Slashdot Mirror
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 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.
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.
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
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.