Why Is US Broadband So Slow? 513
phantomfive writes "Verizon has said they will not be digging new lines any time soon. Time-Warner's cash flow goes towards paying down debt, not laying down fiber. AT&T is doing everything they can to slow deployment of Google fiber. How can the situation be improved? Mainly by expediting right-of-way access, permits, and inspections, according to Andy Kessler. That is how Google was able to afford to lay down fiber in Austin, and how VTel was able to do it in Vermont (gigabit connections for $35 a month)."
Why Is US Broadband So Slow? (Score:5, Insightful)
Answer: corporate greed.
Re:How can the situation be improved? (Score:5, Insightful)
It's not competition, it's service. The government is meant to serve the people, and sometimes that means providing utilities for the public, with the public's input and desires accommodated.
As long as we keep private enterprise from buying up the regulations anyway.
Big picture remedy (Score:5, Insightful)
govt enforces the monopoly. Want govt monopoly? (Score:2, Insightful)
It's governments that enforce the current monopolies and dualopies, what they call a "franchise".
Do you really want government "competing", keeping ie Google fiber out while they offer up government service that works as well as Congress does, with DMV style customer service, and healthcare.gov quality? The way government would "compete" would be to simply deny permits to any company offering a better service that what government bureaucrats and theirlobbyist friends throw together.
The only large-scale success of modern broadband in the US lately has been Google Fiber. They go where local governments have decided to get the heck out of the way, often after wasting huge amounts of taxpayer money on failed attempts to have an ISP run by politicians.
Re:How can the situation be improved? (Score:5, Insightful)
The macroeconomic costs of having all roads be private would be huge. There would be a lot of lost productivity(not to mention fuel wastage) just on the collection of tolls. And of course anyone who owns property anywhere could find themselves at the mercy of a private interest who can essentially blackmail them by cutting off access to their home or business. Another example of an essential service where the government should, and in most rich places in the world, has intervened is insurance. The fact that the US pays so much more for getting so much less than countries with private health care systems has shown that private industry is either unwilling or unable to provide insurance at reasonable cost, and thus it must be taken away from them. Same with broadband, if US providers don't prove they are capable of *gasp* actually providing a decent service at a decent price then the government should step in. Broadband is in the new economy an "essential service", essentially the "roads" of the internet.
The classic straw man argument is of course "well then why doesn't the government run food stores? Everyone needs food!". While this is true, food retailing(not really going to go into production, which is a separate story) is actually one of the most competitive industries in the US. Competition forces companies to provide decent service at very low margins(1-2% in some cases). If the broadband industry were more like the food distribution industry then we wouldn't even have to discuss a government take-over.
Re:How can the situation be improved? (Score:5, Insightful)
You've just noted that there is an existing infrastructure, and it is common to live off of existing infrastructure until forced to move off it. To that I will add that if I recall correctly, 10 years ago 90% of the optical fiber that existed was dark - there wasn't enough demand for it due to overbuilding in previous years. I wouldn't be surprised if that had something to do with the leisurely pace in adding both capacity and speed.
Re:govt enforces the monopoly. Want govt monopoly? (Score:5, Insightful)
you seem to have a chip on your shoulder about Government.
I have issues with them, too; but I'd rather a non-corporate entity build out and even own our infrastructure than profitmongers!
roads, water, electricity, bridges: all were started by government and that was the major funder. we would not have postal system and roads 'to everywhere' if the decision was left to the profiteering ones.
infrastructure is one of the things goverments do best.
as for your bullshit distraction about how well congress works, that's neither here nor there nor part of any thread on this topic. sheesh.
Re:national franchise rights and debt (Score:3, Insightful)
and contrary to populist belief, the telecoms spend billions of $$$ every year in capital expenses. and they borrow to do so. comcast is $44 billion in debt. Time warner is $25 billion in debt. AT&T is also carrying some insane debt from its idiotic shopping spree almost 15 years ago to become a cable company. back then it cost almost $100 billion. its all in the public financial statements they file. they might not have FTTH, but cable and telecoms have spent tens of billions if not hundreds of billions of $$$ over the last 20 years building out their networks and the bill is now due. meanwhile newcomers like google have no debt and lots of cash and can invest a lot of money into FTTH and other ventures.
not being evil, just a fact of life. it has happened before and it will happen again. wintel beat IBM. and now IOS/Android/ARM/Qualcomm is beating wintel. AT&T and then the baby bells built out an amazing PSTN network and the cable companies came in with unlimited local and long distance calling to steal the customers. railroads built out a national rail network and the airlines and cars came in to steal their profits as well
And they've gotten billions in tax breaks, and the government ignoring monopoly laws for them in exchange for building out those networks. Which they still own, and get to charge any third party who tries to "compete" with them for the privileged of using. They decided to pocket the extras as profit instead of using it for what it was supposed to be for, that's their greed and poor planning and their problem.
The government paid them to build out their networks for better service, and they spent the money on shareholder payouts and padding quarterly statements instead of investing. I have no bleeding heart for a multi-billion dollar industry.
We know they've squandered the chance, and mismanaged everything while charging us out outrageous prices for crappy service, because almost any other nation that has enough infrastructure to have internet does better than North America. Some of them by huge margins. Not a little bit, we're talking orders of magnitude in some cases.
This time last year Comcast was looking at about 2 billion profit. Profit, not revenue.
Tell me again how huge monopolies are going broke by failing to provide us with anything approaching reasonable service and rates?
Why do we keep asking this question? (Score:5, Insightful)
This has been covered 2-3 times in the last year already, and the answers aren't going to change.
Corporate greed is the overwhelming reason.
Lack of necessary infrastructure is the other. But then that's because there is no system upgrading being done because of -- corporate greed.
Instead of having the same discussions about the problem, a more productive discussion would be about how to solve the issue and steps people can take to actually realize those solutions.
Re:How can the situation be improved? (Score:4, Insightful)
It wont stop the incumbents from plotting and scheming to fuck it up. Look at Australia's experience, designed and underway and national NBN fibre to the home network. A change of government blatantly sponsored by the News Corporation the owners of Fox not-News and it gets scrapped with nothing but bullshit and PR=B$ left over about vague promises and a scam to sell the taxpayers the worthless rotting copper left in the ground for billions of dollars. Now matter what get's done, they will plot and scheme and lobby to undo it. They want their 1980s media model back where they had total control and you had to pay to be heard.
Re:Why do we keep asking this question? (Score:5, Insightful)
This doesn't work as an explanation because corporations in countries other than the U.S. (with faster speeds) are also greedy. So corporate greed isn't the cause per se. It may be necessary, but its not sufficient.
Re:How can the situation be improved? (Score:5, Insightful)
It's not competition, it's service. The government is meant to serve the people, and sometimes that means providing utilities for the public, with the public's input and desires accommodated.
As long as we keep private enterprise from buying up the regulations anyway.
Arguably, 'internet access' can be broken down into two (broad) components, one a fairly natural 'utility' and one much easier to build a functional marketplace for.
The last-mile bit pipe between your house and whatever the local aggregation point is is, like most 'utilities' strongly inclined toward being a natural monopoly. Not as bad as something like roads(where running multiple competing roads simply wouldn't fit, in most cases); but between the cost and the disruption of laying additional runs, there is very, very strong pressure toward a sharply limited number of, typically incumbent, wireline players, with maybe a feeble wireless competitor that is compelling if you use under 5GB a month.
Once you hit the aggregation point, though, anything that flows over IP can, relatively easily, be offered for hookup to your pipe. Cheap residential ISPs, fancier offerings with loads of static IPs and symmetric bandwidth, assorted VOIP and video offerings, anything you can shove down a pipe.
Keeping the connection between me and the aggregation point installed, maintained, and lit seems like a perfectly sensible function for either the local municipality, or a suitably-tamed contract operator(It's a matter of pragmatism and local choice whether the work be done by municipal employees or an outside firm; but natural monopolies are to be kept on very short leashes). Once you hit the aggregation point, though, the more the merrier. Subscribing or unsubscribing is just a few ruleset changes, so can be fairly frictionless, and this avoids any...potentially unseemly....favor or disfavor by the municipal government toward specific content or services. They just keep the lights on, you buy what you want, or nothing at all(though, even if you buy nothing, it might well be cost-effective for the municipality itself to still offer access to its own site, emergency services contacts, etc. to residents, since traffic on the LAN costs near zero.
Re:How can the situation be improved? (Score:5, Insightful)
Yup, the government should step in when private industry is either unwilling or unable to provide essential services at a reasonable cost, the keywords being essential and reasonable.
The reverse sadly is true today. Local governments, likely under the influence of paid lobbyists working for existing corporate/telco interests, are actively writing laws to block the spread of broadband. Read for yourself the story of how the Kansas Legislature is trying to stop Google Fiber from expanding in Kansas [consumerist.com].
Best part is: the Senate bill [kslegislature.org] states that the goal [muninetworks.org] is to
"encourage the development and widespread use of technological advances in providing video, telecommunications and broadband services at competitive rates; and ensure that video, telecommunications and broadband services are each provided within a consistent, comprehensive and nondiscriminatory federal, state and local government framework."
Re:govt enforces the monopoly. Want govt monopoly? (Score:3, Insightful)
I have issues with them, too; but I'd rather a non-corporate entity build out and even own our infrastructure than profitmongers!
I have news for you: local governments are incorporated, too.
And don't think for a second that the people involved in local government aren't interested in making decisions that personally profit themselves and their friends.
Re:it's not that slow (Score:5, Insightful)
i'm 40 and have seen the internet grow up and settle for the cheaper plans. i'm at 20/2 now
why do i need to pay for super fast internet?
The point is that the super fast Internet is way too expensive. You're fine with 20/2 now, but if you could have 100/100 for the same price, would you stick with 20/2?
Not everything is publish-subscribe. I want to be able to set up storage boxes in friends' houses or the cloud or whatever, so I can have off-site backups of my data. I want to be able to play with various decentralized communications programs. Some people your age are starting to have grandkids. It would be nice to talk to them in HD, like those science fictions of the 21st Century were saying we would be able to do.
Don't worry about what you'd use the bandwidth for. If you have bandwidth, eventually you'll find a use for it.
Regulatory capture (Score:4, Insightful)
Of course they'd find a way to blame government regulation and interference for the problem, rather than abuse of government power to form and support monopolies.
They're two words for the same thing: government failure [wikipedia.org] in the form of regulatory capture [wikipedia.org]. Granting a monopoly privilege certainly qualifies as "regulation and interference".
Re: How can the situation be improved? (Score:5, Insightful)
Re:I could be wrong, but... (Score:5, Insightful)
Re:Why Is US Broadband So Slow? (Score:2, Insightful)
Hardly "insightful". If corporate greed were allowed to take its natural course, I'm quite sure that plenty of companies would be happy to offer faster access at lower prices than I currently have available, but local governments won't let them. It's regulatory capture, not the profit motive, that keeps the incumbents fat and lazy.
Re:Why do we keep asking this question? (Score:5, Insightful)
Other countries don't have lobbying loopholes where corporations can buy their own laws or have the issues with regulatory capture that the US does.
Re:How can the situation be improved? (Score:5, Insightful)
"Do you pay to drive from one end of a WalMart parking lot to the other? It's private. Why aren't there any tolls?"
Two thoughts on that.
1. They don't charge tolls because they don't want to irritate potential customers.
2. The are charging a toll. It's built into the cost of their products.
Re:How can the situation be improved? (Score:4, Insightful)
Do you pay to drive from one end of a WalMart parking lot to the other? It's private. Why aren't there any tolls?
You should read about private toll roads/bridges. [wikipedia.org]
They come into existence one of two ways (AFAIK):
1. State Governments that are desperate for cash will literally sell the road/bridge to a private company, who puts up tolls.
2. State Governments that are desperate for cash will sell the right to build a private toll road/bridge to a private company,
always with guarantees that the State won't build another road/bridge within XY miles or something to that effect.
#2 almost always involves the State invoking eminent domain on behalf of private corporations.
Re:How can the situation be improved? (Score:5, Insightful)
You guys aren't that bad, you just can't compete with Europe or Asia (how should you? the US is quite bigger and harder to lay down fiber)
That is a bit of strange myth. Apart from central US perhaps being a bit empty many states are comparable to European nations.
Take for example California, it is just marginally smaller than Sweden and approximately the same shape. With four times the population one would think that the internet should be faster, cheaper or at least comparable.
It is all just politics.
Re:How can the situation be improved? (Score:2, Insightful)
"Do you pay to drive from one end of a WalMart parking lot to the other? It's private. Why aren't there any tolls?"
Two thoughts on that.
1. They don't charge tolls because they don't want to irritate potential customers.
2. The are charging a toll. It's built into the cost of their products.
3. The cost of charging a toll is greater than the revenue that they would acquire.
Re:How can the situation be improved? (Score:5, Insightful)
A property owner's association eh? If only there was some slightly larger public body that could provide broadband internet strictly for the benefit of it's members rather than for profit. Perhaps it could feature democratically elected managers. Of course it would have to collect dues from each resident in the area somehow.
You know, that's starting to sound a lot like local government.
Meanwhile horror and comedy stories about HOAs are legion.
Re: How can the situation be improved? (Score:5, Insightful)
Who the hell gets high speed Internet for $20/mo?
Japan. Korea. Eastern Europe. Even some western European countries give you pretty good speeds for $20/month, with no cap.
Apologists will point to differences in population density, geography, history and so forth, but the simple fact is that the US is being raped by ISPs. The UK is in the same situation, if it makes you feel any better.