FCC Chairman Tom Wheeler told the cable industry today that he will "preempt state laws that ban competition from community broadband."

Speaking at the Cable Show industry conference, Wheeler discussed how state governments have protected Internet providers from competing against cities and towns that build their own broadband networks.

According to a transcript of his speech provided by the FCC, Wheeler said:

[F]or many parts of the communications sector, there hasn’t been as much competition as consumers and innovation deserve. Given the high fixed costs and consequent scale economies, this isn’t especially surprising. But that makes it all the more important that we knock down public and private barriers to competition and avoid erecting new ones. It is equally important that we encourage competition wherever it is possible. One place where it may be possible is municipally owned or authorized broadband systems. I understand that the experience with community broadband is mixed, that there have been both successes and failures. But if municipal governments—the same ones that granted cable franchises—want to pursue it, they shouldn’t be inhibited by state laws. I have said before, that I believe the FCC has the power—and I intend to exercise that power—to preempt state laws that ban competition from community broadband.

This statement follows up on a previous one in which Wheeler said he believes the FCC can target "legal restrictions on the ability of cities and towns to offer broadband services to consumers in their communities."

This belief arises from the federal appeals court ruling that overturned the FCC's net neutrality rules. We wrote at the time:

Judge Laurence Silberman dissented from his fellow judges in a 2-1 decision last month, arguing against the majority opinion that Section 706 of the Telecommunications Act gives the FCC authority to enforce net neutrality rules. (Separately, Silberman agreed with the majority opinion that the FCC had failed to justify common carriage rules.) However, Silberman wrote that the FCC does have authority to take "measures that promote competition in the local telecommunications market or other regulating methods that remove barriers to infrastructure investment.” In a footnote, Silberman wrote that "[a]n example of a paradigmatic barrier to infrastructure investment would be state laws that prohibit municipalities from creating their own broadband infrastructure to compete against private companies."

There are 20 state laws that limit municipal broadband. These generally aren't strict bans, however. Instead, they make it difficult for municipalities to build their own networks by enacting various limits and regulations the municipalities have to follow.

Given Wheeler's use of the phrase "state laws that ban competition," it's not clear whether he believes the FCC can overturn laws in all of those 20 states. An FCC spokesperson contacted by Ars said that Wheeler "is not trying to make a distinction between 'ban' or 'limit.' The point is to look at the effect of the law."

The spokesperson said, "We will be taking up this issue in the technology transitions proceedings, and there should be an announcement about this in the next few weeks." It's too early to say "how [Wheeler] will address existing state laws."

Wheeler's speech also continued his defense of the controversial net neutrality rules he proposed to replace the ones the court invalidated. Wheeler also praised AT&T's announcement that it is considering bringing fiber Internet to as many as 100 cities.

"I applaud [AT&T CEO] Randall Stephenson for his initiative and see this as a challenge to the cable industry similar to the advent of DBS [direct-broadcast satellite]," Wheeler said. "I hope you respond in a similar manner as you did back then."