Cities seek freedom to sell Internet service

Chattanooga, Tenn., is asking federal regulators to overrule a state law preventing the sale of the city's high-speed Internet service in neighboring areas served by AT&T Inc. and Charter Communications Inc.

Chattanooga's Electric Power Board, which sells residents broadband Internet in addition to electricity, told the Federal Communications Commission in a petition this week that it cannot serve the surrounding area - described as "a digital desert" - where residents have limited Internet speeds.

There is a growing political divide in Washington over Internet services provided by local governments, at times for lower prices than companies charge or to connect areas that were not being served.

Democrats have said municipal broadband networks should be free of state restrictions. Republicans have opposed overriding state laws.

FCC Chairman Tom Wheeler, a Democrat, has told Congress he has the power to override state laws as part of the agency's mission to promote broadband, or high-speed, Internet service. Wheeler said in a statement that the regulatory agency would "carefully review" Chattanooga's petition and a similar request from Wilson, N.C.

"We don't need unelected bureaucrats in Washington telling our states what they can and can't do," Rep. Marsha Blackburn, a Tennessee Republican who is pushing Congress to bar the FCC from preempting state municipal broadband laws, said in a statement. "This is an issue that should be left to our states."

Nationwide, 20 states prohibit or restrict municipal Internet service "at the behest of large cable and telecom interests," Rep. Mike Doyle, a Pennsylvania Democrat, told colleagues in a June 15 letter distributed by e-mail.

Chattanooga's Electric Power Board told the FCC in its filing that after it began service, Comcast Corp. halted annual price increases and reduced its rates.

The power board now serves 60,000 video customers, it told the FCC.