Wednesday, September 13, 2006

America's Pipes Don't Measure up for Broadband

I have a bit of an interest in Internet connectivity. Not just because I work in IT, not just because I work with a lot of people who are part of the digital divide but in part I like to download the sweet multimedia content that's available. The problem is that broadband is expensive and in comparison to other developed countries kind of slow. Ars points to a report by the Consumer Federation of America, Consumer's Union, and Free Press.

One thing that gets forgotten in the paying more to get less reality of American broadband is that the policies of the FCC and the companies perpetuate the digital divide. Yes, the gap is shrinking a bit but still 16th in penetration and 15th in terms of growth, is to be frank pretty piss poor performance especially when one considers the price we pay. For example, Verizon offers FiOS at 30 Mbps / 5Mbps for $179.95 per month, yet in Japan or South Korea one can get 100 Mbps /100 Mbps for $35 and $32 per month respectively.

The reason Americans get screwed is that in most metropolitan areas customers have at most two broadband providers. Others have only one and in large swaths of the country there are none. There is no real profit driven reason for cable or DSL providers to provide service in rural areas, just ask Verizon why they don't want to offer FiOs in Swanksville and other areas in westwern PA. The duopoly and the inherent lack of real competition is due in no small part to the Brand X case and the subsequent FCC ruling on DSL. Cable and DSL providers don't have to lease their lines to competitors and can therefore charge highly for rather slow speeds and poor customer service.

Congress is trying to fix some of the problems with broadband. They are trying to overturn bans on municipal broadband which some states have passed. Municipal is one strategy to bring in much needed competition but congress could go further. They could require broadband providers to lease the lines. The broadband companies are given exclusive right of way in many locales. Doing so would not only shrink the divide in large cities but could help in rural areas. There is a lot of dark fiber that companies are putting to use that can be lit for consumers. If competitors can lease lines then the larger companies would have to compete on price and speed, there would be an incentive to get more customers in unserviced areas because of the competition in former monopoly areas.

On a somewhat related note this puts the whole anti-network neutrality of the cable and telephone companies in perspective. It's bad enough they want to throttle down the speeds of companies that don't pay extortion but the speeds of the fastlane are pretty damn slow.

1 comment:

Wolfie said...

Same story in the UK, in fact its even worse!

... Still on 2Mb, like most Brits :