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How AT&T and Verizon Rip Off DSL Customers (arstechnica.com)
A new white paper written by the National Digital Inclusion Alliance finds that AT&T and Verizon are selling slow DSL internet to tens of millions of customers for the same price as fiber customers. These customers have no choice but to pay the rate AT&T and Verizon give them because no other service is offered in their area. Ars Technica reports: AT&T has been charging $60 a month to DSL customers for service between 6 and 10Mbps downstream and 0.6Mbps to 1Mbps upstream, the white paper notes, citing AT&T's advertised prices from July 2018. AT&T also charges $60 a month for 50Mbps and 75Mbps download tiers and even for fiber service with symmetrical upload and download speeds of 100Mbps. These are the regular rates after first-year discounts end, before any extra fees and taxes. Verizon similarly charges $65 a month for 100Mbps fiber service (including a $10 router charge), and $63 or $64 a month for DSL service that provides download speeds between 1.5Mbps and 15Mbps, the white paper says. The price is this high partly "because Verizon ADSL service at any speed requires paying separately for a landline telephone account." [...] The NDIA calls the practice of charging identical prices for wildly different speeds "tier flattening." It affects both urban and rural customers who live in areas where AT&T and Verizon haven't upgraded networks because they face no competition, because the upgrades wouldn't result in higher profits, or both. These customers end up using "the oldest, slowest legacy infrastructure," while paying much higher per-megabit prices than other Internet users.
...a country with less people than an average US city spread over quite large land area, three different providers are competing who gets to offer gigabit fiber for your street / condo - because whoever gets to build the fiber "last mile" for your area gets money from all those customers going forward as it is unlikely multiple providers build it for same building and "wholesale" prices - using one provider's physical fiber to use another provider's ISP services is not really price competitive at the moment, tho there are regulatory talk about making this happen, so say Telia builds fiber to a condo, Elisa or DNA could still offer ISP services to everyone in that condo while paying "wholesale" cost of operating the underying fiber to Telia.
DSL is something you use only if you live in a sad place where fiber hasn't quite gotten to yet (getting rarer every year). Copper wiring is actively being dismantled and replaced by fiber in most places and by LTE in really remote places (think individual houses or small groups of houses built miles from anything else and any summer cottages in the forest)
Actual "trunk" fiber networks are effectively triple-built - Elisa, Telia and DNA all have their own fiber networks across the country and they are busy covering even suburb houses, street by street. Sure, the initial build-out to an individual house costs a bit (gotta have that backhoe to set the fiber from the street to the building) but it is an one-time fee and probably improves the value of the property at least as much as it costs.
I'm paying 39e/ month for 1000Mbit down, 100Mbit up.
Competition is good.
So, lul DSL for $60.
If the world is round how come satellite signals are always available? Shouldn't they go in and out of visibility if the world was round? My satellite TV always works as does my so called GPS. Explain that!
Wake up you sheep.
We know the planet is round because FSM created it in the shape of a holy meatball, all hail his noodly appendage.
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Because it costs a metric ton of money to start a new ISP when you have to lay down cable as well. If you are allowed to at all, that depends on the local government, which curiously often thinks that one provider is enough and that they don't want many cables in their ground. The cynic in me would say that the campaign contributions of certain ISPs have something to do with it. You might have heard about communities that tried to establish a WiFi based alternative, only to have it shot down by the local government.
So, there's no need to get government involved. It already is.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
The backhaul bandwidth is only a tiny fraction of the cost to provide service, most of the cost is providing and maintaining the physical line so it doesn't cost significantly less for an ISP to provide a 2mb DSL service than it does to provide fibre assuming the infrastructure is already in place.
If anything, providing DSL might cost more because the infrastructure is older and more likely to suffer problems.
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If these providers were really treating me so incredibly unfairly, why wouldnâ(TM)t another option naturally emerge?
In a perfect market yes. Internet service providers are not a perfect market. In fact they are usually a text book example of an imperfect market created through a process of public spending and government granted oligopolies. That's if you're lucky. Quite often you're faced with an outright monopoly.
Hasnt that always been the cycle of technology? Someone does something poorly and then someone else can do it better and make lots of money.
Someone tried. Look how much Google fibre spent only to achieve nothing. This isn't some startup creating an app.
how it works here is that no ISP owns the cable or does the cable work. it is another company that takes care of the cables and ISPs can then use these cables to provide internet to their customers, ofcourse ISPs need to pay the cable company for using it.
same story for electricity etc.
On a long enough timeline, the survival rate for everyone drops to zero.
If these providers were really treating me so incredibly unfairly, why wouldn't another option naturally emerge?
Because even if a competitor could get permits, the moment they announced plans for a roll-out your speeds would go up, prices go down, the network would start getting upgrades and by the time the new network was ready most people would be too lazy to switch so the imagined profits wouldn't be there anymore. Basically people aren't spiteful enough to switch over past poor price-performance and reward the company who (re-)booted the competition. And the competitors knows this, so they don't try in the first place. Also they have high-profit areas of their own, basically if you start killing my profits in one area I'll start killing your profits in some other area. So there's a high incentive to come to some sort of informal understanding.
That's why most threats to them come from outside players that don't have a market to lose like municipal broadband, Starlink etc. otherwise they're happy to serve you slow DSL until the cows come home. The other big incentive would be government bids, but I've read a surprisingly large number of "we gave the ISPs money, but they didn't roll out broadband like they're supposed to" stories that to me makes no sense. It's not hard to create "no cure, no pay" contracts, daily fines for non-compliance and yet it seems no agreement has teeth and whoever wrote them is either incompetent or corrupt. Maybe if New York kicks Charter out for real it'll get better, but why go the nuclear option and get a new deal that won't be honored when you could have had a running financial penalty.
The county my cabin is in here in Norway made a rather simple bid: Fiber available to all permanent residents in the county, cabins are optional, what's your bid? It took three years, 120 km worth of digs and now it's done, from no cable, no fiber just shitty DSL to 70%+ signing up for fiber. Population density of county is ~35/km^2 same as Alabama or Missouri, nothing that qualifies as a town just rural population and yet the fiber roll-out is done. Median speed here in Norway is now 45.8 Mbit and up 45.4% YoY due to small revolutions like these. Granted, fiber doesn't work everywhere but it can work many places if you just make the jump. It's a lot more profitable to just cash in on old copper though...
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This isn't true.
Almost all areas have at least two ISPs, the telephone company and the cable company.
People keep arguing the latter has "exclusive monopoly rights" granted by the local governments, but that's not true either. That might have been true for a decade or two when the company started up, but since then those agreements have been invalidated.
But even if they did have monopoly rights, it wouldn't matter, because the monopoly was on cable TV, not on ISP services. Not even the old, obsolete, exclusive franchise agreements would have prevented new ISPs from setting up in any area.
The reality is that there usually just two ISPs in any area for a simple reason: they both already have infrastructure, whereas any new ISP is going to have to lay cable. And laying cable is phenomenally expensive.
There are things that can help such as local governments helping new ISPs have access to existing poles to hang wires from, rather than forcing them to bury it, but poles aren't everywhere, and those poles often belong to companies that have no desire to allow third parties access.
The other problem is it's easier for telecoms and cable operators to market their services. There used to be WISPs in my area, offering point to point WiMAX service. They disappeared. Why? Presumably because everyone had heard of AT&T and Comcast, they were already customers of both, whereas the WISPs would have had to do a major advertising campaign just to get noticed. Meanwhile AT&T and Comcast can simply ask you whether you want internet service whenever you move in to a new home and call them to get your TV or telephone hooked up. The WISPs you'd have to contact separately.
There are plenty of people who think the solution is "more competition" as if someone can just wave their wand and bring forth millions of miles of fiber optic cable. It's not that easy.
Even Google can't do it. Google. Think about that.
You are not alone. This is not normal. None of this is normal.
No, this is not true at all. Major cities have those two options. Smaller cities/towns do not have cable (people get satellite TV, and yes they could get satellite internet if they want to pay even more for high latency and slower speeds but that's not real broadband).
And even where there ought to be two options, often there isn't. The last place I lived -- which was actually a fairly dense suburb of the capitol of California -- Comcast was my only option because AT&T declared the neighborhood oversubscribed and refused to offer DSL service. And where I currently live, also, Comcast is my only option -- AT&T doesn't explain why, but I just checked their website and verified they still won't offer me DSL.
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The vast majority of the countty (land-wise, not necessarily population-wise) only has DSL, if there is even that available. Indeed, where I live I only have CenturyLink DSL available. My vacation home also has CenturyLink DSL available, and the network there is oversaturated, leaving me with sub-1.5-megabit service with no other options. And guess what? The 10-megabit service and the service below 1.5 megabit cost the same.
If the world is round how come satellite signals are always available? Shouldn't they go in and out of visibility if the world was round? My satellite TV always works as does my so called GPS. Explain that!
Wake up you sheep.
We know the planet is round because FSM created it in the shape of a holy meatball, all hail his noodly appendage.
Exactly, you've never seen a perfectly round meatball, which is why his divine pastaness made the earth an oblate spheroid.
Calling someone a "hater" only means you can not rationally rebut their argument.
Well, the VPN services are probably also subsidizing your monthly fees by selling your activity data to interested parties.
Vintage computer games and RPG books available. Email me if you're interested.
If the world is round how come satellite signals are always available? Shouldn't they go in and out of visibility if the world was round? My satellite TV always works as does my so called GPS. Explain that!
Wake up you sheep.
We know the planet is round because FSM created it in the shape of a holy meatball, all hail his noodly appendage.
Exactly, you've never seen a perfectly round meatball, which is why his divine pastaness made the earth an oblate spheroid.
There exists the holiest of holy meatballs whos bumps and ridges match exactly that of the earth. When this is found surely it will usher in a new age of tomato based sauces for our glorious meatballs.
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both already have infrastructure, whereas any new ISP is going to have to lay cable.
It's worse than that. Any large enough ISP can just undercut them on price and force the new provider out of business. Then they can buy up all the new infrastructure that was built for way below cost in the bankruptcy sale.
And as long as that "free market" option is open to big companies that can afford to bleed money in one area to preserve profits overall, there will never be competition.
What exactly did these people expect living away from cities/hubs/high pop areas?
I'm sure they thought that the government funding that was given to the telcos to build out their networks and provide broadband (by the FCC's definition) in rural areas would have been used to... well.. provide broadband (by the FCC's definition) in rural areas.
APK quotes people (including myself) without context and should not be trusted. Just thought you should know.
At this point I'd settle for CenturyLink improving its own network. Right now they have so many subscribers that they aren't accepting more, and aren't upgrading existing customers. That's the sort of situation where, if there weren't a monopoly in the region, that a company would actually invest to fill the void. But there is a monopoly in the region and the company has done the math. It's more cost-effective to invest nothing (beyond occasional maintenance when something breaks) than to put in the money to improve the network for existing customers, even when improving the network might result in 200 or so new customers.
The problem is an utter lack of competition. There's no need to improve the service, because consumers have no other options. Even in the towns around here, there are only two options - DSL and cable. I'm not sure what the solution is, but one thing is clear - letting these big corporations have their monopolies on service leads only to consumers getting screwed.
It's one of those things where there could always be an alternate explanation that would hold up in a weak court.
Not only that, but not all Internet access is made the same. Even among homes that have both cable and telephone lines, that doesn't mean broadband is available.
Part of the issue here is the FCC's ridiculous method for measuring broadband penetration (in fairness, this method pre-dates Pai, so I can't lay it at his feet). Rather than extrapolating from a representative, random sampling of homes or doing a full survey for each home address, ISPs self-report, on a per-county basis, where they provide broadband. For the purposes of the FCC's measurements, if anyone in the county is self-reported by the ISP as being offered broadband, everyone in the county is counted as having access to broadband. As such, those numbers are only useful for comparing against themselves from prior years (and even then, only questionably so), rather than as any sort of measurement of or reflection of reality.
According to their method of counting, I should have at least three broadband ISPs available to me at my home in my metropolitan area neighborhood, but, in practice, I only have one (Suddenlink cable). Frontier DSL's website suggests that they're available and offering broadband in my area, but in actually calling them up last year, the best they offered at my address was 3Mbps for $35/month. Likewise, the locally-operated WISP's service area stops just at the edge of my neighborhood, with no plans to expand into my neighborhood. They're having enough trouble keeping up with demand from the people outside the big neighborhoods, since, as you suggested, cable is not nearly as prolific as the GP seems to think, meaning that many of the people near me aren't even "fortunate" enough to have access to Suddenlink.
All I'm looking for are modest speeds (>20Mbps) with no data cap. I'll always go for the cheapest plan that offers that, but the cost of getting that plan from Suddenlink (again, the only ISP offering those speeds at my address) has nearly tripled in the last seven years, from $31/mo. 7 years ago to $80/mo. today, most of which happened once Suddenlink's speeds got fast enough to make DSL irrelevant, giving them the justification they needed to drop all pretense of competing.