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For more than a decade, various advocacy groups and municipalities have expressed an interest in
building and operating government-owned broadband networks.
Because these ventures often fail and pose significant risks to taxpayers, 19 states have prohibited or
otherwise restricted their municipalities from constructing or expanding these networks.
Burlington Telecom is a government-owned network (GON) in Vermont. Like many GONs, it is currently in dire financial straits. It also faces a lawsuit, has illegally borrowed from taxpayers, is past its deadline for completion, and has failed to attract subscribers. “In little more than a year, Burlington Telecom went from being a hopeful star of the community fiber network movement to an albatross around its neck.”
Dr. Joseph P. Fuhr, Professor of Economics at Widener University, has released a new paper on the MI-Connection government-owned network (GON) in Davidson and Mooresville, NC. The paper looks at the 5-year decline of the network which has bled subscribers and sunk the towns further and further into debt.
Politicians boosting government-owned broadband networks (GONs) make big promises, but these networks typically fail to deliver and – even worse – often leave taxpayers with a hefty bill. In the past few years, most governments have had to cut back funding for essential services: public safety, first responders, schools, and social service providers, to name a few.
Recently, the Coalition for the New Economy sponsored the cover wrap for the April issue of Florida Trend magazine, the leading magazine for Florida businesses. The cover art illustrates the effects failed or failing government-owned networks have on the state.
A poll released on March 20, 2012 by the Florida Coalition for the New Economy concluded Florida voters don’t want local governments competing with private business. The survey of 801 Florida voters showed 73 percent oppose allowing local governments to use taxpayer funds, including federal stimulus dollars, to compete against the private sector. Only 14 percent favor using taxpayer funds for this purpose, while 13 percent were undecided.
The Hidden Problems with Government-Owned Networks
By Joseph P. Fuhr
On January 9, 2012, The Coalition for the New Economy released a study by Dr. Joseph P. Fuhr, Professor of Economics at Widener University. The study outlines the complex and problematic history of government-owned broadband networks (GONs) and looks for alternatives for achieving universal broadband access.
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