9 ms·

Want 50Mbps Internet in your town? Threaten to roll out your own

124 points by theandym 17y ago

nuclear_eclipse 17y ago
And as I found out first hand, if the only internet provider in town starts to roll out bandwidth caps, just raise a ruckus until your senator drops legislation on the table banning caps, and then watch your ISP become a sour grape and refuse to roll out DOCSIS3 in retaliation... Internet really needs to become a public utility operated by the city/state on cost, rather than to line the pockets of greedy corporations...
- RiderOfGiraffes 17y ago
  I'm not an American, and I was wondering if you could help me to understand this ... > Internet really needs to become a public utility > operated by the city/state on cost, rather than > to line the pockets of greedy corporations... How is this not effectively Socialism? Isn't the system you currently have simply Capitalism in action? Under Capitalism, shouldn't people simply choose another supplier when your ISP does stupid things?
  - ytNumbers 17y ago
    In large parts of the USA, there is only one (or fewer) decent Internet providers. It's hard to let the free market decide when there is no real competition.
    - timmaah 17y ago
      That tells me there is a huge market waiting to be tapped by the right company. 20 years ago there were barely any cell companies and now people (and phone companies) are dropping their land lines left and right. Up here in Burlington VT there is about to be some heads rolling on how the gov handled the gov run phone/internet company.
      - deleted 17y ago
        [deleted]
      - trafficlight 17y ago
        But I still hate my selection of cell companies. Just because people are dropping their land lines doesn't make the cell company selection any better.
      - nuclear_eclipse 17y ago
        It is also far less expensive to drop a few new cell towers (or lease space on competitors' towers) than to go through the gigantic, expensive process of laying new cable/fiber.
      - Lammy 17y ago
        "[T]he right company" is basically guaranteed my money. I can't even imagine what 50MB must be like. The fastest connection I can get here in Georgia is 1.5MB ADSL that costs $35/month (plus phone service, no naked DSL offered) and stops working every time it rains.
      - Kadin 17y ago
        There are multiple competing cell networks because it's relatively inexpensive to set up a cell site, compared to running wires to everyone's house in the same area. If this wasn't the case, you'd have a dozen pairs of copper phone wires and as many cable TV coax lines running into your house, all by different companies -- those industries have existed for far longer than the Internet has, and have traditionally been ridiculously profitable. That you don't have more than one telephone line and one cable line is a strong indication that last-mile infrastructure is a natural monopoly. Whoever gets to your house first basically owns you.
  - mseebach 17y ago
    > How is this not effectively Socialism? It is. It's an all too common knee-jerk reaction in well-off western societies that when something doesn't go exactly your way, call for politicians to fix it with force. And politicians are all to happy to oblige. In Britain, back in the early 80s when British Telecom was operated on cost, and not lining the pockets of greedy corporations, it would take weeks or even months to have a single phone line installed.
    - gloob 17y ago
      One data point is a good example, but hardly a good way to back up an argument. I will concede that I'm unaware as to whether any serious analysis has been done of the efficiency of publicly-run corporations vs. privately-run corporations in first-world, democratic countries, but nearly any data set can be cherry-picked for evidence to support any view. Arguing that all (or the great majority of) public organizations are wildly inefficient on the basis of i) philosophy, and ii) examples, is like arguing that all (or the vast majority) of governments are dictatorships because back in the 80's, Romania was one.
      - mseebach 17y ago
        The argument made, was that a service will by default be better when profit for the owners is no longer a factor. This is largely a philosophical argument, even though it's framed practically, so I will counter it philosophically; The argument fails to incorporate some very basic and well understood market mechanism. A company whose products consumers are forced to buy (either because they are subsidised or because they have a government-enforced monopoly) are less inclined to invest and take risks in development. Why take a risk when people are already buying what you have today and can't go anywhere? Another factor is political interference and the ensuing ICan'tBelieveItsNotCorruption. What happens when the pipes clog up before there's budget for increasing bandwidth because more people than expected are downloading and seeding torrents? Is the memo that says that it's mostly porn and piracy anyway, and we can just block the ports going to be ignored over pumping money in new bandwidth? To help people get porn? Protect the children, save money and get re-elected -- all in one firewall. Yes, absolutely, a government run business can be more efficiently than a private one, and sometimes if can get some infrastructure in place where it simply isn't practical for for private actors to work. But it's never because they don't have to make money for their owners.
  - ramidarigaz 17y ago
    Ideally, people should be able to choose another provider. Unfortunately, the many of the ISPs in America exhibit monopolistic tendencies. What you call "effective Socialism" is just encouraging competition, like the article says. People in big cities usually have a choice of ISPs, but in rural towns, often there is only one "high-speed" ISP. It's kinda a sad state of affairs. I've recently gained a very interesting view, as I'm currently living in Japan. I'm American born though.
  - alexandros 17y ago
    In capitalism people are supposed to have choice. I'm not American either, but from reading HN for a while I gather that this does not hold for ISPs in many areas of the US. So basically what they have in those cases is a state-granted fiefdom. And the solution of course is not to have the state run it. It's to introduce competition.
    - mseebach 17y ago
      > In capitalism people are supposed to have choice. Yes - but nowhere it's stated that the choice must be between immediately comparable services. The alternative choice they have is to go build their own ISP. But, such a venture is difficult, expensive and risky, and thus wasn't deemed a better option than sticking with the current offering. Until the municipality came around and forced the citizens to undertake the venture.
      - Vivtek 17y ago
        "Forced"?
    - Kadin 17y ago
      While competition is generally a Good Thing, there are times when it doesn't make sense to waste a lot of effort through duplication. How does anyone benefit by having two or three equally-slow internet connections into their house (say over copper phone wires, coax, and BPL), rather than having one much faster connection (fiber)? All the money spent duplicating parallel infrastructure could potentially be spent making a single more robust network, one that gets upgraded more frequently. It doesn't make much sense to force each would-be ISP to drag lines out to their potential customers' houses; once customers have a connection, a second one is just waste (unless there's some way to use both at once, but there generally isn't and most people couldn't afford to anyway due to the way they'd be priced -- each ISP has to recoup the cost of its own infrastructure). The better way, and the way that actually fosters more competition where it counts, is to have a good, shared, high-speed infrastructure that all providers can operate on and which is made available to all on non-exclusive and non-discriminatory terms. I think the proper vehicle for these sorts of things are public-private partnerships, similar to the way that transportation projects have been handled for years. (Ex. both the Erie Canal and the NY State Thruway were done by public/private partnerships, called "Authorities" in NY state parlance.) This provides a degree of isolation between the day-to-day management of the infrastructure and the machinations of the political process, and also discourages wasting of taxpayer funds, or raiding of infrastructure funds for other projects. The state might support a project via bond guarantees, but could reasonably expect it to stand on its own (and operate as a non-profit) from then on. That strikes me as a compromise solution which is likely to produce the most competition where it actually benefits users.
  - lucumo 17y ago
    > How is this not effectively Socialism? Does that make it bad? > Isn't the system you currently have simply Capitalism in action? Does that make it good?
    - RiderOfGiraffes 17y ago
      The perception, rightly or wrongly, in the rest of the world is that in the USA people go "OMG !!! IT'S SOCIALISM !!!! AAARRRGGGGHHHHHHHH !!!!" Nowhere else have I come across people who dismiss ideas by saying - Oh, that's Socialism - and seem to think that that's enough. Game Theory says that mixed strategies are almost always (in the technical sense) the best, so the instant dismissal of ideas simply being they have a flavor of socialism seems stupid, and yet it seems that it's the instant reaction of many, many people in the USA. I could be wrong, it might not be the case, and it's interesting to see that the perception from outside the USA might be wrong.
      - frig 17y ago
        What you'll find if you get into more detailed discussion with public-utility internet before dropping the socialism bomb is that they're usually advocating a hybrid model: municipality builds out the pipes and then isps compete on actually providing internet service. You're right about the loudmouths here, but it'd be a mistake to let your sense of public sentiment be overly colored just by volume. Calling something socialism here is a pretty good debate hack, like calling someone racist or anti-semitic or whatnot; it's enough of a social taboo that the so-accused will usually feel compelled to defend themselves against it, thereby derailing the original course of discussion...this is a good strategy for winning unrefereed debates.
        jrockway 17y ago
        Really? I just laugh when I hear someone talk about Socialism in the US. We have been Socialist for years. Ever drive a car on the road? Did you buy the road? Did you pay a company for a subscription to the road network? No, it's all paid for by the government. That, my friend, is Socialism. And it's a good thing. (Actually, it's a bad thing; if people had to pay the full cost of using the road network, it would be a lot easier to get people to take public transportation. But I am just saying it's clear that Americans have nothing against Free Stuff From The Government, even if that Free Stuff is paid for with tax dollars.)
  - sfnhltb 17y ago
    Things like this where the costs are dominated by the need to build lots of infrastructure before you can even sell to your first customer are naturally uncompetitive, and even may be natural monopolies. Without significant competition private companies will generally perform worse (as far as the consumer is concerned) than government. This is certainly not Socialism, as the use of government to provide services that individuals and businesses cannot efficiently provide goes back thousands of years, well before Marx started writing.
  - robotron 17y ago
    It's stunted capitalism. Monopolies are propped up and protected in most areas.
    - JoeAltmaier 17y ago
      ATT prime example -monopoly for 100 years, no change in service. Broken up, and now we have cell phones.
  - jsz0 17y ago
    In the US many essential services work this way. Taxes pay for fire, police, roads, water, etc. Electricity & telecom are heavily regulated. Originally this started as a way to get coverage in rural areas. The government setup a non-compete franchise wherein a provider would agree to cover rural areas (even at a loss) but their exclusive rights would allow them to recoup costs. That alone wasn't a bad idea -- the US's adoption of electricity, telephone, and cable TV outpaced the rest of the world. This however is where it should have ended. Instead the exclusive coverage agreements mostly continue to this day. In spots where local government has decided to open competition the incumbent providers have such an overwhelming advantage that most smaller providers fail quickly but usually no one bothers trying. It's too capital intensive.
    - Vivtek 17y ago
      If it's too capital-intensive to compete, then I'm having real difficulties with your argument that "this... is where it should have ended." Having grown up out the boonies, I have to say that I really appreciated my access to electricity and telephones.
  - RyanMcGreal 17y ago
    I'll assume that your comments about socialism aren't simply trolling and respond that even in a broadly capitalist system, network infrastructure is effectively a natural monopoly. Due to physical property issues, it needs public rights-of-way for deployment and maintenance. Also, fixed infrastructure costs are very high and only become cost effective with widespread buy-in and positive network externalities. It makes no economic sense to build two or more parallel networks side-by-side, with each capturing only a fraction of the potential customers. As a result, an unregulated telco in a natural monopoly has no competition and minimal market incentives to innovate and improve service. Consumers cannot "simply choose another supplier" because other suppliers wouldn't be crazy enough to sink the necessary huge capital investment into a competing service. In general, the options to deal with this situation are: * Public ownership and/or administration. * Regulated monopoly with mandatory service quality benchmarks and profit reinvestment requirements. * Introduce competition by forcing telcos to offer wholesale service to resellers. * Introduce competition through public investment in parallel facilities. * Introduce competition by allowing network service providers to leverage their networks to offer different services (e.g. cablecos offering telephony, telcos offering streaming video).
  - cmelbye 17y ago
    As I understand it, some ISPs have a legal monopoly as the only Internet service utility company allowed to operate in an area (similar to how other utilities such as power and water work).
  - newacc 17y ago
    Almost every single industry in america is oligopoly and defending oligopolies with the free market capitalism argument is completely illogical and unfair. If companies (private or state owned) are making huge profits at the cost of tax-payers money, then capitalism or socialism doesn't make any differences...
- sant0sk1 17y ago
  What we have here is a classic case of barriers to entry. Instead of turning to the government to provide the service (which will result in a sub-par service with no chance of recovery) we should look to innovate and wield new technologies to overcome the barriers and give the greedy corporations a run for their money. Competition is the answer, not government intervention.
- jodrellblank 17y ago
  rather than to line the pockets of greedy corporations What do you have against lining the pockets of greedy corporations? If there was no profit in it for them they wouldn't be doing it at all and you'd have no internet connection - or almost anything else.
  - adamhowell 17y ago
    Yes, and if the Internet wasn't a public works project to begin with the greedy corporations wouldn't have anything to do at all and you'd have no internet connection.
    - jodrellblank 17y ago
      The whole point of corporations is to be greedy. That's the main distinguishing point between them, charities and governments. Using 'greedy' as an insult to corporations is like using buoyant as an insult to ships. I am strongly disagreeing with the grandparent post's sentiment that the ISP should be closed down for being "greedy" and "lining it's pockets".
      - nuclear_eclipse 17y ago
        In my situation, I used "greedy" and "lining pockets" because Time Warner Cable reported record profits from broadband internet service in 2008, and then proceeded to announce the introduction of bandwidth caps that would force many users to pay more every month to get less from their service. In effect, TWC was abusing their city-granted monopoly position to squeeze citizens rather than use their record profits to further invest in their infrastructure.
        Kadin 17y ago
        And you find this surprising...why, exactly? Being surprised when a company maximizes profits is like being surprised that water runs downhill. If we want them to invest in infrastructure rather than pay out dividends, we should figure out a way to make the infrastructure investment be the profitable (i.e. greedy) choice. Which is sort of the point of the article; by introducing competition that threatened to take away the incumbent ISP's business, they were forced to invest in infrastructure that they otherwise wouldn't have built. It's a waste of breath to use loaded, emotional words in reference to big companies; they are the closest thing that exists in the economy to perfectly rational actors. If we, as a society, don't like the outcomes they're producing, the solution is to modify the competitive landscape so that the desirable outcomes are produced, not rail against the companies themselves as if they ought to care about things besides profit.
- MikeCapone 17y ago
  "Internet really needs to become a public utility operated by the city/state on cost, rather than to line the pockets of greedy corporations..." That's great, until your city decides to start filtering/adding caps/blocking your favorite protocol/etc, and then you don't have any other choices. I wouldn't mind cities becoming ISPs if people vote for it, but they shouldn't become the only providers.
  - nuclear_eclipse 17y ago
    I would personally assume that any government-managed utility would have well-defined regulations disallowing that sort of practice. The local power station, for instance, can't say that you're only allowed to charge your cellphone during off-peak hours, or that you have to pay extra for every kWh used by your bigscreen TV.
    - anamax 17y ago
      > I would personally assume that any government-managed utility would have well-defined regulations disallowing that sort of practice. You clearly don't have much experience with govt. > The local power station, for instance, can't say that you're only allowed to charge your cellphone during off-peak hours, or that you have to pay extra for every kWh used by your bigscreen TV. CA does it the other way - they ban devices with certain energy characteristics.
    - MikeCapone 17y ago
      Most of the censorship/blocking/etc around the world is by governments. Even democratic ones (Australia, France, etc). And even if things are good now, do you trust that things will stay that way in the long-run? Better to have more than on choice...
  - Locke1689 17y ago
    What? The government would just provide the dark fiber. Service providers would be able to compete over service using the same lines.
- jedediah 17y ago
  No, as the article shows, the internet really needs to become a commodity that's easily delivered by many parties.
  - yrb 17y ago
    Except I am not sure it is destined to become a commodity in the near future because of the sky high capital expenditure required to roll out most forms of infrastructure in most places.
    - Kadin 17y ago
      Then you make the last-mile infrastructure a public utility, but allow companies to compete by offering services over it. This sort of arrangement has worked well in other countries (generally with copper phone lines and DSL), and it really represents the best of both worlds. You take the part of being an ISP that's basically a "natural monopoly" (because of extremely high entrance costs and entrenchment) and operate it like a public good, while allowing the private sector innovate and compete over those lines.
      - yrb 17y ago
        I pretty much agree completely. The place it normally gets interesting with this approach is where exactly do you put the demark, especially in the FTTN world. Since you are going to most likely want the public utility to own the DSLAMs in areas with low/medium (eg, suburbs) population density, because the area covered by a cabinet is so small (because technologies like VDSL2+ have such a small optimal zone) and rack space in cabinets is normally at a high premium. You are also going to most likely want the public utility to own the fibre backhaul from the cabinets to a central exchange. Because of port density constraints and the fact that the DSLAM is probably going to need to be managed by the public utility to stop access seekers doing silly things that affect other access seekers customers. Now the public utility is also going to need some Ethernet switches to split this out to the various access seekers. Then you have issues of regional backhaul etc... The issues are different again with the PON (Passive optical networks) family of technologies, but you can pretty much swap DSLAM for POLT, though the customer densities change the economics a bit. With ISPs handling regional level aggregation and backhaul would probably be the optimal level in my mind at this point in time. But it is becoming interesting what the ISPs role really is anymore, once you take such a large amount of the infrastructure management off their hands. Since it would seem to be in between a traditional consumer ISP and an ISP that purely does transit.
rened 17y ago
So, before everyone goes off on how it's only big business that's preventing great, high-speed internet, there are municipalities in this country that do run their own cable company. http://www.shrewsbury-ma.gov/egov/docs/1231423976788.htm http://www.shrewsbury-ma.gov/egov/docs/1231423976788.htm That's a perfect example. Town owned and operated and it offers service up to 10Mbps for $50. More expensive and slower than the internet offered in many surrounding places. Oh, and they have a monthly data transfer cap that makes Comcast look good. At $40, you only get 75GB of transfer. I think it's wonderful if municipalities want to try and roll their own competitors to commercial cable/phone/internet companies. However, it isn't all roses. It's expensive to build and operate and you need to get enough capacity to the internet to serve everyone's speeds. The threat might have been better than actually building it.
- idm 17y ago
  The bandwidth cap sucks, but compared to DSL, that's a great deal for 10MBps. In Cambridge, MA we were paying Speakeasy more than that for 1.5MBps. <rant topic="speakeasy"> It turned out to be terrible, but our contract locked us in for a year... and we moved to a new town in 10 months. Free markets are great, contracts are fine, but in our situation, we simply didn't have any competitive options to choose from. Also, the assumption of "perfect knowledge of the marketplace" was violated because we didn't know how severely non-premium the service would be. Speakeasy happens to be the worst ISP I have dealt with -- ever. Their support were competent, but customer service was terrible. They had a system-wide outage during the US Inauguration ceremony. Their prices, as I already mentioned, were very high, but we agreed to the contract under the assumption that we were paying for premium service. In contrast, I can't say enough good about sonic.net, which is a California Bay Area ISP. I'm currently very satisfied with Teksavvy, who are an Ontario ISP. Speakeasy, though... Avoid them. It's the free market in action. If you're in MA, and specifically in the Boston area, be aware... </rant>
- Kadin 17y ago
  I think that's a good argument for why municipalities ought to, at the very most, maintain the bottom-layer infrastructure itself and not try to actually operate services over it. Somebody in Shrewsbury probably thinks the services and price structure they're offering is reasonable, but that "somebody" probably doesn't have the knowledge of the market or interest in making the ISP a success that an entrepreneur would. As I said in another comment, there are good arguments in favor of publicly-maintained roads, as an alternative to having multiple parallel toll roads, all poorly maintained; but there are also good arguments why the government doesn't own all the vehicles or operate all the services that run on top of those roads. A government-run trucking company would likely be rather unpleasant to do business with.
jimbokun 17y ago
Add telecommunications companies to universities, hospitals, mercenaries (Halliburton) and banks as private institutions that receive government money and/or monopoly protection in order to avoid both market competition and public oversight. I continue to think that this is the central problem with the U.S. system at this moment in history.
quellhorst 17y ago
I now have 50Mbps, it was easier to move to a town that had it already.
DavidMcLaughlin 17y ago
I have to laugh at the idea that 20Mbps is slow. I just got upgraded to 16Mbps (from 2Mbps) and still can't believe I can download a full HD movie in 30 minutes.
- nuclear_eclipse 17y ago
  Well, that's better than my "10Mbps" connection that only delivers about 2Mbps at any given time...
  - warfangle 17y ago
    Heh. I have, at nominal, 16Mbps. During peak times, though, it drops like a rock below that to even being intermittent - Google Talk and AIM will drop every couple of minutes. Our cable node is seriously overloaded, and Cablevision isn't doing a damn thing about it. Over the summer everything was pretty reliable, but then a bunch of new students moved into the 'hook and it plummeted. I can get 16Mbps - if I'm lucky - at 4am, and sometimes 8Mbps throughout the day. But from 7 to midnight or so, it's impossible to even browse the web.
DanielBMarkham 17y ago
Speaking as somebody on satellite, and not happy about it, there are two parts to this problem. Part one is connecting fiber to every house back to some centralized switching station. This part can, and should, be financed and regulated by government in much the same way power lines are. Part two is what happens at the switching stations -- who controls the service and bandwidth to the homes. This part should be as free and open as possible, and each home should have at least three available services competing for its business. We seem to lump all of these problems together when we talk about the problem of internet connectivity. I don't know why. Maybe it's just easier that way. But it obfuscates certain parts of the discussion. For instance, in this story things got very interesting once two suppliers were competing to connect fiber. Why? Because whoever connected the fiber would run the service, ie, have the business. It shows that as things stand, you physically have to be willing and able to take the fiber right into the house to make the current monopolistic providers increase their service.
- dantheman 17y ago
  I cannot disagree more with you. Why do most people only have one choice of cable provider? Because the government gave the cable providers local monopolies. So we're stuck, until new technology is rolled out that hasn't been denoted to one company. The best way to manage this problem would be to say that: 1. The individual owns the line from their house to the street (it is managed by their provider). 2. Any provider can run cables on the street (they must share access to telephone polls etc since they get a right of way from the government they must share. The key is to always keep things free and competitive and not have bureaucrats making deals that hurt everyone in the long run.
  - krschultz 17y ago
    That works in valueable markets that are cheap to build up infrastructure - almost everyone in the suburbs of large cities have a choice of DSL vs Cable at least. But it doesn't work in cities where there simply is not the room to let people run cable at will (in NYC it is BRUTAL to get internet installed even something like commercial ADSL or T1 lines are a bitch because of the massive amount of underground infrastructure already). And it doesn't work in areas where it is less profitable becuase the area is more rural. So the government is basically making it more expensive for people in the suburbs to support those in the rural areas so that the economy as a whole is more efficient since everyone will have better access to the internet. The "bureaucrats making deals that hurt everyone" is a strawman. Why would anyone do something that hurts everyone? Underneith the surface there is a non-obvious reason for a lot of policies but when viewed on a macro scale make a lot of sense. I feel like a lot of anti-government arguements boil down to "I set the limits on the economic value of a government action solely on what it does to my direct taxation and fees", rather than looking at the whole picture. As a programmer is it better to pay a bit more for internet but have a larger market to sell to, or pay slightly less for internet but have significantly fewer customers? The question becomes - how best can we provide the internet connection people demand in this country for the least amount of money? Somehow running fiber twice in one town and not at all in another doesn't seem like the best position. I think the solution is to make the system completely free market and competitive in a lot of areas where it works, and completely government subsidized areas where the market fails. Half and half in a patchwork fashion across the country is probably the least inefficient method that could possible be derived, yet that is what we have.
DTrejo 17y ago
It would ideal if the government bundled fiber and power lines together and restructured both grids at once. Two birds with one stone. However, this is probably unlikely.
sixbit 17y ago
50Mbps is a bit on the slow side these days, we have 120Mbps over coax here...

124 points by theandym 17y ago

And as I found out first hand, if the only internet provider in town starts to roll out bandwidth caps, just raise a ruckus until your senator drops legislation on the table banning caps, and then watch your ISP become a sour grape and refuse to roll out DOCSIS3 in retaliation... Internet really needs to become a public utility operated by the city/state on cost, rather than to line the pockets of greedy corporations...

RiderOfGiraffes 17y ago
I'm not an American, and I was wondering if you could help me to understand this ... > Internet really needs to become a public utility > operated by the city/state on cost, rather than > to line the pockets of greedy corporations... How is this not effectively Socialism? Isn't the system you currently have simply Capitalism in action? Under Capitalism, shouldn't people simply choose another supplier when your ISP does stupid things?
- ytNumbers 17y ago
  In large parts of the USA, there is only one (or fewer) decent Internet providers. It's hard to let the free market decide when there is no real competition.
  - timmaah 17y ago
    That tells me there is a huge market waiting to be tapped by the right company. 20 years ago there were barely any cell companies and now people (and phone companies) are dropping their land lines left and right. Up here in Burlington VT there is about to be some heads rolling on how the gov handled the gov run phone/internet company.
    - deleted 17y ago
      [deleted]
    - trafficlight 17y ago
      But I still hate my selection of cell companies. Just because people are dropping their land lines doesn't make the cell company selection any better.
    - nuclear_eclipse 17y ago
      It is also far less expensive to drop a few new cell towers (or lease space on competitors' towers) than to go through the gigantic, expensive process of laying new cable/fiber.
    - Lammy 17y ago
      "[T]he right company" is basically guaranteed my money. I can't even imagine what 50MB must be like. The fastest connection I can get here in Georgia is 1.5MB ADSL that costs $35/month (plus phone service, no naked DSL offered) and stops working every time it rains.
    - Kadin 17y ago
      There are multiple competing cell networks because it's relatively inexpensive to set up a cell site, compared to running wires to everyone's house in the same area. If this wasn't the case, you'd have a dozen pairs of copper phone wires and as many cable TV coax lines running into your house, all by different companies -- those industries have existed for far longer than the Internet has, and have traditionally been ridiculously profitable. That you don't have more than one telephone line and one cable line is a strong indication that last-mile infrastructure is a natural monopoly. Whoever gets to your house first basically owns you.
- mseebach 17y ago
  > How is this not effectively Socialism? It is. It's an all too common knee-jerk reaction in well-off western societies that when something doesn't go exactly your way, call for politicians to fix it with force. And politicians are all to happy to oblige. In Britain, back in the early 80s when British Telecom was operated on cost, and not lining the pockets of greedy corporations, it would take weeks or even months to have a single phone line installed.
  - gloob 17y ago
    One data point is a good example, but hardly a good way to back up an argument. I will concede that I'm unaware as to whether any serious analysis has been done of the efficiency of publicly-run corporations vs. privately-run corporations in first-world, democratic countries, but nearly any data set can be cherry-picked for evidence to support any view. Arguing that all (or the great majority of) public organizations are wildly inefficient on the basis of i) philosophy, and ii) examples, is like arguing that all (or the vast majority) of governments are dictatorships because back in the 80's, Romania was one.
    - mseebach 17y ago
      The argument made, was that a service will by default be better when profit for the owners is no longer a factor. This is largely a philosophical argument, even though it's framed practically, so I will counter it philosophically; The argument fails to incorporate some very basic and well understood market mechanism. A company whose products consumers are forced to buy (either because they are subsidised or because they have a government-enforced monopoly) are less inclined to invest and take risks in development. Why take a risk when people are already buying what you have today and can't go anywhere? Another factor is political interference and the ensuing ICan'tBelieveItsNotCorruption. What happens when the pipes clog up before there's budget for increasing bandwidth because more people than expected are downloading and seeding torrents? Is the memo that says that it's mostly porn and piracy anyway, and we can just block the ports going to be ignored over pumping money in new bandwidth? To help people get porn? Protect the children, save money and get re-elected -- all in one firewall. Yes, absolutely, a government run business can be more efficiently than a private one, and sometimes if can get some infrastructure in place where it simply isn't practical for for private actors to work. But it's never because they don't have to make money for their owners.
- ramidarigaz 17y ago
  Ideally, people should be able to choose another provider. Unfortunately, the many of the ISPs in America exhibit monopolistic tendencies. What you call "effective Socialism" is just encouraging competition, like the article says. People in big cities usually have a choice of ISPs, but in rural towns, often there is only one "high-speed" ISP. It's kinda a sad state of affairs. I've recently gained a very interesting view, as I'm currently living in Japan. I'm American born though.
- alexandros 17y ago
  In capitalism people are supposed to have choice. I'm not American either, but from reading HN for a while I gather that this does not hold for ISPs in many areas of the US. So basically what they have in those cases is a state-granted fiefdom. And the solution of course is not to have the state run it. It's to introduce competition.
  - mseebach 17y ago
    > In capitalism people are supposed to have choice. Yes - but nowhere it's stated that the choice must be between immediately comparable services. The alternative choice they have is to go build their own ISP. But, such a venture is difficult, expensive and risky, and thus wasn't deemed a better option than sticking with the current offering. Until the municipality came around and forced the citizens to undertake the venture.
    - Vivtek 17y ago
      "Forced"?
  - Kadin 17y ago
    While competition is generally a Good Thing, there are times when it doesn't make sense to waste a lot of effort through duplication. How does anyone benefit by having two or three equally-slow internet connections into their house (say over copper phone wires, coax, and BPL), rather than having one much faster connection (fiber)? All the money spent duplicating parallel infrastructure could potentially be spent making a single more robust network, one that gets upgraded more frequently. It doesn't make much sense to force each would-be ISP to drag lines out to their potential customers' houses; once customers have a connection, a second one is just waste (unless there's some way to use both at once, but there generally isn't and most people couldn't afford to anyway due to the way they'd be priced -- each ISP has to recoup the cost of its own infrastructure). The better way, and the way that actually fosters more competition where it counts, is to have a good, shared, high-speed infrastructure that all providers can operate on and which is made available to all on non-exclusive and non-discriminatory terms. I think the proper vehicle for these sorts of things are public-private partnerships, similar to the way that transportation projects have been handled for years. (Ex. both the Erie Canal and the NY State Thruway were done by public/private partnerships, called "Authorities" in NY state parlance.) This provides a degree of isolation between the day-to-day management of the infrastructure and the machinations of the political process, and also discourages wasting of taxpayer funds, or raiding of infrastructure funds for other projects. The state might support a project via bond guarantees, but could reasonably expect it to stand on its own (and operate as a non-profit) from then on. That strikes me as a compromise solution which is likely to produce the most competition where it actually benefits users.
- lucumo 17y ago
  > How is this not effectively Socialism? Does that make it bad? > Isn't the system you currently have simply Capitalism in action? Does that make it good?
  - RiderOfGiraffes 17y ago
    The perception, rightly or wrongly, in the rest of the world is that in the USA people go "OMG !!! IT'S SOCIALISM !!!! AAARRRGGGGHHHHHHHH !!!!" Nowhere else have I come across people who dismiss ideas by saying - Oh, that's Socialism - and seem to think that that's enough. Game Theory says that mixed strategies are almost always (in the technical sense) the best, so the instant dismissal of ideas simply being they have a flavor of socialism seems stupid, and yet it seems that it's the instant reaction of many, many people in the USA. I could be wrong, it might not be the case, and it's interesting to see that the perception from outside the USA might be wrong.
    - frig 17y ago
      What you'll find if you get into more detailed discussion with public-utility internet before dropping the socialism bomb is that they're usually advocating a hybrid model: municipality builds out the pipes and then isps compete on actually providing internet service. You're right about the loudmouths here, but it'd be a mistake to let your sense of public sentiment be overly colored just by volume. Calling something socialism here is a pretty good debate hack, like calling someone racist or anti-semitic or whatnot; it's enough of a social taboo that the so-accused will usually feel compelled to defend themselves against it, thereby derailing the original course of discussion...this is a good strategy for winning unrefereed debates.
      - jrockway 17y ago
        Really? I just laugh when I hear someone talk about Socialism in the US. We have been Socialist for years. Ever drive a car on the road? Did you buy the road? Did you pay a company for a subscription to the road network? No, it's all paid for by the government. That, my friend, is Socialism. And it's a good thing. (Actually, it's a bad thing; if people had to pay the full cost of using the road network, it would be a lot easier to get people to take public transportation. But I am just saying it's clear that Americans have nothing against Free Stuff From The Government, even if that Free Stuff is paid for with tax dollars.)
- sfnhltb 17y ago
  Things like this where the costs are dominated by the need to build lots of infrastructure before you can even sell to your first customer are naturally uncompetitive, and even may be natural monopolies. Without significant competition private companies will generally perform worse (as far as the consumer is concerned) than government. This is certainly not Socialism, as the use of government to provide services that individuals and businesses cannot efficiently provide goes back thousands of years, well before Marx started writing.
- robotron 17y ago
  It's stunted capitalism. Monopolies are propped up and protected in most areas.
  - JoeAltmaier 17y ago
    ATT prime example -monopoly for 100 years, no change in service. Broken up, and now we have cell phones.
- jsz0 17y ago
  In the US many essential services work this way. Taxes pay for fire, police, roads, water, etc. Electricity & telecom are heavily regulated. Originally this started as a way to get coverage in rural areas. The government setup a non-compete franchise wherein a provider would agree to cover rural areas (even at a loss) but their exclusive rights would allow them to recoup costs. That alone wasn't a bad idea -- the US's adoption of electricity, telephone, and cable TV outpaced the rest of the world. This however is where it should have ended. Instead the exclusive coverage agreements mostly continue to this day. In spots where local government has decided to open competition the incumbent providers have such an overwhelming advantage that most smaller providers fail quickly but usually no one bothers trying. It's too capital intensive.
  - Vivtek 17y ago
    If it's too capital-intensive to compete, then I'm having real difficulties with your argument that "this... is where it should have ended." Having grown up out the boonies, I have to say that I really appreciated my access to electricity and telephones.
- RyanMcGreal 17y ago
  I'll assume that your comments about socialism aren't simply trolling and respond that even in a broadly capitalist system, network infrastructure is effectively a natural monopoly. Due to physical property issues, it needs public rights-of-way for deployment and maintenance. Also, fixed infrastructure costs are very high and only become cost effective with widespread buy-in and positive network externalities. It makes no economic sense to build two or more parallel networks side-by-side, with each capturing only a fraction of the potential customers. As a result, an unregulated telco in a natural monopoly has no competition and minimal market incentives to innovate and improve service. Consumers cannot "simply choose another supplier" because other suppliers wouldn't be crazy enough to sink the necessary huge capital investment into a competing service. In general, the options to deal with this situation are: * Public ownership and/or administration. * Regulated monopoly with mandatory service quality benchmarks and profit reinvestment requirements. * Introduce competition by forcing telcos to offer wholesale service to resellers. * Introduce competition through public investment in parallel facilities. * Introduce competition by allowing network service providers to leverage their networks to offer different services (e.g. cablecos offering telephony, telcos offering streaming video).
- cmelbye 17y ago
  As I understand it, some ISPs have a legal monopoly as the only Internet service utility company allowed to operate in an area (similar to how other utilities such as power and water work).
- newacc 17y ago
  Almost every single industry in america is oligopoly and defending oligopolies with the free market capitalism argument is completely illogical and unfair. If companies (private or state owned) are making huge profits at the cost of tax-payers money, then capitalism or socialism doesn't make any differences...
sant0sk1 17y ago
What we have here is a classic case of barriers to entry. Instead of turning to the government to provide the service (which will result in a sub-par service with no chance of recovery) we should look to innovate and wield new technologies to overcome the barriers and give the greedy corporations a run for their money. Competition is the answer, not government intervention.
jodrellblank 17y ago
rather than to line the pockets of greedy corporations What do you have against lining the pockets of greedy corporations? If there was no profit in it for them they wouldn't be doing it at all and you'd have no internet connection - or almost anything else.
- adamhowell 17y ago
  Yes, and if the Internet wasn't a public works project to begin with the greedy corporations wouldn't have anything to do at all and you'd have no internet connection.
  - jodrellblank 17y ago
    The whole point of corporations is to be greedy. That's the main distinguishing point between them, charities and governments. Using 'greedy' as an insult to corporations is like using buoyant as an insult to ships. I am strongly disagreeing with the grandparent post's sentiment that the ISP should be closed down for being "greedy" and "lining it's pockets".
    - nuclear_eclipse 17y ago
      In my situation, I used "greedy" and "lining pockets" because Time Warner Cable reported record profits from broadband internet service in 2008, and then proceeded to announce the introduction of bandwidth caps that would force many users to pay more every month to get less from their service. In effect, TWC was abusing their city-granted monopoly position to squeeze citizens rather than use their record profits to further invest in their infrastructure.
      - Kadin 17y ago
        And you find this surprising...why, exactly? Being surprised when a company maximizes profits is like being surprised that water runs downhill. If we want them to invest in infrastructure rather than pay out dividends, we should figure out a way to make the infrastructure investment be the profitable (i.e. greedy) choice. Which is sort of the point of the article; by introducing competition that threatened to take away the incumbent ISP's business, they were forced to invest in infrastructure that they otherwise wouldn't have built. It's a waste of breath to use loaded, emotional words in reference to big companies; they are the closest thing that exists in the economy to perfectly rational actors. If we, as a society, don't like the outcomes they're producing, the solution is to modify the competitive landscape so that the desirable outcomes are produced, not rail against the companies themselves as if they ought to care about things besides profit.
MikeCapone 17y ago
"Internet really needs to become a public utility operated by the city/state on cost, rather than to line the pockets of greedy corporations..." That's great, until your city decides to start filtering/adding caps/blocking your favorite protocol/etc, and then you don't have any other choices. I wouldn't mind cities becoming ISPs if people vote for it, but they shouldn't become the only providers.
- nuclear_eclipse 17y ago
  I would personally assume that any government-managed utility would have well-defined regulations disallowing that sort of practice. The local power station, for instance, can't say that you're only allowed to charge your cellphone during off-peak hours, or that you have to pay extra for every kWh used by your bigscreen TV.
  - anamax 17y ago
    > I would personally assume that any government-managed utility would have well-defined regulations disallowing that sort of practice. You clearly don't have much experience with govt. > The local power station, for instance, can't say that you're only allowed to charge your cellphone during off-peak hours, or that you have to pay extra for every kWh used by your bigscreen TV. CA does it the other way - they ban devices with certain energy characteristics.
  - MikeCapone 17y ago
    Most of the censorship/blocking/etc around the world is by governments. Even democratic ones (Australia, France, etc). And even if things are good now, do you trust that things will stay that way in the long-run? Better to have more than on choice...
- Locke1689 17y ago
  What? The government would just provide the dark fiber. Service providers would be able to compete over service using the same lines.
jedediah 17y ago
No, as the article shows, the internet really needs to become a commodity that's easily delivered by many parties.
- yrb 17y ago
  Except I am not sure it is destined to become a commodity in the near future because of the sky high capital expenditure required to roll out most forms of infrastructure in most places.
  - Kadin 17y ago
    Then you make the last-mile infrastructure a public utility, but allow companies to compete by offering services over it. This sort of arrangement has worked well in other countries (generally with copper phone lines and DSL), and it really represents the best of both worlds. You take the part of being an ISP that's basically a "natural monopoly" (because of extremely high entrance costs and entrenchment) and operate it like a public good, while allowing the private sector innovate and compete over those lines.
    - yrb 17y ago
      I pretty much agree completely. The place it normally gets interesting with this approach is where exactly do you put the demark, especially in the FTTN world. Since you are going to most likely want the public utility to own the DSLAMs in areas with low/medium (eg, suburbs) population density, because the area covered by a cabinet is so small (because technologies like VDSL2+ have such a small optimal zone) and rack space in cabinets is normally at a high premium. You are also going to most likely want the public utility to own the fibre backhaul from the cabinets to a central exchange. Because of port density constraints and the fact that the DSLAM is probably going to need to be managed by the public utility to stop access seekers doing silly things that affect other access seekers customers. Now the public utility is also going to need some Ethernet switches to split this out to the various access seekers. Then you have issues of regional backhaul etc... The issues are different again with the PON (Passive optical networks) family of technologies, but you can pretty much swap DSLAM for POLT, though the customer densities change the economics a bit. With ISPs handling regional level aggregation and backhaul would probably be the optimal level in my mind at this point in time. But it is becoming interesting what the ISPs role really is anymore, once you take such a large amount of the infrastructure management off their hands. Since it would seem to be in between a traditional consumer ISP and an ISP that purely does transit.

rened 17y ago

So, before everyone goes off on how it's only big business that's preventing great, high-speed internet, there are municipalities in this country that do run their own cable company. http://www.shrewsbury-ma.gov/egov/docs/1231423976788.htm http://www.shrewsbury-ma.gov/egov/docs/1231423976788.htm That's a perfect example. Town owned and operated and it offers service up to 10Mbps for $50. More expensive and slower than the internet offered in many surrounding places. Oh, and they have a monthly data transfer cap that makes Comcast look good. At $40, you only get 75GB of transfer. I think it's wonderful if municipalities want to try and roll their own competitors to commercial cable/phone/internet companies. However, it isn't all roses. It's expensive to build and operate and you need to get enough capacity to the internet to serve everyone's speeds. The threat might have been better than actually building it.

idm 17y ago
The bandwidth cap sucks, but compared to DSL, that's a great deal for 10MBps. In Cambridge, MA we were paying Speakeasy more than that for 1.5MBps. <rant topic="speakeasy"> It turned out to be terrible, but our contract locked us in for a year... and we moved to a new town in 10 months. Free markets are great, contracts are fine, but in our situation, we simply didn't have any competitive options to choose from. Also, the assumption of "perfect knowledge of the marketplace" was violated because we didn't know how severely non-premium the service would be. Speakeasy happens to be the worst ISP I have dealt with -- ever. Their support were competent, but customer service was terrible. They had a system-wide outage during the US Inauguration ceremony. Their prices, as I already mentioned, were very high, but we agreed to the contract under the assumption that we were paying for premium service. In contrast, I can't say enough good about sonic.net, which is a California Bay Area ISP. I'm currently very satisfied with Teksavvy, who are an Ontario ISP. Speakeasy, though... Avoid them. It's the free market in action. If you're in MA, and specifically in the Boston area, be aware... </rant>
Kadin 17y ago
I think that's a good argument for why municipalities ought to, at the very most, maintain the bottom-layer infrastructure itself and not try to actually operate services over it. Somebody in Shrewsbury probably thinks the services and price structure they're offering is reasonable, but that "somebody" probably doesn't have the knowledge of the market or interest in making the ISP a success that an entrepreneur would. As I said in another comment, there are good arguments in favor of publicly-maintained roads, as an alternative to having multiple parallel toll roads, all poorly maintained; but there are also good arguments why the government doesn't own all the vehicles or operate all the services that run on top of those roads. A government-run trucking company would likely be rather unpleasant to do business with.

jimbokun 17y ago

Add telecommunications companies to universities, hospitals, mercenaries (Halliburton) and banks as private institutions that receive government money and/or monopoly protection in order to avoid both market competition and public oversight. I continue to think that this is the central problem with the U.S. system at this moment in history.

quellhorst 17y ago

I now have 50Mbps, it was easier to move to a town that had it already.

DavidMcLaughlin 17y ago

I have to laugh at the idea that 20Mbps is slow. I just got upgraded to 16Mbps (from 2Mbps) and still can't believe I can download a full HD movie in 30 minutes.

nuclear_eclipse 17y ago
Well, that's better than my "10Mbps" connection that only delivers about 2Mbps at any given time...
- warfangle 17y ago
  Heh. I have, at nominal, 16Mbps. During peak times, though, it drops like a rock below that to even being intermittent - Google Talk and AIM will drop every couple of minutes. Our cable node is seriously overloaded, and Cablevision isn't doing a damn thing about it. Over the summer everything was pretty reliable, but then a bunch of new students moved into the 'hook and it plummeted. I can get 16Mbps - if I'm lucky - at 4am, and sometimes 8Mbps throughout the day. But from 7 to midnight or so, it's impossible to even browse the web.

DanielBMarkham 17y ago

Speaking as somebody on satellite, and not happy about it, there are two parts to this problem. Part one is connecting fiber to every house back to some centralized switching station. This part can, and should, be financed and regulated by government in much the same way power lines are. Part two is what happens at the switching stations -- who controls the service and bandwidth to the homes. This part should be as free and open as possible, and each home should have at least three available services competing for its business. We seem to lump all of these problems together when we talk about the problem of internet connectivity. I don't know why. Maybe it's just easier that way. But it obfuscates certain parts of the discussion. For instance, in this story things got very interesting once two suppliers were competing to connect fiber. Why? Because whoever connected the fiber would run the service, ie, have the business. It shows that as things stand, you physically have to be willing and able to take the fiber right into the house to make the current monopolistic providers increase their service.

dantheman 17y ago
I cannot disagree more with you. Why do most people only have one choice of cable provider? Because the government gave the cable providers local monopolies. So we're stuck, until new technology is rolled out that hasn't been denoted to one company. The best way to manage this problem would be to say that: 1. The individual owns the line from their house to the street (it is managed by their provider). 2. Any provider can run cables on the street (they must share access to telephone polls etc since they get a right of way from the government they must share. The key is to always keep things free and competitive and not have bureaucrats making deals that hurt everyone in the long run.
- krschultz 17y ago
  That works in valueable markets that are cheap to build up infrastructure - almost everyone in the suburbs of large cities have a choice of DSL vs Cable at least. But it doesn't work in cities where there simply is not the room to let people run cable at will (in NYC it is BRUTAL to get internet installed even something like commercial ADSL or T1 lines are a bitch because of the massive amount of underground infrastructure already). And it doesn't work in areas where it is less profitable becuase the area is more rural. So the government is basically making it more expensive for people in the suburbs to support those in the rural areas so that the economy as a whole is more efficient since everyone will have better access to the internet. The "bureaucrats making deals that hurt everyone" is a strawman. Why would anyone do something that hurts everyone? Underneith the surface there is a non-obvious reason for a lot of policies but when viewed on a macro scale make a lot of sense. I feel like a lot of anti-government arguements boil down to "I set the limits on the economic value of a government action solely on what it does to my direct taxation and fees", rather than looking at the whole picture. As a programmer is it better to pay a bit more for internet but have a larger market to sell to, or pay slightly less for internet but have significantly fewer customers? The question becomes - how best can we provide the internet connection people demand in this country for the least amount of money? Somehow running fiber twice in one town and not at all in another doesn't seem like the best position. I think the solution is to make the system completely free market and competitive in a lot of areas where it works, and completely government subsidized areas where the market fails. Half and half in a patchwork fashion across the country is probably the least inefficient method that could possible be derived, yet that is what we have.

DTrejo 17y ago

It would ideal if the government bundled fiber and power lines together and restructured both grids at once. Two birds with one stone. However, this is probably unlikely.

sixbit 17y ago

50Mbps is a bit on the slow side these days, we have 120Mbps over coax here...