When Government Enters the Telecom Market
Tacoma Public Utilities (TPU) was founded more than a century ago as Tacoma City Light and was granted monopoly status and the charter to “meet community needs for electricity.” More recently the utility has expanded its mission. In 1997 TPU embarked on an ambitious experiment to build a publiclyfunded telecommunications system called the Click! Network. The system was intended to provide high-speed access for cable television, data transmission and Internet services for TPU customers.
Now that the fourth anniversary of the launch of the Click! Network has arrived, it is an appropriate time to make an objective assessment of how the project has fared. Is the Click! Network fulfilling its promises? Has it successfully met the challenges of building an advanced telecommunications network? What risks and costs has it incurred? Beyond these concerns, the Click! Network raises a deeper question about the role of government in our society. Should tax-subsidized municipal entities be allowed to compete directly against private companies?
The Click! Network is a prominent example of an ongoing trend. Other municipalities have also expressed interest in moving into the telecommunications business. Local leaders across the state are watching and weighing the Click! Network’s performance. If deemed a success, the system will serve as a model for others who may decide to embark on the same path.
This paper presents an in-depth analysis of where the Click! Network stands today. It compares the promises made when the system started with its actual performance since 1997. The study assesses whether it is effective or desirable for public entities to enter this business and compete directly against existing telecommunications providers. It also assesses the impact of the Click! Network on Tacoma ratepayers and the system’s prospects if it continues on its present course. Finally, the study presents policy recommendations about how the system can be improved.
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Now that the fourth anniversary of the launch of the Click! Network has arrived, it is an appropriate time to make an objective assessment of how the project has fared. Is the Click! Network fulfilling its promises? Has it successfully met the challenges of building an advanced telecommunications network? What risks and costs has it incurred? Beyond these concerns, the Click! Network raises a deeper question about the role of government in our society. Should tax-subsidized municipal entities be allowed to compete directly against private companies?
The Click! Network is a prominent example of an ongoing trend. Other municipalities have also expressed interest in moving into the telecommunications business. Local leaders across the state are watching and weighing the Click! Network’s performance. If deemed a success, the system will serve as a model for others who may decide to embark on the same path.
This paper presents an in-depth analysis of where the Click! Network stands today. It compares the promises made when the system started with its actual performance since 1997. The study assesses whether it is effective or desirable for public entities to enter this business and compete directly against existing telecommunications providers. It also assesses the impact of the Click! Network on Tacoma ratepayers and the system’s prospects if it continues on its present course. Finally, the study presents policy recommendations about how the system can be improved.
Click on title for complete article
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