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Why Broadband Service in the U.S. Is So Awful
Scientific America ^ | 10/2010

Posted on 10/08/2010 7:42:26 AM PDT by Sakity Yaks

The average U.S. household has to pay an exorbitant amount of money for an Internet connection that the rest of the industrial world would find mediocre. According to a recent report by the Berkman Center for Internet and Society at Harvard University, broadband Internet service in the U.S. is not just slower and more expensive than it is in tech-savvy nations such as South Korea and Japan; the U.S. has fallen behind infrastructure-challenged countries such as Portugal and Italy as well....

Phone companies have to compete for your business. Even though there may be just one telephone jack in your home, you can purchase service from any one of a number of different long-distance providers. Not so for broadband Internet. Here consumers generally have just two choices: the cable company, which sends data through the same lines used to deliver television signals, and the phone company, which uses older telephone lines and hence can only offer slower service.

The same is not true in Japan, Britain and the rest of the rich world. In such countries, the company that owns the physical infrastructure must sell access to independent providers on a wholesale market. Want high-speed Internet? You can choose from multiple companies, each of which has to compete on price and service. The only exceptions to this policy in the whole of the 32-nation Organization for Economic Co-operation and Development are the U.S., Mexico and the Slovak Republic, although the Slovaks have recently begun to open up their lines....

...[T]he FCC wants to take only a half-step. Genachowski has said that although he regards the Internet as a telecommunications service, he does not want to bring in third-party competition....

(Excerpt) Read more at scientificamerican.com ...


TOPICS: Business/Economy; Government; Technical
KEYWORDS: broadband; competition; internet
The problem: free markets are not compatible with government monopolies.
1 posted on 10/08/2010 7:42:31 AM PDT by Sakity Yaks
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To: Sakity Yaks

The countries mentioned in the article are also much smaller, and much more densely populated.


2 posted on 10/08/2010 7:44:31 AM PDT by dfwgator (Texas Rangers - AL West Champions)
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To: Sakity Yaks
I lived in Tel Aviv for two years. I paid more for broadband services and it was just as good as the broadband I have now (Ohio).

BTW, Israel was free market broadband.

3 posted on 10/08/2010 7:46:37 AM PDT by carton253 (Ask me about The Stainless Banner - a free e-zine dedicated to the armies of the Confederacy.)
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To: dfwgator

I don’t think that explains much, really — most of the really empty areas of the US don’t have broadband at all (and thus don’t enter into the statistics), and when you factor them out the density figures for the US and Western Europe are comparable.


4 posted on 10/08/2010 7:48:03 AM PDT by Sakity Yaks
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To: Sakity Yaks

Notice also those countries are much smaller too


5 posted on 10/08/2010 7:54:19 AM PDT by GeronL (http://libertyfic.proboards.com <--- My Fiction/ Science Fiction Board)
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To: Sakity Yaks

If we pack everyone in the US into a couple of giant cities and run fiber into every housing block we could improve our bandwidth as well.

But since we are spread out, have alot of rural space, and have a government that insists on getting involved just enough to screw things up, we will lag in the bandwidth wars ...


6 posted on 10/08/2010 7:55:39 AM PDT by spodefly (This is my tag line. There are many like it, but this one is mine.)
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To: Sakity Yaks

I have pretty fast internet 19+MBPS and we get phone, cable and internet for around $100 a month. Not too expensive.


7 posted on 10/08/2010 7:56:39 AM PDT by GeronL (http://libertyfic.proboards.com <--- My Fiction/ Science Fiction Board)
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To: GeronL

I have a similar deal with Dimhouse Cable here in Indiana.

For normal web surfing it seems fine. In the two years we’ve had it, there has only been one short term outage.

I suppose if you were doing industrial strength file transfers it might be lacking.

The only thing I miss is Sunday Ticket from when I had DirectTV at my former place.


8 posted on 10/08/2010 8:00:28 AM PDT by nascarnation
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To: GeronL

where the heck is that?

Where I am, internet alone would run a hundred bucks a month at that speed.


9 posted on 10/08/2010 8:00:35 AM PDT by mamelukesabre (Si Vis Pacem Para Bellum (If you want peace prepare for war))
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To: Sakity Yaks

looks like another Obama Administration “America Sucks!” Propaganda Story of the Day to me


10 posted on 10/08/2010 8:02:09 AM PDT by Buckeye McFrog
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To: Sakity Yaks

I think the future is hi-speed wireless cell phone based internet anyway. America will probably skip the intermediate phases.


11 posted on 10/08/2010 8:02:19 AM PDT by mamelukesabre (Si Vis Pacem Para Bellum (If you want peace prepare for war))
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To: dfwgator

As I understand it, here in Canada the local phone company, typically Bell Canada here in Ontario, is required to make their lines available for other DSL providers. So, if you live in an area where DSL is generally available, you can often access DSL services from other companies besides Bell Canada, typically at lower prices. I get my internet service through my cable provider, however, mostly because at the time I first got high-speed internet the cable internet service was clearly superior to the DSL service - and may still be, depending on the area.


12 posted on 10/08/2010 8:02:22 AM PDT by -YYZ- (Strong like bull, smart like ox.)
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To: dfwgator

This is a smart set of responses. Density is the key to cheap broadband and Americans like the wide open spaces.


13 posted on 10/08/2010 8:02:43 AM PDT by don'tbedenied
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To: mamelukesabre

Time Warner Cable

Dallas TX

I went to speedtest.net for the speed.


14 posted on 10/08/2010 8:02:43 AM PDT by GeronL (http://libertyfic.proboards.com <--- My Fiction/ Science Fiction Board)
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To: Sakity Yaks
Worth repeating:

The problem: free markets are not compatible with government monopolies.

A more concise statement of current American policies would be difficult to imagine.

15 posted on 10/08/2010 8:03:24 AM PDT by null and void (We are now in day 626 of our national holiday from reality. - 0bama really isn't one of US.)
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To: mamelukesabre
I think the future is hi-speed wireless cell phone based internet anyway. America will probably skip the intermediate phases.

The early bird gets the worm,
But it's the second mouse that gets the cheese!

16 posted on 10/08/2010 8:05:23 AM PDT by null and void (We are now in day 626 of our national holiday from reality. - 0bama really isn't one of US.)
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To: Sakity Yaks
Phone companies have to compete for your business. Even though there may be just one telephone jack in your home, you can purchase service from any one of a number of different long-distance providers. Not so for broadband Internet. Here consumers generally have just two choices: the cable company, which sends data through the same lines used to deliver television signals, and the phone company, which uses older telephone lines and hence can only offer slower service.

This opening paragraph is so inaccurate ... this is total crap....

17 posted on 10/08/2010 8:05:27 AM PDT by tophat9000 (.............................. BP + BO = BS ...........................Formula for a disaster...)
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To: mamelukesabre

I’m sorry, at this particular moment it looks like I top off at 18.49 mbps. It can vary during the day.

Upload speed is, uh, MUCH MUCH slower.


18 posted on 10/08/2010 8:05:52 AM PDT by GeronL (http://libertyfic.proboards.com <--- My Fiction/ Science Fiction Board)
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To: nascarnation

Normal web surfing for me includes watching a lot of video. heh. Thank Gawd we don’t get charged by the MB


19 posted on 10/08/2010 8:08:19 AM PDT by GeronL (http://libertyfic.proboards.com <--- My Fiction/ Science Fiction Board)
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To: Sakity Yaks

I have 20MBps. Not exactly “mediocre”.


20 posted on 10/08/2010 8:10:15 AM PDT by CodeToad (Islam needs to be banned in the US and treated as a criminal enterprise.)
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To: Buckeye McFrog

“looks like another Obama Administration “America Sucks!” Propaganda Story of the Day to me

Exactly. It seems we are treated to one Communist propaganda story after another bashing America. This one is a bold faced lie. We have as good as or better Internet service than any other country. Not to mention, we serve at least 250 million people with broadband service.


21 posted on 10/08/2010 8:12:16 AM PDT by CodeToad (Islam needs to be banned in the US and treated as a criminal enterprise.)
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To: GeronL

Right, this takes a 2005 view of “broadband” where the only options are cable and DSL. The future is in 3g/4g (as other’s have said).

Wired infrastructure is (mostly) a waste. Wireless is the future.


22 posted on 10/08/2010 8:13:00 AM PDT by Weird Tolkienish Figure
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To: mamelukesabre; Sakity Yaks

(cable)
I am getting 6 megs down (1 meg up) for $27; $10 more would get me 10 megs down.

Just so we are talking apples and apples, that translates into usnet downloads of a little over 2 gigs an hour.

I use a small provider, so I haven’t had anyone sniffing around (yet) regarding the amount of bandwidth I use, which is another issue with some providers.


23 posted on 10/08/2010 8:14:18 AM PDT by ChildOfThe60s (If you can remember the 60s, you weren't really there.)
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To: CodeToad

This is an attempt by idiot liberals to get the government involved (a familiar liberal meme)... as well as telecom companies eager to get their pudgy, greasy, stick fingers on all those fed dollars.

Never ever, ever trust a liberal.


24 posted on 10/08/2010 8:14:53 AM PDT by Weird Tolkienish Figure
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To: null and void

We seem to have a combined government monopoly/free market system that takes the worse traits from both.


25 posted on 10/08/2010 8:18:39 AM PDT by antiRepublicrat
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To: Weird Tolkienish Figure

I have DLS and Cable available, and we’re weeks from having fiber in the neighborhood which claims to have speeds 10X what’s available by cable. Also, AT&T (BellSouth) is supposed to be bringing its “U-Verse” service to our area some day, which will rival cable.

I also have 3G available if I hold the phone near the window, but it isn’t nearly as fast as my cable.


26 posted on 10/08/2010 8:19:02 AM PDT by meyer (Tax the productive to carry the freeloaders - What is it with democrats and slavery?)
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To: antiRepublicrat

...and taxes us for the privilege!


27 posted on 10/08/2010 8:21:50 AM PDT by null and void (We are now in day 626 of our national holiday from reality. - 0bama really isn't one of US.)
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To: mamelukesabre
I think the future is hi-speed wireless cell phone based internet anyway. America will probably skip the intermediate phases.

I disagree, if only because of the trend to limit the amount of data that can be transferred before internet service is cut for the rest of the month. The networks, in certain places, already cannot handle the amount of data that is flowing.

28 posted on 10/08/2010 8:25:59 AM PDT by MortMan (To Obama "Kill them all and let [God] sort them out" is an abortion slogan.)
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To: -YYZ-

The Telecom Act of 1996 made Competitive Local Exchange Carriers the law here too.

(Line owners by law are forced to lease lines to competitors.)


29 posted on 10/08/2010 8:29:28 AM PDT by WOBBLY BOB ( "I don't want the majority if we don't stand for something"- Jim Demint)
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To: Sakity Yaks
Speaking from direct experience (I work in the industry), this article is a load of crap.

The reason that broadband costs are so high and the technology is lagging behind is because the FCC ruled that Incumbent Local Exchange Carriers (ILECs) must provide service to Competitive Local Exchange Carriers (CLECs) at below wholesale costs.

Want to guess who gets the losses passed on to them? That's right, you the customer.

Just remember that when you look at your next phone bill. It's that high because the FCC got involved and tampered with the markets. Now the majority of the ILECs can't afford to make major infrastructure upgrades because they would be forced to offer that new, upgraded plant to companies for less than it cost them to build it, destroying any profit they would have seen and stifling innovation. Thanks Government, you did it again!

30 posted on 10/08/2010 8:30:01 AM PDT by paladin1_dcs
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To: MortMan

They will catch up. there’s too much money to be made if they do. So they won’t let the opportunity pass by.


31 posted on 10/08/2010 8:31:43 AM PDT by mamelukesabre (Si Vis Pacem Para Bellum (If you want peace prepare for war))
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To: WOBBLY BOB

It goes back further than that, but the ‘96 act was a real killer.

The FCC has been a problem since it’s inception.


32 posted on 10/08/2010 8:32:30 AM PDT by paladin1_dcs
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To: mamelukesabre

Too much money? Says who? I’ve seen the sales figures, I know for a fact that Verizon’s Florida FiOS build was shut down due to low take rates, high construction costs and CLECs taking everything that wasn’t considered “lit fiber”.

There’s no money in it as long as the FCC is involved.


33 posted on 10/08/2010 8:34:56 AM PDT by paladin1_dcs
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To: Sakity Yaks

BS article.

My connection works as fast as my fingers can move.

Propaganda to get control of the net.


34 posted on 10/08/2010 8:35:32 AM PDT by Freddd (CNN is down to Three Hundred Thousand viewers. But they worked for it.)
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To: Sakity Yaks

I dropped Mediacomm broadband because it was so damned expensive. I pay $35/mo now for DSL, and the only time I notice the difference is when I download large video files. Those do take longer. Otherwise, everything else is fine.


35 posted on 10/08/2010 8:40:44 AM PDT by reagan_fanatic (First there was nothing. Then it exploded.)
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To: Sakity Yaks
Max speed I can get on DSL is .45 MBS. No cable available. However, fiber-optic was just dug in and should be available next month. Hallelujah!
36 posted on 10/08/2010 8:41:36 AM PDT by Prokopton
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To: Prokopton
Max speed I can get on DSL is .45 MBS. No cable available. However, fiber-optic was just dug in and should be available next month. Hallelujah!

I should say that I feel a little guilty as the fiber-optic is being paid for out of a grant that was part of the stimulus bill that I was against. At least somebody is getting something for the money spent.

37 posted on 10/08/2010 8:44:45 AM PDT by Prokopton
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To: Sakity Yaks

It could have been different. The 1996 Telecommunications Act, although deeply flawed, was designed to encourage local telephone competitors to invest in modern facilities where it made sense to do so (e.g., switches, servers, etc.) and lease the piece-parts of the incumbent’s network (unbundled network elements—”UNEs”) at marginal cost where necessary (distant switches, local lines, etc.).

Unfortunately, the FCC, led by Reed Hundt (Al Gore’s college room mate), destroyed competitors’ incentive to invest in new facilities by allowing them to lease ALL facilities from the incumbent at marginal cost (the UNE “Platform”). Why buy a $2 million switch when you can use the incumbent’s for less than total cost (marginal cost excludes most common costs—overhead)?

Hundt did this, in my opinion, to create the appearance of competition. Hundreds “competitor” phone companies materialized—most of which were nothing more than a billing and marketing operation with zero telecom facilities of their own.

The effect of Hundt’s action was twofold. First, as noted above, it discouraged new entrants from investing in new facilities. Second, it discouraged incumbent telcos from modernizing their networks. What company will invest the billions required for a modern network if it is required to lease it competitors at prices below actual cost?

Most of the pretend competitors died out as a result of two events. First, when the dot.com bubble burst, investors realized that reliance on BS marketing without creating value was not a sustainable business model.

Second, regulators grudgingly realized that UNE Platform discouraged investment by incumbents as well.

We’re back on track now. However, we lost over 10 years largely due, in my opinion, to Al Gore’s room mate’s creation of a “Potemkin Village” of telecom competition.


38 posted on 10/08/2010 8:45:09 AM PDT by mondonico (Peace through Superior Firepower)
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I sure don’t have broadband. I live in Oregon farm country and all we get is dial-up (slow) or satellite (expensive).


39 posted on 10/08/2010 8:48:03 AM PDT by Rio
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To: mamelukesabre

I have home preferred Cox cable internet which fluxuates between 13 and 18 Mbps, extended cable (70 channels) and the HDef box, for $120/month.

I live in a small town of 14k. What kills me is the latency. It takes anywhere between 60 and 400 ms to connect. It is never consistent and the local cable service seems to be clueless.

The only viable other option is local telephone DSL, but it costs $20 more for comparable speed.

Small towns get screwed because of the lack of competition.

Satellite is costs about 2x what the Cable internet does with half the speed. Mobile is starting to show up, but it is expensive and the download usage is very restrictive.

So far, cable, for all its ills, is the best option for me.


40 posted on 10/08/2010 8:49:20 AM PDT by TomGuy
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To: Sakity Yaks

I have 35mbps/35mbps Internet, Full HD package (less premiums) and unlimited phone for less than $100/month. I can’t complain.


41 posted on 10/08/2010 9:00:33 AM PDT by PogySailor (The ruling class will not go down easily. And neither will their paid hacks.)
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To: Sakity Yaks

Another problem.

Geography.

It’s easier to run new cables/fiber in Japan, Portugal, UK, because the cities are more dense.

I live 35 miles from downtown Houston.

All I can get for internet connectivity is satellite (Hughes/DirecTv), wireless (Skynet WISP), or dial-up.

Satellite and wireless have an upfront cost of $300-400 (install a receiver on my roof) and a monthly cost of $60+.

Dial-up costs me $10 a month.

Guess which I chose?


42 posted on 10/08/2010 9:54:29 AM PDT by Ro_Thunder (Press want Obama = “Camelot II - The Return of JFK”, not “Peanuts II - that’s all you’ll have l)
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To: null and void; Sakity Yaks

Here’s a simple way to frame it:

Political entrepreneurs v. market entrepreneurs.

Americans by large margins hate with a vengeance the first, but should love and adore the second.

Too often we mix them up to our detriment.


43 posted on 10/08/2010 10:00:52 AM PDT by 1010RD (First Do No Harm)
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To: Sakity Yaks

Another formerly fine publication obviously hijacked by Marxists:

“But that was before the FCC made a terrible mistake. In 2002 it reclassified broadband Internet service as an “information service” rather than a “telecommunications service.Phone companies have to compete for your business. Even though there may be just one telephone jack in your home, you can purchase service from any one of a number of different long-distance providers.

Here consumers generally have just two choices: the cable company, which sends data through the same lines used to deliver television signals, and the phone company, which uses older telephone lines and hence can only offer slower service. The same is not true in Japan, Britain and the rest of the rich world. In such countries, the company that owns the physical infrastructure must sell access to independent providers on a wholesale market. Want high-speed Internet? You can choose from multiple companies, each of which has to compete on price and service.”

This is just such a crock-of-shite on so many levels.

First, whoever wrote this article actually knows nothing at all about the actual technology, when they falsely claim “older telephone lines and can only offer slower service”. Guess they never heard of DSL, hey?

Second, the physical infrastructure determines speed, not the “independent providers”, which simply just lease the physical infrastructure that’s already there rather than building their own.

Third, has anybody else besides me noticed that the regulated telecommunication services so happily mentioned as having so many competitive options can’t provide Internet service at rates higher that 256 kbps, the same as when phone companies first offered internet access?

In point of fact, the Internet wouldn’t exist at all if Reagan hadn’t deregulated telecommunications service by breaking up the national AT&T monopoly, which thought the Princess telephone was the height of innovation.

By unleashing the competitive forces heretofore stifled by the AT&T monopoly, multiple companies invested in brand new and innovative national and regional infrastructure, including national fiber optic networks. These new networks, originally built to carry voice, were subsequently available for building the U.S. Internet, which by the way, was built entirely by the private sector and free of all regulation. In the mean time, AT&T withered away until nothing was left but it’s name, which eventually was taken over by a regional telephone company.

Additionally, most of the western European countries initially fell woefully behind in Internet development until they emulated the U.S. by removing the authority of their national PTTs to control their Internet, thereby unleashing the same competitive forces that allowed the U.S. Internet to be built in the first place.


44 posted on 10/08/2010 10:10:03 AM PDT by catnipman (Cat Nipman: Made from The Right Stuff!)
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To: catnipman
The European PTTs were running their own competing service. Without free competition we would have ended up with a Minitel like solution, where the services available were controlled by the Telco (or the Postal Service, like in France).
45 posted on 10/08/2010 11:14:04 AM PDT by Dan Cooper
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To: Dan Cooper

“The European PTTs were running their own competing service. Without free competition we would have ended up with a Minitel like solution, where the services available were controlled by the Telco (or the Postal Service, like in France). “

Yeah, I remember when a U.S. high school acquaintance who moved to France decades ago once told me a few years back that he didn’t see what the big deal was about the Internet, since France had Minitel, which seemed to do everything that needed doing as far as he was concerned. Naturally, it was pointless to engage him in further conversation.


46 posted on 10/08/2010 12:02:24 PM PDT by catnipman (Cat Nipman: Made from The Right Stuff!)
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To: mondonico

It’s a similar “fake” competition in the Electricity market in Texas. There a tons of “marketing and billing” companies, but only one real electricity transmission provider.


47 posted on 10/12/2010 5:18:42 PM PDT by anymouse (God didn't write this sitcom we call life, he's just the critic.)
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