US broadband: Overpriced, Underpowered and (for once) Over There

Martyn starts his recollection of the history of ISP a bit late in time. We once had a vibrant ISP market before the telcos and MSO demolished the competition with superior speeds at competitive prices. Now we mostly have duopolies. Although Tim Wu’s report is generally accurate, he did not write anything about our static market that was not known before his report. Martyn’s typically European solution is more regulation, but it is the regulation and laws that have been put in place that prevent carriers and cities from building open-access fiber infrastructure by forming consortia or partnering along with arcane franchise regulation. 

We are challenged by geography in the U.S. that makes deploying fiber much more expensive than in most other countries. Elimination of the barriers that will allow carriers and cities to work together to build and share the last-mile infrastructure would encourage competition that will benefit all stakeholders.

By Martyn Warwick

As an Englishman and therefore, a European (by dint of geographic proximity if nothing more)  who is a very frequent visitor to the United States, I have, over many years now, been able to make my own informal comparative study of the state of the Internet on both sides of the Atlantic. My conclusion is this: in almost all circumstances the US Internet is slow, cumbersome and damnably expensive and in the Global Broadband Stakes, it comes in way down at the end of the field, a knackered, blowhard also-ran. Continue reading

Why the U.S. Has Fallen Behind in Internet Speed and Affordability

Not often will I agree with opinion from “The New York Times,” but in this case they are pretty close to getting it right. After you dig through the comparison to other cities and slamming of our communications service providers they get to the heart of the matter by saying that a duopoly is not competition and competition will lower prices and improve the quality of service. Note that I did not mention “speed.” 

here are structural differences that make the U.S. different from Asian and European countries such as our lower population density and more people living in single-family dwellings. These two facts dramatically increase the cost to build a network to where at best two providers can make a decent ROI. Why do you think that AT&T and Verizon keeps shedding their rural territories? Where we see competition, we see lower prices and better services. Another reason many of these countries have lower prices is that governments have subsidized building of these networks with taxpayer dollars easing the challenge of turning a profit to service providers. In many of these countries service providers use to be owned by the government so they still have a cozy relationship. Continue reading

Pai Worried FCC Might Be Heading Toward Title II

By: John Eggerton

FCC Commissioner Ajit Pai warned fixed wireless Internet service Providers (WISPs) Wednesday that he is worried the FCC might be headed toward Title II regulation.

In a speech to  WISPAPALOOZA, the Wireless Internet Service Providers Association conference in Las Vegas Oct. 15, Pai took a page from former President Ronald Reagan to make his point. “President Ronald Reagan wisely said that the ‘government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.’ Unfortunately, I’m worried that’s where the FCC might be headed when it comes to the Internet.” Continue reading

Raleigh approves AT&T’s fiber internet plan

Lauren K. Ohnesorge
Staff Writer-Triangle Business Journal

The City of Raleigh officially put its stamp of approval on AT&T’s (NYSE: T) plan to bring its “GigaPower” fiber-based internet service here.

Gail Roper, Raleigh’s chief information officer, says the timing is still up in the air. “That would be dependent upon when we finish out all the legal negotiations,” she says, adding that the hope is that things get rolling before the end of the year.

And no, this will have no impact on the city’s ongoing plan to entice Google and its Google Fiber service.

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Economists Rebuff Lawmakers’ Letter by Advocating for Network Neutrality

Finally some common sense with regards to net neutrality. These economists are saying that, like most things, if the government regulates the Internet, then it will actually hurt the people it is trying to protect.  “If it ain’t broke, don’t fix it.” Net neutrality is truly a bipartisan issue with Democrats and Republicans both for and against it. There are several forces at work here that are pushing net neutrality. There are the content providers that are neophytes at lobbying who are trying to manipulate the market to protect themselves. They do not realize that the law of unintended consequences can come back to bite them in the backside. Then there is the FCC that is going with the meme of the current administration to expand governmental powers.  This is a strange power struggle where the “bad guys” are really the “good guys” and vice versa, but for all the wrong reasons.  You have to read this article carefully realize that these economists support the no regulation net neutrality that the Internet originally enjoyed.

Broadband  Breakfast LogoMytheos Holt, Reporter-Researcher, BroadbandBreakfast.com

WASHINGTON, July 9, 2010 – Four economists argued in a letter to the FCC sent Wednesday that the question before the agency was “not whether to impose network neutrality, but whether to eliminate it.”

They responded to a letter also sent to the FCC that was drafted by 74 Democratic lawmakers who said the FCC’s plan to impose new regulations on the internet would violate a standing bipartisan consensus about leaving the internet unregulated. The economists argue that, in the aftermath of deregulatory court decisions like the Comcast case, the question is whether to restore what was previously the status quo, not whether to impose new regulation. The court ruled that the FCC did not have the authority to regulate Comcast’s control over the speed that data flows through its networks.

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New Report Says Net Neutrality Regulations Could Cost up to 500,000 Jobs and $80 Billion per Year in Lost GDP

I agree with the premise of the report that net neutrality as it is currently defined will stifle competition.  AT&T has publicly stated that it will halt U-verse deployments if net neutrality is passed.  Verizon has already capped its FiOS project.  The warning signs are already there.  The Internet is a vital component to the U.S. economy as it transitions from a manufacturing-based to knowledge-based economy.  Any potential threat to its vitality must be stopped.  There are several assumptions in this study that I believe are overstated or flawed.  Even if they are corrected, the result will be that as the FCC has defined net neutrality, jobs will be lost in our economy.  The Internet must remain open and accessible for all users despite methods of access.  On the other hand, the FCC must not be heavy-handed in regulating it as not to impede innovation.  All of these points bring me back to my assertion that open-access municipal networks will go a long way to continue the freedom and innovation of the Internet.

Broadband experts warn of depressed network investment, limits on new business models, and deterred rollout of broadband-enabled services

NEW YORK–(BUSINESS WIRE)– According to research released today from Charles M. Davidson, director of The Advanced Communications Law & Policy Institute at New York Law School, and Bret Swanson, president of technology research firm Entropy Economics, new regulations for providers of broadband Internet service could result in the loss of hundreds of thousands of jobs. The new Internet regulations, the report estimates, could also reduce U.S. Gross Domestic Product (GDP) by tens of billions of dollars per year. The report, “Net Neutrality, Investment & Jobs: Assessing the Potential Impacts of the FCC’s Proposed Net Neutrality Rules on the Broadband Ecosystem,” examines the extent of likely damages to investment, jobs, and U.S. GDP resulting from the implementation of the Federal Communications Commission’s (FCC) proposed net neutrality regulations.

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US broadband: still expensive, underwhelming

Last week the OECD released its update on broadband metrics and the United States lags most developing countries in broadband speeds and price.  It is interesting to note that the cost per bit for Internet access is about 4 times higher than in countries that have more than two competitors in the market.  These figures once again validate the need for local access competition.  Our broadband penetration is respectable considering the population density, but we still lag countries with true competition.

The OECD this week released an update to its much-watched set of broadband metrics. The data set now extends through December 2009, and the US continues to look anemic on most OECD measures.

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