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The Problems with Broadband in America
Tenken writes "Salon has an article about the state of broadband in America. After seeing what many other countries have accomplished with their broadband markets, namely Japan, Korea, and (gasp) even Canada, the current state of affairs in the U.S. is looking pretty dismal. I'm sure I'm not the only one tired of paying $45 a month just for cable internet." From the article: "Across the globe, it's the same story. In France, DSL service that is 10 times faster than the typical United States connection; 100 TV channels and unlimited telephone service cost only $38 per month. In South Korea, super-fast connections are common for less than $30 per month. Places as diverse as Finland, Canada and Hong Kong all have much faster Internet connections at a lower cost than what is available here. In fact, since 2001, the U.S. has slipped from fourth to 16th in the world in broadband use per capita. While other countries are taking advantage of the technological, business and education opportunities of the broadband era, America remains lost in transition."
Free American broadband!
In France, you can get super-fast DSL, unlimited phone service and 100 TV channels for a mere $38 a month. Why does the same thing cost so much more in the U.S.?
By S. Derek Turner
Oct. 18, 2005 | Next time you sit down to pay your cable-modem or DSL bill, consider this: Most Japanese consumers can get an Internet connection that's 16 times faster than the typical American DSL line for a mere $22 per month.
Across the globe, it's the same story. In France, DSL service that is 10 times faster than the typical United States connection; 100 TV channels and unlimited telephone service cost only $38 per month. In South Korea, super-fast connections are common for less than $30 per month. Places as diverse as Finland, Canada and Hong Kong all have much faster Internet connections at a lower cost than what is available here. In fact, since 2001, the U.S. has slipped from fourth to 16th in the world in broadband use per capita. While other countries are taking advantage of the technological, business and education opportunities of the broadband era, America remains lost in transition.
How did this happen? Why has the U.S. fallen so far behind the rest of its economic peers? The answer is simple. These nations all have something the U.S. lacks: a national broadband policy, one that actively encourages competition among providers, leading to lower consumer prices and better service.
Instead, the U.S. has a handful of unelected and unaccountable corporate giants that control our vital telecommunications infrastructure. This has led not only to a digital divide between the U.S. and the rest of the advanced world but to one inside the U.S. itself. Currently, broadband services in America remain unavailable for many living in rural and poorer urban areas, and remain slow and expensive for those who do have access.
For instance, when farmers gathered at this year's Iowa State Fair to discuss their policy concerns with U.S. Secretary of Agriculture Mike Johanns, the topic on the minds of many was broadband. And for good reason. Twenty-five percent of Iowa's rural communities have no access to high-speed Internet service, and over half of the remaining rural communities are serviced by only one provider. Those lucky enough to live in areas served by Iowa Telecom can pay as much as $170 per month for a DSL line.
President Bush has called for "universal, affordable access to broadband technology by the year 2007," and Federal Communications Commission chairman Kevin Martin recently declared broadband deployment to be his "highest priority." Martin recently took to the pages of the Wall Street Journal to tout "the dramatic growth in broadband services." In his editorial he boasts of "fierce competition" among broadband providers and tells us we're "well on our way to accomplishing the President's goal."
The facts tell a different story. Today, major cable companies and DSL providers control almost 98 percent of the residential and small-business broadband market. This trend is the direct result of FCC policies that fail to encourage real competition among broadband providers, giving free rein over the market to the cable and DSL giants. The corporate giants are also vigorously fighting to stop cities and towns from building "Community Internet" systems -- affordable, high-speed broadband services funded in part by community groups and municipalities -- even in places where the cable and DSL companies themselves don't offer service. Yet, like rural electrification projects in the early 20th century, today's Community Internet projects offer the best hope of achieving universal broadband service.
Like so many other challenges faced by the Bush administration, the response to the growing digital divide has been to redefine success and prematurely declare victory.
In the 1996 Telecommunications Act, Congress directed the FCC to oversee the timely deployment of Internet services that "enable users to originate and receive high quality voice, data, g
With FITL, it's fiber optic cable from the central office to a "lightspeed box" in your neighborhood, where it gets converted to copper wires to go to your home. If you're lucky enough to be in a FITL neighborhood, the best you can get is IDSL (aka ISDN). The Megababy Bells insist on putting the DSLAMs in the central office, when they could put it out in the lightspeed boxes, thus creating IFITL (Integrated Fiber in the Loop). By pushing the DSLAM out to the neighborhoods, a vast majority of people could get broadband... but that means opening up the lines to competition, which I know Verizon doesn't want to do... thus the concept of FIOS... which takes advantage of a loophole in the law, allowing them to maintain total control/access of those fiber lines because they've put brand new ones out there from the central office to your home.
Since nobody other than your local power company, local cable company, and local phone company can put lines up on the phone poles (or in the conduits, if you have underground lines), they're going to kill off the broadband companies.
OCO is Loco
We've had 10 mbit up/down no caps since the 90's, 24 mbit for several years and you can also get 100 mbit connections (both up and down, no limitations or caps) for a mere $30 / month in some places. I myself live in a very small town of 3000 people in the middle of the woods, and almost all of us have 8 mbit, or at least 2 mbit. It's even better in the universities.
Canada has long been a telecommunications leader. It's 50%+ the site for the world's first trans-atlantic wireless communication on Signal Hill in Newfoundland. It's had a transcontienent microwave network for phone and TV communication since at least the 1960s [and possibly longer I don't recall], and it's the home of Nortel Networks, and Research In Motion [makers of the Blackberry email device PDA].
Even lowly Saskatchewan has had broadband in smaller markets [compared to US markets of similar size], since the late 1990s.
Saskboy's blog is good. 9 out of 10 dentists agree.
I've heard it said, and it may just be FUD from the ISP's, but if multiple broadband ISP's (ignore the fact DSL and cable can be available in two places) were to compete in the same region then prices would be driven down in competition to a point to where the providers costs in laying in the infrastructure down are not going to be made up in profit.
In a perfectly capitalistic economy this is true, but the majority of telecommunication companies are cartels. They fix prices above the competetive level, competing more on who can service specific addresses than on pricing or services. Additionally, they may compete in different market segments -- one company may be cheaper but offer only slower (e.g. 512kbps) service, while another is more expensive but only offers 1.5mbps service. One caters to people on a tighter budget, the other caters to people with more disposable income.
In this country we really do have good infrastructure. Our backbones are typically high bandwidth even considering the amount of traffic they carry. Many large ISPs and hosting providers offer vast quantities of bandwidth, of which only a fraction is used. The real problem is the last mile: while your local ISP may have an OC-12 pipe coming in, they only use a quarter of it for one of several reasons. The last mile of copper might be too old or low quality to support faster speeds, it might be an artificial limitation designed to boost revenue (artificial scarcity), or they just don't want to raise consumers' expectations which could upset the whole market.
In any event, the issue isn't about what we as consumers want, or what technology is available, or what is best for us, it is about what makes the companies money. After all, these are corporations, they exist to earn profit and return value to the stockholders.
24 beers in a case, 24 hours in a day. Coincidence? I think not!
Canada, the largest country in the world, has much better internet access even in remote communities -- communities that would make what Americans consider remote seem down right cosmopolitan.
...and they brazenly go along with it because that's what the market dictates to be the best value for their campaign war chest...
I moved from a job in NW Ontario where I provided service for the Hudson Basin -- towns that were hundreds of miles from roads, hours by plane -- these towns had better broadband access than most of rural Wisconsin.
The average household in NWO has better access than the average household in Chicago... but of course, they had broadband available many years before most people in Chicago. The difference is the politicians, both local and national, see the value of providing their citizens with connectivity.
Finland had a much higher percentage of landline-less communities a little over a decade ago. They responded by building one of the best cellular networks in the world. Additionally, they saw the value of broadband and integrated that into their infrastructure too, despite very low population densities and long, cold distances.
Whereas in the US, politicians seem to find it better to leave it to the "freemarket", as dictated to them by the deep pocketed telecoms and media conglomerates who tell the elected official what is best
With the exception of Canada, the countries mentioned have a tremendous advanage regarding broadband penetration, and that is relative population density.
As has been pointed out many times before, Canada is actually more "urban" than the US. Something like 3/4 of Canadians live in cities whereas about 2/3 of Americans do, or something like that. Yes, queue jokes about huddling together for warmth, etc., but the facts are there. It helps that only 20% of Canadian land is "habitable" (meaning you can grow crops on it), which is the type of land typically settled on hundreds of years ago. So, Canada has an easier time hitting more of its population with broadband due to population density.
Also, Canada has certain government initiatives to get broadband access to the more remote parts of Canada, such as the far north. Canada has always been on the leading edge of communications technology, and is actively trying to stay that way. The first commercial communications satellite was Canadian owned, as was the first national coast to coast microwave telephone network. This is all because the politicians realized from the start that the only thing stopping the small relatively isolated colonies that became Canada from being absorbed by the US was to overcome the vast communication and transportation obstacles that separated them. Those ideas continue today.
"I have never let my schooling interfere with my education." - Mark Twain
"Last I heard, most of these countries have per minute phone service, and bandwidth usuage caps as low as 6G per month. Also, in the US, High speed internet is considered a luxury. Of course, I also know of people who spend $100(US)+ but the extra $25-30 for Internet is too much."
*Gasp*
Here in France, we have unlimited phone service, unlimited 20Mbits bandwidth usage, 100+ TV channels.. ALL for 30 Euros / Month.
No extra charges.
Oh, and the modem is given for free, and is a wifi access point.
Alexis 'jeriqo' BRET
Sure... lots more area to cover, though
France 2004 gdp: ~1.7T
USA 2004 gdp: ~11T
France sq miles: 211k
USA sq miles: 3537k
France gdp/sq mi: $8M
USA gdp/sq mi: $3M
I think you missed the article's point...that legislation in other countries allows for ISPs to provide cheaper and better services. Rather than doling out monopolies for corporate kickbacks, they force communication networks to be rented out at wholesale prices so any ISP can compete for the consumers Euro, Yen, what have you. They see it as a public utility to some extent, feeling that the entire economy benefits when the general populace has access to fast, always on, broadband connections. Increased education and all that. Note, that most other countries define broadband as being in the Mbps and not Kbps like the FCC does.
Oh, and if you think that population densities are a real factor, which they are to come extent, they are not impossible to overcome. Case in point, Canada, with lower population densities than the US has better service for less, because their legislation keeps monopolies out.
Like the example from the article where a small town with zero broadband ISPs which started to have companies leave for that reason decided to do somethin about it. They asked the ISPs if they could serve the community, but they refused citing the small amount of profit they'd make there not being worth their time. So the community started a public community internet project to offer WiFi throughout the town. The ISP's reaction? Trying to convince the state to pass a law to make that illegal.
That's the kind of mentality we as a nation have, and it's hurting us. We should stop being so high on ourselves, admit our faults, look to others which do it better than we, and fix it!
Why should Verizon be forced to sublease below market value the lines they invested money into, digging up streets and putting up poles.
First problem, Verizon (well all the bells together before they were broken up) did not pay for all the digging to put those lines in, that cost was heavily subsidized by taxpayer money. The other problem with this argument is that the cost of putting all this copper in place was payed off a long long time ago, and it's dirt cheap to maintain.
Then further there is a very serious problem with this one part of it
sublease below market value
It's just not true. Quest for example sells basic phone service for 12.50, they then sell the raw copper loop for $15. And that loop will only be able to serve DSL and thus make it profitable and worth while for the CLEC if they are within range of the CO. Most are not, and since the FCC just took away all access to the ILEC metro fiber assets (because they deemed them unesesarry) only phone service can be offered to customer out of range of the the CO, so the CLEC's and ISP's were forced to resell the ILEC's DSL at tariffed prices (this also means they can have that customer for phone service). With DSL, Quest sells 1.5M/768k DSL for $19.95 for a year and then $39.95 after that, the "below market value" price for just the loop (no email, bandwidth, tech support, etc.) that a competetive ISP must pay is $19.95 (a big discount from $19.95 as you can tell) for a year and then $33 after that. Oh, and then they have to pay for the ATM trasit of customer bandwidth at $250 per Mbit, plus port fees. That and the FCC just took these off of the tarif rates, next year, Qwest and all the other ILECS will be able to set the prices to whatever they want, and customers will be completely screwed because they will have very little choice.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now. - Ed Howd