Verizon: US Broadband Is Really Competitive, If You Just Redefine The Market The Way We Want...
from the that-whole-'and-wireless'-bit dept
Almost all of the issues facing broadband in this country (our slow speeds and high prices relative to other countries, questions about "neutrality" and things like customers being forced into broadband tiers) are really symptoms of a lack of significant competition in many markets. Many customers really only have one or two options, neither of which they like (I'm in that camp myself). Yet, the broadband providers want to make everyone believe it's a really competitive market. That's why they've done everything possible to block the FCC from getting accurate data about actual broadband deployments and competition over the years. Their most recent plan has been about pitching the idea of an organization called "Connected Nation" to "map" broadband penetration. However, as has been discussed previously, Connected Nation seems more like a front for the big telcos to try to pretend there's significant competition... and an increasing number of doubts are being raised about Connected Nation's efforts -- even as it seems to remain a darling of DC politicians. However its "mapping" still won't look at house-by-house penetration and competition (by demand from the broadband providers) and the collected data will remain proprietary, rather than open.Meanwhile, Verizon has put up a video claiming to explain why there's plenty of competition in broadband in the US, but it does so by pulling a neat little trick: rather than defining the market as DSL and cable providers, it dumps wireless providers into the mix... So when you add mobile data providers, yes, there are more players in the space, but that ignores the fact that (1) many of the mobile players and broadband players are actually connected (i.e., AT&T has both, as does Verizon) and (2) that the cellular wireless broadband providers are all greatly limited, and use terms of service that tend to forbid using the data account as a primary connection. In other words, they're not really part of the same market at all.
But, most importantly, the video fails to back up its thesis that the US is "one of the most successful broadband markets in the world." It says there's lots of competition, investment in new technologies and consumers are getting more as prices go down. That suggests there is, in fact, some competition in the market -- a point pretty much everyone agrees on. But it does nothing to compare the US to other markets around the world that have much more competition, much more investment and much greater consumer value per dollar spent. Just saying that because there's some competition, the US is one of the most successful in the world, doesn't back up the thesis at all. It's like saying that you won a baseball game because you fielded nine guys. You forgot about the actual game.
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Filed Under: broadband, broadband competition, us, wireless
Companies: verizon
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South Africa
Come to South Africa and be happy with your 3gb cap and slow speeds that if you can get it:)
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Re: South Africa
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Re: South Africa
Your local ISPs must pay int'l carriers to haul every GB that goes overseas.
No apologies, they may be sticking it to you, too. But they do have higher costs.
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Re: Re: South Africa
What? Very, very little international internet traffic is carried by satellite. It almost all goes by fiber. And you claim to be some kind of telecom consultant and didn't know that? With consultants like you, the telecom industry must be it's own worst enemy.
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http://www.thinkbroadband.com/isps.html
I can tell you right away, that there are probably a lot more I can get as well.
Anyway, off to enjoy my 17Mbit uncapped, un-throttled connection ;-p
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Mike, in most major US centers, there are at least two high speed offerings (cable and DSL) In many areas, there is a third option (3g / 3.5g wireless) that is expanding in the marketplace. Unless a person has specifically purchased a house in an area that isn't served, most major center dwellers have at least these choices.
That last point is signficant, because "house to house" competition in the last few years has been a real issue as americans have taken their low interest loans and purchased large and larger homes, often further and further away from the city center, and are shocked to discover that the cable company ain't coming to town any time soon, and that they are too far down the phone line to get decent DSL.
If you shoot yourself in the foot, don't complain about the mess you made doing it. It is unlikely that the companies providing service can afford to wire up these neighborhoods, or they may have plans to do so only far in the future. Suburban sprawl outstripped their ability or desire to build.
If you live in a major city, the US has broadband that for the most part isn't terrible, and speeds and options continue to expand over time.
So congrats. It's like you fielded 9 posts in a day, but forgot about the content.
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You have made Mike's point for him. He did not say it was impossible to get connected. He said that in many places there are only two choices, which is not significant competition, and wireless does not count because in most carrier TOS you are not allowed to tether other devices to it.
Quite a few other countries have better internet options in far more places than the US, and that is the point, Verizon put out this propaganda crap claiming the US is number one, but in fact we are not even close.
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You call that competition? What a joke! I wish there were only 2 or 3 people in town who were allowed to sell their services to employers in my field. I think myself and those one or two other people would be quite wealthy. But, unfortunately and unlike the telcos and cablecos, I don't have any kind of gov't granted monopoly providing me with such a situation and thus have to compete with thousands. This considerably reduces my wealth.
If you shoot yourself in the foot, don't complain about the mess you made doing it.
Yeah, if you shoot yourself in the foot by living in the US, don't complain about the mess you're in, eh?
If you live in a major city, the US has broadband that for the most part isn't terrible...
No, for the most part the choices are indeed terrible.
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THE cable company and THE phone line? See, that's the problem. If it weren't for gov't protection there could be multiple cable lines and multiple phone lines competing with each other.
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You could have competition - but with half as many clients each, you as the customer would be paying more for it.
Of course, it could all be solves by replacing it all with THE fiber, but then someone would control THE fiber and you would all be pissed off again.
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Then let the market determine that, not the government protecting the existing companies.
Of course, it could all be solves by replacing it all with THE fiber, but then someone would control THE fiber and you would all be pissed off again.
Whether it's twisted pair, coaxial cable, fiber or whatever, there should be unrestricted competition.
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That's ludicrous. You apparently don't know much about markets and economics or you would know that increased supply actually lowers prices. You're spouting off the kind of stuff that the phone and cable companies would like for people to believe but just isn't true.
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At some point, we don't want more infrastructure, but want more competition on the infrastructure we already have.
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Whether it's intentional or not, you're missing the point. The point is to let the market decide when it is or isn't economical to add more infrastructure, not gov't officials protecting incumbent operators. By your reasoning, the gov't should only allow there to be one car company, one bank, one grocery chain, etc., etc., because it would be more "efficient". I suggest people look at how that kind of efficiency turned out for the Soviet Union. The truth is, competition increases efficiency instead of decreasing it. Of course I can see why a teleco shill, such as yourself, would like for people to think otherwise.
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For instance in Britain (where we have a fair amount of competition), either companies provide their own infrastructure (such as Virgin cable), or lease BT (British Telecom) lines at reasonable rates, as BT is required to allow by the government, thus allowing them to compete effectively. We have a similar system with our gas - Transco runs the pipelines and all the providers simply compete to provide the (supposedly) best service.
In the end, there is competition, which means investment and development, and thus generally much happier consumers.
Why is it government protectionism and over-regulation in the US seems to flourish under Republican auspices?
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Ahh, but they could if they wanted to and in many places they do. So if some pipeline operator decides to start gouging Exxon or Shell for transport, then they have the option to build their own pipelines or a competing pipeline company can spring up. But with telcos and cablecos that isn't the case because they have gov't protection.
A common solution is that one company (which may or may not be independent) controls the physical infrastructure, and other companies lease this and try and compete on whatever they feel is worth competing on.
And if that one company gets greedy and lazy and decides to get rich by gouging the others then the others have options. That's not the case with telcos and cablecos.
For instance in Britain (where we have a fair amount of competition), either companies provide their own infrastructure (such as Virgin cable), or lease BT (British Telecom) lines at reasonable rates, as BT is required to allow by the government, thus allowing them to compete effectively.
We tried that in the US but it didn't work because the telcos had the regulators in their pockets and so the rates were so high that it was impossible for other companies to compete with them. And as I pointed out, gov't protectionism keeps other companies from building their own competing infrastructure. You have to remember that here in the US we have the best gov't that money can buy.
In the end, there is competition, which means investment and development, and thus generally much happier consumers.
Maybe in the UK, but not in the US.
Why is it government protectionism and over-regulation in the US seems to flourish under Republican auspices?
I think that's pretty obvious.
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Missing the point?..guess not
"If you live in a major city, the US has broadband that for the most part "isn't terrible"
Is that all we are striving for? a not so terrible network? As for speeds and expansion over time, the poor scores for the U.S are due to comaparison...we are behind and we have been at this the longest. what gives?
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@ Anonymous Coward...
I can't tell if you're an idiot or a shill, either way I don't really care.
"Mike, in most major US centers, there are at least two high speed offerings (cable and DSL) In many areas, there is a third option (3g / 3.5g wireless) that is expanding in the marketplace. Unless a person has specifically purchased a house in an area that isn't served, most major center dwellers have at least these choices."
Thia is why you're an idiot. You're making Mike's point. You just don't realize it, or you're being a shill and hoping people are stupid. In most US markets, cable providers have "gentlemen's agreements" which prevent any competition except in areas of new construction. Even then, after said new construction is completed, whoever got the area, keeps it. I lived on a street next to an alley, on the other side of the alley, Brighthouse was the provider, we had Comcast. Brighthouse would not give us service. Even after offering to pay all costs ourselves, they would not give us service. One day, there was a Brighthouse tech down the street. I asked him why they couldn't run a line to our house. He showed me a city map, everything was highlighted red or yellow. They didn't overlap. The areas were clearly marked as to whose territory was which. So, for Cable, there is no true competition. Don't ever think there is.
As for DSL, why do you think Cable companies got into the phone business? Most DSL packages have rates that are too high, unless you also have local and long-distance service with them. Neither cable nor phone companies are willing to do more to compete over this except every so often offer special switching rates which only last a few months. I know some people who keep switching back and forth to keep low rates, but it's a pain in the ass.
Wireless broadband? Ha. When it gets available to more than a minute fraction of american markets, I'll be interested.
"If you live in a major city, the US has broadband that for the most part isn't terrible, and speeds and options continue to expand over time."
If you go to Hell for lying, bubba you just bought yourself a first class ticket. I lived in a major city up until very recently. Our broadband service sucked ass. At peak usage times, we had problems staying connected to WoW. When we complained about it, we got this: "We are aware of the problem, but we have no plans to upgrade our infrastructure in your area at this time."
Broadband companies in this country suck. They suck because they spend their money on politicians to lobby for laws that let them charge more money for less service.
I read the article yesterday about the town in Montana that won their court case about internet service being a utility. I hope that precedent gets used all over the US for running the scumbag companies milking us dry for crap service out of business.
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See? There's plenty of broadband competition out there! All you have to do is move to Bulgaria. If you're just too lazy to move then don't complain, crybabies!
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Abandoning Pro-Competition Policies
And as America blindly followed this path of so-called “deregulation,” our foreign counterparts maintained their commitment to the very pro-competitive policies pioneered in the 1996 Act.
We see the results today. Their broadband Internet markets have blossom, while ours have withered. At the turn of the century, the United States was ranked fifth among the world’s nations in broadband penetration. But just a few short years later, we had dropped precipitously to 22nd place. Consumers in countries that maintained policies that were committed to competition, such as South Korea and Japan, are today able to access broadband with symmetrical speeds reaching 1 Gigabit per second (Gbps) for less than the monthly price a U.S. consumer would pay for service that’s 100 times slower.
The FCC turned its back on the 1996 Act and ordered up a future of digital mediocrity – sticking American consumers with the bill. Nowhere is this digital shortfall more evident than in the state of competition in our broadband markets.
In the aftermath of the 1996 Act, the average American consumer had access to more than a dozen ISPs; today, our broadband market is a stagnant duopoly. Nationwide, incumbent phone and cable companies control 97 percent of the fixed-line residential broadband market. When complementary (and slow and expensive) mobile data connections are factored in, the incumbent phone and cable companies’ nationwide market share stands at 95 percent.
This situation is essentially unchanged since 2005, when the FCC took its final step to destroy the last vestige of the 1996 Act’s competitive framework.
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Abandoning Pro-Competition Policies
And as America blindly followed this path of so-called “deregulation,” our foreign counterparts maintained their commitment to the very pro-competitive policies pioneered in the 1996 Act.
We see the results today. Their broadband Internet markets have blossom, while ours have withered. At the turn of the century, the United States was ranked fifth among the world’s nations in broadband penetration. But just a few short years later, we had dropped precipitously to 22nd place. Consumers in countries that maintained policies that were committed to competition, such as South Korea and Japan, are today able to access broadband with symmetrical speeds reaching 1 Gigabit per second (Gbps) for less than the monthly price a U.S. consumer would pay for service that’s 100 times slower.
The FCC turned its back on the 1996 Act and ordered up a future of digital mediocrity – sticking American consumers with the bill. Nowhere is this digital shortfall more evident than in the state of competition in our broadband markets.
In the aftermath of the 1996 Act, the average American consumer had access to more than a dozen ISPs; today, our broadband market is a stagnant duopoly. Nationwide, incumbent phone and cable companies control 97 percent of the fixed-line residential broadband market. When complementary (and slow and expensive) mobile data connections are factored in, the incumbent phone and cable companies’ nationwide market share stands at 95 percent.
This situation is essentially unchanged since 2005, when the FCC took its final step to destroy the last vestige of the 1996 Act’s competitive framework.
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Re: Abandoning Pro-Competition Policies
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Re: Abandoning Pro-Competition Policies
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Competition?
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Re: Competition?
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Both parties act in the best interest of large corporations as it is they who help finance the massive campaigns now required to hold office.
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Come on, how can Japan have 100 mbps with 40 gb daily caps, while in the United States the average speed is around 5 mbps with 10 gb monthly caps? I thought de-regulation and the end of line sharing was supposed to propel us ahead of other countries. Instead, we are at the same level of some recently industrialized nations.
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They think we're incompetent government officials (with conflicts of interest) who believe everything they tell us.
BTW, the one to blame for this mess is the American people (us) for allowing these special interest groups to push us around like this. we need to stand up for what's best for everyone even if special interest groups don't like it.
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1) Tiered pricing - lots of it. Look it up
2) Much smaller country and very urbanized.
At least compare apples to apples.
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Census
Question: Do you have Internet access?
a) Yes, through an always-on broadband connection such as cable or DSL.
b) Yes, through a traditional phone-line modem.
c) No.
(Asking how fast it is, or how much competition they have, would probably be too complex a question for 90% of the population.)
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What about grassroots mapping?
I'm not a web developer so unfortunately I'm just another loud-mouth down playing the difficulties involved. But, if a few of you great bloggers got together and started a project based on Google Maps that allowed people to just input their location and the amount of choices they have for broadband or internet access they could do a pretty great job at showing what the competition landscape looks like. I would love to help in that kind of effort.
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Re: What about grassroots mapping?
There was something similar (I think I saw it on TechDirt) having to do with real and fake iMax theatres. It was VERY cool.
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Re: What about grassroots mapping?
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Re: What about grassroots mapping?
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Only problem is the big companies own the pipes. Someone digs up my yard to lay a line for service I don't want? Ummm, no. How is it free market to make a company let a competitor use its own pipeline? That isn't free market, that is communism.
There will always be government regulation involved, because you have to have that pipeline. Think the govt. can afford to go out and put in a nice high speed fiber system? What makes you think they wouldn't screw it up much worse than anything we have today?
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i think thats the point everyone is trying to make.
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the entire infrastructure in this nation needs to be redone properly and identically. Not this mix and match crap that you see everywhere. I understand competition is a good thing, but in this situation, Use one type of pipe for everything so there is consistency and compatibility.
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This whole deal is like Mike's AOL slam post. If you ignore everything about how they got where they are today, what was going on when they were created, etc, it is easy to mock where they are today. Like AOL, the phone companies and cable companies have been OTBE (over taken by events). There was no need 50 years ago for "competition" in the phone market, and nobody wanted to pay for a doubling or tripling of the infrastructure to run the game.
What happened with the internet and long haul fiber optic cables? There is all sorts of fibre lying around dark, useless, because there was no need for it. Many companies went bust running cable all of the place that had no end users.
Funny that Mike doesn't point to the article a few years back in Wired about the development of the train system in the UK. There was massive duplication of effort, massive waste, and massive losses (by companies and individual investors) because of this wasteful development.
If the government wants competition in the US, they need to do what they did in Canada - force the incumbant Telco to allow other companies to resell services. Price the service to the other companies, everyone pays the same, and away you go - all the competition you could want. I have DSL options here from "free with long distance package" to 20 gig fiber. There was no requirement to run duplicate lines or duplicate infrastructure.
If you have two choices, you have competition. If you have 3, even better, and so on. No choice means only 1, and that isn't common for most city dwellers.
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Back then all rates were also regulated. Today, they still have the gov't backed monopolies but there is no more regulation of the rates.
If you're going to grant monopolies, then you need regulation. If you're going to deregulate, then you need to get rid of the monopolies. Either/or. This unregulated monopoly crap is the problem.
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Competition
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Re: Competition
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Who let the Verizon shill through the door? At least two!
No way! That's SO expansive. Go look at the data on South Korea, then STHU.
BTW, saying there wasn't a need for competition in the phone market 50 years ago is comparing apples to oranges.
Phone companies don't have arbitrary limits on how many calls you can make. It's just an idiotic comparison by any measure. If you want to use a good comparison, of South Korea's broad band vs. the USA, then SK would have a phone line while the USA is running a phone via two cans and a string. STHU you lying bastard.
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Gotcha. See how overly broad generalizations make you appear as you are...ignorant. Failure of leadership knows no political party restriction, this much is true.
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Uh....what? I don't want to get into a Republican v. Democrat debate here (because I dislike them both and find them to be essentially the same team in a different uniform), but I'm curious as to what Democrats had to do with banks handing out loans to people who didn't qualify for them (incidentally, if you think that was the chief reason for the massive economy drop, I would strongly disagree).
Didn't the housing bubble, i.e. mortgage crisis occur somewhere in the area of 1999-2004? I seem to remember an awful lot of Republicans in control during that time (thought I don't really blame THEM either, all of this started a long, long, long time ago, probably before Reagan). That is to say on the Federal level, at least.
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I don't either, and my post was esentially saying both sides are too blame, it's esentially unrelated, due to the fact that the Federal government, in general, needs better managed involvement, legislation, and planning on the broadband issue. To answer your question, there is an article published in 1999 titled "Fannie Mae Eases Credit to Aid Mortgage Lending" from the NY Times by one Steven A. Holmes. Snopes.com, a website that investigates "urban legends" and rumors, discusses it here: http://www.snopes.com/politics/business/easescredit.asp
That's why I called him ignorant. I never said it was the main cause of the economic collapse, but one of many factors, again showing poor leadership isn't limited to one political party or another. People need the facts, not political spin. FYI. For the record, I am not interested in discussing this issue more here. Just making a point.
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choice
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Open Your Eyes, look beyond NYC or LA
In France, for 45 euros ($63 bucks), many competitors offer a service with broadband, IPTV, mobile phone, and fixed telephone. That's $63 for unlimited traffic on up to 20Mbps Internet, 90 channels of IPTV, fixed phone with unlimited domestic and some international calling, unlimited SMS, mobile TV, 3G data, mobile email, and 2 hours of mobile calling.
Now, you probably think I'm full of shit with the above. Well, if you speak a little french, just check for yourself:
http://www.laboutique.bouyguestelecom.fr/les-tout-en-un-ideo.html
That's from Bouygues telecom, a consulting client of mine that was a mobile phone company that now offers triple play plans to compete with the other players.
France Telecom, the incumbent, is forced to share their last mile infrastructure, and multiple companies use it to compete on the service layer. The competition has had a...ahem...effect on prices.
The geography and cost structure is definitely higher in the US, but holy @#$#@!! I think there's something more afoot than different cost structures because of population density. They get a lot of value for 45 euros.
Oh, BTW, their iPhone plans start at 14euros/mo with 2 year contract, and are here (scroll down for pricing)
http://www.laboutique.bouyguestelecom.fr/E1001088-apple-iphone-3g-8go.html
But that's France, right. Land of communists and government intervention. Thank God we live here in the good ol USA, where competition is part of the social structure. Ha.
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Re: Open Your Eyes, look beyond NYC or LA
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Re: Re: Open Your Eyes, look beyond NYC or LA
The US has plenty of areas with high population density. So how come you don't see these kinds of deals even in those areas?
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Re: Re: Open Your Eyes, look beyond NYC or LA
45 Euros for TV, broadband, fixed phone, and mobile phone! 63 dollars. Why would a US city-dweller not have access to a deal within 1x-2x of that price?
Dunce. Read first, troll second.
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http://www.businessinsider.com/2008/6/are-internet-providers-making-broadband-more-e xpensive-to-protect-their-tv-businesses
"Are Internet Providers Making Broadband More Expensive To Protect Their TV Businesses?"
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Of course they are! Who would expect otherwise?
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