How Most Broadband Providers Have Focused On Decreasing Competition; Not Innovation
from the indeed dept
Ryan Single has an excellent piece at Wired that details how incredibly misleading telcos are being in claiming that the FCC's attempt to reclassify broadband access will lead to less "innovation." He highlights how far behind other countries the US has fallen, and how hard the telcos seem to work at not competing and not investing in innovation. Basically, Singel points out what many of us have pointed out all along. All of this posturing by telcos is about lowering their own costs (i.e., not investing) and squeezing more money out of customers, in an attempt to please Wall Street:The dirty secret of ISPs is that even as broadband usage on their networks continues to increase 30 to 40 percent a year, their annual costs for shipping data onto and off the net's main pipes continues to fall.He does note that Verizon may be the exception, but as we recently pointed out, with CEO Ivan Seidenberg on his way out, the company has shifted gears and is pulling back heavily on investing in new infrastructure. Seidenberg has long fought Wall Street, pointing out that putting down fiber was the best long-term bet, but the short-term thinkers on Wall Street didn't want to hear about high capital expenditure that would cost a lot initially, but not pay off until later. And, now, without Seidenberg leading the charge, Verizon is going back to not wiring up fiber.
The problem isn't the cost of shipping data.
The problem is that the large ISPs answer to Wall Street and instead of planning and investing for abundance, they prefer to spend their time thinking of ways to extract more money from customers without having to invest significantly in future-proof infrastructure.
Singel highlights how all of the "innovation" that seems to come out of the telcos isn't consumer focused at all. Nearly all of it is about limiting consumers with artificial rules and barriers to try to squeeze more money out of them:
In the last couple of years, ISPs "innovated" by changing how they handle users who type in a URL that doesn't exist. Under net protocols, the ISP's DNS servers are supposed to report an error code to your browser in those circumstances. Instead, ISPs are now serving up pages with ads, sometimes in ways that introduce huge security risks.From there, he covers just how much effort the telcos put into regulatory efforts to block competition in the face of overwhelming consumer demand:
As a reaction, Google set up a fast, ad-free DNS service. And if you want to see what real innovation in DNS looks like, take a look at OpenDNS, which has built fraud protection, security measures and optional web content filtering into its robust DNS service.
ISPs have also long insisted on customers using "installation" software that did nothing but drive customers onto ISPs' web properties to get ad dollars; tried to sell -- for a monthly fee -- wireless home network capability you could set up easily with a $50 router (and then blame service problems on any home wireless networks you didn't buy from them); and even hijack address-bar searches that might otherwise, per the browser settings, use an actually useful search engine like Google.
ISPs also recently dipped their toes into another innovation: Selling access to everything their customers do online in order to build profiles on them and secretly insert targeted ads into other company's web pages.
It's literally not in telecom executives' best interest to invest in broadband and solid networks.All of this is a pretty accurate description of what's actually happening. The one point where I disagree with the article is Singel's assertion that what the FCC is doing in response to this makes sense. While I agree it's not nearly as big a deal as the telcos are making it out to be, I still think that supporters of the FCC's move are underestimating what will result, and what kind of loopholes the telcos will gleefully make sure are present. With the recent reports coming out, saying that the telcos are willing to "agree" to legislation on this topic, combined with the fact that they've hired up a ton of ex-high level government officials to help craft any rules, suggests that what comes out in the end will be a lot more "friendly" to the type of short-term Wall Street-driven "innovation" that the telcos want.
That's why you get companies like Time Warner trying to squeeze customers into limits on the amount of data they can use -- not because bandwidth is expensive -- but because building a real network is. It's far better, in their minds and for the stock price, to focus on bleeding as much from their current customers using self-serving policies instead of gaining loyalty by making networks that are generous, quick and reliable.
When towns get tired of begging for fast internet -- only to be told it doesn't make financial sense for telecoms, they sometimes decide to build their own fiber networks.
And then telecoms sue the cities -- as they did in the case of Monticello, Minneapolis, and run to state legislators to write laws outlawing citizens from organizing their own networks as Time Warner Cable did in the case of Wilson, North Caroline, which set up its own fiber network known as Greenlight.
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Filed Under: broadband, lobbying, net neutrality, regulatory capture
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another myopic view of a subject.
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If internal costs are high, that's your country's fault for being stupid and increasing the costs (or is lack of competition at fault?).
And everyone and his dog knows that the real cost is in shipping traffic to the rest of the world. You can update your internal network easy peasy. Now try going under the Atlantic to lay some more fiber..hard ain't it? Also costs a lot.
"as networks are push to their limits, more nodes are required, more fiber, and more staff to maintain it. "
Pushed to the limit? Last statistics I saw indicated that the "net" isn't anywhere near full capacity.
And more staff to maintain what? Someone to unclog the tubes when they get too full?
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There is no evidence of this and you cite no evidence to support your unsubstantiated contention. Most network admins say the opposite is true, costs are substantially dropping, and some evidence is the fact that many other countries offer faster and faster bandwidth at far cheaper prices yet they're not having any problems.
"so only looking at the cost to connect to the outside world ignores much of the reality."
TAM, nothing you say has any credibility. You make up what you say out of thin air.
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say an isp (your isp) has 100 customers @ 2mbps on each network segement, connected to the central with a 100mbps line. the customers want a higher speed. so what do they do? to move those customers up to 5mpbs, they need to more than double your existing internal bandwidth (forget external). so they move from a 100mbps over copper, and have to run fiber to get a higher speed. that also means you replace the routers, likely change the type of dsl models they are using, and all of that equipment. they may have to entirely redo the racks to handle higher speed connections.
upping the speed isnt about just buying more connectivity. if it was, nobody would have an issue.
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And don't give me the population density argument either, that's been refuted already being that we have population density statistics of various U.S. states and various countries and they disagree with you.
Also, why would they lobby so hard to keep others from building their own infrastructure? and then you haven't explained this.
"When towns get tired of begging for fast internet ... they sometimes decide to build their own fiber networks.
And then telecoms sue the cities -- as they did in the case of Monticello, Minneapolis, and run to state legislators to write laws outlawing citizens from organizing their own networks as Time Warner Cable did in the case of Wilson, North Caroline, which set up its own fiber network known as Greenlight. "
If the problem was really the costs then the telcom it all wouldn't constantly be lobbying to restrict competition. Others would be unable to provide a competing better service for a cheaper price. The reason why communities and others are willing to invest is exactly because they know they can create a better service for a better price and the reason why Cablecos resist is because they know it too and they don't want the competition. Otherwise there is no reason to resist.
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Just to be sure here, we are talking about Megabits per second right?
You people are being screwed hard over there. I have a 24mbps connection with unlimited traffic (upload/download) and that's about to become obsolete. There are already 200mbps fiber-optic connections available (although, they don't run at 200mbps from what I heard..more like 100-ish).
The minimum speeds we have around here are 12mbps.
And we are an insignificant country...Big bad USA is struggling with 5? WTF?
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If so, what exactly?
Next time you make wild claims, you might want to support them with a few citations - other than from industry pundits.
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Being a tech at a telco that actually works on this stuff the article is right, the annual costs of providing high speed is dropping, in many places very quickly.
Build out is cheaper and easier than it was 3-5 years ago, the internal networks are by no means full, yes more nodes are needed but the fibre costs have dropped to far less than copper and take a few seconds to connect and, in fact, less staff is required for maintenance as most troubles, oh, say 95% of them, I can diagnose and repair remotely. Something I couldn't do even 3 years ago with as much speed and accuracy. (My guesses are still better than most of what the automated diagnostics suggest but that's another story!)
Myopia isn't the fault of the story but, in your case, the reader and commenter. Try getting some experience in the industry before you make a stupid remark like that.
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Almost every industry?
Almost every industry is trading innovation for decreased competition that doesn't require risk from the company.
In most cases the risk is actually passed on to the American people, in some sort of reverse socialism. Ironically, they call municipal services socialism and block access to the market.
Beyond that, so many investors aren't trying to build value, but just inflate stock prices in the short term.
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Re: Almost every industry?
It's called plutocracism
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See WiFi P2P. But the current laws make the creation of a Wifi P2P network more difficult by limiting Wifi frequencies to frequencies that don't travel far and don't travel through walls very well. That needs to change.
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it's called BATMAN:
http://www.open-mesh.org
Again, the network will be inefficient but it will work for things like text. For large file transfers it will certainly be a problem though.
the trouble isn't efficiency, it's distance. the FCC has very strict rules limiting the broadcast power for wifi devices. this means your mesh nodes have a broadcast radius of a hundred meters (give or take.) you would need dozens of nodes to cover a square mile of flat ground with no obstructions.
it goes back to innovation and competition: the established broadband market won't deliver what the public wants and the government won't open the market up to competition.
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mesh networking is a little more involved than that.
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Instead, he just resorts to the same non sequitor they themselves use (shocking, huh?): "Wahhhhh, it's expensive!!!!"
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it's only natural
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Slanted article
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There are several ways in which the term bandwidth is used. The one to which you refer is a measurement of data rate or transfer. An ISP will have many connections, each one transfering data at different rates which vary over time. In this case, there is only one "type of bandwidth".
I think what you are referring to is the misguided attempt to charge twice for the same thing. The claim that big websites get a free ride has been debunked many times but some out there refuse to acknowledge the facts.
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your internet connection is made up of two parts. the network internal to your isp, and the second part is their peered connection to the outside world (often referred to as internet connectivity or internet gateway). each jump and each step in the process is at a given speed, usually in a tree like configuration that brings the branches of the tree (individual end users) together to a branch (shared transit) back to the truck (the network center for the isp) that then turns around and connections all of them to the internet via a gateway or peered connection.
so 'bandwidth' can refer to the speed or connectivity of those peered connections, but it can also refer to the connectivity within your isp.
if an isp has a 100 meg line out to your area, and 100 people on at 10 meg each, it is likely that you will not get 10 meg most of the time, because it only requires 10% usage for the 100 meg line to be filled. in order to offer higher speed internet connections, not only does your isp have to increase your connection speed, but they have to make sure they have enough internal bandwidth to route your connections back to their central office so they can then gateway you to the internet. any single blockage in there (over subscribed connection) would lead to slower actual data flow, even if your connection is at a high rate of speed.
put another simple way: your computer connections to your dsl modem likely at 100meg, but your internet connection on average is probably 5 meg. your first jump (computer to modem) is very fast, but the next jump (modem to the dslam, the connection point for you modem in the phone companys connection box) is only 5 meg. so no matter how fast your single connection is to the modem, the next jump will be setting the actual pace.
so your isp could buy a ton more peering bandwidth, and your internet performance would not change unless they improve their internal network, which is incredibly expensive to do. peering bandwidth is getting cheaper, the rest is not.
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Put another way, what you say is there's no attempt at load balancing (dslams are intelligent, in case you didn't know) so the reality is that from modem to dslam will be 100meg regardless unless every port on the dslam is in use at exactly the same moment.
Further, the Internet and protocols running on it are bursty which means that even your connection from modem to dslam isn't "on" all the time nor is anyone elses. The internet is bursty by design and I don't see that changing.
Actually most dslams I've seen in the past 5 or 6 years are rated between and 1 and 10 gig back to the data centre in the nearest large central office and the simple bandwidth simply increases from there to what used to be called a class 1 office up to 500 gig, all on light.
your 100 meg or 5 meg is a mean taken over a few seconds not the total consumption of bandwidth on a constant basis.
You indicate the last mile remains a problem and you'd be right but that's something that telcos will overcome once they get enough of a regulator push on it. Mind you I'm not holding my breath on the that. More likely the current infrastructure will continue to be replaced as it is now in smaller centres as the old, some of it is ancient, infrastructure fails. Major metropolitan areas and concentrations in them are another story.
Incidentally telcos already have a ton of peering bandwidth and the bigger players don't need to buy more cause they're wholesaling it to the smaller players. Also, just so you know, your wired voice and cell voice calls are already routed across what you call peering bandwidth (backbone, actually) using VOIP across the, guess what?, Internet! And that's been going on for two decades now.
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No - this is still only one type of bandwidth.
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So how can Google's internet intervene in that? And how can we progress broadband to work a lot better without arbitrary limits?
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As a reaction, Google set up a fast, ad-free DNS service. And if you want to see what real innovation in DNS looks like, take a look at OpenDNS, which has built fraud protection, security measures and optional web content filtering into its robust DNS service.
OpenDNS does the exact same thing, replacing error pages with ad pages. Type any URL that doesn't exist and you'll get an OpenDNS search page with sponsored links. You can't turn the stupid thing off unless you pay!
The only reason I use it is because my ISP's DNS service is unreliable and seems to forget common URLs about every 5 minutes or so. Naturally, they blame it on my system. Funny that OpenDNS doesn't give me that problem.
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I have Cablevision. They hate innovation, unless it raises prices.
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