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What's Holding Up Broadband in the U.S.?
ProfBooty writes "A recent opinion piece in the Washington Post discloses that the broadband could potentially aid in the economy's recovery (and that Canadians are 2x as likely to have it, South Koreans 4x), but it's not regulation that is the hold up, it's *surprise* content holders' fears of 'piracy' as well as unwillingness to adapt to new markets. Also discusses the governments of Canada and South Korea and how they were involved in bringing broadband to the people. In additon discusses how in the past, Congress would pass laws as to protect innovators as well as the old guard." The article's by Lawrence Lessig.
"What's holding up broadband in the world?"
Mostly last mile issues. Here in Germany DSL is available in larger cities, but little towns like mine will never get a taste for broadband since DSL is pretty much the only option for now.
Can't help but think that part of this is due to the LACK of regulation rather than regulatory delays. Thanks to careless deregulation (read Reaganomics), the telcos have merged with the content providers, and as a consequence the new behemoths are hedging, looking to provide a utility service at luxury-good prices.
That said, some telcos are making the investment, particularly in new neighborhoods.
The demand is there, but I think there are people who would rather go through a root canal than put it with all the BS associated with getting DSL or cable installed.
DSL, with its ridiculously long install wait time, crappy PPPoE platform (In other words, shell out another $100 for a router that will do it for you so all your machines can have a 'normal' connection), and a general lack of value (+$15 for a static IP? Get real Ameritech)
On the other hand you have cable, which @home and all their partners managed to bumble enough to make people stay away from cable for a LONG time.
The content is THERE, these pundits are screaming that there is no killer app for broadband, as if having it will make things easier for users.
Straight up, when I saw "holding up", I read it as meaning "propping up".
When you look at the beatings that broadband providers are taking, it seems like the only thing keeping the whole broadband "revolution" going is the mindless optimism of marketing droids, based on the mythical "average user" spending all of their time (and disposable income) sucking down advert laden pay-per-stream postage stamp sized Britney Spears videos from the provider's portal. It's insane (gee, do I pay-per-view for a postage stamp, or do I pay-per-view to the same provider down the same cable, but have it go to the big widescreen TV on the other side of the splitter?) but it seems to be the only thing keeping the rollouts going.
This is an interesting piece, but it doesn't address the basic problem of broadband. Those of us who already have it know exactly why we want it: we want a fat and unmetered pipe to go find and create our own content with. But the pricing is aimed at bringing in Ms Average User. Frankly, I just don't think that's going to happen, not until the price is way down (in which case you've got to gouge that bit deeper on the pay-pers), and sooner or later broadband providers are going to give up this nonsense about selling content, and are going to have to start charging a sustainable amount for a sustainable service. And those of us who have got used to (fairly) affordable broadband are going to catch it right in the shorts. Oops.
If you were blocking sigs, you wouldn't have to read this.
(Umm, you forgot pr0n ;-) And that is why there's a lack of demand.
While copyright infringement may be the "killer app" for broadband, it's not the content industry that's killing broadband. It's the fact that the ISPs can't profit from these users.
From the ISP's point of view, transiting hundreds gigabytes of data per month per user costs money. Your $50/month broadband connection doesn't cover the ISP's transit costs if you keep the pipe saturated. Until the ISP can find a way to make you pay for the transit cost of the data, the ISP will not want you to keep your pipe full.
(Side note: I believe this to be a defence of USENET -- it may well be cheaper for an ISP to transit in 300GB per day once, and then all your multimedia downloaders can l33ch from your NNTP server, which is on your local network, than to l33ch from P2P users that may not be on your local network.)
The original business plan ("Gee, our market research shows we have users interested in online music and video!") was for the ISP to sell you streaming audio/video subscription services. As we all know, the content offered was, and is, laughably inadequate, copy-controlled, and more than often, both. (No, Mr. Eisner, I don't want a copy-crippled .WMV or .RM stream of whatever ABC deems "must-see TV" this season. I just want my fscking DiVXs of Futurama and Babylon 5!)
Since there's no money in giving customers what they want, that leaves the not-for-pay "killer apps", for which the ISP receive no revenue.
None of this changes the fact that Messrs. Rosen and Valenti would love to kill broadband outright. I merely dispute that they're the ones at fault in this particular instance.
If the local Bells didn't have a monopoly on the last mile of copper and cable companies didn't have monopolies on the last mile of, er, twisted copper, all of LL's concerns would be dealt with.
But the simple matter is that the Bells were allowed to drive out 3rd party DSL, Congress regulated internet service on cable INTO bigger monopolies (at least local cable companies had to compete with DSL).
Of all the reasons I've heard for people not going with "broadband" (and little since my inital experience on a cable modem has truly been "broadband"), I have never, not once, heard anything about content. In fact, I've wanted to do things for people with dialup access that I couldn't do because downloading that nifty new 13.4 MB program was just too long to tie up the phone line.
Lessig is an interesting writer, but he really pushes his arguments into places they just don't work.
The site's not responding for me (Slashdotted? big site for that), so I'm going by the summary, which *completely* misses the mark with broadband's failures. Broadband in the U.S. is failing for two reasons: the infrastructure is owned by companies who are neither competent to nor motivated to provide broadband, and population densities are such that updating antiquated infrastructure is expensive.
Consider the telcos, who are responsible for providing DSL. They want DSL dead, because it cuts into their massive-profit sales of T1s. They're also big, lumbering bureaucracies, which deal badly with change. I won't recount my own DSL horror stories, but there are plenty to be had at DSL Reports. Technically DSL is functional and capable, but the businesses behind it, and the support bureaucracies, are not.
Cable has different problems. First, there's the cable companies; in my area, and in others, cable Internet is simply not an option because the local providers don't offer it. There's also the problem of bandwidth sharing. It's true that DSL bandwidth is also shared, but it's shared at a central point, which is easily upgraded; with cable, mis-estimation of demand or usage can leave people drastically short on bandwidth. (DSLReports again for horror stories).
Finally, consider the population layout in the US, as compared to elsewhere. If you have population-dense cities, surrounded by low-density farmland, you can provide access to most of the population simply by providing short-range access in the cities. In the US, most of the demand is in the suburbs, which involve much longer distances and are, therefore, much harder to provide for. (This is especially true in my home state of Massachusetts, where economics are such that the demand and the money is all in the suburbs).
I think Broadband hasn't caught on because it's the fact that the U.S. has too many toys right now to pay for. Something's got to be cut out.
1. Cable TV $40
2. Car Note $250
3. Car Insurance $100
4. Regular Phone $30
5. Cell Phone $45
6. Tivo $10
7. Cable Modem $40
That's $515 a month and it's missing the cost of 2 little of things:
1. FOOD
2. SHELTER
It's easy to say something like:
"Well, I could get AOL for 20 bucks less, I don't use the internet that much anyway." --Quote from my Mother.
Cable companies don't want to merely be the last mile for unconstrained flat-rate video streams. They want to be in the pay-per-view business. Telcos don't want to be merely the last mile for third-party DSL providers. And content owners are terrified of systems that let anyone pass video around.
The game industry wants a general-purpose wire with low latency and high bandwidth, but doesn't have the clout to get cable and telco plants rebuilt to support it. Web advertisers play a lesser role than they did two years ago, and the pressure for high bandwidth ad delivery is down. So the pure-Internet mass market applications don't really need much beyond minimal DSL bandwidths.
And finally, if a new infrastructure is to be deployed, it should have the capacity for real HDTV, or it will be obsolete by 2006.
That's closer to the real problem than what Lessig says.
Establishes a direct connection from your wallet to our bank account!
It's telcos, stupid!
All the Qwest and Verizons are neither skilled nor motivated enough to change the situation.
I like paying taxes. With them I buy civilization -- Oliver Wendell Holmes
Powell is making the same case that you are: There's no compelling economic reason for consumer's to get broadband. But he goes farther, saying that the reason there's no compelling content is that content holders are unwilling to risk their "intellectual property" by making it available. IOW, if the content owners loosened their grip and made stuff available, people would get broadband so that they could access it.
I just keep remembering VHS tapes going for >$100. Nobody bought them and lot's of people copied them. As soon as they came out ~$20 people bought way more then 5x more and (home) copying virtually stopped. As soon as some daring content provider makes comes up with a novel way of making broadband content worthwhile, they'll make a fortune. What these providers need to understand is that all the consumer wants is economic and convenient entertainment. If they're willing to provide it, they'll get our business. If they're not, people will either find some other form of entertainment, or find a way to make the existing entertainment more convenient.
the compelling reasons are "always on", and not tying up an expensive phone line.
When you think about it, dialup is a fucking pain in the ass. You have to try to connect, then you sit and wait for the fucking modem to dial, and handshake, which takes MINUTES, and only IF it's successful, and about 1 out of 10 times when it fails, it fails in a way that hangs a lot of low-end systems. (in my experience).
Then, you're tying up your phone line, or you've had to pay the phone company for a second line.
Plus, configuration and troubleshooting is a no-brainer for broadband, compared to troubleshooting and configuring a modem.
For DSL and cable, it's not so much the speed, as it is the convenience.
By the way, PacBell is phasing in $50/mo as the DSL rate.
These are my friends, See how they glisten. See this one shine, how he smiles in the light.
Why does everyone expect to receive a T-1 in their home for less than $50/month? It costs MONEY to deliver bandwidth. It costs money to lay fiber and copper. The technicians earn a wage to install the fiber and copper. The wages they earn is what it is because they have to be trained and have to learn how to install telecommunications equipment. This is why local loop charges can end up in the thousands of dollars range. Port charges for a T-1 are about the same between providers. If a broadband provider pays $1500/month for a T-1 and then resells that for $50/month there has to be a limit somewhere or one person could hog the entire pipe and end up causing the provider to spend $1450/month to server one customer. $50 per month for a 768kbps pipe with 5GB of monthly transfer is more than fair. NONE of our current subscribers use even 1GB in a month and most of them are businesses with multiple computers. Sure, I could sell less bandwidth with unlimited transfer but people want a fat pipe. You sell the fat pipe with unlimited transfer and a couple people can monopolize the entire pipe. Clauses in contracts stating that people who abuse the bandwidth will be charged extra are futile. Get with an attorney and draw up a contract stating they get X amount of bandwidth for X amount of dollars per month. DSL and Cable aren't going to cut it either, you have to include wireless and I don't mean these community FREEnets. ISPs are in business to make money, not to convenience people. Until this is realized by more people broadband access will be limited to certain markets where a provider is guaranteed to make money.