Comcast is donating heavily to defeat the mayor who is bringing gigabit fiber to Seattle

You know somethings gone wrong with a society when a company's first reaction to a potential loss of customers is to appeal to the government, rather than appeal to the customers.

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http://www.washingtonpost.com/blogs/...er-to-seattle/

One of Seattle Mayor Mike McGinn's big policy initiatives has been expanding the quality and quantity of high-speed Internet access throughout the city. A public-private partnership plans to offer higher speeds at lower prices than most broadband providers currently offer. And incumbent providers, particularly Comcast, have invested heavily in defeating McGinn in Tuesday's mayoral election. While Comcast denies there is any connection between McGinn's broadband policies and their donations, the company has given thousands of dollars to PACs that have, in turn, given heavily to anti-McGinn groups.

McGinn's major opponent, state Sen. Ed Murray (D-Seattle), has committed to honoring the city's existing contracts for a 14-neighborhood pilot project, but has shown limited enthusiasm about McGinn's plans to expand the network in the future. So the election could determine whether Seattle residents have new options for high-speed broadband service, or will have to make do with the slower services already offered by incumbents like Comcast.

McGinn's broadband initiative

According to Robert Cruickshank, a senior communications adviser for McGinn, one of McGinn's core promises in the 2009 campaign was to "develop a city-wide broadband system." The mayor considered creating a citywide broadband system as a public utility, like water or electricity. But aides say that would have been too expensive, so the mayor settled on public-private partnerships using city-owned dark fiber. This dark fiber was laid down starting in 1995, and the mayor's office now says there are some 535 miles of it, only a fraction of which is being used.

In a partnership with the University of Washington, the city put out a request for proposals in late 2012. "The RFP process is not intended to pick one provider," says Cruickshank, but one company -- Washington, D.C.-based Gigabit Squared -- is currently farthest along. The company is still wrapping up its funding and finalizing plans with the city. They expect to begin offering gigabit-speed service to households with a combined population of 50,000 in early 2014, according to Mark Ansboury, co-founder of Gigabit Squared.

In June, Gigabit Squared announced pricing for its Seattle service: $45 dollars a month for 100 Mbps service or $80 a month for 1 Gbps service plus a one-time installation cost of $350 that will be waived for customers signing a one-year contract. For comparison, Comcast, one of the primary Internet providers in the area, offers 105 Mbps service in the area for $114.99 a month according to their website. (It's unclear if there is an installation charge.)

McGinn has suggested that Comcast hasn't taken this threat of competition lightly. In a recent question and answer session on reddit, he was asked what would happen to Gigabit Squared if he were to lose the race. "I don't know, but I do know Comcast gave Murray a big pile of money," McGinn responded.

Ansboury believes Gigabit Squared's plans will continue regardless of who wins the mayoral election Tuesday, saying that although he supports McGinn -- who he calls an "avid supporter of broadband and fiber services" -- his company's pursuit of fiber service is a community initiative focused on the citizens. "It's pretty clear that outside of the politics, the citizens of Seattle are really looking forward to getting gigabit connections," he said.

Murray does not mention broadband policy or his stance on the mayor's fiber initiative on his Web site. A spokesman for his campaign said that the lack of comment was because "this issue has not come up before in the campaign," so it had not "drilled down yet to make systematic assessment of how the City's approach to promoting ultrafast broadband is going."

The spokesman also committed that, if elected, Murray would honor the current agreements between Gigabit Squared and the city, "but he will also makes sure that the City monitors the company's performance to ensure that they are delivering the promised results as the project moves forward." In other words, the limited pilot project would likely go forward in a Murray administration, but there's more of a question about whether the rest of Seattle would be offered gigabit service via a private-public partnership.
Comcast's contributions

An analysis of Murray's campaign contributions show that he received $700 from Centurylink WA PAC less than a month after the Gigabit Squared project was announced. Comcast has previously donated to Murray's state senate campaigns, and records also show that a Comcast executive named Janet Turpen contributed $500 to Murray's mayoral campaign in October 2013. Her LinkedIn profile describes her as the VP of Government Affairs for Comcast Cable in Seattle.

Comcast's donations to political action committees (PACs) suggest Comcast has poured dramatically more resources into defeating McGinn. The Broadband Communications Association of Washington PAC, which received 94 percent of its 2013 contributions from Comcast, donated $5,000 to the group People for Ed Murray less than a month after Gigabit Squared's pricing announcement. That was the PAC's largest single donation. Unsurprisingly, People for Ed Murray has made significant expenditures supporting Murray's candidacy. The Web site of the Broadband Communications Association of Washington also lists Janet Turpen as president-elect.

Comcast also donated $5,000 to the PAC called the "Civic Alliance for a Sound Economy," or CASE, whose largest expenditures were donations to People for Ed Murray, to the tune of $52,500 -- over half of the money spent by the group according to the most recent disclosures online. Their second largest expenditures was $10,000 to People for a New Seattle Mayor, a group opposing McGinn's reelection.

Seattle Ethics and Elections Commission recently levied a fine against CASE for failing to disclose that a major donation (from a party other than Comcast) was earmarked for People for Ed Murray.
In a statement to The Post, Comcast denied their donations to the Murray campaign were related "in any way to any actions of the current Mayor," instead saying they reflected their prior support for Murray's state senate campaign. On the issue of the CASE donations, they said the PAC "gives to a wide variety of candidates, and which candidates they support is in no way determined by us." A follow-up inquiry about their donations to the Broadband Communications Association of Washington was not returned by the time this blog item was published.

For his part, Ansboury, was not surprised to hear about Comcast's contributions, saying "it's not uncommon in the industry that the larger incumbents, cable operators, and PACs support certain policy initiatives that favor" their interests. Established Internet providers are often afraid of the disruptive nature of fiber competitors, he says, whose potential for much higher speeds can be disruptive to their business.

Often, he believes, these incumbent providers seem to think they know what consumers need more than consumers themselves, but says Gigabit Squared has received over 10,000 requests for gigabit service before even launching in Seattle. That demand is at odds with the argument a Comcast executive vice president made in an op-ed this summer, suggesting that the reason there weren't higher broadband speeds was that consumers didn't want them.
If Comcast is indeed attempting to sway the election, it would fall in line with a larger pattern of telecom interests lobbying against municipal efforts to create their own municipal broadband systems or leveraging city-owner fiber resources to create more competition for incumbent providers. A number of states have even enacted legislation banning municipal broadband.
A loss for McGinn on Tuesday probably won't mean the end of Gigabit Squared's work in the Seattle metro area, though it could curtail Gigabit Squared's plans to expand to other parts of Seattle. More importantly, though, if Comcast's donations help Murray defeat McGinn, it will send a powerful message to mayors in other American cities considering initiatives to increase broadband competition.