Slashdot Mirror
US ISPs Using Push Polling To Stop Cheap Internet
An anonymous reader writes "What happens when a new ISP is started somewhere in the United States that completely blows out of the water all the other ISPs in the area, in terms of price and performance? Apparently, that question is being answered in North Carolina, where Greenlight Inc., a company started by a city government, is trying to offer faster, more reliable, and cheaper Internet service to the local residents. Time Warner and Embarq can't compete. So they are not only lobbying the state government to destroy the upstart competition, but are now using push polling methods to gain support, across the two cities that could benefit from the new ISP, for the 'Level the playing field' legislation they got introduced in the legislature." A local news outlet provides coverage more friendly to the incumbents' point of view.
Any company started and run by any Government is not a "level playing field" IMO. It may be a way for Government price manipulation, but then that's not letting the market determine price.
Secondly, since it is started and run by the Government, wouldn't this be considered a public service instead?
There are no loopholes. It's either legal or it's not.
The reason that nobody has done that is actually very simple. The initial investment in infrastructure is at a minimum in the tens of millions of dollars, and too make that even worse the credit markets are currently frozen so good luck getting a loan.
It sounds to me like internet is becoming more and more of a "needed commodity" than it used to be. Consider, if you will, roads. The taxpayer dollars go towards those and in turn, the government hires private contractors to do the work - this article doesn't sound much different.
However, this would make the internet a public service more than a paid for service, so, unfortunately, there is a large gray area there - and the companies making the pretty penny are going to fight in that gray area.
What in the heavens is the matter with kdawson? Is everyone on slashdot so dumb that they need to be "led" to the right opinion about whatever the fuck the story is about?
This story was already published here without the kdawsonishness and the response was overwhelmingly what the editor seems to be leading everyone up to anyway. But you still can't resist putting the drama in the summary. Can you?
Please, really. If we want an editorial, we would ask for one. Just give us the story and let the discussion unravel. Slashdot has quite a homogeneous viewpoint of many thing already. There is no need to try to lead up the discussion somewhere you like even before it has started - especially if you are (most probably) not going to be in the discussion. Furthermore, just the thought that you think you can change the wordings of a sentence and fool anyone into making a different opinion than I would make otherwise should be quite offensive for them.
Read the senate bill: http://www.ncga.state.nc.us/Sessions/2009/Bills/Senate/PDF/S1004v1.pdf I hate the telcos as much as anyone, but this bill says that when the city enters into the communications business, it should have to pay all the same taxes and fees as private business would, and be burdened with the same oversight. They also say that other fees the citizens pay (trash, water etc) cannot be used to fund the communications business. I don't see how this bill is unfair at all. The telcos are essentially saying "If we didn't have to pay any fees to the city to provide service, we could be competetive." If government wants to set up a business, they should have go compete with other businesses on a level playing field. If municipalities want to open up their own ISP, I am all for that, but then they should stop collecting fees and taxing the other ISPs they are competing with. Municipal government should not be using taxes and fees to provide a commercial advantage for themselves. I think the "level playing field" is actually a good title for this bill, and not an unreasonable request. We're all hopped up on this because it's something that's near and dear to us, but imagine if the city set up a taxi service, but then did not have to pay gasoline tax or hackney licenses. Obviously it benefits the public who uses taxis, but is it fair to the taxi drivers and cab companies that they now have to charge more than the city taxis.
Nothing great was ever achieved without enthusiasm
The funny thing is that almost all of these ISP's (cable providers, telco's) already HAVE government-granted monopolies themselves. Time-Warner has certainly never objected when a city has granted them an exclusive monopoly to provide cable service to a city (such agreements cover close to 100% of their market), nor has AT&T ever been shy about their monopoly. If these companies were so serious about "leveling the playing field" how about they agree to lease those cable and phone lines to competitors and forgo those exclusive agreements with cities and counties?
SJW: Someone who has run out of real oppression, and has to fake it.
I beg to differ, this is exactly why government intervention makes sense in many cases. You believe that it is important to have a really fast Internet connection, but unimportant that little Johnny and Suzie have jump ropes. Someone else thinks the jumps ropes are WAY more important. Neither of you has the individual ability to afford to either upgrade the Schools (to any meaningful degree), or upgrade the Internet connection. Through tax dollars and bonds the local government has the ability to do a passable job of both and mitigates compromise. You don't get 100Mbps symmetric Internet (yet), and your neighbor doesn't get a Montesori school on every corner, but you both get some reasonable approximation of what you want.
I don't need a million points of light, just two points of multi-mode fiber and a 10 Gig-E router.
"Surprise someone finally realized that the last mile is a natural monopoly and should be a utility."
Um, when I moved in to the house I own now, it had two cable services and a telecom service entering the house. No monopoly that I can see, though I am lucky enough to live 1500 feet from a switch and my DSL service was very hot.
Then the 2nd cable company was bought out by Cox. A monopoly emerged. SO I'm down to two 'last miles' entering my house. I don't see Cox and Qwest getting together anytime soon.
In Maine, my house had one cable service and one telecom service. I could choose either Verizon DSL or GWI DSL, which spanked Time-Warner on speed and both TW and Verizon on cost. They still do I think.
My point is that generally speaking, ISP monopolies are created by the collusion of business and government. You will find that most communities grant the dominant cable provider an exclusive agreement. Most communities have one hardline telecom provider, an arrangement that is usually negotiated at the state level, and is grandfathered in from the time of Alex Bell.
This is not a natural monopoly. My house can tolerate several services entering it. It is an artificial monopoly, and could be broken by one of at least two ways:
- Communities permitting competition by ending exclusive agreements.
- Communities offering the service as a 'utility'.
- others?
The last mile monopoly myth keeps us from considering genuine competition. And for those who will point out that the monopoly is what gave the incumbents the practical profit margin to be able to invest in their physical plant, well, yes, but if there is truly an opportunity to create a competitor and make a profit, someone will fill that opportunity. All it needs is a free market.
This is a Keynesian era, let's have at it, ok?
ps- Consider both the taxes/fees your community levies on the monopolies, and the excess cost permitted by the monopoly agreements, as a tax. How much do the much-vaunted european and Asian ISPs pay in taxes and fees???
deleting the extra space after periods so i can stay relevant, yeah.
This is why government intervention makes NO sense at all.
Why in the world should we have to choose between funding schools (Johnny's gym jumprope) and fast internet service? The two are totally unrelated! Of course, when everything is run by the Government Monopoly Inc. (GMI) then yes, they are related because the GMI can only confiscate so much per quarter from taxpayers, so all the money must come from a single, limited pot.
However, if the schools are private and the Internet service is private then the money is limited only by the market, which means that it is practically unlimited. So in a Capitalist system Johnny gets his jumprope, and a new playground set besides, and we all get 100MB service to our homes.
Of course, in that system the local government would NOT be allowed to limit the number of ISPs servicing an area, so there would be real competition for service in that last mile. There might be a few more wires strung and/or tunnels dug to run the lines, but there would be more service, more competition, and CHEAPER PRICES.
It never fails to amaze me how many people don't understand that most of the major socio-political and economic problems we have today are directly due to the application of too much socialistic GMI and not enough application of Capitalistic Federalism. It would be funny if it wasn't so sick and sad.
Official Heretic from the "Church of Global Warming". Proven right thanks to whistle blowers. AGW = Flat Earth Theory
Isn't that exactly what the city offered?
They built the infrastructure nescesary and then went to the incumbants saying "we built this nice fat infrastructure, and we'd like to let you use it if you give us a better service than we're getting right now".
The companies declined this offer and then gut pissed that the city decided to use the infrastructure anyway.
But if the objective is to get affordable broadband to that locale, rather than making a profit, isn't that Job Done? Community Project can then retire having succeeded.
(Note: This only applies to England & Wales, as all Scottish & Northern Irish telephone exchanges are broadband enabled)
You would run into a situation where the rich can send their kids to better schools, and they get better jobs, and then they make more money, and send their kids to better schools, who make more money. Later on you run into a situation where poor people won't be able to afford school. Two more or less permanent classes. The death of the American dream.
So in a Capitalist system Johnny gets his jumprope, and a new playground set besides, and we all get 100MB service to our homes.
In a capitalist system Johnny gets his jumprope and playground if his daddy is rich. Most kids would get to play with sticks and rocks.
We don't all get 100MB service to our homes. Rich people get 100MB service to their homes.
Of course, in that system the local government would NOT be allowed to limit the number of ISPs servicing an area, so there would be real competition for service in that last mile.
I don't think the government does limit the number of ISP's. I think the free market does. As long as ISP's keep their prices under the cost of implementation of new infrastructure there will never be any competition.
There might be a few more wires strung and/or tunnels dug to run the lines, but there would be more service, more competition, and CHEAPER PRICES.
This is a fantasy. In reality we would end up with 1 really cheap ISP who puts the others out of business, at which point they would either buy out or purchase the equipment from the other companies. The new monopoly would languor just as much as they currently do and could charge as much as they want for their service.
It never fails to amaze me how many people don't understand that most of the major socio-political and economic problems we have today are directly due to the application of too much socialistic GMI and not enough application of Capitalistic Federalism. It would be funny if it wasn't so sick and sad.
I agree there is too much socialism in some cases, but it is usually a failure of implementation or corruption manifesting itself. I should be able to take the money for my education and apply it to any school. But to take away public education and turn it completely over to the private sector is not only ludicrous, its downright evil.
Better yet, it's usually structured as slander with a built in escape clause:
"Would you vote for Joe Candidate if it turned out he was hiding a secret cocaine addiction, paid for by ongoing embezzlement at his current job and a flourishing side business in white slavery?"
When the inevitable crapstorm starts, push poller can say "Hey, I never said he did blow and pimped whores, I was just asking a hypothetical!"
Welcome to the Panopticon. Used to be a prison, now it's your home.
Better oversight? Oversight of whom? It's not clear, project oversight or telecom oversight?
Regardless, while people feel cheated I think they're looking at the situation wrong. Inherent business conservatism keeps BT from putting fat pipes to all the little villages. However, if said village shows the initiative to back their grumblings for better service by seeking it out themselves, BT knows there's a market. Digging up the dirt, and not the fiber itself is the cost in growth, so naturally they're going to bury more than necessary. Once the fiber is there, it's likewise obvious to turn it on for customer use. Like it or not, this is the face of capitalism; it's money at work.
Does it give the end-user warm fuzzies? No. Should it? Well, that's another conversation. But, as LandDolphin points out, in the end, consumers benefit with cheaper service.
How could this be done differently? BT offers to lay the pipe to the community once they get X subscriptions. But be warned, X will be inflated because BT knows that 15% of the "subscribed" customers will back out (or some other significant percantage. as this is slashdot, no research into percentages was done). This inflation is may be enough for small towns to think that BT won't come into their area and the same thing still happens; they procure it themselves. In addition, BT isn't likely to want to promote such a program because it means answering questions and training staff when the actual implementation rate is very small.
No, it's not pretty, but it's real. In the end, what's there to cry about? They're not on 56k anymore.
Small suppliers simply couldn't afford to lay the cable, and you would never have very many suppliers because that would dilute the market and even big players wouldn't be able to recover the cable costs.
Which is where the local government could step in, take out a loan, and run the cable to get a connection, then lease use to private companies equally. Free markets are a good idea -- but you do not have to go 100% free market and 0% government, you can find a happy medium. The problem is that right now we are like 10% free market and 90% government, with the big corporations running the government. I could go on about that, but that would be (-1) off topic.
If people weren't forced by the government to fund government-controlled schools and use government controlled utilities, then people could vote with their dollars.
Mine is Good
Others have already pointed out the problems with this arrangement. It rarely serves the poor, people in out of the way places, or generally anyone it is not as profitable to serve very well. There's any number of reasons that someone might not be profitable to serve, but for some essential services (Electricity, telephone, education, garbage collection, and arguably Internet among many others) we as a society have decided that everyone SHOULD be served. So the government either serves them (public utility) or forces a company to do so as part of its contract (regulated monopoly). Others have gone into more detail on this above me, so instead I'll add something else.
For a good look at how things run when something close to "pure capitalism" is practiced, look at the US (or indeed most industrialized nations) in the mid to late 19th and early 20th centuries. Monopolies and trusts dominated the business landscape, the majority of people worked 6-7 days a week for 12 or more hours a day often for near slave wages. Abuses like the "Company Store System" all but indentured workers in mining, fishing, and other industries that require some level of isolation from urban centers. Illiteracy rates ran into the 50 or 60% range (some of this was due to high illiteracy rates in new immigrants, true, but they represented on a fraction of the literacy problem).
Pure capitalism has been tried, and it generally produced a level of suffering on par with feudalism. Remember that when ideas like Socialism and even Communism were initially proposed, the "suffering of the workers" was not that they had smaller TV's than the well off, or that they had crappy or limited health insurance; it was that they worked like dogs from sun up to sundown (luckily electric lights hadn't caught on yet for most of this period) 6 days a week for (hopefully) just enough money to pay the rent and feed the kids. I'm often floored when people present pure capitalism as if it will usher in some new Utopian or semi-Utopian world where competition drives down prices and increases services without any apparent consideration for the fact that it's been tried. It may have driven down prices (for the rich and middle class), and increased services (for the rich and middle class), but it did so at the expense of significant suffering for the working class
I don't need a million points of light, just two points of multi-mode fiber and a 10 Gig-E router.
As was proved during the Reagan era, the rich AND poor BOTH get richer when Government gets out of the way (i.e., fetters to productivity are removed).
8 years is a dreadfully short time to 'prove' an economic method. For all you know what is happening right now is a direct result of Reagan era policies, so I am going to call bullshit on that, but if you can actually provide some reasonable backup for your opinion then maybe you can change my mind!
I am not going to pretend that there isn't bad regulation (goddamn there is tons of it), and it should be gotten rid of, but people who say that all regulation is bad regulation are just crazies. Should we take out anti-trust legislation? Was it smart of us to remove the investment bank regulation? What about safety regulation? What about anti-discrimination legislation?
There are 'fetters to productivity' and there is 'good legislation' but to say that all legislation that fetters productivity cannot be good is wrong.
Wow, EonBlueTool, you don't understand Capitalism at all.
First as the rich get richer so does everyone around them. Yeah the richest can just keep getting richer, but what good is the money if they don't spend it? As long as the rich guy doesn't store all his newly earned money in his mattress then everyone else gets richer too.
So he sends his kids to the fancy private school, that costs money and that money goes to less rich people. Those people spend the money to send their kids to a private school too and so everyone gets richer.
The rich guy isn't stealing wealth from the poor people he is creating wealth and spreading it out through his employees. Wealth isn't going away it is being created!
Wealth is destroyed by the government which doesn't create anything and only takes away what is created from those that make it.
Government spending destroys wealth.
If you look at the history of the United States the nations standard of living has the largest gains in periods where the government isn't involved and then stalls when the government takes over.
The auto industry is a prime example. We HAD the best cars in the world until the government got involved and started regulating the market and telling manufacturers what the consumers really wanted. Way to bankrupt that industry.
Then the government got involved in banking and created Fannie Mae and Freddy Mac and said that they had to give loans to everyone so that everyone could have a home. Way to bankrupt our banking industry.
The next point you make that is way off base is that a monopoly will never crumble. That is false too. At some point a company gets to large and will collapse at this point it is canabalized by smaller companies. The problem in the US is that they have coined the term "To Big To Fail", once again the government in destroying the free markets method of regulation.
Another point being missed is that without the rich you wouldn't have the PC you're working on. The early adapters of any new technology pay a premium for that technology. As we master that technology it becomes cheaper for everyone else raising the standard of living for all.
If it wasn't for the super rich the third would would still be without telecommunications. The earliest cell phones cost thousands of dollars and only super rich wall street types could afford them. If there hadn't been a market to the super rich then we wouldn't have $10 cell phones that could be sold in third world countries providing a wireless infrastructure.
What about Google? What about all the cool technology they are spewing out that everyone gets to use? How is it that you socialist/communist types don't see how you get all you're cool stuff. Have you noticed that none of these cool things that make your life better are coming out of Russia, China, Cuba or any other place where the government controls the market?
The US's free market drives innovation, it may not be perfect but it is still the best solution on the planet. All this new Socialism is killing it.
Actually, the term 'natural monopoly' was used by the OP. I accepted it at face value.
And you seem to be saying that it is in fact the likely outcome of the market.
But one point... Ok, two. Or three.
How many different providers would be needed to avoid a natural (or any other type) monopoly? 2? 3? 4? I can see where two cable providers, a telcom provider, and a wireless provider could offer a market that would not be considered a monopolized market. That would have been Mesa, Arizona in 2006 until Cox bought CableAmerica, IFRC. Now you have only Cox, Qwest, and the nameless wireless outfit that exists but doesn't bother to advertise or compete. Not to be confused with the defunct Tempe municipal WiFi network.
I think you could tolerate 3 cable providers and 3 telcom providers before the DigSafe problems become insurmountable. The fix is to move the demarc out to the curb, which in Arizona isn't too hard. In Maine the envirinment is harsher, and this would mean more investment in curbside boxes, so there it may be too much expense. But remember, the cable cos pulled fiber in the cities/towns, and upgraded their coax, and somehow made money on it. The telcos, of course, got the Government to finance their digital conversion, thank you very much. Not sure that worked out too well for us, but at least we didn't get trapped with ISDN forever...
In Portland, Maine, on the other hand, the terrain is hilly, heavily forested, and WiFi is pointless. Even DSS or other 2GHz solutions are difficult and not viable. Cable and phone for now are the delivery options, and the promised WiMAX and 700MHz solutions are still dreams.
Rural areas present different challenges, related to subscriber density. Wireless will not solve that either, as density is density no matter the delivery technology. Only by lowering the cost of delivery do you get broadband into low-density residential, and much of Maine and Arizona fall into that category.
Ultimately, it seems there isn't enough financial incentive to get competitors going. No, wait, since MOST communities grant exclusive rights to one of each, it's not a free market at all in most communities. Blame City Hall.
deleting the extra space after periods so i can stay relevant, yeah.
Are you referring to the soon-to-be highly valuable skill of odometer (or other mileage sensor) tampering?
Personally, I'm expecting an increase in taxes on electricity. Possibly a second, metered-differently outlet for automobiles. Many cities have this sort of thing for water that is used for outside, like watering lawns and the like. They're metered differently because there is no sewerage charge.
However, knowing the government, I expect them to do both and possibly something else I didn't think of.
Learning HOW to think is more important than learning WHAT to think.
You're seriously comparing East and West Germany as your examples? Excellent choice.it allows me to point out this excellent thing called compromise, or the middle road. You see you are completely correct that East Germany represents an example of the failure of a completely centrally controlled economy. Bad idea, you could just as easily point out the Soviet Union or China before recent reforms. West Germany on teh other hand is hardly an example of unfettered capitalism. It has significant socialist elements including a state sponsored universal health care system, significant wage and work restrictions (to ensure that workers can make a decent living in in menial jobs), state subsidies funding rail and road networks, a much more generous unemployment benefit that the US has, indeed pretty much all of the "normal" European social programs. Despite this its economy is just a strong as the US (smaller, yes, it has a much smaller population) if not stronger, and the "social safety net" that the working poor rely upon is certainly much better. It is arguably better to be rich in the United States than in Germany, but it is certainly better to be poor (or even middle class, for lower end of the "middle class" spectrum) in Germany.
Similarly, as I point out below, the United States is a much more "socialist" country than it was 100 years ago, but the lot of the poor has improved significantly. You are correct that a completely centrally managed economy is a disaster, but for a strong and viable country with a good economy, a mix of private industry with the state managing essential services and providing a fair playing field seems to be the best deal for the most people. Good example!
I don't need a million points of light, just two points of multi-mode fiber and a 10 Gig-E router.
You're quoting a Wikipedia article about the nutcase Kevin Phillips?
I used Keven Phillips because he is about as Republican as you can get without the white robes and burning crosses. I could have used a litany other sources, but then I'd be accused of lib'rul bias.
To put it another way, your numbers are wrong just like Phillips is.
Did you want to contribute any actual evidence to counter the original point, or just try re-frame the topic with a smear? You wingnuts are so pathetically predictable. (See? Smear! Let's not talk about the actual problem!)
But in this case, they've already laid out the infrastructure, so that's not an issue. The only issue here is that they're competing with corporate lobbying.