Verizon About To End Construction of Its Fiber Network 201
WheezyJoe writes: If you've been holding out hope that FiOS would rescue you from your local cable monopoly, it's probably time to give up. Making good on their statements five years ago, Verizon announced this week it is nearing "the end" of its fiber construction and is reducing wireline capital expenditures while spending more on wireless.
The expense of replacing old copper lines with fiber has allegedly led Verizon to stop building in new regions and to complete wiring up the areas where it had already begun. The fiber network was profitable, but nowhere near as profitable as their wireless network. So, if Verizon hasn't started in your neighborhood by now, they never will, and you'd best ignore all those ads for FiOS.
The expense of replacing old copper lines with fiber has allegedly led Verizon to stop building in new regions and to complete wiring up the areas where it had already begun. The fiber network was profitable, but nowhere near as profitable as their wireless network. So, if Verizon hasn't started in your neighborhood by now, they never will, and you'd best ignore all those ads for FiOS.
Why lay fiber at all when you can gouge wireless? (Score:5, Insightful)
The free market strikes again!
Re:Why lay fiber at all when you can gouge wireles (Score:5, Insightful)
Yup, FiOS isn't as profitable because users won't tolerate overage charges or massive throttling on wired connections but they'll bend over when it comes to wireless. Even though their wireless connections are NOWHERE near as good as wired connections.
Yet in even some of the poorest countries you can get 20Mbit connections with no cap for less money than you pay in the US.
Re:Why lay fiber at all when you can gouge wireles (Score:5, Insightful)
Re:Why lay fiber at all when you can gouge wireles (Score:4, Informative)
That is in fact exactly what the article says. While the profit margin on FiOS is apparently 4.4%, the wireless side had a 23.5% profit margin. While those numbers are heavily encrusted with bullshit, they do show the relative value of the technologies to Verizon.
This will bite them in the ass eventually, if not sooner. Verizon refuses to be price and feature [theverge.com] compeditive on wireless. They are coming under pressure [bloomberg.com] from increased wireless competition. The duopoly between Verizon and AT&T isn't such a duopoly anymore- there are lots of wireless players.
I have heard very few complaints from people about the fiber service aside from "it isn't available in my area". It is a lot easier to maintain a monopoly on fiber lines compared to wireless.
Re:Why lay fiber at all when you can gouge wireles (Score:5, Insightful)
There is VZ and ATT, and then there is Sprint and T-Mo.
I've had all four in my area, and VZ by far has the best coverage. It isn't even close. I curently have T-Mo and the speed is much better, but coverage much worse than ATT and VZ. I'll give up a bit of coverage for better speeds.
As for Fiber vs Cable vs Wireless, Fiber will win on raw speed every time. The issue is the cost for last mile, and always will be. Which is why I recommend that Municipalities start looking at building out their own infrastructure and offering CONTENT/INTERNET providers the opportunity to compete for the last mile customers.
Right now, there is no competition, only franchise agreements that limit competition.
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Right now, there is no competition, only franchise agreements that limit competition.
It's not the few percent franchise fee that limits competition, it's the knowledge that a second franchisee for the same function would be splitting the available market and nobody would make a profit without raising prices -- and reducing the overall market.
While there may be a few people in an area who would actually start buying services from the new competitor because they aren't the existing company, they aren't enough to cover the fixed costs of running a second cable company in that area. If one ca
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That is the lamest excuse I have ever heard. I guess Adam Smith was wrong, competition is not good.
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I guess Adam Smith was wrong, competition is not good.
Competition is great. For the customer. For awhile. Not so good for the businesses that are competing. Perhaps you've heard of the term "dumping"? That's when a "competitor" can afford to sell below cost just to drive his competition out of business. Great for the customer, until the competition goes away and prices go back up.
We used to have a great small local magazine shop in this town. Borders moved in. They had books and magazines and a coffee shop and ... all in one place. The local shop was driven
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We used to have a great small local magazine shop in this town. Borders moved in. They had books and magazines and a coffee shop and ... all in one place. The local shop was driven out of business. Bad for them. Then Borders lost the competition with B&N (and Amazon) and they have now gone away. It's an hour drive to the closest full-service shop. This competition turned out just great for the local shop, Borders, and the customers in this town, didn't it?
(Shrug) The same thing would have happened to t
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Citation, please, because Akamai's [akamai.com] State of the Internet mostly disagrees with you. [akamai.com]
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Not that Akamai's State of the Internet is worth a damn anyway, with the throttled shit we have to deal with in the nordic countries. Seriously, Akamai is crap here. Steam, Limelight Networks etc etc, I can max out my 100/100 connection. If it's Akamai, it slows down to like 20Mbit/s.
Re:Why lay fiber at all when you can gouge wireles (Score:5, Insightful)
No you misread. FiOS isn't AS profitable, it's profitable. Someone without a conflict of interest, willing to compete with wireless, could set up a business and make money, give good service, employ people and return value to an investor. Verizon won't, they see it as a cannibalizing their wireless market.
This is an example of all that is wrong with telecom.
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Faster connection with 4G just means you'll hit the bandwidth cap faster and pay Verizon for content that should be free.
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I think you missed the "unlimited 4g" bit.
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I did. Oops. Still.... that can't be cheap. And I can think of a certain wireless provider that offered unlimited service only to force everyone out of those plans later. I don't trust Verizon any more than AT&T.
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Why lay fiber at all when you can gouge wireless?
Why do it? Because they received fucking Federal tax money to do it, that's why.
But instead, they illegally plowed their Federal money into wireless infrastructure.
This has been an issue for a long time now. Consult EFF about it.
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The free market strikes again!
Let's not forget the billions in tax breaks and incentives that the telcos got in return for a promise to make sure everyone got broadband, no matter where they lived.
But will they be punished? Well, look at campaign contributions and make up your own mind.
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What free market? By local government decree, Verizon is the only company allowed to offer POTS (plain old telephone service) in the areas it covers. If the local governments would embrace the free market and allow anyone with a credible proposal and business plan to lay down fiber in public easements and offer service (instead of just the anointed monopoly phone, cable, and electric company), Verizon's incentive to not upgrade its copper wires to fiber would evaporate overn
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They certainly didn't seem very "frightened" of the government when they received tax breaks and incentives to build out the network, did they?
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The only permanent solution to regulatory capture is the extinction of humanity. Otherwise, all we the vo
Whats really going on... (Score:5, Insightful)
They're going to say they've stopped, wait for local municipalities to take care of it themselves, then pop back up and say, "Actually, we want to provide service in this area anyway - you need to give up your infrastructure to us cause FREE MARKET!"
But we already paid for it... (Score:5, Informative)
We paid for the fiber with surcharges in our phone bills in the 80's through the 00's -- we just never got the fiber, and the companies pocketed the cash. Money's good, if you can get it.
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Let's get the government to rescue us from the bad deal the government made. We can trust the government to help us to when dealing with Verizon, can't we [opensecrets.org]?
No... (Score:4, Insightful)
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The government is enforcing the law, otherwise there would be lawsuits. What you simply don't want to face is that laws that were written under the pretense of giving you free stuff, and that dopes like you supported because you wanted free stuff, in reality ended up really giving free money to Verizon.
That is the predictable outcome every time a politician promises to give you better infrastructure, lower cost service, etc.: you end up overpaying s
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I expect him to make the law in a way that is most favorable to corporations and then enforce that corporate-friendly law. And he can do that because morons like you keep electing people like Obama, people who say they want to protect consumers and the middle class, but who actually keep supporting big corporations with tax dollars. The biggest accomplishments of this administration, financial regulation, bailouts, stimulus packages
My experience with Fios was largely negative (Score:3)
I tried out Fios for a while, but I have to say, I wasn't that impressed. The service went out from time to time, and YouTube and Netflix wouldn't play worth a damn. Also, they really trick you with their advertisements of low prices. Sure, the prices look good, but then you can't use your own hardware and you have to rent their proprietary hardware, which adds considerably to your service cost. And then you find out that those good prices were only intro prices and then they jack up your rates sky high.
I cancelled Verizon and went with the local cable company, if that tells you anything about Fios!
Re:My experience with Fios was largely negative (Score:5, Informative)
"rent their hardware"? No...the router was included. Not a great router, but there was no extra line item on the bill for 'rental'.
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These issues have been corrected as far as I can tell. VZ was pressuring Netflix, which has been corrected by Netflix buying a VZ connection. This should be corrected by legislation, but it seems no one in the FCC actually has the balls. I am not sure what was wrong with YouTube, but that also has been corrected.
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How long ago were you using FiOS? I wonder if they were using the Freescale MSC7120 chip for the residential side, or if they still are in many places. I had the "privilege" of working on that chip, and it was a complete disaster. Most of the code written to support that chip at the driver level was there for the sole purpose of detecting when a hardware bug locked the chip up, and resetting it. A book could be written about what a management fuck-up the creation of that chip was.
I lived for a couple ye
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For a while (2-3 years ago) most (not all!) of FiOS customers, especially on the east coast, had terrible (TERRIBLE) experience on most popular streaming services. Worse than Comcast + Netflix. As in Youtube would barely play 360p videos.
You could see it on that youtube statistic pages that showed the average streaming speed per ISP. FiOS was abysmal.
From what I understand, its been fixed by now, but it it was so bad I had to switch back to Comcast when I realize everyone with FiOS in my region had that iss
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Hmm, it'd be interesting to see what the problem was. Was it the horrible MSC7120 chip in the ONU, or something on the OLT side? Did they go around and replace a lot of ONUs (the boxes on the residential side) at some point?
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I can't back that.
3 moves. 3 installs. 3rd install was to a house that already had FIOS (moved in with a friend, he's already got FIOS, I wanted my own link) and never had an issue. I use my own router (Routerboard running Mikrotik) and don't have any issues. Speed has actually been slightly better than what they're claiming to provide (when they "matched upload to download" I tested out having more UP than DOWN) and with the exception of their hardware upgrades for their "Quantum" speeds, no noted outages.
I feel sorry for you (Score:2)
I feel sorry for all of you south of the border. Verizon was, without exception, the worst telco I ever dealt with as far as internet goes. When Canada was rolling out DSL and cable like crazy, Verizon in Delaware was offering up 28.8 dial-up. No options. No choices. That's all you could get. You couldn't even use a 56K modem because they used the high compression voice codecs on their lines, and you couldn't get a data line. You couldn't even get ISDN if you were willing to pay for it. :(
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Deleware is depends a great deal where exactly and when exactly. I wouldn't judge the USA telco by Delaware it is an exception in many ways because of its proximity to major cities, government cheapness and the rural aspects.
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Are you sure it was high compression voice codecs? In my experience you can't get any connection over high compression. What does limit your speed to 28.8 is multiplexing more channels over the limited number of wires. I know as I'm in Canada, perhaps 60 km out of Vancouver and if I'm lucky i can connect at 28.8 with no other choices and it costs $40 + $40 for a phone line.
Opportunity (paid for but) lost NJ (Score:5, Interesting)
But they won't let you municipality to build it. (Score:5, Informative)
Long back Google had a April Fool posting about toilet net. That idea is fundamentally sound. The municipality can run fiber optic cables in storm water drains. It won't cost as much as it is costing Verizon to dig up and bury the cable. But you won't get it. They have the state law makers in their pockets.
Been ignoring it for years already (Score:2)
There's technically FiOS in my city already, but that doesn't mean I've actually been able to get it either in my current building or the building I lived in before that, nor do I know anyone who has it, so it was already clear they didn't give one crap about doing anything with FiOS other than advertising the crap out of it. Which I seriously don't get - where's the profit in spending a jillion dollars on something that everyone would be happy to pay you for, but you aren't letting them?
I mean, yes, Verizo
Will Net Neutrality Affect Wireless? (Score:2)
I'm guessing they know something about the new net neutrality rules being drafted and that wireless is either being excluded or will have loopholes. Especially given that the head of the FCC used to be a lobbyist for them.
Sounds like wireless is a bit too juicy (Score:2)
... I have a prepaid unlimited plan that I pay about 25 dollars a month for which is about half what most people seem to be paying.
I've seen that you can pay as little as 80 dollars a year for 2000 minutes. Many people don't spend a lot of time on the cell phone and 2000 minutes for a whole year is lots.
If you talk even less then that, tmobile has a plan for 3 dollars a month but you only get 30 minutes a month.
Personally, this is where the whole thing needs to go. Bill me for what I use.
Unlimited plans are
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Unlimited plans are for the psychological benefits of not having to pay attention to use. Personally I'm pay-as-you-go because I can only afford a few dollars a month, but that makes it a lot more stressful for me when someone keeps wrong-number-texting me and won't believe it costing me 10 cents a text, or when I have to decide whether it's worth starting a conversation that could cost a bit. People will pay extra to not have to worry, and that's legitimate and understandable.
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I don't even think so. If you're on a really tight budget then you are going to run a very lean plan. But even a plan with thousands of minutes a month are less then these unlimited plans. And sure, some people talk on them a lot but others just don't.
I spend very little time on the telephone. My conversations are typically over in about 30 seconds. Not because I'm rushing things but because the message was communicated. And who even needs that when text messages are frequently better anyway?
The real killer
Well then. All done are we? (Score:2)
Then you can stop overcharging for STBs and allow us to purchase them outright then!
So everybody's bill is going to drop (Score:2)
the fiber is a lie (Score:2)
i have fios. it is coax cable on the street. then on the post near my house it is split into fiber. the fiber goes to my place into a very big box, with two Verizon emblazoned power supplies! and become cable again to a cable modem...
the only explanation i have for this insanity is that if they advertised it as cable, i, who only pay for internet, would be allowed by law to have access to basic cable channels unencrypted. so they do this turnduckey of cables just to avoid it, and force me to pay $20/mo for
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Its not "cable in your house to a cable modem". Its using MoCA, and the router is a moca -> ethernet bridge (my terminology is probably off). Sure, its just semantic, but its just the easiest way for most people to have effectively an ethernet wired house, since its pretty damn unlikely you have fibers running in your walls. Since you don't share that coax with your neighbors, its fast enough.
And as someone else pointed out, whats telling you its coax cable on the street? You opened one up, removed its c
When they can just spend on 5G towers (Score:2)
Why roll out fiber to the curb when 5G will deal with high speed internet.
Solution (Score:2)
Open up those unserved (or even served) areas to municipal fiber, google fiber, Comcrap, AT&T, or Bob's Bait Shop and Networking.
Sweden (Score:2)
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I would be curious to see the difference. Comcrap isn't available in my area, so I cannot compare.
My plan:
75/75 (all FiOS connections are now symmetric) $89.99
I recently added TV, and the only cost difference was the set top box, which I believe was $13, and the cable card for $3
Re:You're really not missing much.... (Score:5, Insightful)
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Comcast had 6.8 billion dollars of profit in 2013. So they have plenty of money available to build out their network and offer higher bandwidth for lower costs. But in any territory where they have an effective monopoly, why would they? Until there's serious com
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I pay around $70 for Comcast, after all of the taxes and whatnot, for "Performance Internet" only. As far as I can tell, that's 25Mbps down and they don't advertise the up but it is nowhere near symmetric. I think you have a slightly better (though still crappy) deal.
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I pay $45/month for Comcast's 25Mbps Internet (which may be called Performance Plus or Blast depending on the market I guess). I get 30/6 on speedtests. I also get free HBO Go because that $45/month includes a tv box for basic cable that is still shrink-wrapped sitting in the corner somewhere.
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I was at work when I typed that or I would have run a test. I just ran the Ookla test and got 23 down / 6 up. Technically I pay something like $53 for the internet, but that includes a $10 discount for having cable, which costs about $10 for limited basic. Without cable, it would be $63 - so I get it for "free" I guess. Taxes and fees and a $2 box rental bring me up to $69.95.
Really, really pricey - but it's good to have a monopoly.
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An here in Singapore,
I pay about 30 USD for 200 mbps up / down fibre , unblocked for torrents, etc. No bundling with any other services. (M1, a local telco is my ISP).
Torrents, during uploads / downloads, actually indicate I exceed the 200 mbps speed. Same when I do speed tests, I get about 205, 210 or so, both up and down.
They just started a 1 gbps to the home for about 40 USD.
Guess I will upgrade to 1 gbps in a year when my current contract is done.
We got a few ISPs here. Competition rocks!
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$50 (taxes included) 50/3 on CableONE in Northeast Missouri. ;)
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You guys in Seattle, whether you know it or not, are actually known for your incredibly poor broadband options.
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13.5 and .76 DSL for $35.00 from Centurylink in Vancouver Wa.. They approved DSL at my rural house in Goldendale Wa, charged me, then decided it was not technically available. Had to fight to get the charges removed.
SCUM...
Re:I thought they're making money... (Score:5, Informative)
They are making money, it's just that internet is less of a profit center than wireless so they would rather put the money where they can make the higher profit.
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Wouldn't they just borrow and invest in the infrastructure? Given that interest rates are incredibly low, *any* money-making opportunity that's reasonably safe should be exploited using borrowed money.
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You'd think so, but it's a long, slow buildout to get that return, so growth! would be slow. Companies don't much care about stable profits, since that just means a stock price that stays flat, no it has to be about growth! Without growth! how does a CEO prove he's the guy to make your stock price go up?
It's the most infuriating thing about modern America, really - everyone's chasing capital gains, and dividends are often seen as a bad thing. For a long time there was a good tax reason for that - that's
Re:I thought they're making money... (Score:5, Informative)
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Just about every supermarket everywhere disagrees with you... http://smallbusiness.chron.com... [smallbusiness.chron.com]
We're definitely talking about different things here.
After all, how can walmart pay a 2.17% dividend if they're only making ~1% profit? :)
I was talking return on investment (ROI) where as you are talking about profit margins on goods sold. They are not the same thing.
A $100,000 investment to create a business selling widgets that cost $1/unit to produce and sell for $1.01 and sells 2 million units a year.
The prof
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4.4% is a LOT more than govt bonds pay. It's not 1985 any more.
Hmm... 2.2% is the best I can find in the states on term deposit. GIC's in Canada are up to 2.85%. But if you have literally millions to invest you can generally do better than advertised retail. So I think my claim that 4.4% is only 1.5% better than they could find in a guaranteed investment vehicle is a reasonable claim.
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You want to bet that number subtracts the cost of their network build out from the profit margins? The bulk of the costs are the labour and equipment needed to run the fiber. Once the fiber is in place, upgrades are just a matter of swapping out the equipment at both ends and the costs will drop sharply.
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I know. I've had this fight a million times here about how Verizon / AT&T / TimeWarner... are not making nearly the money people think they are. And no your $50 / mo does not cover what 2 Gb/sec of peer2peer would cost to provide....
Your sarcasm is well warranted.
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People today are using applications like streaming video to their television that use a substantial chunk of their bandwidth for hours. The percentage of available bandwidth used has gone up quite substantially in the last decade.
No it doesn't average out. Certainly there are higher and lower users but the mean usage is quite high.
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Understood. So whining *but building anyway* makes sense.
But in the end, they want to make as much money as possible. Which means if they choose not to build, it means they think they can't make back their investment, even at the unpleasantly high rates they charge!
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Witness MS trying to make it sound like Linux is stealing trillions of dollars from them, or the religious majority of the country claiming there's a "War on Christmas."
um, what?
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It is worse than that. Regulation on copper meant that different companies had to own different parts of the process. For commercial competition exists so there isn't the same regulation. For home / small business the carriers are regulated monopolies.
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That DSL competition is the only reason I have DSL. Verizon sent me a modem, it couldn't connect. They do very little troubleshooting before they decided to say that DSL wasn't available in my area. One of the other DSL providers chased the problem down and forced Verizon to fix their shit. I've had DSL ever since.
Re:All I know is... (Score:4, Insightful)
But somehow, over in Europe where most stuff seems outrageously expensive to us Americans, people can get high-speed internet connections to their homes for a fraction of the price we Americans are paying.
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Romania is a backwater as far as population density and industrialization and such, yet they have much faster and cheaper ISP service than America.
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UK isn't really Europe. I'm talking about *real* European countries like Germany, Finland, and even Romania, where internet service is fast and cheap. UK might geographically be in Europe (sorta, they're an island), but politically they don't act like it at all. After all, you're talking about a country even more prudish than the USA, by a long shot: they've banned all kinds of things in porn movies, such as female squirting (WTF?), a perfectly natural act. We Americans are made fun of for our prudish a
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I am SURE they can get us 45 Mbps to each house over wireless!
The FCC definition of broadband is only 5Mbps, although they're making noises about increasing it to 10.
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but when wires are just sitting there, what exactly does it cost them to allow more data to "flow"?
Because, of course, the entire infrastructure of the carrier's network, peering connections, management, power, data centers, and all the rest is just "some wires."
Re: YEaah.... (Score:2)
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And internet transit doesn't come free either
Sending does, for ISPs, because mostly they receive and ideally they should be symmetric.
Re:Fuck You Verizon (Score:5, Insightful)
I seem to recall our tax money going to these companies to pay for a fiber infrastructure. It's more like the landscaper you hired and paid for mowed the neighbor's lawn but not yours.
Re:Fuck You Verizon (Score:5, Informative)
You know... Google is your friend...
https://www.techdirt.com/artic... [techdirt.com]
It isn't so much that they got an obligation but they did get tax breaks as an incentive with no repercussions for going back on the deal.
A tax break==owed taxes not paid==taxpayers took up that slack. So yes, it was taxpayer funded in that sense.
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