US ISPs Using Push Polling To Stop Cheap Internet 417
An anonymous reader writes "What happens when a new ISP is started somewhere in the United States that completely blows out of the water all the other ISPs in the area, in terms of price and performance? Apparently, that question is being answered in North Carolina, where Greenlight Inc., a company started by a city government, is trying to offer faster, more reliable, and cheaper Internet service to the local residents. Time Warner and Embarq can't compete. So they are not only lobbying the state government to destroy the upstart competition, but are now using push polling methods to gain support, across the two cities that could benefit from the new ISP, for the 'Level the playing field' legislation they got introduced in the legislature." A local news outlet provides coverage more friendly to the incumbents' point of view.
Well yeah... (Score:5, Interesting)
Surprise someone finally realized that the last mile is a natural monopoly and should be a utility.
This totally ruins their business model of selling something that costs almost nothing for a lot more than nothing.
Of course they're going to pull out every stop to well stop this from happening.
Re:Well yeah... (Score:5, Interesting)
They can pull out every stop if they want. But with an economy that sucks, even if most of it is in peoples heads, people are looking for every way they can to save a penny.
Now would be the perfect time for some upstart companies to gain some market share by simply pricing themselves $10 or so cheaper than the competition. Throw in the added bandwidth and its a no-brainer. The biggest hurdle is getting your name out there. They need to make sure they budget for the right kind of local marketing for it to work.
Corporations trolled (Score:5, Interesting)
And I fucking RAGED.
*You* didn't want the customers, fuckers, *YOU*. They came to you begging for service. You denied. Now they did it themselves and you blame unfair competition? Go jerk off in some cold closet, incompetent bastards...
TW pays a bribe for access; Greenlight benefits (Score:4, Interesting)
At least in the Triangle area in NC, TW pays the local municipalities a bribe, I mean an "Access Fee" that can approach something like 15% of the revenue. While their methods are all unsavory, they are rightfully angry that their bribe is underwriting a competitor.
No Sir! (Score:5, Interesting)
The government here is in the wrong for poking its nose where it doesn't belong. Either the entire ISP business should be under government control or none of it should be. By cherry picking certain parts, the government has made a very bad decision with long term ramifications for all business in the state.
Then let's privatize the Fire Department and all other services exclusively run by government.
Or even better, let's put the entire issue to a public vote. This would be the ultimate form of democracy. How about that?
You are one of the folks that thinks that anything run by government is bad as if, when you find yourself on the death bed...being bamboozled by insurance companies...as if who provides the service you need at the material time matters. What would matter to you is how you can get the help you need. I do not care who provides a service as long as I am satisfied.
People with your thoughts are partly responsible with the current financial crisis. It's insane. I would like you to call for a referendum on this issue instead of ranting around here.
Remember, a drowning man will cling to a reed with the hope that it will offer a lifeline of some sort.
AS someone who worked for a small ISP (Score:5, Interesting)
What really stinks, especially in rural areas, is that you have to buy your back-end bandwidth from a person you are competing against.
They get their money either way, charging a fortune for a 1.5 Mb T1 line, again, especially in rural areas.
So they make a killing off of a bunch of bonded T1 lines or a partial DS3, and then you have to compete with them against their own offerings (i.e. 19.99 and 29.99 a month DSL).
So you get the headache of customer support and make a little money, and the phone company does good either way. Your niche market in a rural area is areas not serviced by the phone company, which means when the phone company does go into a new area, you lose your customers in that area because you can hardly compete with the people who own the infrastructure.
Again, I know there are more options in larger cities, but there is a reason a business likes to be a monopoly.
Transporter_ii
Re:Explain push polling to me? (Score:3, Interesting)
It is a very popular political tool.
Re:Merit (Score:5, Interesting)
You know, socialism isn't outlawed by the U.S. Constitution. I'm in favor of the government doing whatever it can do better then big business, e.g. replace the joke of a medical insurance system with a single payer government run system.
Admittedly socialism doesn't work well in many cases because the process is corrupted by the rich and powerful and special interests. But on the local level, a socialized industry might work better then on the national level, because the people will have more influence to avoid corruption then they do on the national level.
If cities can provide broadband service cheaper then private companies, I want them to. As long as its self supporting and not subsidized.
I'm tired of CEOs making millions of dollars for doing nothing unique or that a lot of other people making far less couldn't do.
And the telecoms are among the worst of the bunch in undeserved profits.
Re:AS someone who worked for a small ISP (Score:5, Interesting)
A similar thing happened to some "community internet" initiatives in the UK. In villages where there was no broadband, people costed out getting a T1 line to their village and splitting the cost. It usually came to slightly more than broadband from the big providers - but with the choice of that or dial-up people would sign up for the service.
The community projects would get the money together and order the T1 line. What British Telecom did, of course, was install a much bigger trunk than needed for a single T1 line, as the extra cost is pretty low and then offer broadband in the area. Many people would then say "I wouldn't have signed for the community project if I knew that broadband was coming here anyway" and try to get out of their commitment. Usually after a year which people had signed up to the project would fold because everyone would switch to BT rather than renew. So BT gets paid to install a line and then uses it to give cheaper competition.
Re:Only one way for city and citizens to win (Score:5, Interesting)
The city of Ashland in southern Oregon operates a fiber-optic network that's open to multiple ISPs. The city does not operate its own ISP at all, and they don't sell Internet access directly to residents; you have to sign up with an ISP, and the ISP pays the city for access to the fiber network. The city sets the speed and charges the ISP more for faster speeds, but the ISP provides the Internet connection, tech support, etc.
Re:AS someone who worked for a small ISP (Score:5, Interesting)
Actually, our company is in exactly this situation. But there are other factors that you do not take into account. Large companies also like to screw their own customers. We found that plain hatred of the competition has driven a lot of customers our way, merely because we like to treat them like human beings.
Very large corporations also compete within their own department. Our bandwidth salesman makes zero money off of his company's DSL customers. Any customer we get is more bandwidth sold for him and he gives us a very decent deal.
Re:AS someone who worked for a small ISP (Score:3, Interesting)
At least in theory this was dealt with in the UK by making BT (the company which maintained the infrastructure, and worked as an ISP) split out the infrastructure side into a separate company (BT Openreach) which is required to sell bandwidth at the same price to BT and their competitors.
As with anything like that it hasn't been a complete success, but on the whole it seems to be working, with some excellent competition between providers.
Re:REALLY misleading title (Score:5, Interesting)
And there's the rub.
When I was growing up, we used to have two choices for cable TV - Warner Cable (later became Time Warner) and Viacom Cable.
Warner was the "newcomer". They started running "specials", subsidized by their monopolies on OTHER cities. For a while, you got a basic cable package for $15/month and the pay channels like HBO for another $5 or so.
Then, Viacom folded. They couldn't compete any more, they were losing customers in droves to the "specials" because at that price, Warner was actually selling the service below cost (but claiming it was a "special" and a "sale", so getting around state laws against below-cost permanent pricing).
What did people find out once Viacom was dead? TW did what they do to everyone once they have a monopoly - they started running TV ads with the "happy king" declaring "I declare Warner Cable for my entire kingdom!" with a shit-eating grin on his face.
Meanwhile those "special" $15/month rates were expired out, and within 3 months the base price was $80/month.
Look at the prices you're offered for ISP service. If you are in a "competition" area, one of the lucky SOB's on a border (and the borders move as they put each other out of business), you can probably swing some ridiculously cheap pricing. Otherwise, what do you get? Comcrap pretty much has a monopoly on our area. DSL service is technically "available" if you want roughly the same data rate as a pair of 33.6 phone modems (no seriously: they haven't upgraded their equipment in 10 years or more).
Comcrap, 10 miles down the road, offers their "high tier" speed at $40/month. For us, "low tier" is $50/month. That's because 10 miles down the road, Verizon owns the lines and is offering FiOS to compete with Comcrap. Meanwhile, Comcrap's own internal memos show that they could double the speed to EVERY USER IN THEIR NETWORK, both up and down, for a mere $6/customer one-time cost, and they refuse to do it.
That's the kind of shit you deal with. They all want a monopoly so they can gouge the crap out of you.
Re:Well yeah... (Score:1, Interesting)
That's what people probably said before water was a utility.
The actual bill in question (Score:3, Interesting)
Has anyone actually bothered to read the bill [state.nc.us] in question? All it's doing is making sure the city-owned ISP isn't---or doesn't in the future---engage in the kind of abuses I just posted about. It's specifically to make sure they can't lower their rates by subsidizing themselves with tax dollars, exempt themselves from paying telco taxes, and similar. Here are the relevant pieces:---
Anyone opposing this is basically saying, "I want cheap Internets by making you pay for it."
Re:REALLY misleading title (Score:4, Interesting)
I'm with you on this -- the monopoly is completely anti-consumer. The problem is that with significantly lower operating costs, the city will be able to drive the telcos out, and then THEY will be the monopoly. I hate private monopolies but I hate the state as monopoly equally. Simple solution here. Tell the city they cannot collect fees/taxes on the ISPs we're all good. I definitely want the city to come in and bust up the Telco monopoly -- I just don't want one monopoly to be replaced by another.
"
I agree the way the telcos are going about this is wrong though. I'd rather see legislation like: Where municipalities set up their own ISP, they cannot assess city taxes or fees on competing ISPs."
It's all about operating costs -- make those as equal as you can, and THEN let everyone compete.
Re:AS someone who worked for a small ISP (Score:3, Interesting)
Spread between 20 people this didn't work out too badly at all. They dug their own trench for the line to save money as well.
All figures are from memory so they could be inaccurate, but he didn't pay more than £100 personally. In fact I seem to recall that BT are obligated to provide a service if more than X people wish to subscribe, so it may have ended up being free to install (not including normal subscriptions) A T1 isn't worth the hassle.
Re:REALLY misleading title (Score:3, Interesting)
Read the senate bill: http://www.ncga.state.nc.us/Sessions/2009/Bills/Senate/PDF/S1004v1.pdf [state.nc.us] [state.nc.us] I hate the telcos as much as anyone, but this bill says that when the city enters into the communications business, it should have to pay all the same taxes and fees as private business would, and be burdened with the same oversight. They also say that other fees the citizens pay (trash, water etc) cannot be used to fund the communications business. I don't see how this bill is unfair at all. The telcos are essentially saying "If we didn't have to pay any fees to the city to provide service, we could be competetive." If government wants to set up a business, they should have go compete with other businesses on a level playing field. If municipalities want to open up their own ISP, I am all for that, but then they should stop collecting fees and taxing the other ISPs they are competing with.
Bullshit, bullshit, and more bullshit. The government is not running a business; it is providing the best service it can to the citizenry. If that prices out some private ISPs, fuck 'em. If they want to establish taxes specific to the ISPs, fuck 'em. If the people _vote to make private ISPs illegal in their community_ (perhaps because they have a history of gouging, monopoly, and privacy-breaking practices), then they can do that too!
Municipal government should not be using taxes and fees to provide a commercial advantage for themselves. I think the "level playing field" is actually a good title for this bill, and not an unreasonable request. We're all hopped up on this because it's something that's near and dear to us, but imagine if the city set up a taxi service, but then did not have to pay gasoline tax or hackney licenses. Obviously it benefits the public who uses taxis, but is it fair to the taxi drivers and cab companies that they now have to charge more than the city taxis.
Awesome, sign me up for that taxi service. Democracy comes first, capitalism comes second.
Re:REALLY misleading title (Score:5, Interesting)
From the techjournalsouth article-
"If the cable/phone companies really want a level playing field, they'd open their books just like we do in the spirit of open meetings and open records law. They don't want a level playing field. They want to be the only team on the field."
It seems the community internet operating books will be transparent, so people can see what costs are, and where the money is going. It's a public service, not a for-profit business like Time Warner is.
While it's true a monopoly is generally anti-consumer, a publicly open/owned monopoly is far less likely to be in a position to price gouge for crap service, where the larger, established private monopolies already are.
Re:AS someone who worked for a small ISP (Score:1, Interesting)
there is a reason a business likes to be a monopoly
What's ironic is that these monopolies (phone and cable) were created by government in the first place. The concept is absurd: a "quasi-private" business, with a pure objective of profit like normal private business, yet created and sustatined by government through a mandated monopoly? Does this not immediately raise the red flag to anyone else? Common sense tells me that the solution is EITHER government OR private business, not both. Allowing them to operate as "both" is a recipe for corruption, poor service, and outrageous prices. It's no surprise that phone and cable services are exactly that: a ripoff.
Re:AS someone who worked for a small ISP (Score:3, Interesting)
Back in about 2002, a small print shop in the village I lived in put a sign in their window. It said something like "We have asked for broadband, but BT say they don't have evidence of demand for this village. If you want broadband, phone BT on xxx and request it. When they get 400 requests, they will install broadband to the whole village".
We got broadband a few months later.
IIRC, BT had a counter on their website for every exchange in the UK recording demand, the higher the demand the sooner ADSL was installed.
Re:AS someone who worked for a small ISP (Score:5, Interesting)
As a counter-example, my dad's office building is in the middle of Midvale, Utah, which is effectively part of Salt Lake City. He wanted to get Comcast internet service for his office building. They wouldn't provide it, because they would have had to run a cable across the street (literally). He offered to pay for it himself, and they still said no.
Instead, they wanted him to get some percentage of the tenants of that business park to sign up for Comcast - they wanted him to do their marketing for them! As a busy accountant, my dad hardly has time to do that kind of thing.
He ended up getting Qwest DSL instead.
Re:Push Polling (Score:3, Interesting)
There was a case about 5 years ago...I think it was Verizon then, fighting a Chicago(?) suburb that was trying to get fiber-to-the-door paid for through tax bonds. They called everyone in town and asked them how they felt about their tax money going to provide child pornography.
There was a more recent one in Louisiana where Cox and Bellsouth (now AT&T) called around and said that the town would start rationing TV if they owned the lines.
It's real shady crap. It's usually done politically. The biggest political one I can think of was the Republicans accusing John McCain of having an illegitimate black baby in a push poll in South Carolina in '04 (And yes, amusingly, they had to do an information campaign there in '08 to convince people that had been a lie).
Re:Well yeah... (Score:2, Interesting)
Let's start with the disclaimers: I doubt the best solution is 100% government or free market and 0% of opposite. I do lean more towards free market though.
What you wrote is wrong. Let's look at the US (and all industrialized nations) in the mid to late 19th and early 20th century. For starters, they were industrialized because of the free market. Because the free market brought in the industrial revolution most people finally had more prospects than farming. Not that there is anything wrong with being a farmer, it's just that if that's not what you wanted to do in life, before the industrial revolution, you didn't really have many other options.
Those 12 hour days and 6-7 day work weeks were on the way out by the time the government got involved. Labor Unions had done a lot to change that. But even without labor unions, you eventually get people who wise up and realize that a happy workforce with low turnover is a more productive work force. In fact, it is not the government that decided that 40 hour work weeks should be the norm, it was the free market in the form of Henry Ford [worklessparty.org].
And as for your illiteracy stats, it was the industrial revolution that brought prices of paper down enough which allowed for people to learn to read and write. Also, you're stats are bunk. Illiteracy rates in 1870 was about 20% [ed.gov] and that declines to less than 8% by 1910.