5 ms·

We already paid for nationwide broadband installation several times by now. How many more funds do we need to siphon to major corporations that still don’t buil

We already paid for nationwide broadband installation several times by now. How many more funds do we need to siphon to major corporations that still don’t build anything?

thomaslord 6y ago
I definitely think we shouldn't give another dime in tax credits to broadband providers - a signed contract with aggressive enforcement provisions would be in order, and if the current major ISPs don't want to build the infrastructure we should find someone else who will.
- jdhawk 6y ago
  vote for people who don't take funds from them. Its almost impossible.
- rayiner 6y ago
  > current major ISPs don't want to build the infrastructure we should find someone else who will. There are no such people. Both Baltimore and Los Angeles put out bids asking for companies willing to build fiber networks on certain terms. Nobody volunteered. E.g. https://la.curbed.com/2018/1/9/16863352/free-internet-los-angeles-wifi-network https://la.curbed.com/2018/1/9/16863352/free-internet-los-an... > Los Angeles officials planned to build up a network through a public-private partnership, passing off the costs of the ambitious infrastructure project to an outside provider. Blumenfield announced last year that the city never received a workable proposal from a private company to build out the network.
  - misiti3780 6y ago
    why though?
    - rayiner 6y ago
      There's no money in wired broadband. Investors have been trying to get Verizon to divest itself of FiOS pretty much since the beginning. It's probably profitable at this point, but barely. (Verizon's entire wireline division has a 5% or less profit margin.) Chatanooga Tennessee charges about $60/month for 300 mbps fiber. It is probably financially sustainable, but: 1) Tennessee is a low-cost, right-to-work state; 2) the capital costs of the fiber network were shared with the electric "smart grid" so some of the capital costs are being recouped from electric ratepayers. You couldn't make the same thing work in New York, San Francisco, etc. at the $60 price point. But at a much higher price point than that, you're talking about something quite expensive for what's supposed to be a public utility. Wired broadband, unlike water or electricity, is an optional service for most people. (1 in 6 high-income households only have cellular service.) If it costs you closer to $100 to have the same service in an expensive northern city, many people will opt out, and that will cause the per-household costs to skyrocket. It's a really tough mathematical equation to work out.
      - misiti3780 6y ago
        thank you!
  - grandinj 6y ago
    Baltimore is a basket case, so no surprise there. LA is probably too big for a single company. Normally when these tenders fail it is because the terms need to be tweaked. Probably want you really want is simply to allow individual suburbs to set up their own little broadband networks, and have the city just run some central hub. But big city beauracrats are never keen on giving up control.
  - dv_dt 6y ago
    I think this is odd because a lot of the major ISPs seemed to have outsourced the actual physical and electronic construction work to third parties. It's a different thing setting up the accounts and operation, but the building part seems accessible.
- pizzazzaro 6y ago
  Screw it. I guess those cities have to build it for themselves. And if they buy it, its theirs to maintain and use. Your "free" market has failed. I wonder where I can send a resumé for this...
zipwitch 6y ago
That depends on how many more bonuses their executives need.
cybwraith 6y ago
Agreed. If they do pass something like this it had better include net neutrality provisions for any ISP taking the money, too.
rayiner 6y ago
This is simply not true. Federal money wasn't used to build broadband until Obama's second term, and that amounted to a couple of billion a year since 2012. (Of the tens of billions invested in broadband networks annually.)
- Supermancho 6y ago
  > This is simply not true. How so? (eg https://www.congress.gov/bill/114th-congress/house-bill/3805?s=1&r=8 https://www.congress.gov/bill/114th-congress/house-bill/3805..., there are lots of bills over the last decade, American Recovery and Reinvestment Act of 2009, etc) Unless you can go through each individual bill that was mandated to build infratructure, the history indicates that the OP statemnt is true. The money was pocketed and it wasn't done. Business as usual with govt contracts.
  - rayiner 6y ago
    The claim that "we already paid for nationwide broadband installations several times now" is not true. The bill you linked to, for example, just says that the Secretary of Transportation "shall require States to evaluate the need for broadband conduit in accordance with this section as part of any covered highway construction project." It doesn't even appropriate any money. The ARRA appropriate a small amount of money for rural broadband, about $2.5 billion, much of which was never even spent: https://www.benton.org/blog/questioning-federal-broadband-spending https://www.benton.org/blog/questioning-federal-broadband-sp.... That was 10 years ago. Then the Connect America Fund spent less than $10 billion over the last decade. These are the only major federal programs I'm aware of that spent any significant amount of money on broadband. Over that same decade, private companies invested over $70 billion per year: https://morningconsult.com/opinions/reversal-of-fortune-broadband-investment-on-the-wrong-track https://morningconsult.com/opinions/reversal-of-fortune-broa.... I don't have a recent breakdown, but in the 2007-2008 timeframe, it was $40 billion+ per year for wireline, and $20 billion+ for wireless: http://cpham.perso.univ-pau.fr/ENSEIGNEMENT/PAU-UPPA/RHD/PAPER/OLD/CarrierCapital.pdf http://cpham.perso.univ-pau.fr/ENSEIGNEMENT/PAU-UPPA/RHD/PAP.... It might well be the reverse today, with most of the investment in wireless, but you're still talking $20-30 billion+ per year in wireline. So over the past decade, it's maybe $10-15 billion in government funding, targeted at a few rural areas, compared with hundreds of billions of dollars of private investment. Whether or not the government money has been properly used is a fair discussion, but a separate one. It's just a tiny fraction of what you need to build and maintain a nationwide broadband network, which is what OP was talking about.
chooseaname 6y ago
I think it was Ars that ran an article a couple years back that showed how much money AT&T has gotten for broadband access they never completed. It was $Billions.
crazygringo 6y ago
Wait, really? What happened to the money? Is it not contingent on delivery of the completed product? Or was it intentionally badly written in order just to funnel money/pork to big donors? Can you provide some citations? I'm not finding anything with a quick search.
- rayiner 6y ago
  It's a trope based on the notion that the 1996 telecom deregulation was supposed to encourage development of fiber. It's kind of like saying "we already paid for XYZ" where XYZ is whatever justification was given for the recent corporate tax cuts.
- manigandham 6y ago
  Some sources here: https://news.ycombinator.com/item?id=23646690 https://news.ycombinator.com/item?id=23646690

We already paid for nationwide broadband installation several times by now. How many more funds do we need to siphon to major corporations that still don’t build anything?

thomaslord 6y ago

I definitely think we shouldn't give another dime in tax credits to broadband providers - a signed contract with aggressive enforcement provisions would be in order, and if the current major ISPs don't want to build the infrastructure we should find someone else who will.

jdhawk 6y ago
vote for people who don't take funds from them. Its almost impossible.
rayiner 6y ago
> current major ISPs don't want to build the infrastructure we should find someone else who will. There are no such people. Both Baltimore and Los Angeles put out bids asking for companies willing to build fiber networks on certain terms. Nobody volunteered. E.g. https://la.curbed.com/2018/1/9/16863352/free-internet-los-angeles-wifi-network https://la.curbed.com/2018/1/9/16863352/free-internet-los-an... > Los Angeles officials planned to build up a network through a public-private partnership, passing off the costs of the ambitious infrastructure project to an outside provider. Blumenfield announced last year that the city never received a workable proposal from a private company to build out the network.
- misiti3780 6y ago
  why though?
  - rayiner 6y ago
    There's no money in wired broadband. Investors have been trying to get Verizon to divest itself of FiOS pretty much since the beginning. It's probably profitable at this point, but barely. (Verizon's entire wireline division has a 5% or less profit margin.) Chatanooga Tennessee charges about $60/month for 300 mbps fiber. It is probably financially sustainable, but: 1) Tennessee is a low-cost, right-to-work state; 2) the capital costs of the fiber network were shared with the electric "smart grid" so some of the capital costs are being recouped from electric ratepayers. You couldn't make the same thing work in New York, San Francisco, etc. at the $60 price point. But at a much higher price point than that, you're talking about something quite expensive for what's supposed to be a public utility. Wired broadband, unlike water or electricity, is an optional service for most people. (1 in 6 high-income households only have cellular service.) If it costs you closer to $100 to have the same service in an expensive northern city, many people will opt out, and that will cause the per-household costs to skyrocket. It's a really tough mathematical equation to work out.
    - misiti3780 6y ago
      thank you!
- grandinj 6y ago
  Baltimore is a basket case, so no surprise there. LA is probably too big for a single company. Normally when these tenders fail it is because the terms need to be tweaked. Probably want you really want is simply to allow individual suburbs to set up their own little broadband networks, and have the city just run some central hub. But big city beauracrats are never keen on giving up control.
- dv_dt 6y ago
  I think this is odd because a lot of the major ISPs seemed to have outsourced the actual physical and electronic construction work to third parties. It's a different thing setting up the accounts and operation, but the building part seems accessible.
pizzazzaro 6y ago
Screw it. I guess those cities have to build it for themselves. And if they buy it, its theirs to maintain and use. Your "free" market has failed. I wonder where I can send a resumé for this...

zipwitch 6y ago

That depends on how many more bonuses their executives need.

cybwraith 6y ago

Agreed. If they do pass something like this it had better include net neutrality provisions for any ISP taking the money, too.

rayiner 6y ago

This is simply not true. Federal money wasn't used to build broadband until Obama's second term, and that amounted to a couple of billion a year since 2012. (Of the tens of billions invested in broadband networks annually.)

Supermancho 6y ago
> This is simply not true. How so? (eg https://www.congress.gov/bill/114th-congress/house-bill/3805?s=1&r=8 https://www.congress.gov/bill/114th-congress/house-bill/3805..., there are lots of bills over the last decade, American Recovery and Reinvestment Act of 2009, etc) Unless you can go through each individual bill that was mandated to build infratructure, the history indicates that the OP statemnt is true. The money was pocketed and it wasn't done. Business as usual with govt contracts.
- rayiner 6y ago
  The claim that "we already paid for nationwide broadband installations several times now" is not true. The bill you linked to, for example, just says that the Secretary of Transportation "shall require States to evaluate the need for broadband conduit in accordance with this section as part of any covered highway construction project." It doesn't even appropriate any money. The ARRA appropriate a small amount of money for rural broadband, about $2.5 billion, much of which was never even spent: https://www.benton.org/blog/questioning-federal-broadband-spending https://www.benton.org/blog/questioning-federal-broadband-sp.... That was 10 years ago. Then the Connect America Fund spent less than $10 billion over the last decade. These are the only major federal programs I'm aware of that spent any significant amount of money on broadband. Over that same decade, private companies invested over $70 billion per year: https://morningconsult.com/opinions/reversal-of-fortune-broadband-investment-on-the-wrong-track https://morningconsult.com/opinions/reversal-of-fortune-broa.... I don't have a recent breakdown, but in the 2007-2008 timeframe, it was $40 billion+ per year for wireline, and $20 billion+ for wireless: http://cpham.perso.univ-pau.fr/ENSEIGNEMENT/PAU-UPPA/RHD/PAPER/OLD/CarrierCapital.pdf http://cpham.perso.univ-pau.fr/ENSEIGNEMENT/PAU-UPPA/RHD/PAP.... It might well be the reverse today, with most of the investment in wireless, but you're still talking $20-30 billion+ per year in wireline. So over the past decade, it's maybe $10-15 billion in government funding, targeted at a few rural areas, compared with hundreds of billions of dollars of private investment. Whether or not the government money has been properly used is a fair discussion, but a separate one. It's just a tiny fraction of what you need to build and maintain a nationwide broadband network, which is what OP was talking about.

chooseaname 6y ago

I think it was Ars that ran an article a couple years back that showed how much money AT&T has gotten for broadband access they never completed. It was $Billions.

crazygringo 6y ago

Wait, really? What happened to the money? Is it not contingent on delivery of the completed product? Or was it intentionally badly written in order just to funnel money/pork to big donors? Can you provide some citations? I'm not finding anything with a quick search.

rayiner 6y ago
It's a trope based on the notion that the 1996 telecom deregulation was supposed to encourage development of fiber. It's kind of like saying "we already paid for XYZ" where XYZ is whatever justification was given for the recent corporate tax cuts.
manigandham 6y ago
Some sources here: https://news.ycombinator.com/item?id=23646690 https://news.ycombinator.com/item?id=23646690