50 Million US Homes Can't Get 25 Mbps From More Than One ISP

from the who-needs-competition? dept

We’ve talked for a while how while there has been a lot of hype placed upon the nation’s scattered but modest deployment of gigabit networks, broadband in countless parts of the country is actually getting significantly-less competitive. That’s thanks in large part to the nation’s phone companies, which have increasingly refused to pony up the necessary costs to upgrade their aging DSL networks at any scale. Instead, many have shifted their focus either to enterprise services, or as in the case of Verizon, into trying to peddle ads to Millennials after gobbling up AOL and Yahoo.

As a result, cable has established a growing monopoly over broadband across massive swaths of the country. This reduced competition has resulted in rampant price hikes (usually in the form of hidden surcharges or arbitrary and unnecessary usage caps and overage fees). But it also has eliminated any real incentive to keep rates low or repair what’s statistically some of the worst customer service in any industry in America.

A new study by several consultants for the broadband industry offers a little more insight into the real-world result of the sector’s ongoing competition problem. According to the report by Economists Incorporated and CMA Strategy Consulting, there’s a fairly staggering number of broadband consumers that don’t see any real competition whatsoever, especially at the FCC’s standard definition of broadband (25 Mbps down, 3 Mbps up):

“More than 10.6 million US households have no access to wired Internet service with download speeds of at least 25Mbps, and an additional 46.1 million households live in areas with just one provider offering those speeds, a new analysis has found. That adds up to more than 56 million households lacking any high-speed broadband choice over wired connections. Even when counting access to fixed wireless connections, there are still nearly 50 million households with one 25Mbps provider or none at all.”

So it should be noted here that these estimates are likely optimistic. FCC data has previously suggested that this number is even higher, former FCC boss Tom Wheeler stating that around 80% of homes can’t get access to the agency’s standard definition of broadband. It’s notably worse in rural or tribal areas. But even this week’s new, toned down report by industry consultants doesn’t paint a particularly pretty picture. Even at slower broadband speeds, you’d be hard pressed to identify anything close to reasonable competition:

“There were 31.1 million households with exactly one wireline provider offering speeds of at least 10Mbps, and another 6.9 million households with zero providers offering such speeds over wired connections. At the paltry level of 3Mbps download speeds, 19.3 million households had access to one wireline ISP and 4.9 million households had no access at all.”

It should be noted that one of the co-authors of the report, Hal Singer, has a bit of a history creatively-massaging data at the industry’s behest — especially when it comes to trying to vilify net neutrality (which the 45-page report seems to avoid talking about). So while Singer’s ability to candidly acknowledge a lack of competition is a little surprising (even though the report does try to scale back previous FCC estimates on this front), less surprising is the authors’ proposed solution to the broadband industry’s broadband deployment and competition shortcomings: the magical wand that is telecom sector deregulation.

So again, the report is quick to avoid the debate over the current administration’s decision to kill consumer privacy protections and gut net neutrality, despite Singer being a major player in trying to make the latter happen. And while it pays some lip service to competition, it fails to acknowledge how cable’s growing monopoly and outright telco apathy are making competition problems worse. The report however does try to claim that several, less talked about FCC initiatives are going to expand fiber and competition to an additional 26.7 million homes:

“In two recent Notices of Proposed Rulemakings (?NPRMs?), the FCC has outlined a range of potential actions to make it faster and less costly to deploy next-generation networks. It is expected that these proposals will lower pole-attachment costs, reduce the time and cost of make-ready, reduce barriers to copper retirement, accelerate legacy time-division multiplexing (?TDM?) product discontinuance, and reduce barriers to locating and deploying wireless infrastructure.

The telecom industry has insisted for decades that if you remove all regulatory oversight, competition and connectivity will magically spring forth from the sidewalks, bathing us uniformly in dirt-cheap, ultra-fast connectivity. Of course that never happens because reality is notably more complicated, and each piece of regulation (especially in an industry where incumbent legacy giants are usually quite-literally writing the laws) needs to be weighed on its actual merits. When you just blindly “deregulate” a sector that suffers from both regulatory capture and limited competition, history tells us you don’t get a miracle — you get Comcast.

What most people also don’t seem to understand is that when the telecom industry pushes for “deregulation,” what it actually means is passing regulation it writes. And, historically, that regulation unsurprisingly makes life easier for wealthy, entrenched duopolists, but makes life substantially harder on the smaller competitive upstarts that lack the same lobbying and campaign-contribution firepower. It’s generally how they get partisans who adore the concept of killing burdensome regulations (because yes, there is plenty of that) into cheering against their own best self interests. And it has been a smashing success for decades. Your Comcast bill surely agrees.

So while the report is correct that things like utility pole attachment reform is important for fiber deployment, it fails to mention that cities that have attempted to do so have been sued by Comcast, Charter and AT&T to try and slow competitive threats. Similarly, while the report is quick to emphasize the importance of “reducing barriers to copper retirement,” it fails to mention that AT&T and Verizon’s version of this involves severing the taxpayer-subsizied DSL connections of millions of users (many elderly), and just shoving them toward notably-more expensive wireless (assuming it’s even available).

So yes, some of these efforts — in an ideal world — could speed up deployment. But because we’ve let industry giants quite literally infect government (including surveillance) on a bone-marrow level, actually implementing any regulatory or deregulatory policies that improve competition simply doesn’t happen — because it would reduce sector revenues. Consultants predominantly paid by the industry aren’t likely to admit this, but as somebody having spent the better part of a lifetime tracking this sector I can assure you: none of the competition, coverage and service problems in telecom are going to be fixed until we somehow lessen Comcast, AT&T, Charter and Verizon’s influence over state and federal politics.

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Comments on “50 Million US Homes Can't Get 25 Mbps From More Than One ISP”

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39 Comments
Anonymous Coward (user link) says:

=> “…I can assure you: none of the competition, coverage and service problems in telecom are going to be fixed until we somehow lessen Comcast, AT&T, Charter and Verizon’s influence over state and federal politics.”

So our politics/politicians have been ‘captured’ by the big telecoms here — and you see no available solution.

Sounds like our representative-democracy form of government has big problems then, well beyond the small potatoes of internet service.

My profound faith in the personal integrity of government politicians has now been shaken. What is it anyway that we hired our elected officials to do for us citizens (?) … can we at least get a refund on their salaries and upkeep?

JMT (profile) says:

Re: Re:

"Sounds like our representative-democracy form of government has big problems then, well beyond the small potatoes of internet service."

No shit, it’s call campaign financing, and it has poisoned the US electoral system nearly to death. If the sources of political funds were far more restricted and far more transparent these sorts of problems would be significantly reduced. But since campaign financing reform can only be enacted by those who benefit from the status quo, and the populace is generally ignorant of or ambivalent to the scale of the problem, I don’t see much changing in the future.

San Diego Resident says:

Re: Re:

The numbers absolutely are worse. If you want a great example of what happens I suggest taking a look at San Diego. Inside the city of San Diego we have Cox, Time Warner, and ATT.

If you ask the city there is great competition for internet access! They have even touted the competition and high speeds available.

The reality is that each ISP individually has turned up single residential condo buildings to gigabit speeds. Which has allowed them all to advertise that gigabit speeds are available in San Diego.

Except those speeds are only available if you live in these specific condo buildings. And if you look at each ISP’s coverage map there is absolutely no overlap. So while there are technically 3 major ISPs in San Diego they dont actually compete with each other.

As a San Diego resident I have access to one single ISP. There is no competition for internet access here.

Its really weird to hear the city talk about how great and how available technology is available in the city.
Which is basically the city trying to convince us that the sky is purple. Because reality for almost all of us is a single ISP with slow speeds and high prices.

Richard M (profile) says:

Hopefully not a problem in 3-5 years

Hopefully Musk’s internet satellite swarm will take care of this problem. He is saying 2019 but my guess from past experience is that it will take a bit longer to get there so probably 3-5 years is realistic.

The thing is the cable/ISP companies will go from sucking us all dry to completely dying in a very short time once the satellites go live. All that bad customer service and price gouging is going to create a huge exodus once something else is available.

Anonymous Coward says:

Re: Hopefully not a problem in 3-5 years

That is not going to happen on technological reasons alone. Plus, Musk is not some “man of the people” entrepreneur. He is just damn good at thumbing his nose at the establishment, which is a good thing in this case. Musk is very much on board with being a big brother with the technology you purchase from him, effectively making you nothing more than a renter/lesee of anything you buy from them.

Not even mentioning the problems that other nations will have if Musk provides everyone access to the internet.

Even if Musk does become a man of the people, he will be effectively prevented from being one. Regulations are just not going to allow it.

Richard M (profile) says:

Re: Re: Hopefully not a problem in 3-5 years

I would not bet on him not being able to beat the technological issues. If you had told me a few years ago that someone would be able to have two rockets take off and land in the same weekend I would probably have laughed.

The big problem is cost and if he continues to bring down the launch costs it will work.

As far as being “a man of the people” I never said that and do not even think that. I imagine that he plans on making a whole lot of money with satellite internet and I am OK with that. He can make all the money he wants as long as he delivers a service that is worth buying.

The thing is he is not even going to have to undercut the existing companies on price because their service and contempt for their customers is so bad. I bet a lot of people would be willing to pay MORE just to get out from under Comcast and Verizon.

Hugh Jasohl (profile) says:

Re: Re: Re: Hopefully not a problem in 3-5 years

My biggest worry about it not working is not about any technical reason, but due to interference from Comcast, AT&T and the NSA. All of them have current setups to mutually benefit the others and a new party would reduce the gravy train for too many people to be allowed to happen.

Richard M (profile) says:

Re: Re: Re:2 Hopefully not a problem in 3-5 years

Normally I would agree as they manage to do a good job blocking Google in enough locations that Google decided to start backing wireless.

However any laws that get passed would have to be on the Federal level and I think that would be hard for them to do to Musk and keep it hidden in the dark like business as usual. He could shine a very bright light and make a lot of noise if they try underhanded tactics.

Keep in mind we are talking at least 3 years before he gets this started and by then he will be launching who knows how many satellites a year and ferrying astronauts to the space station on a regular basis. The will give him an even bigger soapbox than he already has to make noise if other companies try to block him out.

Not saying they will not try but I just have a hard time believing they will succeed.

Anonymous Coward says:

Re: Re: Re: Hopefully not a problem in 3-5 years

“I would not bet on him not being able to beat the technological issues.”

You might be right, but regardless of how smart he appears to be, he can only go as fast as the giants he stands upon.

“As far as being “a man of the people” I never said that and do not even think that. I imagine that he plans on making a whole lot of money with satellite internet and I am OK with that. He can make all the money he wants as long as he delivers a service that is worth buying.”

I assumed that you might have had that mindset from the way you wrote your post. Apologies for being in error.

“The thing is he is not even going to have to undercut the existing companies on price because their service and contempt for their customers is so bad. I bet a lot of people would be willing to pay MORE just to get out from under Comcast and Verizon.”

I never understood why people believe that is all that is necessary to make a change. People literally develop Stockholm like syndrome with politics and the economy as well, not just with other people. You are most certainly underestimating humanities tolerance for greed and evil. In the vast majority of cases there are superior products and services all over the place by they are not taken advantage of because of the many biases that people develop. People LOVE maintaining the status quo because it is familiar and comfortable and are not quick to depart from it.

Richard M (profile) says:

Re: Re: Re:2 Hopefully not a problem in 3-5 years

“I never understood why people believe that is all that is necessary to make a change. People literally develop Stockholm like syndrome with politics and the economy as well, not just with other people. You are most certainly underestimating humanities tolerance for greed and evil. In the vast majority of cases there are superior products and services all over the place by they are not taken advantage of because of the many biases that people develop. People LOVE maintaining the status quo because it is familiar and comfortable and are not quick to depart from it.”

You are not wrong, people tend to be creatures of habit even with it is not really in their self interest to be that way.

However I think there are two things “fighting the inertia” in this situation.

The first is the fact that many of the people who are cord cutters are already looking to make a change. They are actively trying to move in a certain direction and being blocked. As soon as there is another choice they will be on it like my dog gets on bacon.

The second is that Comcast is a particularly horrible company and in my opinion a fair percentage of those slow to change have had enough to motivate them to do something. Obviously not all of the or even enough but it will be a big enough number to hurt.

Anonymous Coward says:

50M too low

I can guarantee that this number is too low, based on my own personal experience. Here’s my story:

In my Major Metro Area, I’m nominally able to purchase coverage from multiple ISPs. Thinking “anything is better than Comcast”, I opted for Verizon DSL. For 4 weeks after installation, without *any* serviceable internet to my home, and god knows how many countless hours on the phone with clueless offshore tech support, I gave up.

I was ostensibly left with Comcast as the only option in a supposedly competitive market.

So, yeah, bull$hit.
Broadband is a duopoly / oligopoly industry.
Save for a handful of locales with actual competitors like Google Fiber, Comcast et al have divvied up the markets nationwide (as well as the lawmakers who govern those markets) and charge whatever they want with impunity.

Anonymous Coward says:

correction

“As a result, cable has established a growing monopoly over broadband across massive swaths of the country. This reduced competition has resulted in rampant price hikes (usually in the form of hidden surcharges or arbitrary and unnecessary usage caps and overage fees). “

The FCC “established” this and is the entire premise behind Title II from its inception, LONG before the interwebs were even discovered by “politicians” as a resource to hand-wring over and control.

“The important relationship of the FCC and the American Telephone and Telegraph (AT&T) Company evolved over the decades. For many years, the FCC and state officials agreed to regulate the telephone system as a natural monopoly.[52] The FCC controlled telephone rates and imposed other restrictions under Title II to limit the profits of AT&T and ensure nondiscriminatory pricing.”

Again, you cannot run to a politician and get protection. All you get is a politician working out a deal where you only get fucked half as hard, but still getting fucked.

Seegras (profile) says:

Gigabit

We’ve got around 10% of all households who could order Gigabit (1000Mbit) symmetrical internet connections via fiber. From several different ISPs. A further 50% can order 100MBit (but then usually asymmetrical), mostly from a few different ISPs (we’ve got around 250, but some of them only cater to specific regions, customer segments or communities, like ISPs that are run by a specific town).

But of course it took one of the smaller ISPs to move in with Gbit (in the biggest cities, of course), so the bigger ISPs had to follow suit.

Anonymous Coward says:

Re: Re:

No only that, but all of those speeds are “UP TO”, you are not even guaranteed to get the Full 25Mbps even when that service is being called “available” and advertised at a higher speed.

Heck I have been on a call with Verizon where they said as long as I am getting 50% of my speed they don’t give a shit if I am only getting 50Mbps while paying for 100Mbps.

“sucks to be you” is their response

Anonymous Coward says:

Re: Re:

I bought a house in 2012 in the same city and called ahead to Comcast to make sure I could transfer my existing service, was told yep everything stays the same at new location. I then closed on the property and called Comcast to switch address to service, only to find out they do not offer internet service at my new address only TV. I inquired on how I called ahead before I bought the place and why was told I could transfer, and I was told that the reps have to tell everyone yes. That was literally her response, that they are required to tell everyone Yes! during sales inquiries.

I had to settle for 3mb DSL because that was all that’s offered. CenturyLink told me at the time the 3mb was for now, they are upgrading lines. That was 5 years ago. They still have no time frame. I don’t think they are going to ever upgrade, I’m paying the 25mb price because that’s the lowest tier plan they offer. Why would they upgrade my lines to 25 if I’m already stuck paying that price for 3mb?

TheResidentSkeptic (profile) says:

Conflict of Interest (pun intended)

As many government agencies and programs are reliant on extra income from trust funds and major investments, it is not in their best interest to foster competition which might reduce profits thereby reducing stock gains and dividends. Keep profits up, keep “free money” flowing into their hidden agenda projects.

And it is only the proletariat who are getting screwed here, so it doesn’t matter to those in power. Any way of getting more money out of us without it looking like a new tax…

Anonymous Coward says:

Phoenix the 5th largest city in the US and the surrounding cities can only get cable internet through Cox. The alternative is slower Century Link DSL. Cox just imposed 1TB data caps with $10 per 50 gigs over. Talk about flexing your monopoly power. 100 megs is about as fast you can get unless you move way out to the outskirts of town where new builds may have Cox fiber laid.

Anonymous Coward says:

I’m a little surprised there is no talk about reducing the FCC’s definition of broadband from 25 Mbps down, 3 Mbps up back down to 4 Mbps down, 1 Mbps up. After all “who needs 25 Mbps down” and “4 Mbps down is enough for everyone”.

The current definition just highlights the current inadequacy of the telephone company’s DSL offerings.

Anonymous Coward says:

regardless of what the telecoms DONT/WONT do, the biggest problem is the ease with which senior politicians of the most corrupt country in the world take ‘encouragements’ from those telecom companies so as to boost their ‘campaign contributions and personal bank balances at the expense of the very people they are supposed to represent!! disgusting conduct!!

Anonymous Coward says:

Re: Re:

a problem easily resolved by voters that often “claim” to care but don’t. Which is why every nation gets the government it deserves.

If a candidate is not wrapped up in someones party packaging wrap people won’t even bother to see what the rest of their platform is.

I have seen Republicans more Democrat than some Dems and vice versa… yet the fact that that R or D next to their name just means so much to MOST OTHERS!

American CANNOT be fixed without first repairing the ignorance and blind bias of the electorate.

ECA (profile) says:

How much do we have to spend?

The Gov has paid the Corps 2-3 times to UPGRADE THINGS..
STATES have Paid and signed contracts to UPGRADE THINGS..
WE pay Lots of money for Phone service and then Goto Wireless Cellphones BECAUSE its cheaper..

How much would you PAY for Cellphone Internet at HOME?? 3g, 4g, 5??

Anyone understand that the MAIN backbone is the SAME for all these service? There are a FEW trying to ADD to it in different ways, but its the SAME WIRES/CABLE/everything between all the cities..

And those numbers are ABIT LOW..

MyNameHere (profile) says:

Numbers game

Of course, if you also did a study of “how many American households live at least 20 miles from a major center” you would find that it’s remarkably going to come up to something like 50 million.

If you want to live in the sticks, you have to pay the price somewhere. There really isn’t any money in dragging the internet to houses 20 miles out of town a mile or more apart, and there certainly isn’t enough money in it for two or more companies to do the same.

You want to live low density, you get low density problems.

Anonymous Coward says:

Re: Numbers game

The solution to that problem is to treat the phone system as common infrastructure, and use regulation to allow multiple ISPs to offer service over the same wires. That is how the UK deals with the problem. I am three miles from the nearest cabinet, and 20 from the exchange, and have the choice of several suppliers, with an unlimited DSL service that exceeds 7GiB.

CarefullThereBilly says:

Re: Numbers game

Excellent point. So most cities are considered high density should have to pay a higher tax rate, right? Since there are more people, more infrastructure to be supported, etc. city dwellers should have to pay a higher state tax rate (or if you do not have one, begin paying one).

You want to live high density, you get high density problems (higher tax rate). See what I did there? 😉

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