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Court upholds New York law that says ISPs must offer $15 broadband
- hi-v-rocknroll 2y agoIt might be cheaper for all and easier for the ISPs to instead pay money in lieu of servicing customers into a city-/county-owned municipal co-op for $15/month.
- infecto 3y agoSerious question here. Is this law more or less stating that the business gets no revenue back from local or state government? I have no issue with the argument that internet service is a basic right but if that is the case, I would expect the government to either offer the service or pay a market/agreed price to cover the cost for low income users.
- ceejayoz 3y ago$15 probably does cover the costs of these plans. 25 megabit?
- infecto 3y agoI don't know what the costs are but my point is more that its setting price for a for-profit entity. It gets sticky because I don't know NY state law and perhaps these groups have lobbied for getting regions where you are unable to compete as n independent and with that defacto monopoly they should play by any additional rules. I would just assume that if you want to provide broadband service to low-income that the government would be making up for some of the lost revenue.
- outofpaper 3y agoThe government is letting you provide service using tax-payer fiber. That makes for a fair bit of profit. Take away the fiber n try operating an ISP. Oh I know there's StarLink but that's not going to giver everyone in a city broadband.
- toast0 3y ago25 mbps isn't much, but... $15/month probably doesn't cover any line to your house. A low cost landline was $10/month 10+ years ago, and usage was extra. I think that's an ok baseline for a connection that needs maintenance and service.
- munk-a 3y agoI think there's also the factor that the US government has already paid ISPs for last mile installations several times now - the line to everyone's house has been paid for... if an ISP diverted that money into stock buy backs I'm sure they can explain that to the court and instead be found to have fraudulently expended that subsidy.
- toast0 3y agoSome of that is one time cost, but you've got ongoing costs like pole maintenance and replacement, repairing breaks, trouble tickets, call centers, etc. I just don't think you can do that for $15/month, even if the capex of build out has already been paid for. Maaaybe if you had near 100% uptake, like landlines used to have. But no ISP is getting that. Most (certainly not all) people can choose between wired internet from a telco and a cable company, and 4g/5g is available in a lot of places, starlink in less dense places, and a lot of people don't need a separate home internet plan because the only networked device is their phone.
- awad 3y agoMy understanding is there are already federal incentives to get less dense areas wired, though I'm not up to speed on the state of that - a quick Google tells me that USDA has loan and grants for it but unclear how well funded that is and how that would impact economics at $15 and $20 a month. Given that more than half of the population of NY is in NYC and Long Island, I would imagine that there is enough density and economic diversity at least downstate to make this at minimum cost neutral though this is total conjecture. As an aside, I remember the days of companies partnering with CLECs taking advantage of rural connectivity loopholes to create free conference calling services by billing larger upstream carriers and splitting that revenue with service providers, which was pretty clever.
- matt-p 3y ago25Mb doesn't cost any more or less to provide than say 500Mb in reality. If your last mile infrastructure supports those speeds then it supports those speeds. Even the cheapest router possible to buy will do 500Mb. This comes down to an argument about what "cost", it will cover the marginal cost of an additional subscriber sure (e.g additional customer support, sending a router out, taking a payment each month, 500GB/month across the backbone etc) but will not really be enough to payback the capital cost of the original fibre or coax rollout.
- throw0101d 3y ago> 25Mb doesn't cost any more or less to provide than say 500Mb in reality. If your last mile infrastructure supports those speeds then it supports those speeds. Even the cheapest router possible to buy will do 500Mb. It can once you start adding up all the customers and worrying about 'upstream' connectivity. One thousand customers at 500Mb can potentially saturate a 400Gb link; one thousand at 25Gb cannot. One has to do capacity planning and average and worst case scenarios to worry about, especially at peak times.
- matt-p 3y agoIt's only slightly more peaky, and there is no more, or very little additional aggregate bandwidth used. I promise you if you've got 2 x 100G links out of an exchange you will not be able to visually tell from the traffic profile which is 5000 500Mb customers Vs 4000 25Mb customers and 1000 500Mb customers.
- singlow 3y agoI think the logic here is that the government has already subsidized them by granting privileges to use public infrastrucure that was built with tax dollars. There can only be so many wires running on the poles or under the streets so in return for that privilege, you have to provide this in return.
- infecto 3y agoYeah I was thinking that might be the case as well and I can see that argument making sense too. This especially makes sense if they get assigned regions with zero competition. On the other hand these types of rules seem like they would be hard to perfect I would almost rather have municipal run internet.
- throwaway48476 3y agoIt would be nice if there was as much interest in making laying new fiber cheaper as there seems to be in shuffling pieces around via regulation.
- tshaddox 3y agoThe term of art is "natural monopoly," and ISPs (at least landlines) are a textbook example.
- legitster 3y agoGovernments already charge ISPs to use said infrastructure: https://www.fcc.gov/sites/default/files/ad-hoc-commitee-survey-04242018.pdf https://www.fcc.gov/sites/default/files/ad-hoc-commitee-surv... So for those poles running down the street in front of your house, ISPs are already paying ~$20 per pole per year. Places like NYC probably also take a cut of the revenue on top. In some regions, this is the primary gatekeeper against competition! It's really hard to argue that this is a subsidy - if anything it's the municipalities using the power of their natural monopoly.
- BugsJustFindMe 3y ago> $20 per pole per year So low? That's approximately 0% of what the ISP makes from the homes served by that pole. I figured it would be more.
- jballer 3y ago> have no issue with the argument that internet service is a basic right I am curious how you would define “a right”?
- AndrewDucker 3y agoSomething society says that you have to be allowed.
- csomar 3y agoMy limited experience seeing how some of these deals play from the inside, it's usually some sort of a conflict or hostile take over; and the "poor"/"rights" argument is leveraged to attack the other party. This applies also to politicians buying votes and getting random companies to pay for it. It's easy when it's someone else money.
- hanniabu 3y ago> For consumers who qualify for means-tested government benefits, the state law requires ISPs to offer "broadband at no more than $15 per month for service of 25Mbps, or $20 per month for high-speed service of 200Mbps," the ruling noted. The law allows for price increases every few years and makes exemptions available to ISPs with fewer than 20,000 customers. Okay, so they're either going to make the application process an extremely painful experience so nobody will want to go through it, or make a ton of shell companies where each one is dealing with less than 20k customers.
- vidarh 3y agoI don't know New York law, but pretty much every jurisdictions has mechanisms for determining that a company is a subsidiary that is not an independent entity. Whether or not the law currently takes that into account, if anyone plays stupid games with that expect the law to be changed accordingly. This is hardly difficult to untangle.
- hanniabu 3y ago> expect the law to be changed There's tons of loopholes everywhere allowing companies to get away with ridiculous stuff, getting it fixed is the last thing I'd expect
- swatcoder 3y agoYou think it's more cost effective for a company to artificially restructure itself into a obscured collage of vanishingly small cells than for them to offer a fixed-price minimal-service tier to a specific set of low-opportunity customers who probably have high collections issues under normal circumstances?
- BugsJustFindMe 3y ago200Mbps isn't minimal service. It's more than most people need for anything they do online. Netflix suggests 25Mbps for 4K streaming.
- loceng 3y agoNot accounting for government-produced inflation is interesting. I wonder if city could sue Federal government for printing money and causing such consequences? Reminder that deflation should be occurring with the benefits of automation technology, where the buying power of the dollar should be increasing.
- bobthepanda 3y agoThis has happened before. Most cities capped transit fares at one nickel when streetcars got started and the US was on the gold standard. These laws remained in effect even through massive inflation through two world wars, and usually didn't get repealed until the companies failed, the government took ownership of these services and then realized how much they cost.
- rizzom5000 3y agoHave price controls ever ended with a positive outcome for consumers, or anyone for that matter?
- gms 3y agoNo. Unfortunately wielding them is always an act of either ignorance or malice.
- antifa 3y agoLol no, this is like saying lawn mowers don't work just because you know a guy who refused to do regular maintenance like oiling the engine.
- loceng 3y agoIs this an argument for having or eliminating the gold standard, where currency is anchored to a physical good?
- cryptonector 3y ago
- legitster 3y agoThis seems... excessive. I'm all for cheaper internet, but why even bother with $15 at this point? Why not just make it free? Both companies and consumers are going to be completely at the whim of regulators. If they start jiggering around with the means testing and or the completely arbitrary price point, I'm not confident the quality won't deteriorate or ISPs pull out of the state altogether.
- MathMonkeyMan 3y agoAt this point, internet is like electricity. Except that I have more choices for power providers than I do for internet. In my building in New York City, I have one option (cable via Spectrum), and the cheapest plan they offer is $80 per month. It recently got a lot faster, which is nice, but I'd happily pay $30/month instead for a small fraction of the bandwidth. But I can't. I wouldn't qualify for the hypothetical state enforced $15 option anyway.
- legitster 3y ago> Except that I have more choices for power providers than I do for internet I've lived in over 15 different places in the US, and I have never, ever had more than 1 option for power provider.
- nobody9999 3y ago>> Except that I have more choices for power providers than I do for internet >I've lived in over 15 different places in the US, and I have never, ever had more than 1 option for power provider. In NYC, Con Edison[0] delivers power to customers. It also generates power, but other power generation companies share their delivery infrastructure in NYC. As such, there are at least half a dozen folks I can buy my power from. But all of it is delivered by Con Edison -- which, by the way, charges more for delivery than it does for the power itself. This may well be different from other places in the US/world, but that's how it is here. N.B.: I too, have only two choices (spectrum and RCN) for broadband where I live, but (as I mentioned) at least half a dozen power providers. [0] https://www.coned.com/en https://www.coned.com/en Edit: Added the missing link
- jmyeet 3y agoNational retail ISPs should not exist. All Internet should be municipal broadband that should be subsidized or free by the state. I welcome any ISP who is unhappy about this giving back the broadband infrastructure that governments have already subsidized and paid for as well as given legal monopolies to by, for example, banning municipal broadband. I also welcome eminent domain to solve this problem.
- grecy 3y agoNow do education, prisons & healthcare !
- anon291 3y agoAs long as we make sure that the public pensions that will collapse after the expropriation of the utility companies are not bailed out, I am in full support of this. At the end of the day, the largest investors in most utilities are unfunded pension programs (Usually government) desperately looking for a higher rate of return after legislatures overpromised.
- cryptonector 3y agoHello DMV.
- fy20 3y agoI think the UK could be taken as an example here. For the past couple of decades internet access at home has usually been provided over copper phone lines. That infrastructure was originally laid across the country by BT, which was government owned, until a decade ago. The actual digging and trenching work was often done by private contractors, but the resulting infrastructure was owned by the government. When ADSL broadband rolled out in the 2000s, BT offered their own service, but they were also forced to allow other companies to provide internet access over their infrastructure. At the end of the day the speeds were the same regardless of who you chose, but they competed against each other to gain customers. Unlimited broadband quickly because a thing, and the prices stayed low (compared to the US). Over time they did upgrade the service, and now you can get close to 100mbps over the same, often 40+ year old, cables. In large cities fibre is rolling out, but it's being done by private companies. The UK has a lot of small towns and villages where that won't make sense, so it will be interesting to see how the market looks in the next 20 years.
- m3kw9 3y agoPretty much required infrastructure now broadband
- KingOfCoders 3y agoIs this like everyone has the right for a bank account? In Germany public libraries have free internet access, I rarely see people there though (and in libraries in general, they have the most expensive magazines to read for free!)
- ssl-3 3y agoI don't know if it's codified anywhere (and unlike Germany, we've got 50 states' worth of laws), but public libraries in the US also [almost always] provide free Internet access. ...and somehow, I'm not at all sure what that has to do with a New York City law requiring ISPs to sell Internet access for people's homes at a price of $15 monthly -- regardless of where in the world a public library might be.
- KingOfCoders 3y agoIf the reasoning is, ISP need to be $15 so everyone has internet, and everyone gets free internet at the library, that argument does not make sense. If the reasoning is, ISP need to be %15, so everyone has convenient internet, that argument makes sense.
- ssl-3 3y agoWhy not both? Why not $15 Internet access to use while at home, and free Internet access to use while at the library? What part of this potential eventuality "does not make sense"?
- Novosell 3y agoGermany has 16 states, why is 50 special?
- notresidenter 3y agoAre the states in Germany similar to the states in the US? I thought they were merely a relic of pre-WW1 unification, after the 1990 reunification, but that the states were just administrative entities with no independent sovereign power.
- christophilus 3y agoSerious question. Is there an example of price control that has worked for longer than a handful of years? I’m not aware of any, but I’m also in a conservative bubble.
- yxhuvud 3y agoYes. For example EU have eliminated excessive roaming charges between telephone operators in the EU. That brought down costs for consumers by multiple orders of magnitude. In practice, price controls can work well when there is no efficient price competition.
- phatfish 3y agoAnd most mobile phone operators in the UK put back roaming charges as fast as they could after Brexit. So you know they were screwing everyone over.
- elzbardico 3y ago$15 for 25Mb/s? And the ISPs are still complaining?????
- deleted 3y ago[deleted]
- deprecative 3y agoThat'll run you at least $50/m here in the Midwest.
- barryrandall 3y agoThe preferred rate for ISPs is $infinity/month for 0 MB/s. Anything less is just leaving money on the table.