Slashdot Mirror
The Extinction Of The Mom & Pop ISP Service?
RFL asks: "SFGate (site of the San Francisco
Chronicle) has this feature article describing the unexpected deaths of local Internet Service Providers after they are taken over by large telecommunication companies, leaving the customers totally forgotten. Only after giving it a moment of thought did I realize that a lot of those small ISP's, the ones with those cool cool domain names, were in fact gone. These were the mom and pop services of the Internet, and they provided excellent customer support. I even remember being able to talk to my ISP's administrators on IRC. So is it now fair to say that we have lost yet another battle against those evil corporations?" As it is with most companies that get swallowed up by larger entities, the increase in customer base usually means a decrease in customer support and personal-touch that made earlier ISPs so successful. Is there still room for the small-time ISP in today's market or has dial-up Internet become solely the realm of big-time providers?
That's the thing, now that Internet access is a maturing industry and the voice-line modem kludge is no longer adequate, you really need to own your own infrastructure. I keep waiting for someone to build fibre-to-the-home and leapfrog the cable cos hybrid plant and especially Ma Bell's copper hacks (DSL). You could use the fibre as a digital TV (think DSS receiver over landline, only HDTV-everything) and digital telephone transport with analog converter box (IP multicast for TV?) because they're just another datastream, but high-bandwidth data transport would be its primary purpose. Yes, capital intensive, but it'd be amusing to see how the existing monopolies (with their sunk costs) deal.
I think you have to differentiate between what happens when small ISP customers are absorbed into a large ISP and the service that a large ISP gives its typical customer.
I owned and ran a small ISP for about six years. When we started out, big companies didn't do a very good job of getting people online. Getting the tcp/ip stack to work was often difficult, and strange modem problems were common. So there was a real niche for a company like ours, which could try to put more effort into getting people online.
And when people had problems, they could call or email us, and I'd pick up the phone. I'm not the smartest guy in the world, but I was the person who built the entire system, and I think I was probably able to give better support than the average support guy at a large ISP.
But times changed. If you buy a computer now -- almost any computer -- the odds are overwhelming that it's going to work. It's really easy to set up net service on a modern windows machine. After we sold our company, I went to the Earthlink site and signed up. I was online immediately, with no hassles. And they have access numbers all over the country. I've even used it in Paris. That's a big advantage. I think Earthlink does a good job.
When small ISPs were cannibalized by the large ones, it was very bloody. Customers were jerked around, email addresses were often forcibly changed, and the deals were always very bad for the guys who had the small ISPs. We were lucky -- we sold to another small ISP, and they've just added to our features, nothing was taken away. Not even the shell accounts.
Typically the large ISP wrote the contract -- they agreed to pay so much per customer, but only for the customers who stuck through the transitition. So when 1/3 of the customers dropped off, it was no skin off the big ISP's nose. They didn't have to pay for those people. And there are lots of horror stories about the big guys not paying the money that they owed legitimately, even under the lopsided contracts that they wrote.
We were approached over and over again by large ISPs who wanted to buy us. They would invariably change the terms at the end of the negotiation, and back out of comittments they had made to us. For the most part the guys who built those large ISPs through aquisition were bottom feeders, sharks who were trying to pick the bones of distressed small businesses. Most of them didn't seem like honest guys. So it was never surprising to me that guys like that didn't treat the customers well.
The real problem with the big players is that they're few in number and are vulnerable to pressure. A world with 100,000 mom and pop ISPs isn't as easy to wiretap as a world with 3 blue chip corporate ISPs. And every now and then Time/Warner/AOL or AT&T will say someting really scary -- like how they think that e-commerce people should pay them a commission, how they would be completely within their rights to block access to whatever sites they felt like blocking.
Big ISPs can provide good service, especially in a simpler world where things tend to interoperate more easily. But I don't feel confident that the market or the government will always protect consumers the way that they deserve.
In the old days they forced the guys who owned the movie theatres to sell the studios they owned. The wisdom of such a move isn't apparent to most people now. The "synergy" of having the pipe and the content is seen as a good thing.
I'm certain that we're going to see attempts to build copy protection into the net itself. I think they'll fail, but the companies will try. Those are the kinds of problems, I think, are going to be the real costs of the consolidation of the mom and pop ISPs into a small number of large companies.
You just don't get that kind of service from the big providers.
The wheel is turning but the hamster is dead.
The wheel is turning, but the hamster is dead.
As with everything it all depends on the circumstances. Smaller companies are (in general) far better at customer relations because they have more resources to spend per customer in this department, and the people running them depend on this for their livlihood so they're motivated to help. But a larger company can pass on economies of scale to it's customers in the form of reduced prices, special deals and so on.
It's all a matter of what kind of service you want - cheap or good. And let's face it, most people prefer to have a cheap service that they can then bitch about to one where they pay a lot more but get help. As a culture we're used to waiting half an hour on the phone for some support person who has no more idea about your problem than you do, so we've in a sense become inured to such treatment.
So I think that smaller ISPs aren't really a hugely viable concern. If they could work, I'd say it would be by catering to areas where a lot of help is needed that a large company won't provide - to nursing homes for instance. Otherwise people will try and save a few dollars everytime.
We were approached over and over again by large ISPs who wanted to buy us. :-)
/."
I worked for a mom 'n' pop for a year (hiya, dethro!) and it was painful to watch the bigger ISP's circle us like a dying animal. But being so close to my clients (I was the webmistress) and having them know they could call me whenever, or knowing that you could call the president at home if your email went down, or page the sys admin at 3am, those kinds of things were really cool. Not to mention being able to stay late and play Q2 on the T1, muahahaha!
I've had friends who worked for the bigger companies, and I'm glad I never went that route. I'm dealing with Verizon right now in a frustrating attempt to get DSL at home, and their customer support is a fscking joke. When OH When will cable modems become available in my city?!
[Pardon my rant.]
"I'm not a bitch, I just play one on
The House Between - Original Sci-Fi Series
that took over a lot of smaller ISPs. When we took them over, the transition was not smooth. We lost a lot of customers because of increased hold time and the fact that we did not know the quirks of each little ISP. I would like to say that we still gave the customers good service, but it was still not up to par with what they had before. The company I worked for no longer cared about the small ISP customers. They just wanted to switch them over to their national dialup as soon as possible. Benefits like shell access and customized email filtering options were eliminated from the customers accounts without warning. Local dial-up numbers were shut off and the customers were now dialing into 3rd party POPS. I would guess that at least a third of the original customers were lost at each ISP we bought.
The goal of any business is providing an mutually acceptable quality of product or service at a mutually acceptable price in competition in the free market. I would be interested in hearing how exactly this is supposed to be evil. "Because I don't like it" isn't a valid argument: if there's no seller, there can be no buyer, and if there aren't enough buyers, then there can be no seller. That's why large corporations are dominant in the market, because they sell what buyers want.
Similar things happened in the early days of the telephone. Larger telcos got larger buying up smaller local companies. It seems that the market is rapidly changing with broadband access. I mean you used to be able to buy a bank of modems set them up in some local access calling centers (starting with only one in a city perhaps) and build from there. How do you do that when people have cable modems or DSL provided directly by the vendor providing the underlying infrastructure? This transition or it's threat would have weighed heavily on small dialup providers.
The barriers to entry seem to have grown.
Am I wrong about this? Are the days of local ISP's numbered?
Whenever the "barriers to entry" (i.e. initial fixed costs) of running a business are low, then many people go into business and compete with each other. Due to this competition (competition==good thing), profits become lower and lower. Finally, the razor thin profit margins means that only a large corporation can make any substantial profits, driving the smaller companies out of business.
The same thing will happen with online shops. The larger shops, perhaps one with brick and mortar counter-parts will eventually squeeze out the little shops. This is because etailing has some of the lowest barriers to entry that I've seen.
Moral of the story? Don't feel bad about it. It's inevitable that we will all play our roles as consumers, which causes this whole thing to happen. Since the internet is still a relatively 'new' business medium, these little kinks have yet to be worked out.
Keeping
to make money.
Usually, one good way to do this is "providing an mutually acceptable quality of product or service at a mutually acceptable price in competition in the free market."
But you can often make more money, more easily, by buying up the competition, or running it out of business, then essentially force the consumers to buy your product. Your 'limiting price' then is no longer set by competition, but rather by the barrier of entry cost for someone else to become competition. This is usually a much higher number.
Alternatively, you can keep the price static, and reduce the product. (ie: cut your service) It amounts to pretty much the same thing.
We still have a local ISP here in Vermont, SoverNet. We used to have another local ISP, Together Net, which was bought by OneMain, which was bought by EarthLink. Unfortunately, in order for me to get Bandwidth, SoverNet was not an option, so I'm with an evil corporation.
The living have better things to do than to continue hating the dead.
And get this, previous to that, I worked at the Big Evil One. That's right, AOL. So I guess I've had the pleasure of doing both. The actual knowledge and support level is the same, however at the local ISP we get to do customer callbacks, keep in touch, etc, while at AOL there is no such thing. At AOL, someone would call up and ask for Bob. I would say, "Bob in Tucson, Bob in Ogden, or Bob in Florida?" At the Local ISP, when they call for Bob, they get Bob. Some people like this, others don't care. However, we are $4 cheaper than AOL and provide everything from web hosting, T1, server co-location, etc etc. Try getting a full pipe with AOL.
In terms of the previous post about the underlying infrastructure providing cheaper service, this is true. Our main competitor to DSL sales is PacBell herself. She can offer it cheaper, but the service is cheaper. PB uses PPPoe and/or DHCP, almost like a modem pool, while we assign everyone a static, public (or private if they choose) IP.
The funny thing is, whenever someone calls in and says "well PB is cheaper by $x amount," they don't understand the tech side of it and go towards PB. The kicker: a large percentage of our DSL sales come from ex-PB customers who had to wait 4 months for an install or 1 hour on hold to change their password. They say "why didn't anyone tell me, they're terrible!" and I hold my breath thinking "We told you so." There's complete domains and websites dedicated to PB horror stories.
And one last thing. Our company president who started this company did it all himself from a closet, like many start-ups. The cool thing is, he actually knows all about ISDN problems and occasionally helps us down here in tech. I remember the last time I was having trouble with an ISDN customer and she started getting bitchy. After putting her on hold for a minute or two (I swear!) I told her "ok, our company president is looking into this personally and logging into the router now."
Dead silence...
Most folk'll never lose a toe, and then again some folk'll...
I still work for a local ISP that's been around since 95. It's a great place to work and a great place to have an account. Over the years I've seen the other small isp's fold, merge, or get sold out. Some seem to happen repeatedly. For instance. techlink.com was bought out by meta3.com whick was bought out by ayrix.net which was bought out by bignetsouth.net. Now I hear bignet is getting bought out. These Isp's seem to be trying to get too big too fast. They expect merging to help, but I think they just end up buying into another isp's dept and crappy equiptment that has to be merged. Bignet is still running techlinks old 14.4 modem racks in some areas of mississippi. Obviously no one wants that. I even remember when cruisenet went out of business they didn't tell half of there customers. Suddenly no one could connect. For about a week we were flooded with calls from angry customers that wanted a new account with us because they couldn't connect or even get anyone on the phone at cruisenet. Little did they know cruisenet went under.
:).
The company I work for is NETDOOR. We've managed to survive, and just opened our own colocation making us the only local isp in MS to have one. People still enjoy good service, we have our own techs (no one is subletted). The president of the company is not only an incredible business exec, but a great admin as well along with the other talented admins.
So far NETDOOR has had a few offers to sell, but none have been accepted. I think we have survived and grown due to our service and equiptment. We have 3 backbones through UUNET Cable and Wireless and Sprint. Plenty of redundancy and extra equitment. So if something breaks there is a backup. These are the things that make us the best
The article said it in a nutshell why these isp's die. They wanted to be like AOL. I don't think it's a good idea to try to get that big. The odds are definitly against you. I've seen far to many companies try to get too big to fast. From what I understand NETDOOR doesn't even plan on trying to expand out of Mississippi.
It's sad to see these ISP's shrivil up and die, but I think in the end there will still be a few left. Maybe the customers from these dead isp's will help keep the others profittable by moving to "mom and pop" isp's that have a chance. ISP darwinism.
For internet service which is a public good, check out the town of , which offers net access for a minimum fee ($5.15 per month).
They even have wireless access downtown.
III.IIVIVIXIIVIVIIIVVIIIIXVIIIXIIIIIIIIVIIIIVVIII
While you can sit around and gripe, the other option is to get togetther with a few of your friends, and start your own service.
While this may seem a bit outrageous, it is not that impractical. The Register has this story about Laramie, Wyoming, where they run their own non-profit community wireless Internet service called Lariat (Laramie Internet Access and Telecommunications). It includes high-speed Net access service for a fraction of the price of most services in the US.
The initial cost was about $3,000. Many residents donating their own PCs. Normal dial-up service is $5 a month, $20-$30 a month for high speed (10MB/second). Businesses can now get T1 wireless or SDSL for fee $125 monthly
Information on how to set up a similar enterprise can be found on the lariat site.
"It is a greater offense to steal men's labor, than their clothes"
What I find interesting about people complaining about Barnes & Noble knocking off the little bookstores is that B&N has a huge variety of books and magazines available you couldn't get at any mom and pop bookstore. I'm a fancier for British aviation magazines and only a store as big as B&N could stock them.
I think the problem with the mom and pop ISP's is that they don't have the money and/or resources to get access to high-speed Internet connections such as DSL lines, cable modem lines, satellite dish systems or the new line-of-sight wireless antenna systems. It's only the big companies that have the resources to put up these methods of Internet access to your home.
Raymond in Mountain View, CA
...was a Mom 'n' Pop ISP in Memphis, called "Magibox". I had dropped out of philosophy grad school, and got a job there as Macintosh support and HTML jockey.
There were only four employees besides the owner and his wife. Three of us had advanced degrees in the humanities: me with a MA in philosophy, and two guys with MFAs in creative writing. We ran on a mix of Digital Unix and SCO. SCO was gradually replaced with FreeBSD. It gave me a chance to learn systems adminstration and Perl. (Many thanks to Ken McCleaft for the best advice I ever got: "learn vi".)
Eventually it was swallowed up by U.S. Internet, which prompted me to quit, as my position was going to change from technician to sales. I gave up some stock options that turned out to be utterly worthless. But my experience there got me a job as an entry level Unix sysadmin.
U.S. Internet was swallowed up by One Main, who was then swallowed up by Earthlink, who then merged with Mindspring.
Anyway, phone tech support sucked, but we had fun, and I learned a lot. The Mom 'n' Pop ISP was a great place to get started in a computer career, for those of us who studied Liberal Arts in college.
And for those of you wondering: yes, it really was just like "User Friendly". My funniest tech support moment was talking to this elderly woman, setting up Windows 95 dial-up networking. We got to the point in the wizard where you enter the phone number, and I tell her "Enter 555-7000". I hear from the other end "Beep beep beep boop boop boop boop", as she presses the keys on her touch tone phone. I had to put her on hold while I fell into a fit of laughter.
Thanks Louis, June, Ken, Mare, Craig, and Mike. And Neil who got me the job in the first place.
--
We're still alive and kicking, although the outlook is entirely different than it was 18 months ago. At the time, we couldn't add modem pools fast enough (Verizon (then Bell Atlantic) wasn't very fast at accomodating us).
Suddenly, new dialup customers slowed dramatically and our investment in DSL turned out to be a wise one. I don't think any ISP will survive long without offering DSL. While DSL has it's own problems which every Verizon Sucks web site will tell you about, it should help keep us alive. Time Warner opening up their cable network to independent ISPs is also a good thing (but they're all talk at the moment).
We're not dead. We're far from it. It's sad to see the industry change so quickly so fast, but the bright side is that I have DSL now instead of a 56k. *shrug*