVID-19) outbreak
Albert Gea / Reuters
Across the digital divide
  • Samanth Subramanian
By Samanth Subramanian

Looking into the Future of Capitalism

The best broadband in the US isn’t in New York or San Francisco. It’s in Chattanooga, Tennessee. And it’s owned by the city’s government—which makes it a shining case study for president Joe Biden’s push to have more municipal authorities build and run internet infrastructure.

As part of his American Jobs Plan, Biden wants to spend $100 billion on bringing affordable, high-speed broadband to everyone, and particularly to the 17% of rural American households who cannot get online at the government’s benchmark speeds. In a fact-sheet, the White House compared the indispensability of the internet today to that of electricity in 1936, when federal loans were disbursed to connect isolated pockets of America to the grid under a new Rural Electrification Act.

The plan proposes a federal overturning of state laws that, in many parts of the US, prevent municipal bodies from being internet service providers. In 17 states, laws prohibit local governments from offering broadband services. (An 18th state, Washington, has repealed its laws but is waiting for the governor to sign the bill.) The barriers are a holdover from a time when Internet access was a near-luxury—a consumer product rather than a utility. That made it possible for Republican legislators and lobbying groups to argue that the government shouldn’t compete with the private sector, and that the only way to provide high-speed, affordable and widely available broadband is to leave the industry to companies.

The best internet in America

Chattanooga proves them wrong. Its fastest broadband connection runs to 10 gigabits per second, fast enough to download a two-hour HD movie in three seconds; the starter pack offers 300 megabits per second for less than $60 a month. These prices haven’t ever risen. The broadband is so attractive that it has drawn companies and professionals to the city. And in a post-pandemic future where remote jobs will be a more staple way of life, Chattanooga’s broadband prompted PC Mag, this past January, to rate it the best work-from-home city in the country.

By owning the broadband network, the city is able to make it more inclusive as well. Last summer, when students had to attend school online, Chattanooga offered free internet access to 17,000 low-income families and their 30,000 or so children. “The city paid the cost of building the network out to these homes, and they offered 10 years of service free at 100 megabits per second,” said Christopher Mitchell, who heads efforts to expand broadband access at an advocacy group called the Institute for Local Self-Reliance. “I’d say it’s the only place in the US where there’s no digital divide, although of course that’s a complicated term.”

Chattanooga began laying down fiber-optic cable in 2009. Its Electric Power Board (EPB) had been planning a revamp of the grid, and to build out a cable network in tandem was not difficult. Comcast and AT&T, which were operating in the city then and still do today, tried to block the move by suing the city. An industry body of telecom companies paid for television ads that urged residents to call city hall in protest.

After the municipal government won its cases in court, it started constructing the network with the help of a $169 million loan and a $111 million grant from the federal government—a grant that, like Biden’s plan, was part of a stimulus to help an ailing economy. Paying the loan back would leave a hole in the city’s budget, critics pointed out. “But it’s natural for a network to run a deficit for a few years and then generate a surplus for a long time,” Mitchell said. In Chattanooga, the authorities calculated that they needed 30,000 customers to break even. Now they have 120,000.

The benefits of broadband

Beyond its own profit-and-loss statements, the EPB’s broadband service has brought huge benefits to the city. A recent analysis showed that Chattanooga recorded a “community benefit” worth $2.69 billion in the past decade. This exercise in quantification included the value of 9,516 jobs created in the city and its surrounding areas over the past decade, the country’s low unemployment rate, and the savings realized through a smart power grid that relies on the internet infrastructure.

“And you can see how this is working on the ground,” Mitchell said. In Knoxville, the city’s leadership for years refrained from getting into broadband. “Then they saw that businesses were relocating from Knoxville to Chattanooga because of the telecom benefits. And now Knoxville has announced that it will build a municipal network. That’s a sign of success, I think.”

Other US towns and cities are building networks as well, although perhaps none yet as ambitious as Chattanooga’s. Mitchell thinks Biden’s stimulus money will energize these enterprises. “I don’t think we’ll see a thousand municipal networks, but we’ll see hundreds,” he said.

More than anything else, the federal push for wider, better broadband recognizes how vital the internet is for everyone. Like water or power, it has become an essential need, to be treated as a utility rather than a product. And that means the state has more reasons to get involved, to ensure that prices are fair and that no one goes unserved. “It was very controversial when cities began providing electricity a hundred years ago,” Mitchell pointed out. “Some people considered it to be socialism. But it isn’t as controversial any more. People don’t get animated or think of it as an example of big government. I think we’ll get there with broadband as well.”

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