Washington Post Notices That Japanese Broadband Is Pretty Damn Fast (And Competitive)

from the in-case-you-hadn't-been-paying-attention dept

Thu, Aug 30th 2007 6:33am — Mike Masnick

While there isn't that much new there if you've been paying attention, the Washington Post has an article about how Japan reached the point where it has a highly competitive broadband market that is cheaper and many times faster than US broadband offerings. The Washington Post version does a pretty good job highlighting how opening up access to the core lines was a big part of it (as was newer infrastructure and the much smaller geographic footprint in Japan). It's a pretty balanced piece, and good background if you weren't familiar with the situation in Japan. There is one very interesting point, however, that doesn't get very much attention in this debate and deserves to be highlighted.

Whenever the debate comes up in the US about unbundling broadband networks and requiring network providers to offer their wholesale pricing to competitive providers, people say that it will kill those network providers and take away all of the incentive to invest in new network technologies. In Japan, it seems the exact opposite happened. When the gov't required DSL wholesaling to competitors, it certainly increased competition and lowered prices for consumers -- but it also opened up new uses for the network that increased demand for bandwidth. That became an opportunity for former monopoly provider NTT who was pushed (thanks to the competition which drove the increased usage) to invest heavily in a new fiber optic network that provided even better speeds and services. And what's happened? NTT is doing great: "NTT is becoming dominant again in the fiber broadband kingdom," according to a Japanese professor of telecom economics. This is a point we've tried to make repeatedly, but sometimes doesn't get through clearly: while many people fear that competition hurts innovation by making it tougher to profit, the opposite is usually true. Competition drives innovation as the competitors look for some edge that differentiates them and allows them to profit. That edge pushes the innovation train faster and faster, opening up new opportunities to earn even greater profits. The new things that people can do on fiber networks are going to help NTT (and others) make a lot more money than if it had remained offering pokey DSL without any competition.

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Filed Under: broadband, dsl, japan
Companies: ntt, softbank, yahoo bb

35 Comments

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D, 30 Aug 2007 @ 6:57am

Time Out
Wait a minute. Competition and giving customers what they want is good for business? Take these crazy thoughts back to Japan.
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RandomThoughts, 30 Aug 2007 @ 7:13am

"Americans invented the Internet, but the Japanese are running away with it."

Damm those Japanese, they did the same thing to the United States with trains.
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TriZz, 30 Aug 2007 @ 7:25am

Re:
...and cars!
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Tyrun, 30 Aug 2007 @ 7:27am

Amen!

I wish the US would realize this and stop restricting everything. Then maybe we'd finally have broadband connections that rival the rest of the world.
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Bryant, 30 Aug 2007 @ 7:30am

Poor excuses
This is hardly a fair competition, with the population density in japan compared to the us it would be much easier to bring faster connection with less distance having to be covered for the same bandwidth. Not that i would mind seeing some US companies stepping it up. I'm interested in see the potential in new technology like internet offered through electrical lines.
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Jon, 30 Aug 2007 @ 7:34am

Re: Poor excuses
I came to say the same thing - Japan is how big? The size of Florida or so?

Still, there's a lot we can learn from them, and hopefully we'll learn that deregulation helps.
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D, 30 Aug 2007 @ 7:41am

Re: Poor excuses
So this could at least exist in places with high population density? What's the downside to having better broadband rolled out in certain areas first?
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Anonymous Coward, 30 Aug 2007 @ 7:41am

Population density is only one, minor, part of it. The (much) larger point is that the Japanese govt has backed off and let the market decide where it's going. Also, their legislators are more than likely not being bought and paid for like their American counterparts by the cable/communications companies who know that they can continue to give their customer crappy speed on old technology for too much money as long as they buy the right congressmen.
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Anonymous Coward, 30 Aug 2007 @ 7:42am

u obliviously haven't learned anything.

its not the size of the boat but the motion of the ocean
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Paul, 30 Aug 2007 @ 7:46am

Re: Poor excuses
You're missing the disadvantage they're facing at being so densely populated. They'd have to offer a much higher bandwidth/area density to allow users to achieve connection speeds faster than most of us can attain. Cable and fiber shares the bandwidth amongst that hub. Therefore, if the hub is overpopulated, the bandwidth gets cut into smaller and smaller chunks. So they'd have to overcome that by providing even more bandwidth.

They still got us beat any which way you look at it. You don't have to make excuses for America. We're just behind.
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Anonymous Coward, 30 Aug 2007 @ 7:48am

Re: Poor excuses
i'm not so sure about internet over power lines. it seems to unstable. power lines create so much noise, i'd wonder what kind of speeds you could actually get and still keep reliability.
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Mr. Geography, 30 Aug 2007 @ 7:59am

Re: Re: Poor excuses
Check your geography facts before writing.

Japan is "slightly smaller than California" (CIA Factbook), Japan is 2x as big as Florida;
Density wise, Japan is 10x the population density of the US.
So yeah, it is an unfair comparison.

Ms. Teen South Carolina.
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valentino775, 30 Aug 2007 @ 8:12am

well United States communication companies finally got GSM cell phones like 4 years or so ago while the rest of the world at that point had it for 20+ years.... so lets hope and wait that by the time our generation is into its 50+ we'll have broadband speeds which japan had 20+ years ago.
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RandomThoughts, 30 Aug 2007 @ 8:19am

In a lot of areas providers are not allowed to install fiber in urban areas while ignoring the suburban areas.

NYC would be easy to wire, NY state isn't.
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AU Area Resident, 30 Aug 2007 @ 8:33am

Perfect example
I used to work (and still live near) Auburn University. Amongst other things, it's a major hub on Internet2. It's 3 blocks away from me. Internet2 has speeds well over 100MBit all the way to Maine. In fact, when I worked there, we did video conferences at over 3MByes/sec that looked better than most HDTVs in real time - all the way to england. Yet, just 3 blocks away, I have 2 choices. I can use the 8MBit DSL or the 3MBit cable. How is it that AU - or any other university on Internet2 - can't find some way to justify providing free access to Internet2 (even if it's just 802.11g wifi access) to, say, a 5 block radius around campus? I mean, I've seen real time usage data from OIT there, and at any given point, if every system on the network used the maximum amount of traffic it can, all of them (well over 25,000 of them) could achieve 6MBits/sec, and yet the average system there uses well under 128k/sec over 97% of the time. So why can't they spare a little next gen high speed love for the town?

I'm not saying this could work everywhere, but it just seems crazy to me that with well over 250 colleges and universities on Internet2 all over the US - and even in other countries and continents - we're not putting the spare bandwidth - all 97% of it - to any use.
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Overcast, 30 Aug 2007 @ 8:45am

Yeah, the problem in the US - is that people are fantastic at innovating. Always have been, but corporate interests are all about greed and their own interests. Overall, it creates a foul environment for innovation.

Regardless of the desires of the corporate world, or the government. There is simply no parallel to individual innovation. Flight is a good example, so are the telephone and lightbulb.
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Ed, 30 Aug 2007 @ 8:50am

Alabama
I also live in Alabama and attended Auburn but am in Birmingham now. While it is an interesting idea for colleges to share their internet; it creates all sorts of obvious challenges and headaches if you just allow people to run amok on your connection; especially a wireless connection; for the OIT at Auburn.

I'm not surprised though; I'm sure Charter pays someone somewhere to keep it from happening.

What I will agree on is that it is truly sad that I pay almost $80 a month for 3mb speed. Thanks Charter for all that innovation and hard work you do with your exclusive city contracts that you don't have to compete against anyone for in the area; so why bother to better our service eh? We can't go somewhere else anyway.

In fact, the internet has not worked for 24 straight hours without high latency or completely dropped internet; but because Charter is spending money to make their service better? No. Because AT&T is upgrading cable in Georgia..
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Chronno S. Trigger, 30 Aug 2007 @ 9:02am

Re:
But it takes a long time to get to England in a row boat.
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Sanguine Dream, 30 Aug 2007 @ 9:09am

Its amazing...
how industies see examples of where an incumbent refused to innovate and keep up with the times and said incumbent either fell to last place or even worse went out of business altogher.

Just look at Nintendo. Nintendo dominated during the years of the NES and SNES. And what happened during the the years of the N64? Nintendo rested on its laurels and Sony came in and took a bite of its dominance. Add Microsoft to the mix and its no wonder that Nintendo has yet to regain its long past glory.

Mind you it is worthy to note that Nintendo did not have the government protection to secure dominance in the game industry like these telco incumbents do. But the point I'm trying to make is that if you do not keep up with customer desire and fight the tides of change and progress you get left behind.
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Duane M. Navarre, 30 Aug 2007 @ 9:38am

Greed is job #1
Here in the US greed is job one.

The billion dollar rip offs of the DOT COM days
were not enough, they have to pull stunts like this too:

http://www.tispa.org/node/14

Global Crossing, MCI Worldcom, it is all part
of a horse and pony show to sell B$ marketing schtick
to ppl that do not really understand the lies.

But some ppl who worked in the Industry smell the B$
and call them on it.

http://en.wikipedia.org/wiki/Dark_fiber#Dark_fiber_overcapacity

Some areas of the country 30 of 31 strands of fiber
lay dark in the ground unlit.

Asychronous Transfer mode cards on Ebay for $12 ????

http://cgi.ebay.com/Fore-Systems-HE155-MMF-PCI-ATM-Adapter-HE155MMF_W0QQitemZ280145131975QQi hZ018QQcategoryZ11182QQssPageNameZWDVWQQrdZ1QQcmdZViewItem

Gigabit fiber converters for $39 ???

http://cgi.ebay.com/CISCO-GIGABIT-INTERFACE-CONVERTER-GBIC-WS-G5484_W0QQitemZ120154420229QQih Z002QQcategoryZ51206QQssPageNameZWDVWQQrdZ1QQcmdZViewItem

It all spells one thing, the supposed cost of laying
out a fiber network is only high because they made
it falsely high.

The cost of power to send flickering light pulses
down a fiber optic strand do not need to cost
multiple millions of dollars a month for just a
OC-3 line when japanese consumers get that run to
their house.

It is just total greed and the US teleco's execs are
screaming rrrrrrrrecord profits.

The US needs to make fiber data a regulated utility
and call it done, and kick out the AT&T monopoly that
as Mr. Colbert says is is the T1000 of Telecoms.

No matter how many pieces we break it up into it
just reforms itself back together again.

It is like the Anti-trust suit didn't even happen.
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rpageio, 30 Aug 2007 @ 9:42am

This is an excellent article with a back-story on how many American companies prefer to monopolize and price gouge rather than increase revenue by offering better service. If you ask they will hold to the tenet that it cannot be done.
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Duane M. Navarre, 30 Aug 2007 @ 9:59am

Population Density Excuse
The last mile is copper, the fiber is already in the ground,
and some areas have 30 times the dark fiber than lit fiber.

Distance means nearly nothing to fiber optics, we transfer
data via undersea fiber 10,000 miles, the distance across
the US is a joke.

There is no Good reason every major US city doesn't
have cheap fast broadband other than the Telco's
in power do not want the ppl to have it.

It is "that" simple.

If everyone has cheap very fast low latency broadband
and switched to VoIP their long distance business
would dry up like lint in the afternoon sun.

I said it before and I can back it up with stats
as someone who worked for Cisco Systems, it
is all about the greed, not about serving the ppl.

I have seen the billions in stock options.

Where do ppl think that money is bilked from ?

from the person at the bottom of the food chain,
the end users.

This alone screams it is all a pack of lies:

http://www.tispa.org/node/14

The US consumer should sue the telecoms to
get the $200 billion back and use it to fund
a dark fiber Co-op between major US cities,
and take its earnings and use them to grow
the network as a non-profit government
regulated utility.

Fiber lines run to every cell tower in the country now.

a single fiber line can carry a DWDM signal that
breaks out into many Sonet channels carrying
over 100GBps speed.

The Telcos know this, and think the general population
will never know it, but in time they will learn
just how massively they have been screwed.

The Tispa link above is just the tip of the iceberg.

The last mile can be done with ADSL/VDSL, Wifi, WiMAX,
or whatever in rural areas.

http://en.wikipedia.org/wiki/VDSL

http://whatis.techtarget.com/definition/0,289893,sid9 _gci213915,00.html#dslsumry
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Duane M. Navarre, 30 Aug 2007 @ 10:02am

Greenland ...and Greed-land
Guess where you are...
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Duane M. Navarre, 30 Aug 2007 @ 10:16am

This is the hope for the Internet for the ppl
http://politics.slashdot.org/article.pl?sid=05/09/24/0356256

Municipal Broadband...

It is going to take towns interconnecting via dark fiber
and bypassing the billion dollar greed machine telcos
to make it work.

The telcos are going to fight tooth and nail to prevent
this intrusion on their massive cash cow, read all about
the coming internet war.
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Phil, 30 Aug 2007 @ 10:30am

Corporate Whores
It's ironic that in the country that is arguably the most free market in the world, that one of the most fundamental components of capitalism would be questioned. This is just one example of competition improving innovation, which has been proven multiple times over. It's just the providers who have a problem with it because they actually have to work and innovate for their money.
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Anonymous Coward, 30 Aug 2007 @ 10:50am

A U.S. Tradition
Yes. Well, we know how quickly the U.S. learned their lessons from Japanese car makers.

I suspect that in that tradition, we'll do the same with telecom.

How much longer before all the switches and routers are designed by and sold under non-US labels? (they're already *made* in China, for the most part.)

People who visit the U.S. already talk about how quaint and antiquated the mobile phones are. And *those* are people from 3rd world countries ;)

Not too long and traveling to the U.S. will be like visiting a Disney theme park: a journey back the quaint mid-20th...
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hegemon, 30 Aug 2007 @ 11:13am

Re: Its amazing...
Sanguine - I have seen you comment about Nintendo's lack of innovation before, as well. You are right about their past actions. But, it is also important to note how it is innovation and creating a whole new experience for a a whole new market, rather than just playing the "power game," that has slingshot the Wii back up to #1. (I know that, technically, the x360 has sold more, but it also had a year head start, and Nintendo is closing the gap as fast as they can manufacture units.) I am not here to start an OT war about what system is better, just pointing out that one company, at least, seems to have learned from its own past successes and mistakes.
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Poomer, 30 Aug 2007 @ 11:18am

Re: A U.S. Tradition
I like your analogy to Disney Park.

but how/why did we become like this?
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Thales, 30 Aug 2007 @ 11:57am

FIGHT THE POWER!
I see a lot of complaining about monopolies and mean ol' Telco... why don't you all cancel your service and free up bandwidth for the mindless, corporate slaves that are willing to shell out money for substandard internet? That's infinitely more productive than whining and that would send a clear message.
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Sanguine Dream, 30 Aug 2007 @ 1:28pm

Re: Re: Its amazing...
Not OT at all. I agree with you on your point and it even stands as proof that competition encourages innovation. Nintendo knew that they didn't have the money to invest the "power game" with Sony and Microsoft which meant they had to bring something else to the table and they have with the Wii. And this is why I firmly believe there needs to be at least three major players in the game console market. If there are only two then each will just be concentrating on taking out the other guy in order to setup a monopoly. Its a bit harder to outperform two competitors instead of one.
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Duane M. Navarre, 30 Aug 2007 @ 1:55pm

Ask and you shall receive...
http://politics.slashdot.org/article.pl?sid=05/09/24/0356256
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Anonymous Coward, 30 Aug 2007 @ 4:43pm

Re: It is like the Anti-trust suit didn't even hap
Amazing how

1) easy it is to buy politicians

2) how easy it is to fool the general population with corporate and political bulls shit.

If an American has to read a couple of newspaper articles - forget it. It's lost. (and yes - I am an American)
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Boriquajake, 31 Aug 2007 @ 8:21am

Re:
While I am no engineer, I have always heard that there are some good technical reasons that explain why American companies were not anxious to adopt the GSM standard. It is my not-too-informed impression that GSM's primary potential advantage is that lots of international carriers use it and that makes it easier to travel with your phone, not that it is somehow technologically better, but I could be wrong.
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Lawrence, 26 Feb 2008 @ 9:22am

Broadband DSL
This is an excellent article about broadband DSL. However, satellite DSL should be considered as an alternative, particulary in rural areas without regular DSL or cable internet access.
[ link to this | view in thread ]
Lawrence, 26 Feb 2008 @ 9:23am

Broadband DSL
This is an excellent article about broadband DSL. However, satellite DSL should be considered as an alternative, particulary in rural areas without regular DSL or cable internet access.
[ link to this | view in thread ]