5 ms·

Interesting. I live in a country with a minimum wage of $58 a month (Ukraine) and yet the internet is one of the few things that pretty much anyone can afford:

by drops 10y ago

Interesting. I live in a country with a minimum wage of $58 a month (Ukraine) and yet the internet is one of the few things that pretty much anyone can afford: high speed connections (50-100mbps) cost about $2-4; rarely more. Are american high prices the result of scummy pricing on the corporations' side or is it an actual infrastructural issue that prevents the ISPs from providing cheap connections to everyone?

walrus01 10y ago
1) it costs a great deal less in salary to pay construction workers to install aerial or buried fiber in ukraine. Or to aim point to point microwave. 2) A network engineeering position that might cost a company $115,000/year in the US could be filled for $35,000/year in Ukraine. 3) Eastern european ISPs are much more "Adventurous" in terms of the low cost network equipment they use for core infrastructure. $1500 Mikrotiks in the same role where a US ISP would use a $15,000 Ciscos or Juniper. Building five to six nines uptime core router POPs with fully redundant -48VDC A and B power is not cheap.
- qaq 10y ago
  Be it as it may the quality of service is way better then what I can get with Comcast at about 1/10th the price :)
  - walrus01 10y ago
    Your shitty last mile DOCSIS3 connection over 20+ year old coaxial copper is not a reflection of the quality of an ISP backbone... I realize that from a customer perspective the two are indistinguishable, but if you look at the quality of the router/switch equipment used by the top 50 ASNs (ordered by CAIDA ASRank) for major north american ISPs, it's vastly more expensive than what's used in countries where ISPs don't have the budget luxuries for $100,000 routers.
    - qaq 10y ago
      What benefit is it to me :)? In all seriousness we run things in US and Ukraine and while in theory you would expect there would be some tangible differences given the concerns you outline in reality they are not there. Major backbone providers also use cisco and juniper gear and are about as reliable as stateside providers. Residential providers due to intense competition offer way better service at a small fraction of the cost.
- zzzcpan 10y ago
  > Eastern european ISPs are much more "Adventurous" in terms of the low cost network equipment Well, unlike US ISPs, they try to compete on price and there is a lot of competition. They kind of have to be much more adventurous in terms of cutting down costs of network equipment. But they also compete on quality, so it has to satisfy that too or you are out.
Fej 10y ago
It is 100% a corporate issue. In the US, many people have only one choice for an Internet/TV/phone provider. Some have two choices. It is exceedingly rare to find a place with three choices. Telecoms are typically granted local monopolies. As a result, they can charge pretty much what they want. And they do. Even in markets with a duopoly, companies very rarely attempt to beat each other on price, it's not in their best long-term interest to (but I doubt they are outright colluding). The only places where it is more expensive than the norm to build out is in more rural areas... but the telecoms sometimes don't build out there at all, so some people are stuck with whatever they can get with a copper phone line, or satellite Internet if they can afford it (that's very expensive as well). In my area - Optimum wants $50 for 60/25, plus $10 to rent a modem monthly, plus other taxes and fees (most of them made up) that are nigh impossible to find out beforehand. For TV and phone as well, $90 plus rental fees for the router and required boxes for each TV However, Optimum is terrible at my particular house, but we're one of the lucky ones who can choose Verizon as well. Verizon wants $70 for 100/100, reduced TV service, and phone, plus all the fees above. The telecoms push the bundles very hard. As you can see, this shit's expensive (adds up to $130).
- deleted 10y ago
  [deleted]
- WillPostForFood 10y ago
  It can't be a 100% a corporate issue if, as you point out, telecoms are granted local monopolies. Governments grant those monopolies.
  - rayiner 10y ago
    Which isn't true anyway.
__jal 10y ago
It is classic regulatory capture. US telecom, historically, basically owns the regulators. Occasionally, like now, the FCC pushes back a bit. Combine that with large regions of low population density and a lot of land, and we have very little competition in the vast majority of the country.
Spooky23 10y ago
Many countries benefited from having a government owned telecom monopoly. In the US, we get the downside legacies of a monopoly without the benefit of government control. The last mile and regional infrastructure (poles, mostly) is owned by private interests, who tend to be dicks about sharing. There's also a regulatory tension between the Federal government and state governments.
- eli 10y ago
  They also benefited from starting later which means they could start with newer, better technology. If you were going to start a wireless data network in the US from scratch, you wouldn't design it the way the current US hodgepodge has evolved.
rayiner 10y ago
The vast majority of the cost of any kind of infrastructure is labor, which scales with local wages.[1] A New York subway ticket is about $2.75. That's about 11x more than the cost of a ticket on the Kiev Metro. And it's not like the New York subway makes a profit--fares cover only about half the system's operating costs.[2] In Baltimore, I paid about $50 for a 50mbps connection, or about 20x more than a subway ticket. Sounds like the ratio is about the same order of magnitude in Ukraine. [1] A telecom field technican in the U.S. makes about $6,000-$7,000 per month, plus benefits. That's about 20x what the average Ukrainian in Kiev makes (according to the Internet). [2] Fares on D.C.'s metro, which similarly cover only about 50% of costs, range from $1.75 to $5.90(!).
- linkregister 10y ago
  How did you get that $50/50Mbps deal in Baltimore? Was this part of a bundle for cable television?
  - rayiner 10y ago
    That's what Verizon charged for FiOS in my apartment.
  - crazy1van 10y ago
    It was remarkable how much the price per Mbps dropped in the area once Verizon FIOS entered the market. Just one real competitor to Comcast made a substantial difference.
  - deleted 10y ago
    [deleted]
- rahimnathwani 10y ago
  "The vast majority of the cost of any kind of infrastructure is labor, which scales with local wages." I'm not sure that's true. Let's say it costs VeriCast $500/year to maintain a single home's landline and broadband connections (including the stuff in the street), for which they charge the customer say $700 per year. Do they really have one employee per 200 connections (assuming $100k full-loaded cost per employee)? That would be 500,000 employees in the USA, if 83% of households have broadband. That's about the total number of employees of ComCast, Verizon and AT&T. But those folks provide other services (like cellular service). Where is my math wrong? Even we accept that it is true, it's not relevant, because the price paid by the customer is as much about the willingness of customers to pay, as it is about the running costs. Even if we believe it's relevant, because the price customers are willing to pay vary with local incomes, experience tells us that local incomes don't tell us the whole story. People in London pay less for broadband (~$300 per year for phone and broadband, including taxes[0]) than those in San Francisco. I don't see how that is explained by labour costs. [0] http://www.moneysavingexpert.com/phones/cheap-broadband http://www.moneysavingexpert.com/phones/cheap-broadband
ryanSrich 10y ago
Corporate and local government bureaucracy. I've lived in very affluent neighborhoods that have access to a single, shitty, ISP. So even when you can afford the inflated and outrageous prices you're still at the mercy of an incredibly corrupt and poor preforming corporation.
lake99 10y ago
Now I understand why Russian-speakers dominate many gaming communities. I pay around 20$ for an 8mbps connection, with a monthly download limit of about 50GB. Now you know why there won't be Indians competing in global e-leagues for a long time to come.
- mankash666 10y ago
  Do you pay about 1500 INR and still cap out at 50GB a month? I'm sure you get unlimited access for around that
  - lake99 10y ago
    About 1200 INR, which I rounded in USD. To the best of my knowledge, only Hyderabad has unlimited options.
- zzzcpan 10y ago
  Russia is also in the same category of cheap high-speed internet access. Romania is there too. In the rest of Eastern Europe it's a bit more expensive, but still below $20.
- gozur88 10y ago
  I, for one, look forward to the day I can learn to swear in languages other than Russian and Tagalog. But why is it relatively more expensive? Have Indian companies rigged the rules such that they don't have to compete with each other? I thought Indian labor was relatively inexpensive.
  - lake99 10y ago
    I have no idea if net connectivity is rigged now. Back in the day when cable TV operators ruled the roost, I had heard of existing operators of a neighbourhood ganging up against new entrants. With ISPs, even the last-mile connectivity is handled by major ISPs, so that seems unlikely. Overall, I don't understand what's going on with Indian ISPs. For example, my traceroute to qoo10.sg (hosted in Korea) reveals traffic going from Bangalore to Delhi to London to Fremont (US) to Japan to Korea. For various other places that are supposed to be close by, I see traffic going all the way to Delhi and then coming back. I think the demand for broadband is still very low here, and so, unoptimal strategies (from a network packet's POV) are good enough for our ISPs.
crazydoggers 10y ago
The minimum wage in US would be $1200 per month. So if the average price in the US is $55, that's about 4.5% of a monthly salary. Given your quoted numbers, the price in Ukraine is actually higher at 5% of a monthly salary. Of course the US doesn't have a monthly minimum wage (not sure how that works in Ukraine) so many people in the US might only have part time jobs paying the minimum hourly wage, hence they make considerably less than $1200 a month.
- chaostheory 10y ago
  I could be wrong but I think it's actually lower in the US if you're only making minimum wage. Years ago it qualified you for a subsidized $19.99 plan. UPDATE It seems to be even less today at $5-10: http://money.cnn.com/2016/04/22/technology/access-from-att-digital-divide/ http://money.cnn.com/2016/04/22/technology/access-from-att-d... It's strange that the article doesn't mention this.
  - technofiend 10y ago
    Uh, yeah about that.. I have an aunt on permanent disability. She haggled with AT & T in Austin for months trying to get that service. They make it extremely difficult to actually sign up. I believe she finally just switched to the $300 one time cost Google Fiber plan when they came to town.
    - chaostheory 10y ago
      Why am I not surprised? I wonder if there's a way to put a spotlight on that practice? Medium post?
cema 10y ago
Proportionally, the price may be comparable. For example, in Massachusetts, the current minimal wage is $10 per hour which translates into about $1700 monthly. 50-100 Mbps in Comcast can be had for about $40-60. Now, a monthly subscription of $2 out of $58 is 1/29, and $1700/29 = $58. Of course, not all components of the prices translate proportionally. Salaries probably do, equipment probably does not.

by drops 10y ago

walrus01 10y ago

1) it costs a great deal less in salary to pay construction workers to install aerial or buried fiber in ukraine. Or to aim point to point microwave. 2) A network engineeering position that might cost a company $115,000/year in the US could be filled for $35,000/year in Ukraine. 3) Eastern european ISPs are much more "Adventurous" in terms of the low cost network equipment they use for core infrastructure. $1500 Mikrotiks in the same role where a US ISP would use a $15,000 Ciscos or Juniper. Building five to six nines uptime core router POPs with fully redundant -48VDC A and B power is not cheap.

qaq 10y ago
Be it as it may the quality of service is way better then what I can get with Comcast at about 1/10th the price :)
- walrus01 10y ago
  Your shitty last mile DOCSIS3 connection over 20+ year old coaxial copper is not a reflection of the quality of an ISP backbone... I realize that from a customer perspective the two are indistinguishable, but if you look at the quality of the router/switch equipment used by the top 50 ASNs (ordered by CAIDA ASRank) for major north american ISPs, it's vastly more expensive than what's used in countries where ISPs don't have the budget luxuries for $100,000 routers.
  - qaq 10y ago
    What benefit is it to me :)? In all seriousness we run things in US and Ukraine and while in theory you would expect there would be some tangible differences given the concerns you outline in reality they are not there. Major backbone providers also use cisco and juniper gear and are about as reliable as stateside providers. Residential providers due to intense competition offer way better service at a small fraction of the cost.
zzzcpan 10y ago
> Eastern european ISPs are much more "Adventurous" in terms of the low cost network equipment Well, unlike US ISPs, they try to compete on price and there is a lot of competition. They kind of have to be much more adventurous in terms of cutting down costs of network equipment. But they also compete on quality, so it has to satisfy that too or you are out.

Fej 10y ago

It is 100% a corporate issue. In the US, many people have only one choice for an Internet/TV/phone provider. Some have two choices. It is exceedingly rare to find a place with three choices. Telecoms are typically granted local monopolies. As a result, they can charge pretty much what they want. And they do. Even in markets with a duopoly, companies very rarely attempt to beat each other on price, it's not in their best long-term interest to (but I doubt they are outright colluding). The only places where it is more expensive than the norm to build out is in more rural areas... but the telecoms sometimes don't build out there at all, so some people are stuck with whatever they can get with a copper phone line, or satellite Internet if they can afford it (that's very expensive as well). In my area - Optimum wants $50 for 60/25, plus $10 to rent a modem monthly, plus other taxes and fees (most of them made up) that are nigh impossible to find out beforehand. For TV and phone as well, $90 plus rental fees for the router and required boxes for each TV However, Optimum is terrible at my particular house, but we're one of the lucky ones who can choose Verizon as well. Verizon wants $70 for 100/100, reduced TV service, and phone, plus all the fees above. The telecoms push the bundles very hard. As you can see, this shit's expensive (adds up to $130).

deleted 10y ago
[deleted]
WillPostForFood 10y ago
It can't be a 100% a corporate issue if, as you point out, telecoms are granted local monopolies. Governments grant those monopolies.
- rayiner 10y ago
  Which isn't true anyway.

__jal 10y ago

It is classic regulatory capture. US telecom, historically, basically owns the regulators. Occasionally, like now, the FCC pushes back a bit. Combine that with large regions of low population density and a lot of land, and we have very little competition in the vast majority of the country.

Spooky23 10y ago

Many countries benefited from having a government owned telecom monopoly. In the US, we get the downside legacies of a monopoly without the benefit of government control. The last mile and regional infrastructure (poles, mostly) is owned by private interests, who tend to be dicks about sharing. There's also a regulatory tension between the Federal government and state governments.

eli 10y ago
They also benefited from starting later which means they could start with newer, better technology. If you were going to start a wireless data network in the US from scratch, you wouldn't design it the way the current US hodgepodge has evolved.

rayiner 10y ago

The vast majority of the cost of any kind of infrastructure is labor, which scales with local wages.[1] A New York subway ticket is about $2.75. That's about 11x more than the cost of a ticket on the Kiev Metro. And it's not like the New York subway makes a profit--fares cover only about half the system's operating costs.[2] In Baltimore, I paid about $50 for a 50mbps connection, or about 20x more than a subway ticket. Sounds like the ratio is about the same order of magnitude in Ukraine. [1] A telecom field technican in the U.S. makes about $6,000-$7,000 per month, plus benefits. That's about 20x what the average Ukrainian in Kiev makes (according to the Internet). [2] Fares on D.C.'s metro, which similarly cover only about 50% of costs, range from $1.75 to $5.90(!).

linkregister 10y ago
How did you get that $50/50Mbps deal in Baltimore? Was this part of a bundle for cable television?
- rayiner 10y ago
  That's what Verizon charged for FiOS in my apartment.
- crazy1van 10y ago
  It was remarkable how much the price per Mbps dropped in the area once Verizon FIOS entered the market. Just one real competitor to Comcast made a substantial difference.
- deleted 10y ago
  [deleted]
rahimnathwani 10y ago
"The vast majority of the cost of any kind of infrastructure is labor, which scales with local wages." I'm not sure that's true. Let's say it costs VeriCast $500/year to maintain a single home's landline and broadband connections (including the stuff in the street), for which they charge the customer say $700 per year. Do they really have one employee per 200 connections (assuming $100k full-loaded cost per employee)? That would be 500,000 employees in the USA, if 83% of households have broadband. That's about the total number of employees of ComCast, Verizon and AT&T. But those folks provide other services (like cellular service). Where is my math wrong? Even we accept that it is true, it's not relevant, because the price paid by the customer is as much about the willingness of customers to pay, as it is about the running costs. Even if we believe it's relevant, because the price customers are willing to pay vary with local incomes, experience tells us that local incomes don't tell us the whole story. People in London pay less for broadband (~$300 per year for phone and broadband, including taxes[0]) than those in San Francisco. I don't see how that is explained by labour costs. [0] http://www.moneysavingexpert.com/phones/cheap-broadband http://www.moneysavingexpert.com/phones/cheap-broadband

ryanSrich 10y ago

Corporate and local government bureaucracy. I've lived in very affluent neighborhoods that have access to a single, shitty, ISP. So even when you can afford the inflated and outrageous prices you're still at the mercy of an incredibly corrupt and poor preforming corporation.

lake99 10y ago

Now I understand why Russian-speakers dominate many gaming communities. I pay around 20$ for an 8mbps connection, with a monthly download limit of about 50GB. Now you know why there won't be Indians competing in global e-leagues for a long time to come.

mankash666 10y ago
Do you pay about 1500 INR and still cap out at 50GB a month? I'm sure you get unlimited access for around that
- lake99 10y ago
  About 1200 INR, which I rounded in USD. To the best of my knowledge, only Hyderabad has unlimited options.
zzzcpan 10y ago
Russia is also in the same category of cheap high-speed internet access. Romania is there too. In the rest of Eastern Europe it's a bit more expensive, but still below $20.
gozur88 10y ago
I, for one, look forward to the day I can learn to swear in languages other than Russian and Tagalog. But why is it relatively more expensive? Have Indian companies rigged the rules such that they don't have to compete with each other? I thought Indian labor was relatively inexpensive.
- lake99 10y ago
  I have no idea if net connectivity is rigged now. Back in the day when cable TV operators ruled the roost, I had heard of existing operators of a neighbourhood ganging up against new entrants. With ISPs, even the last-mile connectivity is handled by major ISPs, so that seems unlikely. Overall, I don't understand what's going on with Indian ISPs. For example, my traceroute to qoo10.sg (hosted in Korea) reveals traffic going from Bangalore to Delhi to London to Fremont (US) to Japan to Korea. For various other places that are supposed to be close by, I see traffic going all the way to Delhi and then coming back. I think the demand for broadband is still very low here, and so, unoptimal strategies (from a network packet's POV) are good enough for our ISPs.

crazydoggers 10y ago

The minimum wage in US would be $1200 per month. So if the average price in the US is $55, that's about 4.5% of a monthly salary. Given your quoted numbers, the price in Ukraine is actually higher at 5% of a monthly salary. Of course the US doesn't have a monthly minimum wage (not sure how that works in Ukraine) so many people in the US might only have part time jobs paying the minimum hourly wage, hence they make considerably less than $1200 a month.

chaostheory 10y ago
I could be wrong but I think it's actually lower in the US if you're only making minimum wage. Years ago it qualified you for a subsidized $19.99 plan. UPDATE It seems to be even less today at $5-10: http://money.cnn.com/2016/04/22/technology/access-from-att-digital-divide/ http://money.cnn.com/2016/04/22/technology/access-from-att-d... It's strange that the article doesn't mention this.
- technofiend 10y ago
  Uh, yeah about that.. I have an aunt on permanent disability. She haggled with AT & T in Austin for months trying to get that service. They make it extremely difficult to actually sign up. I believe she finally just switched to the $300 one time cost Google Fiber plan when they came to town.
  - chaostheory 10y ago
    Why am I not surprised? I wonder if there's a way to put a spotlight on that practice? Medium post?

cema 10y ago

Proportionally, the price may be comparable. For example, in Massachusetts, the current minimal wage is $10 per hour which translates into about $1700 monthly. 50-100 Mbps in Comcast can be had for about $40-60. Now, a monthly subscription of $2 out of $58 is 1/29, and $1700/29 = $58. Of course, not all components of the prices translate proportionally. Salaries probably do, equipment probably does not.