• by Wendy Davis  @wendyndavis, April 19, 2010

Last year, Internet service provider Time Warner backed an initiative in North Carolina to discourage local towns from building their own broadband networks. The proposed bill, which would make municipal broadband prohibitively expensive, ultimately was put on hold pending further study.

Now, a legislative committee is getting ready to report on the results of that study. And some local broadband advocates say they fear that lawmakers could vote as early as Wednesday to impose a moratorium on new municipal broadband construction.

Greensboro resident Jay Ovittore, who is organizing an effort to defeat the potential moratorium, says that new municipal broadband networks will benefit the entire state. "With the speeds and broadband capacity that would be available, I would think you'd see a huge inflow of jobs," he says. "Time Warner is holding our state back."

For its part, Time Warner says that commercial broadband providers are at an unfair disadvantage to municipalities because local governments can finance construction with taxes and subsidies not available to commercial providers.

"By no means are we against the competition," says Melissa Buscher, Time Warner's spokesperson for North and South Carolina. "We're just saying that all competition should be on a level playing field."

Buscher adds that it is "premature" to speculate about whether lawmakers will vote on Wednesday to restrict municipal broadband.

The law, as introduced last year, would prevent cities from using revenue from other public utilities to finance broadband networks. The measure also appears to prevent cities from using federal stimulus funds to build new networks.

Several towns in North Carolina recently created their own networks -- largely because residents wanted faster and cheaper service than what the incumbents offered. Wilson, for instance, built a fiber-optic network that offers residents service at Web speeds of 10 Mbps in both directions, more than 80 cable channels and a digital phone plan for around $100 a month. Currently, Salisbury is in the process of installing a fiber to the home network, Ovittore says.