Can the US Actually Cultivate Local Competition in Broadband?

New submitter riskkeyesq writes with a link to a blog post from Dane Jasper, CEO of Sonic.net, about what Jasper sees as the deepest problem in the U.S. broadband market and the Internet in general: "There are a number of threats to the Internet as a system for innovation, commerce and education today. They include net neutrality, the price of Internet access in America, performance, rural availability and privacy. But none of these are the root issue, they're just symptoms. The root cause of all of these symptoms is a disease: a lack of competition for consumer Internet access." Soft landings for former legislators, lobbyists disguised as regulators, hundreds of thousands of miles of fiber sitting unused, the sham that is the internet provider free market is keeping the US in a telecommunications third-world. What, exactly, can American citizens do about it? One upshot, in Jasper's opinion (hardly disinterested, is his role at CEO at an ISP that draws praise from the EFF for its privacy policies) is this: "Today’s FCC should return to the roots of the Telecom Act, and reinforce the unbundling requirements, assuring that they are again technology neutral. This will create an investment ladder to facilities for competitive carriers, opening access to build out and serve areas that are beyond our reach today."

Comments

Split Comcast in two

[jfdavis668]

Give both access to their current cable network. Watch service improve and prices drop.

Re:Split Comcast in two

[ColdWetDog]

That may be only a temporary solution. Remember Ma Bell? split up into AT& for long distance and regional 'baby Bells'. The regional companies eventually all morphed back together again, like the liquid-metal terminator. Long-distance rates dropped because companies like Sprint & MCI were allowed to sell services over AT&T's wires (AT&T was forced to allow this). Now we don't quite have a situation of a total monopoly, but it's clear that there's not enough competition, especially at the local level--the service maps are basically gerrymandered districts.

Nothing is permanent. The breakup of Ma Bell did allow for exciting technology such as 2400 baud modems and telephones that had features. It's unclear if the Internet as we know it would exist today if Ma Bell were still alive. Now that the Bell System /SBC has reincarnated itself in AT&T / Verizon it's unclear if the Internet can continue as we know it for much longer.

So I would agree with the the premise of Mr. Jasper - we have to cut the head off the new Zombie before it completely engulfs us. If successful (which I rather doubt), it may set the monster back another decade or two but it will always be there. Under the bed. Hungry. Waiting.

Split last-mile from ISP

[corsec67]

The only real solution is to split the last-mile provider from the ISP, and make the last-mile provider a utility.

Competition in the last-mile is infeasable, but connecting customers at a CO to the internet is a much more competition-friendly possibility.

3 tier separation

[Anonymous Coward]

You either:
- own the cables.
- provide internet access to consumers.
- sell content.
exclusively. No combinations allowed.

Can government solve government problems?

[bmajik]

Legally, only one ILEC is allowed to run copper pairs to my property. They have no interested in upgrading their plant.

They have a protected monopoly.

In many jurisdictions, only one cable company can put coax in the ground.

They have a protected monopoly.

IP protections, like copyright, are a government protected monopoly.

Frequency allocations, overseen by the FCC, are a government protected monopoly.

Access Easements on private property for incumbent wire owners (e.g. the cable company can put a truck or a box on your property if they like) are a government grant of special privilege.

Given all of the government collusion with the current infrastructure, asking if government can address its own problems seems a bit silly. Of course it could. It could stop enabling all of the stuff it currently enables, for one.

If you try to factor the residential broadband problem into an OSI-type layer model, perhaps what makes sense is to limit vertical integration.

E.g. if there is physical plant, IP transit, content delivery, and content production, it would be problematic to allow, for instance, SONY, to own all 4 of those layers in some specific area.

Ideally there would be robust competition at each layer.

Another action the government could take would be to stop approving merger/consolidation deals that have the net effect of consolidating layers and/or markets in such a way that overall marketplace competition suffers.

In some communities, public utility ownership of layer 1 (physical plant) would make a lot of sense and would be voter supported. In others, it wouldn't, and wouldn't. Both models are worth trying.

As you go up the stack, there are lots of opportunities for different business models. Community owned IP transit? Why not? This is, in some regards, the case at current internet peering points. The members co-own the exchanges. It is in some respects like the agricultural co-ops that are so common in rural America - the land of rugged individualists.

People are, after all, not opposed to working in groups when they like the group and when the cooperation makes sense (as opposed to being coercive in nature)

Re:That worked out well for AT&T

[Rockoon]

sigh...

AT&T did not buy everything back up. In fact, AT&T lost it all. AT&T is gone.

It was the baby bells that merged, most aggressive was Southwestern Bell Corporation (SBC) which picked up the completely failing AT&T in 2005 and took over its name.

AT&T is dead. Long live AT&T.

Easy

[Orgasmatron]

STOP GIVING OUT CABLE MONOPOLIES.

That's really all you have to do. There is no competition in most markets because competition is banned by government decree.

I live in a town with two cable companies. Actually, I live 5 miles out of town. Both cable companies have fiber optic networks here, both have great customer service, high speeds, low prices, etc.

The city I lived in previously had granted a monopoly to Charter. Charter has a coax network, lousy customer service, low speeds, high prices, etc.

Cable + DSL is not a meaningful competition, so having 2 monopolies is not the way to go. Stop granting cable monopolies and you will have competition.

P.S. Both companies have fully developed fiber networks in the ground (and on poles in some places) so don't try claiming that the monopoly is necessary for physical reasons. It isn't.

Uh... no

[rsilvergun]

There's a reason we gave out cable monopolies. It was too expensive to build out the infrastructure w/o a guaranteed profit and we're too frightened of the gov't to just make it a public works project. It's either monopolies or figuring out how to counteract 50+ years of cold war propaganda about the evils of socialism...