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Why You Don't Have a Broadband Connection
blandthrax writes "I ran across this article on The New Republic. The long and short of it indicates that the reason why almost 90% of Americans don't have a broadband connection is because current broadband providers are preventing other ISP's from entering the fray. The result: higher prices for broadband connections and a general lack of innovation. An interesting read full of good details. And, as usual, we learn that countries such as Japan and Korea are far ahead of the US in terms of innovation and technological saturation."
I have AT & T broadband. So I get this advert from Earthlink, basically offering the _exact same_ service for the _exact same_ price. I bet it's just AT & T with the Earthlink name. Why go through the hassle? Is this competition?
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Could it be that most users on the internet are just there to send e-mail back & forth between their families, or to hang out in chat rooms?
This is because most people do not need broadband and cannot justify the increased cost just for the online activities listed above. That is why by 2005 broadband will will just be catching up to dial-up percentage wise for users of the internet..
My broadband connection just is not very good. There are many restrictions on how I use it. I cannot run servers, for instance, or even have a static ip. Downtime of a few random daylight hours a week is not unusual. Recently my bill was increased by $5, to a total of $45 per month. No increase in quality of service accompanied this price hike. I will not name my service provider, but it is a major one and is currently being investigated by the SEC.
I'm tired of seeing and hearing all the broadband commercials that make high-speed connectivity seem like such a panacaea.
Such ads usually concentrate on some particular aspect of broadband that makes it superior to dial-up. For instance:
1) No waiting to connect!
Now seriously, of ALL the reasons to go to broadband, this is the most idiotic. Since most people aren't running servers on their home systems , the connect time isn't that big of a deal. I have also seen DSL systems that still require you to actively connect to the network, and it takes about the same time as a 56K handshake.
2) I get my email in seconds!
I guess this is just because we get so much spam or something. I rarely receive an email that huge attachments.
3) Watching streaming video
I have yet to see streaming video on the web worth watching. Maybe I'm not looking in the right spot or something, but until I can watch DVD quality movies online, I don't care about streaming video.
4) Listening to streaming audio
This is much more plausible, but probably doesn't justify the much higher cost of broadband vs. dial-up. I do like listening to streaming audio.
Dial-up is more practical simply because it is far less expensive, and is more than adequate for most users.
Now, when it comes to:
5) Getting the latest linux distros that are upwards of 400 MB and...
6) Downloading tons of pr0n
well, broadband just can't be beat.
bytesmythe
Hypocrisy is the resin that holds the plywood of society together.
-- Scott Meyer
I recently ordered Verizon DSL (NY suburb area, optimum online not available). I asked the sales rep why I should go with Verizon and not with another equally priced DSL provider: He said something about how Verizon has much more experience with DSL.
I found out the real answer later. When the rep was checking my phone line to see if it was DSL capable, he implied that if my line hadn't been DSL-capable (if it was on older wires) then it could have been fixed, by speaking to a local Verizon phone line technician, usually by catching him on the job and asking him politely to hook it up (or possibly by requesting a service job through my local Verizon office, although they wouldn't be obligated to do it).
This gives Verizon a completely unfair advantage, since no other company is authorized to maintain the phone lines in the area. DirectTV DSL can't sell to non-DSL enabled customers, but Verizon DSL can since they can enable just about anyone who asks!
$8.95/mo web hosting
Though the article didn't give numbers, it did list Canada in the same sentence as South Korea. While I admit that I have a largely biased sample space, practically everyone I know has broadband. My parents do, my friends do - even my non-computing friends. You can get cablemodem access in the town of Didsbury in Alberta, a town so small that practically everyone in town knows each other. All across Canada I have friends, and they all have broadband. We've got fewer people, sure, but our landmass is pretty damn big. Make no mistake, you've got problems down there when my access costs the same as yours, but in Canadian money, is faster, more reliable and more accessible. The US has no good reason to be lagging behind. Big businesses are crushing you underfoot, and removing the technological advantage that you should have.
When I see so many posts commenting on how expensive 40-60 bucks/month is, I have to smile. Here in Tokyo, I jumped at the opportunity to install ADSL in May last year. My price for the telco fees + ISP port connection/services was just under 80 bucks/month. It has since dropped, thankfully.
However, prior to ADSL, my dial-up charges were on the order of about $250/month. The North American all-you-can-eat dial-up courtesy of no-charge local calls would have delayed my adoption to xDSL for a very long time. The move was made because the pricing was so much more attractive.
Of course, now things are different. Telecommuting and doing the VPN into the office network wouldn't be possible with dial-up, so when the company asked me if I wanted to work at home, I was suddenly VERY pleased to already have ADSL installed.
Hmmm. It occurs to me that some of you folks stateside might have a good argument to present to your local representatives. Telecommuting really does require broadband. If the broadband providers are forcibly slowing the adoption of broadband in wide areas, it's plausible that there are negative economic consequences coming about as a result.
Large companies no doubt make hassles for their competitors. This is precisely why deregulation doesn't work. The prophets of deregulation assume a "level playing field" when arguing for deregulation, but then take advantage of the lack of regulation to bully competitors out of the market.
Here in the UK, we were a little slower with broadband, but it's taking off here now to some extent.
Rather than the 12 month contract, leased modems, astronomical prices and company monopolies, a new method has emerges that seems to be working. Approximately 40 to 70% of UK exchanges are dsl capable now, dependign on how far along you think they are. Oftel (the UK telecoms regulator) ruled that BT was obligated to allow other ISPs to offer dsl over BT's existing phone lines with no punitive charges in order to aid competition.
As a result of that, I have a dsl service (640k down, 256-300k up) that costs me $35 (equiv) a month with no 12 month contract. The only outage I had was when lightning struck my house and cut the phone off (hardly the ISP's fault!) and I own all the hardware at my end.
You buy a small dsl splitter from your ISP (or an online retailer) that you plug into your existing phone socket allowing you to connect your phone and modem. This way, no engineer needs to call round and install any hardware. The setup is a breeze, and I can have a static ip and run my own servers for a small fee if I need that capability.
The other option is to get your broadband with cable TV. NTL offers cable internet with their cable TV service. The modem is built into all of their set top boxes, so if you want to use the service, all you need is an ethernet cable from your tv box to your PC and a phonecall to them to get set up.
I think the driving force for this is the way the phone system works here. Local calls are not free, so dialup access is either through an ISP that offers a toll free number (AOL, Compuserve etc) which are expensive or an ISP that offers free use, but with a normal local call rate number, costing you 2p per minute off peak, and 3.5p per minute on peak.
For the amount of time I spend on the net daily, I'd easily rack up the same cost in phonecalls as I'm paying for my broadband access, except at dialup speed. No contest.
I just got back from my first business trip to Tokyo, and I was surprised to see there that they had numerous competing DSL providers, each providing much higher bandwidth at lower prices than you can find in the U.S.
Yahoo!/Softbank had the best offering: 12Mbps DSL for ~ US$19/month!!! This would be amazing in the U.S., but factor in that Tokyo is a ridiculously expensive city, and it's even more amazing. A cappucino in my mid-range business hotel costs ~ $6.
What do we need to do for that kind of service here? I am paying over 3x that much, for a 1.5Mbps DSL service.
I can't speak for Korea, but in Japan the situation is no different for a startup broadband isp. Distribution of access might be better, but check out Professor Collins' post, below. NTT's blatant monopoly and unabashed abuse of power makes ATT's actions here seem insignifigant. The dot-com boom never happened in Japan. Can you guess (one of the major reasons) why?
For more info on Japan and NTT, look for Tim Clark's "Japan Internet Report".
At the same time, a coworker up the road from me in Daly City had a 1.5/784k ADSL for $69.00/mo.
I resigned and relocated to Westerly, RI and Cox Cable was my only choice. I now pay $109.00/mo. for 256/256 with 1 static address. The service is absolutely slush (and I'm on a "Business" class connection, no blocked ports, separate non-residential subnet, etc.). Cox has now started capping people below their subscribed bandwidth, and has begun to shut people out of their own cable modems, so you can't get traffic statistics from the modem any longer... even if you own the equipment!
The nearest DSL around here is from ChoiceOne, and it's 2x the price for 128k SDSL. I'm 2,000 feet from the CO. 1.5m SDSL from ChoiceOne here is $499.00/mo. That's almost what it would cost me to get a T1 dragged into my house.
That same friend recently moved from Daly City to Fremont, and now pays $79.00/mo. for his 1.5/768k DSL line and he also has a cable line, which he pays $29.00/mo. for. He's getting two broadband connections at more than 10x my speeds, for less than I pay for one cable connection, per month.
Broadband pricing varies WILDLY from location to location, even a few miles apart, from the same providers and CO.
And for those who don't know what the "Brass Rail" pricing is, "..just firmly grasp this brass rail on the front of my desk as I step behind you for a moment.." -Broadband Provider
Regulation is not the answer. Look at the CA power crisis. It occurred because government regulation caused there to be no real profit in CA energy. Therefore, there was no incentive to build new power plants, even though the increase in demand was obvious. Now, only after threat of blackouts and therefore loss of re-election by govt. officials, is anyone doing anything about the power crisis in CA. If you allow broadband to be regulated, you will have a similar situation. The network will become so overused due to lack of incentive for upgrades, that the effective bandwidth users will get will decrease instead of increasing over time. We'll start seeing commercials to conserve bandwidth by not using your computer during peak hours. The solution is to allow competing companies to lay their own redundant phone lines and cable. This will allow real competition. Deregulation of long distance has been successfull when more than one company has its own network. We just need to fix the "last mile" problem in the same manner.
Vote for Pedro
I've found the most important thing to people (including myself) isn't the download speed most of the time, it's the always-on connection. The ability to sit down, check your e-mail, and walk away is great. The ability to use the internet despite your teenaged daughter being on the phone ALL THE TIME is great; the ability to use the phone while your 13-year old l33t h4x0r s0n is fragging his lamer friends on counterstrike is also a bonus.
Also, in Canada, fast download speeds are paying off. One of the largest media companies (CTV) has a cable news channel, but if you have broadband, you can watch the day's stories on-demand on their website. The 'tickers' and so on, like CNN also has, displaying the weather and whatnot are similarly interactive, letting you jump straight to the day's business news or weather reports.
Not to mention that you can listen to the CBC's radio programs (mmm, culture) via the internet.
All in all, broadband is taking off like a rocket here, but these two reasons (always-on and interactive media) are the keys.
Me, I just want to idle on IRC....
--Dan
Gradually recouping the cost of laying fiber and of keeping some equipment alive is a no-brainer business!
The real expense comes in being recruited into a polcing role to enforce the interests of others (like RIAA) because of the DCMA.
Qwest one day just turned off my DSL after a year of service, resulting in my first ever call(s) to their tech support line, after several hours of hold/idiot/hold/idiot/hold/idiot They told me it had been turned off, they wouldn't tell me why, only that a FedEX was on it's way. Well, the next day an overnight FedEX ($14) informed me that MPAA had sent an email claiming that I was distributing a copy of "101 Dalmations"! WTF! I've never seen the movie, it's certainly not something I'm going to waste my bandwidth sharing, even if I had it.
Cost to MPAA to send Qwest an email - $0.00
Cost to Qwest to enforce interests of MPAA
$14 - Sending FedEx
$30 - 50 minutes of Tech support call time!
$20 - to deactivate and reactivate the service
at least $64.00!
Cost to me for MPAA's mistake - 2 days broadband withdrawal pain, 3 hours wasted on the phone.
The other main expense is supporting customers that won't RTFM! If Joe consumer wants on-(the phone)-line training they should pay for it not me just because we use the same ISP.
If legislation continues to increase the cost to ISPs, the cost to consumers will continue to rise in direct proportion (plus a margin).
So are there any examples of a pure free market economy in the world? If not, which countries qualify as the closest to pure?
According to the "Economic Freedom of the World" report from the Cato Institute, the most free economies are Hong Kong and Singapore, followed by the USA, New Zealand, United Kingdom, Ireland, Canada, and Switzerland.
It should be noted, of course, that economic freedom is different depending on where you are. For example, the UK has introduced private alternatives to their old-age pension system, whereas meddling with Social Security in the US is still the "third rail" of politics.
Western European countries generally ranked high in all areas except size of government and labor market regulation.
Life expectancy is higher among more economically free nations, and they also enjoy higher levels of income and faster levels of growth. The poorest 10% earn much more income in economically free countries.
The bottom five nations in terms of economic freedom were the Democratic Republic of the Congo, Myanmar, Guinea-Bissau, Algeria and Ukraine. However North Korea and Cuba were not included in the report since their data is not available.
Aside from the gratuitous and annoying bashing of Republicans, it was an interesting article. However, it missed the real reason that broadband is such a pain in the ass.
About 4 years ago, I got a cable modem from Marcus, our local cable provider. The infrastructure was designed so that few homes would share a line, and the speeds were estimated to max out at 6Mbit/6Mbit. There was no cap on bandwidth. There was no hassle about servers. I had 5 static IPs for $45 or so per month. I did not get any cable TV service. The provider was @Home, but I ignored them. Marcus' tech support was clueful and useful, the few times I had to call them. Uptime was excellent.
Charter bought out Marcus about 2 years ago, I think. The first thing that happened was that the prices started rising (to about $55 per month). Then the bandwidth got capped at 3Mbit/512Kbit. Then they hassled me about the server. Then the uptime started getting a little iffy. Then they required that I have basic cable service in order to get the cable modem, split the fees, and ended up charging another $5 per month net. Then they tried to rent me the cable modem I owned (that failed when I threatened them). On top of all of this, their technical support was miserably uninformed and useless.
When @Home died, I lost the ability to get static IPs (DHCP only) and the price was going to go up. Despite my $200 investment in a cable modem, I switched to DSL from Verizon. The cost was about $55 per month, the data rates were OK, but they set me up on the wrong service plan. I was unable to get static IPs, and to switch from the (wrongly-provisioned) home service to the business service (complete with IPs) would not only take 3 weeks, with all of the coordinating done by me (even though Verizon owned both DSL services, the modem, the phone line and so forth), but it also cost me another $30 per month to switch over, and I'd have to send back my DSL modem and get another one! On top of that, their uptime was not good, and their tech support was clueless. (Once, I called them to let them know that their nameservers were down. The tech support person told me it was not them, it was me, and that I would have to fix my problem. Note, I was on the DHCP only service, and was using their nameservers, etc., with nothing on my end but clients. I asked the tech to go check, and he came back with (I kid not!) "I can't check, because the network is down.")
I decided to get Earthlink's DSL, because I could get a static plus several dynamic addresses for $65 per month without any hassle about servers, and with better bandwidth, and because the sales guys appear clued in. I didn't want to wait weeks without service, so I reattached my cable modem and got it turned on for the interim period. I was told that for $45 or so per month, I could get 5 dynamic IP addresses. (Bandwidth now 384Kbit/128Kbit!!! and no possibility of static IPs.) When it was hooked up, I could only get three. I called tech support, and was told I was on the wrong package. I should only have one. Tappity, tappity, voila! Two of my computers stopped working. Call to sales got my package upgraded to one that "supports home networking" for another $10 per month. Still no additional addresses. Call to tech support informs me that while my package supports home networking, I had not purchased any additional addresses. Call to sales gets me 4 additional dynamic addresses for $7 per month each, total now up to $85 or so. I can get 3 addresses. When I bring my laptop home from work to use the VPN, I have to unplug the cable modem, turn off all of the machines, plug in the cable modem, and turn on the machines in the order that I want them connected to the network. Usually, I can get three, and sometimes four, to work at one time. I have stopped calling customer service or tech support, because they don't want to help me very much, and appear unable to help if they wanted to. I am expecting the Earthlink service to be working any day now, so I can shut off the Charter crap.
In the end, bad customer service, high prices and terrible difficulty just making things work will drive me off of traditional broadband. I am looking very seriously at moving to a community that has broadband installed throughout and run by the homeowners' association (they are building a number of these in my region now) rather than put up with the hassle of dealing with any of these companies. Maybe Earthlink will save me (I've heard good things) or maybe I'll move.
-- Two men say they're Jesus. One of them must be wrong. - Dire Straits