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Broadband In Crisis: Does The US Need Regulation To Force Meaningful Competition?

from the two-internets dept

Susan Crawford believes telecommunications in America are going through the biggest crisis ever, and this is just as bad as the banking crisis was. Monday, at the Freedom 2 Connect conference, the Internet law scholar and former Special Assistant for Science, Technology and Innovation Policy at the White House, laid out what's wrong with broadband in America, hinting and what needs to be done to fix it. It's not going to be easy.

"The stakes are extraordinarily high, this has been an incremental crisis for a long time but now it's an actual crisis," said Crawford, whose book analyzing these issues, Captive Audience, will be published in November. The central issue is the so-called digital divide and what Crawford refers to as the "looming cable monopoly." Due to deregulation, which was predicated on the premise that the free market and competition would protect consumers, cable companies have found themselves with an inordinate amount of power to control the Internet and broadband access while, at the same time, traditional phone companies like AT&T are struggling to keep up and veering towards wireless services.

To support her thesis, Crawford presented some stunning numbers. In the last two years, Comcast market share has grown from 16.3 million subscribers to 18.5, a 14 percent growth. Time Warner Cable has grown 10 percent, from 9.2 to 10.7 million customers. Meanwhile, DSL subscribers have plummeted: AT&T and Verizon market share is down 22 and 21 percent respectively.

So, while it's good to be Comcast, it's not good to be an American citizen. Without competition, there's no drive to improve the service. The average speed of an Internet connection in the United States is around 5Mbit/s. An astoundingly low number if you look at other western countries. South Korea, for example, has an average of 50Mbit/s. And faster connections are starting to be implemented around the world. One gigabit connections are available in countries like Japan, Portugal or Sweden and at much better prices than in the U.S. – in Hong Kong, connecting at one gigabit per second costs $26 a month while in Chattanooga, TN, it costs $350.

What does this mean to the average citizen? It means the United States are giving up their leadership. Crawrford said this means “the next Google won't come from America.” And, even within U.S. borders, there's a fundamental problem: you either pay premium for a mediocre service or you are left behind.

“We end up with two Internets, two societies in America,” Crawford said to me in an interview.

One America does some tweeting and Facebook on their inferior, slower wireless devices. The other America not only gets to enjoy video online, but they can also apply for jobs, do video-conferencing, get an education online and, ultimately, live in the 21st century. Crawford argues that this digital divide ends up creating inequality between the haves and have-nots in America.

The only solution, Crawford argues, is for the government to intervene and regulate. Internet access, particularly high-speed access, should be treated “as a utility, just as electricity, gas and water.” Doing so would make the Internet a natural monopoly in which the government would provide the pipe and guarantee equal opportunity of access to everybody.

It might not happen immediately, but Crawford hopes that, with her influence and that of other thinkers like her, this will come to the forefront of the public discussion. She believes that, eventually, in every district, there will be elected officials who understand and care about these issues. That will be when we'll be able to look for a solution. "We make this a voting issue, that's how we fight back."


Reader Comments (rss)

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    A Guy (profile), May 24th, 2012 @ 2:39pm

    Regulation would just be a stop gap measure. What we need is a fiber build out that would provide some meaningful competition instead.

     

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    Keii (profile), May 24th, 2012 @ 2:44pm

    Disclaimer: I don't know anything about economics so this may seem like a wild and crazy idea that wouldn't work, but I'll give it a shot anyway.

    Why doesn't the government try a utility based internet service while also competing with the private sector? You could get your cheap internet utility or opt for the faster business service providers?

     

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    Steven LEach, May 24th, 2012 @ 2:44pm

    Hurrah Hurrah Someone who appears to be on my side

    I Agree whole heartedly with this person, since we allowed our government to carve out little monopolies all over the United States, we should definitely allow this same government who is fed millions in cash from these same companies to "increase competition". Who ever believes this will actually happen is either an idealistic naÔve person, or just totally clueless.
    While I agree more competition is needed, and will provide relief I believe that the break up of Ma Bell should be looked at far more closely, and learned from so we don't repeat those mistakes.
    Where will this new competition come from ? Maybe Google, Maybe Apple, maybe someplace else, but asking the government to force competition into the mix will be a regrettable decision, if history is any teacher.

     

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    Anonymous Coward, May 24th, 2012 @ 2:44pm

    Simple fact:

    No one will be able to build an entire network from the ground up to compete with others that already have that infra-structure in place, that is just not going to happen unless you are Google or have the same deep pocket.

    In other countries this exact same approach worked wonders like Japan and the UK, it failed spectacularly in Canada because of the implementation and it remains to be seen how Australia will fare.

    There is no competition in the American market, the cost to enter that market is high, the regulations are endless, the backdoor exclusive deals between individuals and institutions is rampant so if there are no regulations the future doesn't look good for the US broadband in the near future it could turn around for other reasons not known at this point, but nobody should hold their breadth waiting for it.

     

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    Benjo (profile), May 24th, 2012 @ 2:44pm

    Good Ideas

    I've thought similarly for a while. Broadband internet bandwidth is essentially a featureless service, and fits in with a bunch of utilities we already regulate.

    I think a compromise could be something like what they have in the UK, where BT is forced to sell bandwidth wholesale (regulated price) to smaller (regional) companies that can then turn and attract subscribers however they can. iirc BT fought this hard at first but it has actually worked out for them pretty well (less overhead, more efficient now that they can focus more on just the infrastructure).

    Projects like Google Fiber help too, but I don't think their scale is large enough.

     

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    A Guy (profile), May 24th, 2012 @ 2:49pm

    Re:

    Because lobbyists keep trying to kill any attempt to inject real competition in the market.

     

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    A Dan (profile), May 24th, 2012 @ 2:49pm

    Re: Hurrah Hurrah Someone who appears to be on my side

    asking the government to force competition into the mix will be a regrettable decision, if history is any teacher.

    It seems to me that the relevant history here is landline telephones. Government forcing competition seems to have been a good thing for those.

     

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    Josef Anvil (profile), May 24th, 2012 @ 2:51pm

    Econ 101

    The cable companies and the telcos could provide faster service, but that goes against their corporate greed. The could not maintain the bandwidth shortage myth if they suddenly offered faster service.

    Verizon and ATT both have fiber offerings (FiOS and Lightspeed), but they are pricey compared to their DSL offerings and they don't want to cannibalize their own products, like when they didn't want to offer VoIP service.

    It's basically that our broadband companies do not want to be good companies, they want to be wealthy companies. Yet another example of wanting to hold onto the old business models for as long as possible to the detriment of their customers.

     

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    :Lobo Santo (profile), May 24th, 2012 @ 2:52pm

    Re: Comp this...

    The corporations are far too good at forming powerful confusopolies, there will be no honest competition when collusion is better for one's profit margins.

     

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    John Fenderson (profile), May 24th, 2012 @ 2:52pm

    Re:

    A number of towns have tried, but have had the attempts stopped due to lawsuits from the private telecommunications companies -- even a few where private companies have no plans to offer competing services at all.

     

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    John Fenderson (profile), May 24th, 2012 @ 2:54pm

    Re:

    No one will be able to build an entire network from the ground up to compete with others that already have that infra-structure in place


    True. This, and the need to prevent monopoly, are two good reasons why this should be a publicly-owned project.

     

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    Anonymous Howard, May 24th, 2012 @ 2:57pm

    What's the old rule? If the title of the article is a question, the answer is probably no?

     

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    Anonymous Coward, May 24th, 2012 @ 2:58pm

    We need regulation simultaneously with government spending on our infrastructure.. Sweden, S Korea and others have great Internet because their governments invest. Unfortunately we've got the Repubicans and Democrats.

     

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    Anonymous Coward, May 24th, 2012 @ 2:58pm

    'in every district, there will be elected officials who understand and care about these issues'

    too many politicians getting kick-backs to want to bring serious internet speeds into being. although they are 'area specific', there are too many monopolies at work and there ain't no way that any will be relinquishing their hold any time soon. they think that their individual profits are what should be used to judge the US prosperity rather than the overall position in the international field. using that, E.Asia is kicking the US well and truly in the nuts!!

     

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    Yakko Warner (profile), May 24th, 2012 @ 2:59pm

    Did I miss something in Geography?

    When did South Korea become a Western country?

     

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    :Lobo Santo (profile), May 24th, 2012 @ 3:00pm

    _sigh_

    The conclusion is inevitable: the corruption, the cancer that is the United States is either going to die and be replaced, or it must be reborn, revitalized, revolutionised...

     

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    Digitari, May 24th, 2012 @ 3:06pm

    RE: faster Internet?

    hell No, the MPAA and RIAA and their ilk would just DIE if we could "steal" IP quicker.

    even if Hell Michigan does freeze over, this aint gonna happen

     

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    Yakko Warner (profile), May 24th, 2012 @ 3:11pm

    It should be a utility by now

    Telephone service is a utility. Even though it's deregulated, companies that provide the service still have to maintain a level of service.

    Something I learned as a Comcast subscriber -- if you want better service, subscribe to their phone service (which is VOIP and is carried by their internet service). Both I and my mother subscribe to Comcast service in our respective homes (which are separate dwellings, thank you). We each had internet and phone service through them. When we had a problem, all we had to do was remind the customer service tech that we had phone service, and it was fixed the same day.

    I've since gone to a much cheaper VOIP provider (about a third of the price for about twenty times more features). We had an internet outage just last week, and we were down better than 30 hours until they got around to fixing it, because they didn't provide phone service and didn't have that obligation. (Funny how that distinction is made.)

     

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    ilya brook, May 24th, 2012 @ 3:18pm

    what a strange claim...

    "Due to deregulation, which was predicated on the premise that the free market and competition would protect consumers, cable companies have found themselves with an inordinate amount of power"

    Due to deregulation? I am guessing this is a reference to the telecom act of 1996 but that completely ignores the fact that it was regulators that granted cable franchises exclusive territories in the first place.

    Broadband in the US *is* a mess. And the cable companies *do* have too much power. But please lets all remember that this all started with government mandated monopolies and while it may require new regulations to fix the mess created by old regulations we should approach these solutions cautiously and reluctantly.

     

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    Anonymous Coward, May 24th, 2012 @ 3:18pm

    Re:

    Another thing to consider is the shear size of the US and the infrastructure needed to cover all of it. Japan, S. Korea, UK, Portual and Sweden are all tiny (landmass wise) compared to the US. If Australia fares well, that'd be a more accurate comparison.

     

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    Anonymous Coward, May 24th, 2012 @ 3:22pm

    funny, i always thought that size didn't matter!

     

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  22.  
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    :Lobo Santo (profile), May 24th, 2012 @ 3:24pm

    Re: Size does matter.

    Of course size matters!

    If your ship is too big, it won't fit thru the Panama canal.

    On the other hand, if your moped is too small nobody will want your help moving a couch.

    Like, duh.

     

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    mr. sim (profile), May 24th, 2012 @ 3:34pm

    would not do anything. in my area all broadband and utilities are pre determined thanks to exclusive rights contracts since before i was born. i live on a side of town which means i have to use THIS utility provider or none and i have a choice between one cable broadband provider or the one guy who gets to sell satellite.

     

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    Anonymous Coward, May 24th, 2012 @ 3:37pm

    Re: Re:

    Can we nationalize the telcos?

     

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  25.  
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    :Lobo Santo (profile), May 24th, 2012 @ 3:44pm

    Re: Re: Re:

    Is government incompetence, bureaucracy and corruption better than corporate greed, sociopathy and corruption?

     

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    Anonymous Coward, May 24th, 2012 @ 3:49pm

    Re:

    If I remember correctly, in Sweden the goverment invested in pure infrastructure. Not the cables but rather the tubes in the ground where you place the cables making it much cheaper for new companies to start competing. IMO, this is what the goverment is for, owning the infastructure.

     

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    Anonymous Coward, May 24th, 2012 @ 3:52pm

    Re:

    But who is gonna provide the fiber? That seems like the primary question and something where regulation could be a possibility.

     

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    Chris Brand (profile), May 24th, 2012 @ 3:52pm

    Re: Re: Size does matter.

    If I need a couch moved, I'm not looking for somebody with a moped, regardless of its size.

     

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    Anonymous Coward, May 24th, 2012 @ 3:58pm

    Re: Re: Re: Re:

    Yes, hopefully the incompetence and bureaucracy will bring on the coming collapse faster than the greed and sociopathy.

    But I guess I am not sure which horse will win after writing that down.

    But nationalizing would cut down the need for National Security Letters.

     

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    DMNTD, May 24th, 2012 @ 4:07pm

    howly mowly

    Snatch you're heads back. I for one don't want to hand anything over to the gov until the internet is at a reasonable level of reality. With talks of internet2 etc coming from heads within the gov, no thanks. Could it happen..yeah. Should it happen..no.

    Competition would be nice and will only happen if we just pull our collective heads out of the govs ass.

     

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    TDR, May 24th, 2012 @ 4:08pm

    The real question is, why do we allow corporations to grow to such large sizes in the first place?

     

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    Mike42 (profile), May 24th, 2012 @ 4:15pm

    Re: Re:

    The city I live in is running fiber. They have the business district done, and I'm scheduled for the beginning of the year.

     

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    Jeff, May 24th, 2012 @ 4:25pm

    WHAT WE DO NEED

    Is for us to be getting what we pay for. If you get a 1.5mbps dsl service, you expect to be able to download things faster than 150kbps.

    150kb =/= 1.5mb.

     

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    Mike42 (profile), May 24th, 2012 @ 4:26pm

    Re: Re: Re: Re:

    I would say that government oversight is better than corporate, simply because the modern philosophy of business is purely short-term profits, and there is no transparancy by design.
    Neither is ideal, but the government devil is 6 inches shorter.

     

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    Anonymous Coward, May 24th, 2012 @ 4:35pm

    Verizon finally brought fios to our neighborhood, but we opted out. The fine print says they want the copper in our dsl/phone lines. No way am I setting myself up to have no alternatives. Their prices and behavior are not as bad as Comcast, but that's not exactly a ringing endorsement.

    Btw, one major reason fiber is cheaper in Hong Kong is because people are packed together tightly, so cables don't have to be laid as far. Ditto Japan and Portugal. Try scaling better and tell me if China, India, Australia, Canada, Brazil, and Russia have fiber everywhere. If that answer is yes, then we're behind. Otherwise, what we have is an issue of broad coverage, which is going to be hard to finance. Who's going to pay for the extra half mile to reach that one house back in the woods? Or the tiny, poor neighborhood next to the old highway?

    I think we should leapfrog, like many developing countries are doing. Make it about wireless, not wired, at least in low population density areas. Then go ahead and find a way to reduce the price and increase the competition among wireless carriers and device manufacturers.

     

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    Anonymous Coward, May 24th, 2012 @ 4:38pm

    Re:

    Gilded Age, round 2. We've forgotten sherman and the other anti-trust laws. Whoops!

     

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    CWO, May 24th, 2012 @ 4:41pm

    Jeff, you've got the measurements wrong. Likely, you have a 1.5 megaBIT connection and downloading around 150 kiloBYTES. 1 byte is 8 bits so with a 1.5mb connection, you should download around a maximum of 225KB/sec. So you're downloading at around 66% of your connection speed which is actually pretty good in many cases.

     

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    Anonymous Coward, May 24th, 2012 @ 4:43pm

    Re: Re: Comp this...

    The Govt forms the frame for all these confusopolies to operate. I know that Cox was given huge tax breaks for building out infrastructure with a wink&node to capture as much profit via monopoly as they could.

    They contribute to campaigns and the monopoly continues...

     

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    Zos (profile), May 24th, 2012 @ 4:53pm

    Re:

    because even a cheap local utility would blow comcast out of the water, simply by the virtue of being build to current specs.

     

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    LDoBe (profile), May 24th, 2012 @ 5:02pm

    Re: Did I miss something in Geography?

    I'd say since the 1950s after the Korean War, when the US pretty much rebuilt it's entire economy into a western style of market. South Korea is a huge trading partner with the US, and has so much immigration back and forth it's pretty much a western country.

     

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    LDoBe (profile), May 24th, 2012 @ 5:09pm

    Re: WHAT WE DO NEED

    What you paid for was Up To 1.5 mbps which is ~187.5 KiB/s, so in some unit of measurment conversion you're getting what you paid for. And all the ISP has to provide contractually is that you might get up to 1.5 mbps, which means they can provide you an 8 bit/s connection and still be holding up their end of the deal....

     

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    JoeCool (profile), May 24th, 2012 @ 5:21pm

    Re:

    Actually, this is asynchronous serial communications, so we're normally talking 1 start bit, 8 data bits, and 1 stop bit AT BEST. So about 150 KBps is actually just right for a 1.5 Mbps connection. That's about what I get from my 1.5 Mbps DSL. I have CenturyLink DSL, and my choices are 1.5M for a tolerable price, or pay through the nose for 5M. They claim to be stringing fiber optic in most places and that I should check back periodically to see if it's available where I live yet. I'm not holding my breath...

     

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    Anonymous Coward, May 24th, 2012 @ 5:24pm

    Re: WHAT WE DO NEED

    150KByte/s is what you get from 1.5Mbit/s

    I think you have your Bytes/bits units confused...

     

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    Anonymous Coward, May 24th, 2012 @ 5:28pm

    Re: Re:

    Correct, we learn from the dialup modem days that it takes about 10 bits to transfer a serial byte.

    There's also protocol overhead to deal with, but on the brighter side, many higher level protocols support inline compression now :)

     

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    Anonymous Coward, May 24th, 2012 @ 5:39pm

    Re: Re: Re: Re:

    This is a tough choice but I Vote for the Government Brand.
    I doesn't go down quite as smooth as the Corporate Brand but
    there's a lot to be said for tradition.
    I say bending over and getting the shaft from a Brand that has all that brute Strength is very important.
    Of course don't forget that the Corporate brand controls all the Vaseline

     

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    Steven Roy, May 24th, 2012 @ 6:37pm

    The internet saves lives

    Our national communications networks, are the next municipal utility.

    Some things are too important to be done simply for profit. That idea may seem way of base to you, but think for a minute. We trust our governments to manage our military, police, and fire departments to keep us safe. Those corporations are owned and operated almost universally by governments. They services save lives, and are too important to be done for profit.

    Things like our water, sewage, electricity and telephone are frequently managed by private corporations. These corporations however are very tightly regulated by the local governments. Most of the time they have to ask for a bill to be passed to change their prices.

    Our information networks both wired and wireless, have reached the point where they have become necessary for our society to function. I work for a Teleradiology company. Our newest service allows someone in a rural area with no qualified doctor nearby, to be diagnosed with a stroke, and saved by a doctor three thousand miles away. This business, and the lives it saves couldnít exist without reliable broadband, and mobile networks. Even more lives could be saved if some companies were willing to sacrifice a little profit. They could give the whole nation a level of access and service, enjoyed by other, less wealthy nations. But they don't, because it isn't profitable. So people will continue to die, because it isn't profitable.

     

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    Chronno S. Trigger (profile), May 24th, 2012 @ 7:27pm

    Re: Re: WHAT WE DO NEED

    He may not. I've played with DSL a lot, and sometimes it can suck hard.

     

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    Anonymous Coward, May 24th, 2012 @ 8:04pm

    Correction: since by my understanding the ISPs provides 2 months exemption every 12 months here, the average monthly fee is more like $21 if the fees you quoted is correct.

     

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    Chargone (profile), May 24th, 2012 @ 8:26pm

    NZ telephone system started off (like a number of things) as part of the NZ post office. at some point (probably in the 80s when we had some major economic problems) it was privatized along US corporate lines. (generally considered to have been a highly dubious move.)

    the exception was this: it was still considered a vital service and consequently regulated into the ground. combine that with a usage that lead to foreign technicians thinking the were running load tests when they first saw the exchanges running (they weren't) and they couldn't afford to slack of and still meet their minimum performance requirements.

    for a long time there was only one competing company, and it only existed because part of the regulation was that Telecom (the privatized ex-post office entity) had to allow it to use the pre-existing cables and such.

    cue wide spread public adoption of the internet. in the mean time the competing company has merged with another and changed names a couple of times, but is still basically the same entity. only now it has Money and there's Demand. it starts running fiber optic cables to the home, among other things, but still needs to use the main (backbone?) cables and interact with the exchanges. many retail level ISPs pop up offering different connection deals. the problem at this point became that Telecom was both a retailer in it's own right And a wholesaler so far as internet connectivity was concerned. this lead to some somewhat anti-competitive business practices. which lead to a bit of a scandle and was About to lead to a government investigation and probably forced break up.

    to avoid that the company reorganized and split itself up. (into retail, wholesale, and 'all the random crap needed to make everything actually interact and work', so far as i can tell.) it's a bit complicated, (especially as there was then a government project that many different companies got involved in to upgrade everything which rearranged who owned what Again) but solved the problem.

    meanwhile that other major competing company, somewhere along the way, went 'hey, we can run TV signals through this shiny fiber cable we've got here...' so, we actually have cable tv these days. if you sign up with them. it's just an alternate transmision medium for the standard satellite and free-to-air tower based broadcast channels you could get here Anyway, but it's slightly (read, single dollar numbers per month) cheaper to get tv and phone and internet through them than to get satellite tv and phone internet at the same performance level otherwise, and the reception's better. not enough of a difference to make people switch over, generally, but enough to make it a slightly better deal if you're setting up a New connection and want All of those things.

    anyway, point of all this: the main backbone cables and exchange are pretty much a utility which is probably best run as a highly regulated monopoly (not actually by the US government, given how That seems to work, though if it weren't so blatantly corruption prone that would be best) but with minimum performance standards which are updated regularly, and never lowered, and a very close eye kept on it's pricing. i imagine a few hundred or more ISPs are a louder voice than one 'dumb pipe' company in that regard.)

    Retail ISP services should be in free competition, and generally relatively small entities. if they run cable for themselves at All it should be only the last bit, and they shouldn't need to do That unless they want a performance advantage due to new tech or there simply Isn't such cable yet (the basic cable should be owned by the town or city or whatever, really). avoidable monopolies are bad, yo? corporations just make it worse.

     

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    anon, May 24th, 2012 @ 8:47pm

    Fiber

    And I thought America was only starting there decline as a world power.It seems like you have been devolving for a while now.

     

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  51.  
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    Scott (profile), May 24th, 2012 @ 8:53pm

    Comman Carrier

    Two words...
    TITLE 2

    Fix what Kevin Martin and his goons created by reclassifying them all under title 2 common carrier regulation...the FCC could do it without even making congress vote on it. Only problem is the FCC chairman lacks a pair and keeps forgetting he is a regulator

     

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    Brock Phillimore (profile), May 24th, 2012 @ 9:09pm

    The government should run fiber to everyone's home. Then rent out the bandwidth to the private companies offering the services like phone, cable, internet and a dozen other things not available yet. This would offer true competition when a variety of companies could offer competing services over the same fiber.

    This would take billions for a big city, but the government could recoup the costs over the next 10 years from the private companies offering the services.

     

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  53.  
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    R.H. (profile), May 24th, 2012 @ 9:46pm

    Re: howly mowly

    We shouldn't want government owned ISP's but maybe we should have a nationalized fiber backbone network. That way smaller ISP's could compete without having to build networks of their own.

     

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    R.H. (profile), May 24th, 2012 @ 9:51pm

    Re:

    I've said this before but in the case of cities like Hong Kong and Tokyo having better internet speeds than us in the United States and the population density argument, if population density is the issue then why don't cities like New York, LA, or Chicago have those kind of speeds?

    The densities are comparable and I understand that the rural areas would take years to get up to those speeds but our medium and large cities should be there already. There's no excuse except for us falling behind.

     

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    Renee Marie Jones, May 24th, 2012 @ 11:02pm

    Internet speeds

    In the US, regulators and congressmen just stick their fingers in their ears and repeat "there is vibrant competion, there is vibrant competition"

    We live in a country so blinded by its love for the "free market" that we define "vibrant competition" as three companies ... whether they compete or not, and we define whatever outcome we get as "the best" because the "free market" created it.

    We have the "best" Internet service in the world, the "best" health care in the world, the "best" anything in the world. Just ask any republican. When you define whatever you have as "best" there is no reason to work for better.

    At least the rest of the world is making progress.

     

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  56.  
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    Trenchman, May 24th, 2012 @ 11:29pm

    Sad Thing

    The sad thing is that many problems with the free market in the US is that the government got involved in the first place. There are numerous cases of the government stifling competition by over-regulating and making it harder for small competitors to get started and some companies to move to different areas. In truth I haven't really looked into Internet providers, but I wouldn't be surprised if over-regulation was the problem here as well.

    I do think that it's kinda funny that people will say the government should take control of things, because lobbyists buy off politicians. Wouldn't putting those politicians in control of things only change the nature of the lobbyists and the corruption, and still allow people to control the market to their interests?

    Either way, I hardly trust the government with the services they provide now. The extent that they want to take control and regulate the internet now is worrying enough. What the government would do if they had direct control of the internet is absolutely terrifying. The less the government has control of anything, and if they only had necessary regulations, I truly believe the better off we'd all be.

     

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    Prisoner 201, May 24th, 2012 @ 11:30pm

    Re: Re:

    They also lay down actual fiber. Stockholm city is currently laying down tax financed(*) fibre bundles to all apartement buildings. A number of companies will then rent bandwidth and sell services such as internet access, IP telephony, digital TV etc to the customers.

    (*) regional tax from people in the Stockholm area.

    My brother has this city net and he can change ISP on a monthly basis if he likes, with just a few clicks on an intraweb page.

    My apartement building is already connected to the city net, but the switch is collecting dust in the basement because we are stuck in a 3 year contract with a telco who had their own fibre laid down to our building when it was built.

    I have 100/10 and I pay about $48 per month for internet, tv (basic channel package only) and ip phone (my isp is one of the more expensive).

    I see it as a nation doing smart investing - if you want lots of tax money, you want your citizens to do well in a global market that is increasingly less about physical goods. You want your citizens to be educated and on the internet.

    Free education and healthy internet access is an investement that will pay off down the road.

     

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  58.  
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    Hephaestus (profile), May 25th, 2012 @ 1:07am

    Re: Re: Hurrah Hurrah Someone who appears to be on my side

    The government should be forced to prevent monopolies at every level, local, state, and federal.

     

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    Seegras (profile), May 25th, 2012 @ 1:15am

    Monopolies

    Cables in the ground are pretty much a natural monopoly. Of course you can allow everyone to lay their own cables, but as with electricity and water, it doesn't make too much sense to do so, and it's expensive.

    And, as with any natural monopoly, it makes sense to let the community control it. The city to control the cables in its ground, the state (or whatever bigger entity) the overland ones. That's not to say you should bar private entities from owning their own cables.

    Now the service on these cables is something completely different. Everyone can do it; so there is no natural monopoly, and consequently the government should keep out of it. Some communities might opt to offer a service themselves, but they need to be very careful that they don't start looking at cables+service together as a profit-center, and thus impede service-providers which need to use the same cables. But with that a given, services offered by the community can be an effective competition to services offered by third parties, and thus lead service providers to be at least as competitive as the community-owned services.

    The main problem with this setup is, that lobbying can lead to the creation of artificial monopolies. But then again, rent-seeking is a general problem everywhere, and not something that needs to be solved specifically for broadband access.

    There are two very simple guidelines:

    If there is a natural monoply, the community must hold it

    If there is no natural monopoly, the community must do everything to prevent artificial monopolies

    (Of course, things like "granting patents" fly totally into the face of the second one, as do a lot of "regulations" which are obviously only drafted to raise the market-barrier)

     

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  60.  
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    Anonymous Coward, May 25th, 2012 @ 1:47am

    Re: Re:

    Is New York smaller than Tokyo or London? or less dense populated?

    That is not a consideration, since the backbone in America is suffering from an over abundance of bandwidth, America has the most dark fiber build up in the whole world.

    http://www.wisegeek.com/what-is-dark-fiber.htm

    Which shows the infra-structure is already in place, other companies just don't have access to it.

    Which brings up Moore's Law to fiber optics where bandwidth capacity doubles every nine months. For fiber that means the same fiber already in the ground can double its speed every nine months, there are no technological barriers there.

    https://en.wikipedia.org/wiki/Dark_fibre#Rate_of_expansion

    With that in mind, one has to wonder where the real bottleneck is happening, it is not in the infra-structure, is in the regulation structure, it is on the business side of things that were badly implemented.

    The government should own the way and force everybody to play by the same rules, the participants of that scheme would naturally keep an eye on the government against undue influence and the government would have no reason to favor one over another without being called out and so would have less interest in hearing only one company and hopefully would mind only enforcement of regulations that benefited the whole ecosystem of players that it cultivates.

    That is exactly what Japan and the UK did, Canada did something similar but allowed the sharing to have price competition and so the players forced to share their fiber priced others out of the market, Australia actually is building an entire network from the ground up instead of dealing with regulations nightmares and if all goes according to plan and they don't screw it up they will own the infra-structure and every player will have to fallow the same rules having to compete on the service side of things with an interest on keeping the whole infra-structure in good condition and expanding it.

    I see this an open source kind of thing, the code(fiber) is owned by everybody and it is equal to everybody else, everybody contributes to it so it stays relevant, and people build services around it, it stimulates local investments, it doesn't siphon resources from all areas to one single point.

    At the very, very least the governmet should build up the channels where the fiber goes and make it easy so anybody could lay down fiber, that is the pricey thing in the whole scheme, rights of way, licenses and so on are the real show stopper, France for example have an easy way to lay cable underground they had already tunnels build in the 19th century running all under Paris and so it is cheap to lay fiber there anybody who wants to put fiber just needs to ask for permission to put cable there.

    Companies use those expenses to keep out competitors, this is what is killing American broadband, people who want to put fiber don't have a place to put anything new because ways are already owned by someone that doesn't want them there and that is a problem for competition.

     

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  61.  
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    Anonymous Coward, May 25th, 2012 @ 3:27am

    5mbs O_O I have 50mbs but I'm paying out the ass for it. I would cry if I got stuck on 5mbs >..

     

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  62.  
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    Random Hungarian Guy, May 25th, 2012 @ 3:50am

    Where I come from

    It isn't exactly heaven in Hungary, but at least there is some good in the internet legislation: the phone companies are legally required to let any ISP provide ADSL over their lines, even without an actual phone service (i.e. only ADSL comes over the phone line). The situation with cable internet is not this nice, though.

    I think that this opening of phone lines creates competition. I wonder if this would work in the USA.

     

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    Impatient, May 25th, 2012 @ 7:34am

    This is a crisis?

    I get 7 mbps to my home for less than $30/mo. The Internet sector is thriving in this country, providing millions of high-paying jobs without substantial government regulation. Facebook just went public with an $80 billion post-IPO valuation.

    And this charlatan claims that we're facing a crisis akin to the banking collapse. Enough said.

     

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  64.  
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    Anonymous Coward, May 25th, 2012 @ 7:49am

    Economics of population density

    I always find it interesting when South Korea is used as the model for anything related to the entirety of the US. There are costs that go into providing the wire to a residence for internet service. When the cost of running that wire can be shared among many users the cost per individual goes down. Also as the wires get longer, the tech choices for service change and get more expensive.
    The cost of getting service to everyone in Korea is similar to getting service to everyone in California, but only if they live in an area the size of South Carolina.

     

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    hegemon13, May 25th, 2012 @ 8:08am

    Re: Re:

    Um, "publicly owned" is, by definition, a monopoly. Just because it's the government's monopoly doesn't mean you're going to get any better of a deal.

     

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  66.  
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    ZadokthePriest (profile), May 25th, 2012 @ 8:54am

    Re:

    The problem is that power or gas is carried over uniform lines while internet is, for the most part, heterogeneous. Cable uses copper wires, DSL uses fiber and god knows what the business highspeed uses. How would you have service carried in a tiered manner anyway? Unless there exists throttling or data caps, which are unpopular, there is no feasible means of equating digital data costs to current utilities.

    However, there are several posts made that the cable network is still rather backwards. That is one of the problems: cable has had no need to upgrade their infrastructure to fiber or anything else. I don't know if it were possible to have a 'nationalized' network infrastructure and individual service providers but I think a fiber network would be the first step in that direction.

     

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  67.  
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    John Fenderson (profile), May 25th, 2012 @ 9:10am

    Re: Re: Re:

    You're right, it is a monopoly. But at least it's a monopoly that we have some influence on. Private monopolies are much less responsive.

     

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  68.  
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    Suzanne Lainson (profile), May 25th, 2012 @ 9:22am

    This is why I don't trust big business

    Whenever there is a thread on Techdirt saying government should stay out of as much as possible and let business run things, I think of how companies like to get bigger and control more stuff. And because they are accountable for quarterly financial reporting, they tend to do whatever it takes to boost short-term results at the expense of long-term thinking.

    Any big company, tech-based or not, tends to morph into the same kind of monopoly if given the chance. Since my father was career military, I'm more comfortable with government-run programs than privately-run programs. Sure, the government screws things up, too, but in general, I think private companies are more likely to arrange things so that in the end they take the most from me and give me the least, because that's how they make money.

     

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  69.  
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    Anonymous Coward, May 25th, 2012 @ 9:49am

    Re: Re: Re:

    The issue isn't dark fiber or anything like that - it's the last mile issue, more than anything.

    Because of how we got here (single cable company monopolies for an area, and one phone company providing the copper wire connection) it leaves you with few choices. There isn't a single company out there right now with the money or the desire to replicate the networks these established companies have, for a small part of that market. It's not cheap to set up all that potential market without actual customers.

    The last mile is the issue. It won't go away.

     

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  70.  
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    Digger, May 25th, 2012 @ 10:18am

    Nationalize (eminent domain) the networks

    Make em all basic utility networks where everyone is allowed access to use them - then instead of competing by building out separate networks, it's all shared, they all pay into a pool to keep em updated, and people are free to pick whomever they want as a provider anywhere in the country.

    Worked for telephone service, worked for Electricity - would work for Internet service and Cell service - imagine if all the cell networks were merged into one - the capacity we'd have, the reduction in costs and overhead.

    Hmmm - imagine

     

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  71.  
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    Anonymous Coward, May 25th, 2012 @ 10:44am

    Re: The internet saves lives

    Try applying for a job without access to internet. It's not possible anymore. I've said before that it's easier to download a show (3 hours / 30 min show) than to stream it. And for that I pay $70/mth. I have one high speed provider in the 5th largest city in the US. 3G is faster. Every electronic gadget is now designed and advertised to connect to the internet. What internet?

    I think a bigger question might be how many in the public realized connections are so pathetic here?

     

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  72.  
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    Anonymous Coward, May 25th, 2012 @ 10:51am

    Re: Sad Thing

    Look what happened when electricity was carved up to private corporations in California; ENRON. When gas was carved up in the SE, the prices went up 300%.

    Give me the government over critical infrastructure anyday. It's non-profit, for the good of the public (vs. stockholders), must be fair, and officials are representatives - voted in or out by the public. No it is not perfect, but it's relatively transparent in comparison to private corporations.

    Private corporations have one mandate; make money for stockholders. The end.

     

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  73.  
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    Anonymous Coward, May 25th, 2012 @ 10:53am

    Re: Monopolies

    When communities have attempted to provide wireless, cable companies have lobbied to make it illegal. That hurts us all.

     

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  74.  
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    Anonymous Coward, May 25th, 2012 @ 10:54am

    Re: This is a crisis?

    LOL! What country are you in? It's certanily not the US.

     

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  75.  
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    Anonymous Coward, May 25th, 2012 @ 11:00am

    Re: This is why I don't trust big business

    Government in non-profit, has an obligation to the public it serves and officials can be elected. Corporations have one goal; to make money, they consider services propitary, secret and have no obligation to the public good.

    If it's tax payer dollars supported, there should be an obligation to the public and that's what has been missing. The cable companies got stimulus money with no accountablity required. They lined their pockets with it.

    If the internet is so important that it requires security legislation (SOPA/CISPA) then public investment in it should also be protected.

     

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  76.  
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    IrishDaze (profile), May 25th, 2012 @ 11:59am

    Re: This is a crisis?

    What, so you have it good, so there's no problem?

    Dude, I've never seen a better example that illustrates the concept that anecdotal ev is not ev.

    An up-to 1.5 mbit is the best offered in my area for under $50/month -- And I live less than five miles from the center of the fourth largest city in the US.

    People who live less than 25 miles from me can't even get what I have without being charged substandially more.

    So yes, there's a problem.

     

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  77.  
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    Joly MacFie (profile), May 25th, 2012 @ 1:19pm

    Video of Susan's talk

     

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  78.  
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    John Fenderson (profile), May 25th, 2012 @ 1:23pm

    Re: Re: Re: Re:

    The last mile is the issue. It won't go away.


    True, but because of the actions of the telecoms, not any technical limitations. There are a number of ways that the "last mile" problem can be easily and cheaply resolved right now, form a technical point of view. But the telecoms fight against allowing anybody to actually do them because they want to maintain their monopoly.

     

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  79.  
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    Brian Littlefield, May 25th, 2012 @ 2:43pm

    what we need is...

    a separation of infrastructure and service providers. the competition that spawned the internet boom in the mid- to late-90s was due to the fact that services like AOL, Earthlink, Prodigy, and others had to keep offering more service for less money. and you could pick ANY of them or switch anytime you wanted (with the minor inconvenience of switching your email addresses) because they had no ties to the phone companies. Cable modem and DSL providers started taking over when they started offering faster service (for more than marginally higher prices) and that not only drove out the independent ISPs, but it intrinsically tied service to infrastructure. And the problem with infrastructure is that every single region in the US (at least that I'm aware of) has local monopolies on cable and phone service. None of the areas I've lived in for the past twenty years have given you a choice of cable provider. if you get cable, you only get Time Warner (or comcast or cox or cablevision or...), and if you get phone/dsl service, you only get AT&T or Verizon (or Bell South or whatever). the only choice you get is between coax or two-wire. and since the infrastructure for these is not coupled together in any way, and one will often lag behind the other in local upgrades, the companies can basically ACT like monopolies. AT&T is a major player in all of this, and does ANYONE remember when they were hit with an antitrust lawsuit by the federal government and forced to break up into several smaller, independently held companies, as well as allow long distance service providers access to their lines? That's part of the reason that Verizon even exists today: it was one of the break-up companies (Bell Atlantic) and combined with GTE to grab marketshare. They have monopoly DNA in their blood!

    I guarantee one thing: if the current trend toward data caps, contracts with ETFs and higher rates is not reversed, it will have a significant impact on the economy in terms of limiting access to subscription-based and single-purchase based digital content, as well as surfing, shopping and social networking. And since all of those are clearly economic growth areas, well....

     

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  80.  
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    Anonymous Coward, May 25th, 2012 @ 3:57pm

    Re: Re:

    To be honest, there's no excuse at all. My parents live 300 yards from one of the major pipelines through their state. They pay Comcast through the nose to get real speeds approaching... wait for it... 200kps.

    Yes, they live in a rural area, but they lucked out big time. Except they didn't.

     

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  81.  
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    Anonymous Coward, May 25th, 2012 @ 4:06pm

    Re: This is a crisis?

    Where do you live, and can I move in?

    I live in a near suburb of one of the largest and most tech-savvy cities in the country after silicon valley. I live about a half mile from the city limits. I can get fiber for $75/mo with a mandatory (unneeded) cable package, or I can stick with dsl at 125kps with phone (actually used sometimes) for $30/mo. And I consider myself lucky that I have two options.

     

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  82.  
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    Niall (profile), May 28th, 2012 @ 5:34am

    Re:

    I think that was written in English somewhere. I wasn't aware that Kiwis talk at breakneck speeds!

     

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  83.  
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    LOLasaurus, May 28th, 2012 @ 11:56am

    Re:

    In Lafayette, LA the local government (LUS) decided to build a fiber system. The private ISPs in the area tried their hardest to get the measure voted down but it passed.

    Now LUS offers much faster internet access than the companies that tried to shut them down. Currently you can get 75Mbps down and 75Mbps up for $100/month. The best the private ISPs can offer is 50Mbps down and 5Mbps up for $95/month and this is after they dropped prices and increased speeds.

    So long story short, more competition makes for better cheaper service. Big surprise.

     

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  84.  
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    Les Lorenzo, May 31st, 2012 @ 2:51pm

    Re: It should be a utility by now

    I don't know how you get better service from Comcast. Their cable is Ok their broadband is HORRIBLE. Massive over-subscription at least in Portland, OR. There are times of the day when you cannot get on. Curiously usually starts around 6 or 7 pm.

     

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  85.  
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    txpatriot, Aug 1st, 2012 @ 9:37am

    Google says regulation not needed

    Well, google didn't literally say that.

    No they went out to Kansas City and built their own fiber network. Susan Crawford should stop whining about the telcos, cable companies and lack of regulation.

    Instead she should encourage others to do as google has done.

     

    reply to this | link to this | view in thread ]


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