A Step Closer (Or Not) To Cable ISP Diversity

Tom Veil writes: "Yahoo! posted a story saying that AT&T Broadband and Comcast have both made agreements to work with other ISPs in order to allow them to provide service through cable systems. The Earthlink/AT&T deal appears to be set at this point, but they haven't received FCC approval. Don't suppose this means we'll be seeing free NetZero cable, but hopefully competition will kick in and make things more affordable for cheapskates like me." Bear in mind that both companies provide cable Internet service and are seeking regulatory approval for a merger. They have good reason to sidestep suspicions that the result would be a strangling monopoly.

Comments

Competition

[friday2k]

I remember the deregulation of the market in Germany when Deutsche Telekom had to open their phone and Internet services. Lots of competition popped up. INITIALLY. Many of them are gone by now, because they sold under their own cost (read: under the price that Telekom was charging them). That cannot be healthy over time (see .gone bubble). By now everybody is about the same, they all raised prices and there a happy few. Did it do much for the consumer? Not really as I recall (but I do not live there anylonger). The only differentiator (basically) is service now. So maybe it is a good thing ...

Let's see better cable access in Ontario...

[The Evil Beaver]

We have three (or is it now two) cable providers in southern Ontario, each in their nice little zones. Where I am, there's Rogers Cable, with horrible cable internet access since before @Home died. Cogeco, out in the boonie areas (Niagra, Belleville, other places like those) provides access too, better from what I've heard, but then again, I'm not in a Cogeco zone. Shaw, the company that seems to have all but vanished, never provided cable internet access, at least not when they had control of the zone I live in.

So my only alternative is to go with Bell/Sympatico for broadband access, or get a T1. Considering what either costs, compared to hellish cable or my so-so dialup, I'll stick to Primus, thanks very much.

Let's see real cable competition in Ontario, followed by _working_ (as opposed to spotty) cable internet access.

Don't count on it...it didn't happen in my town

[sapphire42]

AOL/Time WArner was forced to open their cable systems in my area to other ISP's as part of their merger agreement. Now I have a choice between AOL, Roadrunner and Earthlink. Prices aren't any different. I know of one local ISP trying to get into the action, but I already know that they are going to have to charge more than the other three to do it. "Open" systems just mean that they will "open" them to select partners, keeping their monopoly through backroom deals. I can't even beleive that they consider AOL and Roadrunner different ISP's at this point.

Cable was *Always" Open

[billstewart]

Cable modem service was *always* open - that was what really upset the other ISPs. Both the cable companies and the Enforced-Openness ISPs picked the wrong issues - the cable companies "won" by better political lobbying, and killed their industry in the process by causing several years of delay in the growth of their customer base while trying to pay off big debts and delaying their transformation into the new telephony industry. Here's what openness really did and didn't mean:

• YES - Routes packets from the user to anybody on the internet. That was the real problem that upset the competing ISPs often objected to, because this is what makes their traditional model of dial-plus-mail-plus-web obsolete. The obvious implementation of cable modem service is to do routing from the head end on up, unlike DSL or dial services which fundamentally provide Physical Layer or Link Layer services between the end user and some service provider that builds IP connectivity on top of them. Some cable providers do obnoxious things like PPPoE or use 10.x addresses with NAT to give them more control over their users' access (e.g. make it easier to cut off people who don't pay their bills), but they're not necessary.
  
• YES - Routes packets from the user to an email provider. Until the recent problems with spammers started some providers forcing Port 25 through their own relays, this was available, and they all will still allow you to fetch your email from your favorite POP/IMAP/Webmail provider. Some ISPs will only let you retrieve your email if you connect in through their dialups, but that's the ISP being closed, not the cablemodemco.
  
• YES - Lets you retrieve your AOL mail. AOL was one of the big complainers about competition from the cablecos, but they have offered a $9.95 service for a long time that lets you use AOL services from your real ISP.
  
• NO - Competing email service from the cable modem company. Sure, if you were an Excite@Home customer, your webmail account didn't have banner ads on the top the way the free webmail accounts did, but this isn't a real issue, and the Enforced-Openness ISPs shouldn't have tweaked on this one - there were lots of free webmail services competing with them, and providing POPmail and other good-quality email service was the way to compete.
  
• YES - Provide big pipes to service providers that want better performance than they'd get on the open internet. I know that Excite@Home offered this, and I think some of the others did too. Most ISPs can get by with one connection into the cable network, in which case they don't need it, some need multiple connections, e.g. at the big regional peering points, and almost nobody had applications that needed to actually get down to the individual head end - the cable modem companies' regional concentration networks were adequate for that. I don't think the cable modem company lawyers who did the big Resist-Enforced-Openness-We-Paid-For-This-Network lobbying campaigns ever had a clue that they were talking out of both sides of their mouth by tweaking on this issue. Once you've got a routed network, you own the user's connection, and the rest is just implementation and pricing. They already *were* open, in the ways they were telling people it would be *way too expensive* to open up their networks, and they were too clueless to know it.
  
• YES, THIS ONE WAS CLOSED - Decent billing systems that can handle wholesale ordering. This has two impacts - can the ISP market and sell the service to customers and get it provisioned without making the customer order it directly, and does the bill say "Your friendly neighborhood ISP" or does it say "Cable Modem Service From Your Cable TV Company"? A number of the Enforced-Openness ISPs ranted about this, but they failed to make it their major lobbying focus, even though it was the key issue and was the most fixable, and they let the Anti-Enforced-Openness cableco lobbyists lead them off into arguments about connections to the head end. This was one of the big failings of the cable modem companies - it's not strictly necessary for openness, but the big problems they had besides upgrading obsolete hardware were How To Get Customers To Buy Broadband, and wholesaling would have given them more options for finding the content and marketing plays that worked. As it was, the closest they really had to a wholesale marketing connection was Napster :-) Since it was free, they didn't care that they couldn't get the cableco to do billing, and it *was* one of the big reasons people bought broadband. This policy problem especially irked me, because AT&T Broadband's parent company AT&T *does* do wholesale billing for dial ISP services that want to do the same things with their modem service, but the billing systems for cable were totally different and the @Home marketing people were clueless.
  
• NO - Lower prices for wholesale accounts. The Enforced-Openness ISPs did tweak on this one, and spent a lot of time whining about it instead of hitting the billing system openness issues. Yes, it's harder to compete by providing email service for more money than the free webmail at the cable co, but you can do it.
  
• YES, THIS ONE WAS SEMI-CLOSED - Policies against users running servers or providing services on their home systems. (In an open environment, each ISP would probably be able to set separate policies about this, but that's not easy in a routed-from-the-head-end network.) This was another cluelessness on the part of the cable modem companies - they thought that by spending $6B for Excite, they could provide enough exciting content to get couch potatoes to buy their service, instead of realizing that they desperately needed compelling content and that Central Planning wasn't the way to make it appear. Sure, they had to deal with performance issues, and the no-servers policy was partly because the early cable modem systems didn't have mechanisms to limit users' upstream bandwidth, which was the technically constrained resource in the system, but in spite of all those Pac Bell DSL "NO Web Hogs" commercials, performance was never really a problem except in one of their initial test cities which turned out to have some bad hardware.