Former Federal Communications Commission chairman Julius Genachowski shared his thoughts in a post on Forbes.com on how state and local governments may be impeding innovation in the shared economy as well as in the broadband market. Mr. Genachowski recommended to state and local lawmakers that they avoid errors from the past by avoiding allying with entrenched industries and given innovation a chance by recognizing the benefits that disruptive technology can introduce into an economy.
It would have been good for Mr. Genachowski to speak to the issue of cable franchise, I-net, PEG, and other fees that cable companies pass on to consumers as a result of state and local government requirements, yes allowed by law, but in all cases not based on any quantitative analysis.
Innovation and competition are negatively impacted when start up companies cannot enter a local market because of ROW fees or franchise fees that are apparently determined without a demonstration of cost. Did that institutional network that a county wants really have to cost $ 25 million? Was there an alternative? Was the real cost something less?
Unfortunately consumers do not attend franchise hearings and although they are concerned about the cost of cable service and the lack of competitive alternatives, it never occurs to them that their very state or local government may the bottleneck that harms consumers and service providers alike.