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> I view the broadband industry as a fascinating example of what happens when an infrastructure industry meets the technology industry. I don't disagree with y

> I view the broadband industry as a fascinating example of what happens when an infrastructure industry meets the technology industry. I don't disagree with your comment, but your argument would seem to apply to the rest of the world, whereas in fact the US is in a fairly unique situation among developed countries. Most of the current situation can be explained by the fact that broadband is currently the only unregulated public utility. In NYC, I don't really pay much attention to electricity, gas, and water. ConEd kind of sucks, and I wish they were better, but really, they work well enough most of the time, and I'm not sure that I could name anybody else who would do it better. The problem is that we sold off monopoly rights to broadband without attaching any strings of regulation, etc. Why should they bother to upgrade their infrastructure? Heck, we literally paid the cable companies billions of dollars of government money to do exactly that, and because we failed to enforce that with any real teeth, they just took the money and ran. Of course they're not going to listen when consumers say they "want gigabit". It would make no business sense to do otherwise, especially when 80% of your customers are unable to vote with their wallet and use a competing service[0]. There's a case to be made for either a free-market approach to broadband, or a more "socialized", regulated monopoly. Unfortunately, what we currently have is a hybrid of both, and it happens to hit upon the worst of both worlds. [0] There's a South Park clip that does a great job of describing this relationship. I won't link to it here, because it's rather crude and possibly (?) a bit NSFW, but searching "south park cable" on Youtube should lead you to it if you want to laugh, sigh, and cry all at the same time.

jfasi 13y ago
I disagree in terms of regulation: there is plenty of regulation on broadband internet, except it tends to discourage competition against broadband providers. This isn't a problem that is going to be solved by placing regulations on the industry. Your example of past subsidies provides an excellent argument for this: given the political clout these entities hold and have in the past used to stilt legislation in their favor, what leads us to believe we're going to do any better with new regulations? At the end of the day, the market is demanding better internet service. While telecommunications providers are certain to wage war against the injection against honest competition into their sector, things are actually looking pretty good in my mind. The FCC sees market demand and is working to tear down anti-competitive legislative barriers [1]. Smaller efforts such as Google Fiber are doing the hard work of convincing the public that better service is within reach. http://www.slate.com/blogs/future_tense/2014/02/20/fcc_s_plan_to_reboot_net_neutrality_might_transform_municipal_broadband.html http://www.slate.com/blogs/future_tense/2014/02/20/fcc_s_pla...
- barrkel 13y ago
  You need to qualify your statements with "in the US", because regulation has been effective elsewhere.
- abvdasker 13y ago
  It's highly unlikely that the FCC will accomplish much in the way of enforcing net nutrality given that the agency has basically been captured by special interest. Tom Wheeler, the new FCC Chairman, was a lobbyist and head of the NCTA for 5 years[1]. The idea that he will do anything to hurt the cable companies his old organization represents is ludicrous. [1]http://www.nytimes.com/2013/05/02/business/tom-wheeler-telecom-investor-is-fcc-nominee.html?_r=0 http://www.nytimes.com/2013/05/02/business/tom-wheeler-telec...
- chimeracoder 13y ago
  > I disagree in terms of regulation: there is plenty of regulation on broadband internet, except it tends to discourage competition against broadband providers. Well, yes - when I use the word "regulation", I'm implying the sort of regulation that we see with respect to Con Edison. They can't so much as change the way they itemize fees on my bill (!) without regulatory approval. That certainly creates problems of another sort, but on the other hand, the actual service provided[0] and the pricing is pretty much a solved problem (as much as one can expect)[1]. I'm sure ConEd would like the sort of legislative protectionism that cable companies receive, with no requirements surrounding price or quality, but thankfully, they don't have that (and altering the status quo is always tough in general - in this case, inertia is on consumers' side). Obviously regulation could be established to make things worse, but I think it's clear what kind of regulation we're looking for for the purposes of this discussion. And I'm intentionally deferring the question of how any of these policies would be enacted - I'm just comparing two alternatives states to the status quo. [0] excluding customer service, which is going to be mediocre at best no matter what. [1] Interestingly, pricing is partly "solved" due to the introduction of ESCOs, which are a way to privatize the supply chain (at the consumer's choice). "Free market" and "regulation" are not mutually exclusive - we could easily establish a regulated monopoly on last-mile copper wire while allowing multiple competing upstream providers.[2]
- 13y ago
rayiner 13y ago
Your whole post is based on a false premise, which is that customers have a problem with the status quo. I think internet companies have a problem with the status quo. They want somebody else to build the fat pipes crucial to their business. That's why Google fiber is a marketing and lobbying tool and not a real business.[1] But I don't think consumers here are any less happy than in other places. According to Akamai's state of the internet, the U.S. ranks #8 in average connection speed, ahead of places like Sweden. They have no reason to be. I've never heard someone outside my engineer friends complain about the lack of gigabit or even 50 Mbps+ connections. As long as its enough for Hulu, people are happy. There are also other problems with your post. For example, we didn't sell off monopoly rights. Its been illegal for municipalities to grant exclusive franchises since 1992. Also, franchises don't come without strings attached. Here in Phila, Comcast has to run cable to a bunch of poor neighborhoods and charge $13 per month for service. Distribution requirements and regulated rates exist in the cable world. [1] At the end if the day, if Google bought TWC instead, Google's average profit margin would go down.
- foobarqux 13y ago
  Engineers are lead users for internet usage, they predict what others will want in several years. And even average users would become upset if they found out how much more they are paying than Swedes.
  - rayiner 13y ago
    The U.S. beats Sweden in Akamai's study, so are we paying more to get more?
    - foobarqux 13y ago
      The US allegedly beats Sweden in average broadband speed which is a poor measure for most purposes. I don't think you will find any Swedes telling you that the US has better broadband. From the FCC: "The United States is 26th out of 32 countries in the 15-25 Mbps speed tier (advertised) with an average stand-alone broadband plan price of $56.50. The lowest advertised price for stand-alone services is in Slovakia at $18, while the highest charges are found in Switzerland at $180" Although they don't summarize the findings above 25 Mbps the story looks much worse.

jfasi 13y ago

I disagree in terms of regulation: there is plenty of regulation on broadband internet, except it tends to discourage competition against broadband providers. This isn't a problem that is going to be solved by placing regulations on the industry. Your example of past subsidies provides an excellent argument for this: given the political clout these entities hold and have in the past used to stilt legislation in their favor, what leads us to believe we're going to do any better with new regulations? At the end of the day, the market is demanding better internet service. While telecommunications providers are certain to wage war against the injection against honest competition into their sector, things are actually looking pretty good in my mind. The FCC sees market demand and is working to tear down anti-competitive legislative barriers [1]. Smaller efforts such as Google Fiber are doing the hard work of convincing the public that better service is within reach. http://www.slate.com/blogs/future_tense/2014/02/20/fcc_s_plan_to_reboot_net_neutrality_might_transform_municipal_broadband.html http://www.slate.com/blogs/future_tense/2014/02/20/fcc_s_pla...

barrkel 13y ago
You need to qualify your statements with "in the US", because regulation has been effective elsewhere.
abvdasker 13y ago
It's highly unlikely that the FCC will accomplish much in the way of enforcing net nutrality given that the agency has basically been captured by special interest. Tom Wheeler, the new FCC Chairman, was a lobbyist and head of the NCTA for 5 years[1]. The idea that he will do anything to hurt the cable companies his old organization represents is ludicrous. [1]http://www.nytimes.com/2013/05/02/business/tom-wheeler-telecom-investor-is-fcc-nominee.html?_r=0 http://www.nytimes.com/2013/05/02/business/tom-wheeler-telec...
chimeracoder 13y ago
> I disagree in terms of regulation: there is plenty of regulation on broadband internet, except it tends to discourage competition against broadband providers. Well, yes - when I use the word "regulation", I'm implying the sort of regulation that we see with respect to Con Edison. They can't so much as change the way they itemize fees on my bill (!) without regulatory approval. That certainly creates problems of another sort, but on the other hand, the actual service provided[0] and the pricing is pretty much a solved problem (as much as one can expect)[1]. I'm sure ConEd would like the sort of legislative protectionism that cable companies receive, with no requirements surrounding price or quality, but thankfully, they don't have that (and altering the status quo is always tough in general - in this case, inertia is on consumers' side). Obviously regulation could be established to make things worse, but I think it's clear what kind of regulation we're looking for for the purposes of this discussion. And I'm intentionally deferring the question of how any of these policies would be enacted - I'm just comparing two alternatives states to the status quo. [0] excluding customer service, which is going to be mediocre at best no matter what. [1] Interestingly, pricing is partly "solved" due to the introduction of ESCOs, which are a way to privatize the supply chain (at the consumer's choice). "Free market" and "regulation" are not mutually exclusive - we could easily establish a regulated monopoly on last-mile copper wire while allowing multiple competing upstream providers.[2]
13y ago

rayiner 13y ago

Your whole post is based on a false premise, which is that customers have a problem with the status quo. I think internet companies have a problem with the status quo. They want somebody else to build the fat pipes crucial to their business. That's why Google fiber is a marketing and lobbying tool and not a real business.[1] But I don't think consumers here are any less happy than in other places. According to Akamai's state of the internet, the U.S. ranks #8 in average connection speed, ahead of places like Sweden. They have no reason to be. I've never heard someone outside my engineer friends complain about the lack of gigabit or even 50 Mbps+ connections. As long as its enough for Hulu, people are happy. There are also other problems with your post. For example, we didn't sell off monopoly rights. Its been illegal for municipalities to grant exclusive franchises since 1992. Also, franchises don't come without strings attached. Here in Phila, Comcast has to run cable to a bunch of poor neighborhoods and charge $13 per month for service. Distribution requirements and regulated rates exist in the cable world. [1] At the end if the day, if Google bought TWC instead, Google's average profit margin would go down.

foobarqux 13y ago
Engineers are lead users for internet usage, they predict what others will want in several years. And even average users would become upset if they found out how much more they are paying than Swedes.
- rayiner 13y ago
  The U.S. beats Sweden in Akamai's study, so are we paying more to get more?
  - foobarqux 13y ago
    The US allegedly beats Sweden in average broadband speed which is a poor measure for most purposes. I don't think you will find any Swedes telling you that the US has better broadband. From the FCC: "The United States is 26th out of 32 countries in the 15-25 Mbps speed tier (advertised) with an average stand-alone broadband plan price of $56.50. The lowest advertised price for stand-alone services is in Slovakia at $18, while the highest charges are found in Switzerland at $180" Although they don't summarize the findings above 25 Mbps the story looks much worse.