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Towns’ network purchase was a pro-consumer deal

MI-Connection workers installed new high-speed wires on South Street in Davidson during the system upgrade in 2008. ( file photo)

MI-Connection workers installed new high-speed wires on South Street in Davidson during the system upgrade in 2008. ( file photo)


A recent article in the New York Times (Dec. 4, 2011, “The New Digital Divide”) about why the US is ranked 12th among developed nations in Internet connectivity underscores the excellent reasons why Davidson’s mayor and town board (along with Mooresville) decided to purchasecommentary bug scandal-ridden Adelphia’s decrepit local communications network several years ago. The U.S. is dominated by just six Internet cable providers— like Time Warner, Comcast, AT&T. These providers are acquiring most remaining smaller systems without any federal oversight. We know what this means—prices will go up and quality of service will go down for those subscribers.

State legislators, including North Carolina’s, influenced by well-funded cable industry lobbyists, have made it easier to do this by outlawing local competition like MI Connection. In North Carolina, it is now illegal for a government entity to own a communications system. That’s like requiring the water system to be owned by a private company beholden only to its stockholders for whom profit is the only motive, and not providing water to homes that aren’t profitable enough.

This means that the Digital Divide will widen, turning us even more into a society of haves and have-nots. High-speed Internet connections will become even more critical in coming years for education, business, personal communications, journalism, healthcare, finance, commerce, government, and even lowly entertainment. Those who can access speeds of up to 150 Mbps will have many more opportunities than those with lowly telephone-company DSL—or nothing at all. It slams shut the door to opportunity for children in households that can’t afford to prop up shareholder profits because they can’t afford the unregulated, exorbitant rates for something that is a cultural necessity on the level of water, telephone, electricity, and roads.

Rural areas will be left out because there’s no immediate profit in building lines to serve small populations. Without government regulation, there is no incentive for cable giants to include less-populated and lower income areas.

A large part of Davidson’s motivation for purchasing the local cable system was to ensure a fair rate structure and access to all citizens. It also wanted to ensure the latest technology. In the hands of Time-Warner, Comcast and the other cable giants, instead of ranking with top 10 countries like Sweden, Japan, and even up and coming Portugal and Russia, our cost to access the fastest technology (150 Mbps) ranks with Istanbul. In the 4 percent of the US where you can get those speeds the cost is 5 times higher than Paris—as just one example.

I have had MI Connection’s high speed Internet, telephone, and TV package for more than a year. It has been 99 percent flawless, and the few problems have been fixed quickly and courteously, as if the employees had a personal stake in customer service (imagine that!). Buying MI Connection was not a mistake. Its economic problems would disappear overnight if more people showed a little more civic responsibility, and used just MI’s telephone and Internet services.

By civic responsibility, I mean that if lower income citizens are served with Internet connections required for the new digital world of health care, education, etc., all of Davidson will benefit. A huge corporation based in Colorado couldn’t care less about Davidson’s potholes or the quality of its police force. High speed Internet must not be the exclusive territory of gated communities and high-end business parks. This country does not need more division. This was the genius behind acquiring a cable system. Global economic problems have made it a difficult beginning, but those who have bought into it have excellent services at a good price, and hopefully more than a little civic pride. By working together, even in the coming digital world, great things will be achieved.

Robert Maier lives on Walnut Street in Davidson.


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David Boraks is the founder and editor of Davidson News LLC, which started in 2006 as a neighborhood blog and evolved into a regional community news network. He is a print, magazine, web and radio journalist, with experience in every nook and cranny of the news world, covering everything from local news to Fortune 100 companies to technology to Asia. He lives on South Street in Davidson, in a house that was at the center of a 1914 murder case. Ask him and he'll tell you that story.

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12 Responses to “Towns’ network purchase was a pro-consumer deal”

  1. Michael Orlando says:

    Maybe we have different definitions of civic responsibility, but given a choice I would put the money in a public library (with free internet service), police cars, new fire station, and greenways long before I would risk our town’s economic stability on a cable company. State or federal initiatives on this front would be much more meaningful than one town’s stab at fixing a national problem.

  2. Robert Maier says:

    Civic responsibility in this case means subscribing to the Town-owned Internet and phone service instead of one of the privately-owned services. It will pay the MI Connection debt and even provide low cost services to those who can’t afford them.

    My experience as a community college instructor says that on-line courses are rapidly growing as cost-cutting measures. They are becoming more complex, requiring higher Internet speeds. I have many students who cannot afford $60/month Internet bills and there is no movement at the State level to underwrite those costs, any more than with providing public transportation or automobiles for students to get to classes.

    Many students who are doing the worst in school have don’t have Internet at home, and must do their on-line classes and homework at the library, whose hours and facilities are also being permanently cut. So, the Digital Divide is growing and will become a huge problem. Davidson and Mooresville saw a rare and noble opportunity to address this problem with no cost to taxpayers– that is if the citizens joined together to support the endeavor. If people are more concerned about government meddling than quality education for all, then, well, then we become a banana republic.

  3. Greg Scoggins says:

    If the town’s purchase of the cable company was intended to close the so-called “digital divide,” can you please tell me how many residents are receiving free or subsidized service from MI-Connection? Also, quoting articles published in the New York Times has about as much credibility as quoting articles from Fox News.

    Regarding the quality of service provided by MI-Connection, my experiences (that date back to the to the Adelphia days) are quite different from yours. We suffer frequent losses of service week in and week out, we frequently lose many of our TV channels, tonight I got nothing but snow on one of our TVs when I turned on the cable box. Believe me, this doesn’t even begin to describe the problems we have had over the years and I am sure the dozens of service calls are documented at MI if you’d like satisfy yourself that we are not all getting the service you are enjoying. Our download speed over the past 24 months is documented on to vary from .78Mb/s (yes, you read that right) to a max of 7.78 Mb/s. I can’t even comprehend what 150 Mb/s would be like. Yet, in spite of our poor, substandard internet service, our family seems to be doing quite well, thank you.

    You say you want to close the “digital divide,” are you not concerned with other “divides”? What about the “automobile divide”? Shouldn’t everyone be entitled to drive a Mercedes Benz? Maybe the town should buy a car dealership too. How about groceries or furniture? Should the town buy a grocery store and a furniture store too? Believe me, the town of Davidson isn’t going to close any “divides” by giving things away. The best the town of Davidson can do is to assist the federal and other local governments in providing temporary assistance to get people back on their feet and productive again. Once that has happened, they can close their own “divides” and they will have two things nobody can take from them, pride and confidence. Two things your plan will not provide.

    Last, you stated that one of the town’s reasons for purchasing the cable company was to “… ensure a fair rate structure …” Will it be fair to the residents when the local tax rates have to be increased to subsidize the incredible debt the town has incurred to own the cable company? You have attempted to vilify the “big cable companies,” but you don’t mention that because they are big, they are able to deliver huge economies of scale to their customers in the form of better programming, service, and rates.

    Greg Scoggins

  4. David Boraks says:

    Greg: Please get in touch with me about your weekly outages on MI-Connection cable. I’d like to look into it … – David

  5. Greg Scoggins says:


    You are more than welcome to look into it. I have grown weary of complaining. An email has been sent to your address with additional information including speed test results for the past 2-3 years.



  6. Alan Hall says:

    Mr. Scoggins:

    I have reviewed your service call history and agree this deserves a quick resolution. Our service and maintenance supervisor will contact you for a convenient time when we can meet you to resolve all outstanding issues. You are also welcome to contact me directly at 704-360-1801.

    Alan Hall
    Director of Operations, MI-Connection

  7. Joe Hutchens says:

    I not sure why some feel it is necessary to occasionally trot out a pro-MI Connection article. Facts are our town’s leaders paid $92.5 million for a business that was worth $30-35 million at the time and probably worth even less now. Their mistake was compounded by doing a deal with 100% leverage and zero equity, thus leading to huge loan payments that cannot be met with cash flow the business generates. That’s what happens when you pay too much for a business and borrow too much money to buy it. That is why the citizens of Davidson see 20-25 percent of our town budget going to prop up this loser of a business.

    Mr. Maier’s article is long on hyperbole but short on facts. To wit, Davidson is not rural America; Davidson resides in a highly prosperous urban area. Rural America receives high speed internet without the need for cables being run to every home. There are other options that are more cost effective. The fact that MI-Connection is owned by the town of Davidson does not in any way address the issue of haves and have-nots in our society. Referring to phone company DSL service as lowly is ridiculous, as is the caricature of slamming the door shut on rural children. Where does this drivel come from? The Digital Divide? Really now.

    Contrary to Mr. Maier’s thinking, I believe private owned American business is fully capable of addressing the digital need of our citizens, and can do so without the 20-25 percent tax penalty paid by the citizens of our town. My sense of civic responsibility tells me this unnecessary burden on our citizens is unjust.

    Perhaps this article should have been entitled “Towns’ network purchase was an anti-tax payer deal.”

  8. Robert Maier says:

    Here’s more on the subject:

    Dec. 9, 2011,, Bob Cesca column: Time to Occupy the Internet Before It’s Too Late”

    Meanwhile, America’s access to broadband is embarrassingly awful. We’re 15th among other nations in broadband reach, and, unforgivably, 26th in terms of speed. If you want killer download speeds, you’d might be better off in South Korea or Romania. Put another way, the Republican presidential candidates are releasing YouTube videos in which they hoot and fist pump about American Exceptionalism… at download speeds slower than Greenland (No. 19) and Lithuania (No. 1).

    Those who prefer a corporatocracy over democracy never met a corporate giant they didn’t like, and don’t mind twisting facts and reality to support their claims. If you think Lehmann Brothers, Bank of America, and Enron are civic models, you’ll have no problem with another aspect of the battle for the Internet, which has been run by corporate giants for a decade. See how they lead:

    “The outfits that are prepared to pay for fat tubes through which to pump their corporate crap will win the day and you, specifically, will get whatever is left over, dooming your voice and, in many cases, your livelihood to strangulation and death. In other words, while the Internet was the great equalizer, allowing any content of merit to succeed, corporations are using massive financial and political resources to transform all of this into a television/film model in which a chosen few decide what content makes it to the masses.

    Meanwhile, America’s access to broadband is embarrassingly awful. We’re 15th among other nations in broadband reach, and, unforgiveably, 26th in terms of speed. If you want killer download speeds, you’d might be better off in South Korea or Romania. Put another way, the Republican presidential candidates are releasing YouTube videos in which they hoot and fist pump about American Exceptionalism… at download speeds slower than Greenland (No. 19) and Lithuania (No. 1).

    Advocacy groups like Wireless for America are attempting to ameliorate our pathetic ranking by pushing for a widened broadband spectrum, but they’ve been thwarted at every turn by special interests and, naturally, puppeteered Republican members of Congress. For example, a company that calls itself LightSquared is attempting to start up a new wireless network, but Big Telecom — or Big GPS in this instance — has decided that there’s no room for more wireless competition so they’re using Senators Chuck Grassley (R-IA) and Tom Petri (R-WI) to block the startup. You know, because Republicans are all about competition in a free market, right?”

  9. Rodney Graham says:

    While I agree with the gist of Robert’s commentary, specifically that broadband internet access should be used as both a tool for economic and personal development, I would caution against making comparisons between speed and access in the United States versus other countries, and specifically against drawing conclusions that the differences are attributable to whether the internet is delivered by private or public entities.

    Now that I’ve got that run-on sentence out of the way…it’s true that the U.S. ranks about 32nd in terms of average speed. But, none of the countries ahead of us (except Canada, who is 31st by a whisker, and the Ukraine, who at #26 is barely faster than the U.S.), are large countries with large populations. Lithuania has only 2 million internet users, vs. nearly 300 million for the U.S. Is it better to have half of your population on a screaming fast internet connection, or to have over 80% averaging over 12 Mbps (as a point of reference, most of MI-Connection’s broadband customers such as myself have speeds of 8 Mbps, which is pretty fast for what most of us do). Lithuania is about the size of West Virginia, and is presumably must easier to wire than the United States, which is the size of not only West Virginia but also 49 other states.

    I do agree that MI-Connection should have as a goal the delivery of faster speeds to people that need them. I don’t know what the future holds, but for now most of us are good at 8 Mbps (or 20, which is available from MI-Connection for only a slight increase in the monthly fee). I don’t see a need to make an investment to get us to Lithuania-like speeds of 30 Mbps, unless it can clearly be shown that doing so will result in economic and educational advantages. Right now, if we got 30 Mbps it would only mean for most of us that instead of taking 5 seconds to download a photo it would take 2.

    I recognize that some (Bob, being in film production is probably one of them) need faster speeds and MI-Connection should seek to provide them with those speeds.

    What is needed is a push to make sure that no one in Davidson is educationally disadvantaged due to a lack of internet access. Not having internet access in the 21st century is analogous to not having a paved road to get to school in the 20th century.

    Together with our children’s report cards we recently received a report card for Davidson Elementary School. This report card showed that over half of lower income students did not pass both their reading and math end-of-grade (EOG) tests, compared with 90 percent of children who are not lower income. Most likely those with less income have less access to the internet, and we should not stand for this in 21st century Davidson.

    Whether you agree that the internet should be provided by a private firm or by the government, hopefully you will agree that as a town we should make an effort to ensure that broadband access is available to all areas and all populations of Davidson. MI-Connection is not only an economic development tool, but also an educational development tool. We should use it as such. Not doing so only costs us more in the long run because kids who are not passing their EOGs in elementary school will be much more likely to earn less as adults.

    P.S. For those interested in internet speeds, visit You can even see average internet speeds by state and city within the U.S.

  10. Robert Maier says:

    In answer to Rodney, I do fine with 8 Mbs. It’s actually rarely that because of bottlenecks along the way– from Netflix for example, which sometimes is unusable even though MI connection speed tests at greater than 8. The people I’m concerned about are my community college students who are struggling financially.

    No, you don’t see them sampling beers at the local tap house, they’re clerking at the Dollar store in Gastonia to help their unemployed parents pay utility bills and pay their bus fares to school and work. 1 Mbs would be fine for their on-line courses, but the $40/month is a big bite, plus they have to save up $500 for a usable computer.

    Many people want the working poor to just suck it up and not expect handouts, but when they’re working, going to school, supporting their family, and still failing because there aren’t enough hours in the day, what does society at large gain for the few bucks it saves by not providing critical educational services to the needy and willing students. It’s like denying school bus service to any family outside the gated communities, because “we just can’t afford it.” And yes, there are people in Davidson in as desperate need as Gastonia. From what I’ve seen in the world, a public company like MI-Connection would be more inclined to help these students with their Internet needs.

  11. Greg Scoggins says:

    To MI’s credit, I can report a very pleasant visit by two extremely knowledgeable guys that thoroughly tested all of the cable outlets in my home and replaced several connectors that could create a loss of signal strength. That wasn’t their responsibility, but they did it anyway. It has only been three days, but so far, so good. Todd Heyworth (I hope I spelled his name correctly) told me they admitted there had been several oversights regarding our service in the past, but they were there to fix them and any others they uncovered at other addresses. I believe them. They still must return to properly run a new drop line from the street box to the residence, but I have confidence they will take care of it professionally.

    As a sidebar, I can say that in just about all of the dozens of service calls we have had, MI-Connection has responded in a timely fashion. It was the repeated visits, frequent outages that mysteriously fixed themselves after some inconsistent time period, and slow speeds that prompted my comments.

  12. Greg Scoggins says:

    To Robert Maier: You have not responded to any of the questions I posed to your commentary. Specifically, I’d still like to know how many subscribers are receiving free or subsidized internet and/or cable service from our town owned cable company. The entire thesis of your commentary centered around the need to deliver internet connectivity to those without and that it would not happen without public ownership in lieu of those evil, greedy corporate shareholders you loathe. While I have been waiting patiently for a response, I did a little research for you.

    Did you know we are a town of approximately 10,000 people and that there are about 700 households that make less than $30,000 per year? I think anyone would agree that an income of $2,500/month would be enough to provide for the maximum $35/month 1Gb or better internet service you say is so crucial. So, maybe there are still 500 households left where it is just a bit of a stretch to spend $35/month. Did our town spend $92 million dollars in order to ensure connectivity to these 500 or so households? I’ll do the math for you, that’s $184,000 per household. I think those households would have rather had the cash.

    Regarding those greedy stockholders you frequently referenced, let me ask you, do you have a retirement fund? A 401(k)? Own any shares of a mutual fund? If so, one can only conclude you purchased them with the expectation they would increase in value, you greedy stockholder, you.

    Also, can I ask why you have only been doing your civic duty for a little over a year by subscribing to MI-Connection? The rest of us have been subscribers for years.

    Last, in April, you made a comment on bemoaning the purchase of the BB&T building by Davidson College and the loss of the tax revenues with a specific reference to the heavy debt incurred by the town for the cable company. Taxes were being paid by the real estate investment company on the lease income derived from BB&T. Geez, I guess all of that evil corporate tax revenue hurts when it leaves, heh?