A tech antitrust problem no one is talking about: US broadband providers

https://arstechnica.com/tech-policy/2020/10/the-tech-antitrust-problem-no-one-is-talking-about/

by elsewhen • 6 years ago

743 340 6 years ago

Canada has the same problem. I don’t have definitive data, but the promo pricing for internet plans has seemed pretty weak since COVID hit. We call our ISP every (fucking) year to ask them to give us the current promo pricing for the next year and this year everything is a solid $20-$40 per month higher than it’s been in the last 3-4 years.

They’re totally price gouging IMO.

MattGaiser• 6 years ago

Canadians are unwilling to price shop:

https://www.youtube.com/watch?v=HlRPLBLkZK0

michael19992• 6 years ago

I used to suggest joining a credit union to people who complained about bank fees, and the first response would be that there were fewer ATMs and the branches were farther away. Canadians want premium service for free, and will do exactly nothing besides complain to get it.

908B64B1976• 6 years ago

They are pretty hostile to international players setting shops.

In such a non-competitive environment, it's no wonder rent seeking is the norm.

Edit: I see the downvotes but no explanations.

wstrange• 6 years ago

The explanation is largely the same as in the US: It's very expensive to run cable / fibre to the house. It's a natural monopoly.

Having a US incumbent enter the Canadian market isn't going to change that.

908B64B1976• 6 years ago

I'm always surprised this isn't discussed more.

Big tech is accused of being monopolistic, but there is a constant flow of new players in the field, all gaining market shares and building the Next Big Thing, while telecom providers are pretty stagnant.

I'm curious why cities don't directly lay down the infrastructure work for broadband access. In some cases that might raise property value enough that the town could make it's money back in very little time.

ineedasername2• 6 years ago

There may be a constant flow of new players, but much of the time when they start to show a certain amount of success then one of the big players simply buys them up.

908B64B1976• 6 years ago

Correct except,

Microsoft should have won search. They had all the tools to execute and were pretty much at the right place at the right time.

Google should have won social networking and messaging. They had the userbase and the network. Yet it's Facebook that did.

Same goes for Phones, and yet it's Apple that captured the market.

TuringNYC3• 6 years ago

You phrase it as if these are hostile takeovers. Having been a founder, I can state that most of my peers wanted acquisitions. It was a way to finance the vision and growth.

Would YouTube, Instagram, or dozens of other companies have been able to get where they are w/o the support of their acquirers? Just think of the burn alone and the required investment is a scary figure.

jancsika• 6 years ago

I'm curious why cities don't directly lay down the infrastructure work for broadband access.

In a lot of states there is legislation banning them from doing just that.

Plus-- where are all the videos demoing what it's like having a fiber connection, to rouse all the people who live in internet deserts? For fuck's sake, the article references kids lurking around Taco Bell "scrounging for internet."

If you are a technologist with a fiber connection, please take five minutes away from overclocking your company's attention-sucking machine to see what it's like working toward a goal that is 100% non-creepy.

Edit: clarification

walterbell2• 6 years ago

Here's a success story with photos of a customer running conduit and fiber to enable Comcast service.

https://arstechnica.com/civis/viewtopic.php?f=10&t=1403795

Is there a good place to look for similar success stories on customer-initiated extensions at the edge of rural broadband networks?

inetknght2• 6 years ago

I found this comment deep in an unrelated thread [0] a couple months ago. It describes someone who created his own ISP for his neighborhood using fiber and links to a good video [1] about it. It's worth using youtube-dl to archive it.

[0] https://news.ycombinator.com/item?id=24410506

[1] https://www.youtube.com/watch?v=ASXJgvy3mEg

biggermike3• 6 years ago

Big tech has big profit margins. Big telecom services doesn't.

Competitors don't enter the industry because there's little money to be made. The only way you make money by starting an independent ISP right now is by serving some niche clientele e.g. serving wireless internet to events at locations without enough broadband access.

908B64B1976• 6 years ago

Sounds like a perfect situation for coops.

As long as they break-even then it's a success.

darkwizard42• 6 years ago

I don't think competitors are avoiding telecom due to low margins. I guess you could say the high amount of start-up capital AND high regulatory hurdles AND the low margins (meaning your payback takes longer) cause it to be undesirable...then... yeah margins are (part of) the issue

giobox• 6 years ago

There's arguably been a few instances of "no one ever got fired for picking IBM" syndrome in neighborhoods I have lived in that considered it.

When a local authority run by people with little understanding of the technology is presented with a local infrastructure bid from a not so well known group vs a glossy Comcast/AT&T/<big telco> bid etc...

I absolutely agree though. It's an antitrust problem that has caused me genuine huge cost increases in reality (Comcast mandatory 1TB data cap in Comcast only neighborhoods. not sure if this nonsense still going on), not just hypothetically.

There are ways to expose the existing networks to competition too. There are examples out there of using careful legislation to force a big monopoly player to share cable space and so on, allowing other vendors to compete on price.

zepearl2• 6 years ago

I'm curious why cities don't directly lay down the infrastructure work for broadband access.

Wondering the same thing here (Switzerland), but I might not understand the context: decoupling the "cable" from the "provider" is not common in the US, or there are some other complexities that I don't understand?

In my case the company "Swisscom" opened half of the sidewalk, connected my apartment building to their FTTH infrastructure, then sent me a ton of flyers etc.. to advertise their Internet, but I still decided to use a tiny provider located 100km away (being small, high customer focus etc...) => works since 7 months perfectly, latency is good (e.g. 2-8ms to ping 8.8.8.8), etc... .

My parents had basically nothing (half-broken copper wire), then on a random day the city's electricity&water&gas company team suddenly turned up, installed the FTTH cable (old house => turned out to be super-complicated to push that tiny cable through the house's structure => took them 4hrs), then they left, that's it => me and my parents then had multiple discussions about providers and they finally chose "Sunrise" (one of the major ones in Switzerland) and everything so far has been perfect.

As far as I understand how things work here, the company that provides the cable earns money paid by the providers that use that cable, which in turn earn money paid by their customers => everybody earns money, everybody is happy.

For very small communities (e.g. the one where my parents live - ~800 inhabitants), the town/village might have to directly finance a part of the costs needed to lay down the cables (which in turn are covered by common taxes), but that in turn makes the small community more desirable by whoever takes it into consideration when moving.

nine_k3• 6 years ago

Many municipalities expressly made contracts with cable TV networks to wire their towns / neighborhoods in exchange for a monopoly in cable access. Else the cable company did not have enough incentive (or pretended to) to lay the cable at all.

So the cable company owned the only copper capable of broadband internet, and also the underground channels to lay fiber in. They naturally upgraded their hub spots to allow Internet traffic, and laying the last mile all over again is prohibitively expensive, or even administratively prohibited, in a lot of places.

There is, of course, phone infrastructure! But Bell was a textbook monopoly, and pieces if it retained the infrastructure after its split. So in some places they can profitably reuse the copper they have to also provide Internet service, and sometimes you can even get fiber from them in newer houses which were wired with fiber backbone for the phone service anyway. In some areas the fixed-line copper is not good enough, and running fiber is too expensive because of low housing density.

In large proper cities, of course, the situation is much better, because infrastructure cost per reached customer is much lower.

toast02• 6 years ago

I might not understand the context: decoupling the "cable" from the "provider" is not common in the US, or there are some other complexities that I don't understand?

So the US context in a nutshell; in most places, the provider of the cable is the provider of the service.

In a bit more detail. Up until 1982, almost all telephone service was provided by AT&T (also known as the Bell System or just "The Phone Company"); at that point, it was split up through anti-trust into regional local phone companies (the baby Bells, ex Pacific Bell in California, Bell South in the south), and a long distance phone company (AT&T), and it became possible to choose a long distance carrier, if you wanted to make long distance calls. The local phone companies were not permitted to provide this service, although AT&T may have been allowed to be a default choice. This unleashed real competition in long distance service, it was now fairly easy to switch, and as easy to dial, and there were several companies ready to go, because they had been offering less usable services already (dial a local number, get a second dial tone and dial the actual destination, etc); prices dropped, quality improved, etc, etc.

In 1996, we got a Telecommunications Act which among other things, required the incumbent local telephone services to lease access to their lines at cost based rates. Under these terms, if there was sufficient space in the central office, a competitive local carrier could install equipment and provide local (and long distance) calling and DSL.

However, the regulator (FCC) said this only applied to telephone service and not to "new" services like phone and internet via cable TV lines.

Additionally, DSL length restrictions meant many customers weren't close enough to the Central Offices to get good service, and phone companies began building out remote terminals to house the equipment closer to the customers. But there's no space in a remote terminal for competitive carrier equipment, so that wasn't necessarily required to be available either.

Finally, courts ruled that it wasn't fair to impose leased access requirements on telephone companies but not cable companies, and the regulator declared the market competitive because consumers could chose from their telephone company, their cable company, internet over power lines (which I don't think every actually happened!), or wireless, so line sharing wasn't important.

An additional wrinkle is that although the leased access prices were regulated, and supposed to be based on cost, incumbent carriers would regularly price retail accounts below the leased access prices, making competition unfair.

There are a few open access networks that were explicitly built out for this, but it's pretty rare, or it comes with big caveats: I can get on my municipal fiber network where I live, but I'd have to pay all the construction costs to get the network extended; if I organize a group, we can split the costs, but interest is low, I'd rather be able to do it, but get partially reimbursed if someone else connects up on the line I extended (within a reasonable time).

TL;DR: we almost had it, but it was a bit broken, and then it was taken away.

pottertheotter• 6 years ago

There are a lot of municipalities doing exactly what you say and making the money back fast. But a lot of states have blocked doing this, and the incumbents fight like crazy to turn people against the idea. My favorite way of implementing it is open access. The city installs and owns the infrastructure and anyone can come be an ISP on it. You get great competition. It's basically the same as how it works with the community owning the roads and you pick who you want to service your house (FedEx, UPS, yourself, DoorDash, the local roofing guy, etc.)

The other thing that would be worthwhile is local loop unbundling, which is basically open access but with existing providers having to open their infrastructure.

I highly recommend muninetworks.org and their podcast if you want to learn more about municipal broadband.

treis6• 6 years ago

There are a lot of municipalities doing exactly what you say and making the money back fast

Can you give us an example?

austincheney2• 6 years ago

Stagnation isn't directly related to market dominance.

redisman• 6 years ago

It's true. I'll never stop being amazed at how in Helsinki 10 years ago I had a 500/500Mbps connection for $29/mo and in Seattle I have a 200/10Mbps connection for $59/mo.

I won't even get to mobile plans since at least there it's somewhat plausible that I must subside the rural cellphone towers since it's a huge (in area) network.

commandlinefan• 6 years ago

And for the most part, it doesn't matter how much money you have to spend on it. If I were inclined to offer twice as much for double the bandwidth, that's just not an option. (Not that I feel like I'm getting the bandwidth I pay for in the first place...)

MivLives• 6 years ago

The worst is the highly one directional connections too. Sure I have a gig down. I have 25mbps up though. The upload is the same for every package from 300mbps down and above. I'd happily have less download for more upload.

lotsofpulp4• 6 years ago

It's true. I'll never stop being amazed at how in Helsinki 10 years ago I had a 500/500Mbps connection for $29/mo and in Seattle I have a 200/10Mbps connection for $59/mo.

There isn't sufficient voter interest to force politicians to go after the existing cable company monopolies and overturn laws preventing government owned fiber networks. And there isn't sufficient voter interest in spending taxpayer funds to build out government owned fiber networks.

gnopgnip3• 6 years ago

There are at least 5 ISPs that offer gigabit service in Seattle. Wave is as low as $50. Atlas is $59. Century link is $65 as a promotional period. Google Fiber is $70, Comcast is $100+.

techsupporter2• 6 years ago

Not all in the same place. WaveG and Atlas and Google (WebPass, not Google Fiber) buildings do not overlap. Nor do WaveCopper-not-WaveG and Comcast except for a small part of Beacon Hill and Lower Queen Anne.

And CenturyLink does not offer fiber-to-the-home, or fiber-to-the-node-with-gigabit (and FTTN upload is limited to a paltry 10Mbps) in about 35% of the city, including places like Ballard, most of the Central District, Hillman City, or Crown Hill.

yftsui2• 6 years ago

Condo Internet and the other two are available in very limited apartment buildings. Century link is the only one that provide real Gigabit service to homes outside those apartment buildings. Comcast? Well you can enjoy the speed for 5 hours before hitting the data cap.

mooman219• 6 years ago

A large number of buildings in Seattle still have Comcast contracts such that Comcast is the only provider allowed. I find it strange that my hometown of Rochester has better better Fiber options than the tech hub that is Seattle.

yftsui2• 6 years ago

I pay $89 a month for a 600Mbps Comcast. If I am ever able to download at full speed, my data cap hit within 5 hours.

Ekaros• 6 years ago

In Finland I think I rent in some grandfathered building. 9,95€ a month for 100Mbs VDSL... And this same price has probably being here for much longer than 3 years I have lived... And these prices have been around for long long time.

crazygringo• 6 years ago

Seriously, I feel like I say it every time it comes up: WHY aren't people taking action against ISP monopolies?

It seems like such a cut-and-dried political issue: they're utilities and they overcharge you whether you're a Republican or Democrat. And taking action doesn't require new antitrust concepts, because it's just your garden-variety utility. It's the same established principles as electric or natural gas.

Yet bizarrely this doesn't show up as an issue on Republican or Democrat platforms. Going after Google and Amazon and Facebook's free products is the sexy new issue, but the fact that we're all overpaying hundreds of dollars a year for broadband is just massively ignored.

And I'm not talking about politicians being bought. It baffles me why voters aren't writing letters to their city councils, their mayors, their state reps, their governors. If voters actually care, politicians do respond.

It would seriously be so easy to change if the voting population actually did care about it. But, inexplicably, we just pay the fees and deal with the crappy customer service and complain, but it never seems to occur to anybody to actually organize local political action against it.

It's utterly baffling.

burlesona• 6 years ago

It's a good question, but I think one of the issues is that physical networks are a natural monopoly in the same way as most public utilities, so it's not just about enabling more competition but about establishing a regulatory framework around that competition, much like exists with airports and railways. OR, alternatively, changing to a public sector provision model like plumbing or roads.

What actually bothers me the most is the rules that (in most places) prohibit cities and towns from offering new municipal broadband service as a competitive offering. This used to be more common in smaller towns that had not been able to get good commercial service, and it adds valuable options and competition, but my understanding is that it's extremely hard for cities who don't already have municipal broadband to start offering it now.

C1sc0cat• 6 years ago

Local Loop Unbundling works fine in the UK

thatfrenchguy• 6 years ago

I mean, if it's a natural monopoly, then it should be public. Roads aren't private right ?

treis6• 6 years ago

physical networks are a natural monopoly in the same way as most public utilities

But ISPs are not, generally speaking, a monopoly. There's usually at least two wired options and they compete with cellular and satellite options. Profit margins generally reflect this. The large ISPs are around the average for the S&P 500.

WalterBright3• 6 years ago

one of the issues is that physical networks are a natural monopoly

When telephones were first installed, competing telephone companies stringing wires sprang up everywhere. Regulation put a stop to that.

rapsey• 6 years ago

It’s only baffling if you believe the system works. It is entirely unsurprising if you believe that those monopolies are too rich and powerful to be attacked by politicians.

avmich• 6 years ago

So the question becomes then why people believe so much this - "that those monopolies are too rich and powerful to be attacked by politicians" - to not act, while they, the same people, don't seem to have similar beliefs in other issues.

RcouF1uZ4gsC• 6 years ago

WHY aren't people taking action against ISP monopolies?

Mainly because ISPs are not engaging in viewpoint discrimination. They don’t care what political viewpoint you have, as long as you pay them money, they will let you post it on the internet. In addition, most people have become used to the prices and expending a bunch of political energy to save $30/month isn’t worth it to a lot of people.

Now the feeling of being censored, on the other hand, generates a visceral reaction, and people can be convinced to expend a lot of political capital for that.

nitrogen2• 6 years ago

One could argue that ISPs participated in the fight against peer-to-peer technologies, the hindrance of which allowed social media and other communication technologies to centralize.

pixl97• 6 years ago

Only baffling because you dont fully comprehend how much communication monopolies control they playing field by financing both political parties. Not behind my computer, but look up the legal bribery that has prevented municipal broadband in the US. I worked for Cox when this was a thing back in the early 2000s. There is no amount of money they would not spend to subvert competition.

AlexandrB• 6 years ago

ISPs are "natural monopolies" like water or electrical companies, especially in areas with low density. This means that even a level playing field was not enough, because small competitors can't afford the cost of building their own infrastructure (nor would we want them to lay redundant cables). Measures like Net Neutrality are ways of keeping the natural monopolies from abusing their position to gain advantage in other markets.

Here Biden clearly seems to be for net neutrality while Trump is, obviously, against it. So it's not as if this issue is not visible to both candidates. It's just never spoken about in terms of "monopoly" because there's no clear way to eliminate natural monopoly without a ton of regulation (e.g. sharing the last mile) or outright public takeover of the last mile infrastructure.

thotsBgone3• 6 years ago

This is the result of government corruption. For example: the government paid ISPs $400 billion dollars (!) to create a nationwide fiber network, and the ISPs pocketed the money and didn't do it. No investigation into what happened or anything. The money is just gone. Clearly corruption is the only explanation. Politicians have been bought.

Why voters don't know/care is another issue, but it might have something to do with the fact that the news media has also been bought.

colejohnson66• 6 years ago

It’s really down to the simple fact that most people aren’t aware. And those that are feel powerless to do anything about it; “It’s been this way for so long, it’s part of how life is now.” (see also: the NSA spying complex) Not to mention that ISP monopolies aren’t near the top of people’s “policy priority list”(TM) (contrast with, say, abortion), so even if a politician were to campaign to fix the problem, most people wouldn’t care. And because of that, most candidates don’t campaign that much about ISPs because it’s (essentially) a waste of ad money.

Take Ron Wyden (D-OR) for example. He’s been talking about the problems of “Big Tech,”[a] the NSA, etc. for years, but no one outside tech or his state have even heard of him.

[a]: Those aren’t “scare quotes.” They’re because there isn’t really a good word for it. FAANG seems too restrictive compared to how many companies are actually part of the problem.

rayiner7• 6 years ago

For example: the government paid ISPs $400 billion dollars (!) to create a nationwide fiber network

False: https://news.ycombinator.com/item?id=7709556

havetocharge• 6 years ago

Can't be hurting the domestic spying apparatus.

furyofantares• 6 years ago

Yet bizarrely this doesn't show up as an issue on Republican or Democrat platforms.

The cynic in me says that it's because it helps neither win against the other.

sumtechguy• 6 years ago

watching them flip positions in realtime was quite interesting too. neither group cares because of what you say, and money, but mostly money. i became 100% convinced neither side really cared other than how much ended up as campaign contributions. all of the large cities at this point should have amazing internet. instead many dont or only small pockets of it. one side tells me how too many of them would make our roads a potmarked hellscape. the other tells me how they are being downtroden upon and throttled yet find new and inventive ways to spy on me. I am beginning to think it is time to declare shenanigans.

jariel• 6 years ago

It's not baffling, it's populism.

Only so many issues can be discussed at once in the commons and politicians are mostly going to react to those.

So BLM, Facebook, Twitter, the Election, Trump etc. are sucking up all the air and that's that.

There are other ugly factors: CNN is owned by AT&T. So do you think CNN is going to help 'fan the flames' of the movement? I don't think so.

'Anti Trust' is also a complicated word, almost a little to complicated for MSM cable news. It's possible for watchers to understand 'Privacy and Facebook' but it's a struggle to get the plebes to try to think about such an abstraction as 'anti trust'.

Those entities spend a fortune lobbying both sides of congress.

Without some popular focus and the press latching onto it like they did BLM, it's going to be hard to get some kind of movement going there.

Even politicians that 'care' about the issue are going to want to 'pick their battles' and it might not be a while before someone starts knocking on that door.

cortesoft• 6 years ago

This is a classic example of what happens when you have concentrated benefits and diffuse costs. Everyone pays a little bit more because of the way broadband is treated, but broadband companies make a LOT because of it.

It simply doesn't reach a high enough priority for people to really push for reform, but it is high enough priority to broadband companies that they fight tooth and nail.

muststopmyths• 6 years ago

It's only baffling if you didn't bother to read the party platforms. The Democratic party platform explicitly talks about removing barriers to municipal broadband as a goal, which is the only way you are going to get competition where ISPs have a monopoly. At least in the current landscape where it's cost-prohibitive for a competitor to enter a region.

Also (emphasis mine),

Democrats will restore the Federal Communications Commission's (FCC) clear authority to take strong enforcement action against broadband providers who violate net neutrality principles through blocking, throttling, paid prioritization, or other measures that create artificial scarcity and raise consumer prices for this vital service.

Regardless of anyone's feelings broadband is not categorized as a utility. You may want it classified as such. Then ask yourself which party is likely to move in that direction.

https://www.demconvention.com/wp-content/uploads/2020/08/202...

briandear2• 6 years ago

removing barriers to municipal broadband as a goal, which is the only way you are going to get competition

Municipal broadband is the only way you’ll get competition? A “public option” seems to invite the very opposite of competition. Less regulation is how you increase competition — by allowing more new entrants into a market, you necessarily increase competition.

Municipalities should own the wire, not the service flowing through the wire. Making capital expenditures less expensive would encourage more service providers.

rayiner7• 6 years ago

The Democratic party platform explicitly talks about removing barriers to municipal broadband as a goal, which is the only way you are going to get competition where ISPs have a monopoly. At least in the current landscape where it's cost-prohibitive for a competitor to enter a region.

It's only "cost-prohibitive for a competitor to enter a region" because of build-out requirements which are broadly supported by Democrats. I used to live in Baltimore, where Verizon wanted to come in and compete with Comcast. The city refused to let Verizon come in and compete. Then they put out an RFP that basically sought bids for ISPs to come in and provide universal service for free. Nobody took Baltimore up on the offer.

WalterBright3• 6 years ago

The Democratic party platform explicitly talks about removing barriers to municipal broadband as a goal

Since the cities are generally under solid Democratic control (there's not a single Republican in elective office in Seattle, for example), there's something else going on.

nostromo8• 6 years ago

Democrats will restore the Federal Communications Commission's (FCC) clear authority to take strong enforcement action against broadband providers who violate net neutrality principles

This seems antithetical to their newfound views on how corporations like Twitter should be able to block political news on their platforms. I don't see how it's dramatically different for Twitter (or Facebook or Google) deciding to block the New York Post than it is for Comcast to do so.

It's not obvious to me right now which is the party for a free and open internet.

ogre_codes3• 6 years ago

I don't think this is a Dem versus Rep thing. Local corruption issues like this usually end up boiling down to following the money. Many municipal broadband projects end up being scrapped after lobbyists $$ get involved regardless of who is running the show.

hhjinks• 6 years ago

which is the only way you are going to get competition where ISPs have a monopoly

Would it not be possible to make it illegal to provide internet access and to own the infrastructure at the same time?

Where I'm from, there are two national phone networks, owned by the two biggest phone plan providers. They also rent out their network infrastructure to smaller companies, which effectively means they control the price of phone plans. As a result, phone plans are comparatively very expensive where I'm from. It seems like separating the infrastructure from the phone plan providing would make the market more competitive, leading to lower prices.

briandear2• 6 years ago

Are we overpaying? I pay less in the US for fiber Internet than I paid in France for DSL. Can “overpaying” be quantified?

CyberDildonics2• 6 years ago

Australia has also had more expensive internet than many countries including the US. This is because they had a huge telecom monopoly that locked down the market for decades.

Just because the same problem has happened in other places doesn't mean it isn't a problem.

srtjstjsj• 6 years ago

Wikipedia says "Bouygues Telecom lowered the first price of standard triple-play offers to €20 in February 2015."

Which is half the basic US DSL price

Fellshard• 6 years ago

Because Net Neutrality was the angle that brings more money their way.

Net Neutrality assumes the monopoly will stay, that no alternatives are available, and that top-down control is the best bet.

If you focus on the monopoly instead, different ISPs could offer different advantages based on the consumer's requirements: gaming, video consumption, media upload, basic light browsing - you could tailor engineering costs to meet the needs of consumers, instead of one-size-fits-all baggage.

nitrogen2• 6 years ago

Offering consumer-controlled latency prioritization doesn't violate net neutrality. Giving that control exclusively to the ISP, or to third parties who pay the ISP, does.

est31• 6 years ago

Net neutrality doesn't forbid you from offering+building low latency services (needed by gaming), or from offering+building symmetric internet connections (useful for media upload). "Basic browsing" can be implemented by just giving users a low bandwidth or weekly traffic quotas.

Also, most of the difference in these services lies in the backbone, but that's not where most of the cost lies. The main cost is digging the last mile. Generally, having multiple ISPs put cables to your porch will n-fold their cost. Who's gonna pay for that in the end? You, the customer. It's best to have one ISP lay fiber cabling to your home and then have them rent it out to others, on terms set up by regulators in advance. Maybe that last mile ISP could even be publicly owned.

joshAg3• 6 years ago

Because america is so anti-socialist. No, seriously. And it's the same reason why PG&E does such a shit job of maintaining their infrastructure, too.

Letting anyone tear up the street to run their own wires whenever they want isn't feasible. From a competitor perspective,that's super expensive and a massive capital investment, so any preexisting competitor with a large enough warchest could just lower their competing prices to drive the new competitor out of business. But from a municipal or society perspective, cable right of ways/culverts are already a constrained resource, and installation disrupts traffic and residents. So basically that last mile infrastructure is a great example of a natural monopoly.

If it wasn't such a natural monopoly, a market could be a great solution for increasing ISP quality, but since it is a natural monopoly, market based solutions fall flat due to lack of competition.

This is where the socialism bit comes in. If america were less anti-socialist, it would treat the last mile of wires like it treats public roads. It doesn't solve the natural monopoly issue, but it does solve the issue that ISP users have no means by which to get the ISP to improve service. Unlike, a private ISP whose only constituents are the shareholders, a governments constituents are the people being governed, so if they want a better ISP, they can vote for improving it through bonds or taxes or however they want to finance it. But that's socialist and america hates socialism, so instead state governments pass anti-municipal-ISP laws and/or municipal governments grant multi-decade-exclusive service contracts in exchange for the ISP deigning to maintain the infrastructure or promising to marginally improve it (but of course at a rate that never threatens their quarterly numbers).

mistrial9• 6 years ago

yes, and .. there was a time long ago in California when PG&E had a clear, engineering oriented management culture. In fact, great infrastructure was built and ran very reliably, for decades. But the times changed. There were relatively fewer 'grand challenge' engineering efforts, and far more day-to-day infrastructure and labor management, accounting and banking. Oh, lots of cash accumulation and cash flow control, too.

A new set of PG&E leadership settled in -- bean counters and control-focused policy. The old engineers, for good reason, considered their "job well done" and went to play golf or whatever. The new management hid money, played hardball with sub-sub-contractors, and told old people on pensions to pay up, as business people tend to do..

source: attorney from the time of the Enron price crisis in California

mikepurvis2• 6 years ago

I'm not sure exactly what the legal framework is around it, but Canada's monopoly network operators (Rogers for coax, Bell for copper) are I believe required to sell bulk bandwidth to MVNO-style carriers. I've been a long-time TekSavvy customer, and certainly I get way better pricing from them than I would buying equivalent service directly from Rogers. And for what it's worth, when I tracert out of my house, the very first hop (9ms away) is a TekSavvy IP address which geolocates to a point in my neighbourhood, so it's not like I'm going through a ton of Rogers infrastructure to get to them (unless it's all transparent and extremely low latency).

There isn't much of a difference on the service side either; the trucks which come around here are all third party fulfillment firms regardless of who your ISP is (and they have super-bland, forgettable names like "Dependable HomeTech")

randyrand• 6 years ago

at the same time I don't want a single government ISP controlling everything controlled by bureaucracy.

At least today we have hundreds of small ISP companies, and at least a few big ones.

Every time I move I consider who my ISP will be.

nobody99992• 6 years ago

at the same time I don't want a single government ISP controlling everything controlled by bureaucracy.

Firstly, most municipal broadband networks, either built or proposed, absolutely do not include ISP services.

Rather, they provide last-mile/Fiber-to-the-premises infrastructure that comes back to an interconnection point where multiple ISPs can provide Internet access services to customers.

This actually increases competition, because ISPs don't need to pull cable to every single customer in order to provide service. They just need the appropriate back-haul capacity to service those customers who sign on with them.

This allows for more competition on price, features and customer service, not a "single government ISP."

closeparen• 6 years ago

Maybe because the actual antipathy towards Facebook and Google is about their role in discourse and electioneering; antitrust is just a weapon that happens to be nearby.

TuringNYC3• 6 years ago

Just a decade ago, SMS messages in the US cost 10 to 25 cents per SMS. You also got charged for spam SMS. Prices were completely disjointed from the reality of underlying costs (zero for the telcos). My college CS professor gave senate testimony on this: https://www.judiciary.senate.gov/imo/media/doc/keshav_testim...

(side rant: in the following ten years, the tech giants sweeped in, competed, provided a better service, with better cross-platform support, for zero dollar immediate cost to the end customer -- gained a massive following (think whatsapp), and are now vilified for their "monopoly" and the "harm" it has caused.)

My read of this situation is:

- Real monopolies (esp Telco) have entrenched lobbying bases

- Tech has done a poor job at lobbying, possibly due to idealism that logic wins even though thats now how things work in the US

- Tech has disrupted so much that they now have multiple industries as enemies

- Tech is concentrated enough geographically that there is some jealousy against this sector "over there" raking in too much money, even if they have provided an amazing service

arminiusreturns3• 6 years ago

K-Street runs congress, despite whatever their party platform talking points are. Non-representation in a captured legislative entrenched by things like gerrymandering maintain the status quo.

imajoredinecon• 6 years ago

And I'm not talking about politicians being bought. It baffles me why voters aren't writing letters to their city councils, their mayors, their state reps, their governors. If voters actually care, politicians do respond.

Concentrated benefits, disparate costs. Paying $20/month too much for internet is a pain in the ass, but it's a pretty minor issue for most people compared to (say) healthcare.

speeder• 6 years ago

Telecom is... too nasty to touch to be honest.

Brazil tried it, we had a state company that had a monopoly of telecom, we broke it up intentionally in many tiny parts and sold them.

Results were basically this:

1. A bunch ended eventually merging, often with help of blatant corruption (for example one such merger was first denied, then approved again after the son of the president "sold" to a telecom company, his game company for 30 million, a game company that never made any games, and the son of the president before that was a zoo caretaker and didn't knew how to code).

2. Some are going bankrupt, with parts they bought being unprofitable, and will eventually get merged into the others.

3. A LOT of international 007-style spy shit happened because of this... We had our version of CIA spying on our own president, owner of a bank spied upon (seemly with good reason), Italy and Brazil spying on each other, agents getting arrested, agents disappearing, people bending backwards to release criminals and suspected criminals to avoid diplomatic incidents, people that disappeared or died, etc...

To be honest Telecom looks like the sort of thing that even touching with a mile-long pole you will still get shit splattered on you, and if you try a shorter pole it will be nuclear shit.

andromeduck5• 6 years ago

I think telecom is like power, the only way it can be split is by creating horizontal markets, emphasis on plural, and preferably along some natural lines to the fictional overhead such as generation/distribution in the case of electrical markets.

For communications I think the way to do it might be to create 3-4 levels of responsibilities and say that no single player can operate in more than a few levels at once and must offer their services via live public auction or standard public wholesale pricing.

For wireless the way I'd split is is: 1. Location/site management, aka who owns/manages the poles. 2. Operating the actual Networking/Peering equipment, networking to the site with permission of #1. 3. Consumer/retail such as MVNO; direct-use in the case of large businesses, or value-add aggregation/resale for intermediates.

For wired the way I'd split is is: 1. Global networking/peering. 2. Regional networking/peering. 2. Last-mile equipment/rights, servicing. 3. Consumer/retail, value-add etc.

The goal here being to reduce the barrier to entry for small players via horizontalization which increases competition but not draw too many hard lines so that players have some flexibility in organization and so that players in one level have the opportunity of punching through to an adjacent or skip level if it is being overpriced.

rojoca• 6 years ago

In NZ we have 2 levels, wholesale and retail providers. By law you cannot be both. The price paid by retail providers to wholesale providers is currently set by the commerce commission because the infrastructure being built and managed by the wholesale providers was heavily subsidised by the govt. The (4) wholesale providers are effectively regional monopolies but importantly cannot set their prices, and the retail providers compete on value-add services and price for which there is fairly healthy competition.

teorema• 6 years ago

I posted this essay I wrote in the spring:

https://write.as/ccgaoox9alf3hbv4.md

I think the key is to not necessarily have state-run ISPs completely OR private-run ISPs completely. Something like the courier/delivery market where there's access to multiple providers is key.

Any kind of local monopoly is bad.

The other elephant in the room is the right-of-way that's granted to these telecom companies over private and public land. In exchange for what?

Lots of room here for lots of progress.

mattferderer• 6 years ago

I am curious how Starlink will change this conversation one way or another.

It adds another competitor to the mix.

Could it become the monopoly if the tech were to make current ISP tech obsolete or to expensive for most areas?

If it became the better method, does that mean our skies will soon be even more polluted with satellites by exponential factors?

marcus_holmes8• 6 years ago

I really hope Starlink lives up to the hype.

But if it does, how do we stop it becoming a monopoly? We don't need and can't have multiple rival fleets of satellites up there. But if it's just Starlink then how do we stop it charging more and more for less and less because no-one else is threatening it?

If it works, should the UN step in and take over the network as a service to all of humanity?

justinclift• 6 years ago

I really hope Starlink lives up to the hype.

The technical aspects of it seem to be:

https://arstechnica.com/information-technology/2020/11/space...

Robotbeat4• 6 years ago

We do need and can have multiple fleets up there. OneWeb has already launched a bunch of satellites, and there is enough room up there for several more, particularly as operators get better at safely operating them.

dantheman• 6 years ago

I wouldn't want the UN touching anything I ever might want to use/rely on.

jcims3• 6 years ago

I’m curious what happens with rural terrestrial broadband. Does it dry up and die or do the telecoms try to compete at a relatively high cost per customer. Many don’t have dial tone and satellite TV bundles aren’t competitive so they will likely lose the customer completely and are left with an asset that makes no money.

They might open the local loop back up to at least get rent?

daniellarusso3• 6 years ago

The DSL providers have already neglected their maintenance and upgrades.

I was the last one in my neighborhood to be allowed 12Mbps download. All new accounts are maximum of 6Mbps.

I would like to see reform in the CATV franchise laws.

Robotbeat4• 6 years ago

It is odd that Starlink isn’t mentioned in the article. Starlink has impressive speed and latency and the potential to compete to some degree in every market in the US. Twitter angst aside (some of which is fair but much seems to be either dishonest or ignorant, even by those who should definitely know better), SpaceX has also done a remarkably good job of addressing the light pollution problem such that the satellites are invisible to the naked eye once in operational orbit (mitigating impact on ground astronomy is something SpaceX continues to work with astronomers on). They’ve done so well, this should probably become industry regulation. And by choosing a lower (self-clearing) orbit, they’ve mitigated a lot of the concerns about space debris as well. I think their approach to these problems shows it is scalable (although IMHO we should actually codify some of these mitigation’s instead of just relying on good faith).

And thankfully, competitors exist. OneWeb has exited bankruptcy and is starting to launch again. Project Kuiper also shows promise.

I think people are still sleeping on just how big of a deal Starlink (etc) is going to be.

baq2• 6 years ago

starlink cannot compete in densely populated area because the sats have comparatively (to dsl, fiber, etc.) limited total bandwidth to spare, just like any other shared medium. musk himself was very open about this. starlink is a game changer where the last mile is prohibitively expensive i.e. sparse/rural areas a few dozen miles away from population centers.

marcus_holmes8• 6 years ago

This is such a weird thing. After spending time in SE Asia, where bandwidth is cheap and plentiful (in the cities), it's painful coming back to Europe (and Australia). I'm in Berlin atm, and the wifi is shit, bandwidth is expensive and unreliable. And the phone plans suck. I was in Perth (Australia) before that, and access there is terrible.

In Cambodia, 120Gb (per week) of download cost me US$1 (per week) over good-quality 4G connections anywhere in the city (but almost nothing outside the cities). In Berlin, it's 40 euros a month for 5Gb, and coverage is a bit patchy, and very patchy if I go a few Km's out of the city.

In Bali, a $5 SIM card got me a month of effectively-unlimited download over decent connections. Nepal, Malaysia, all good. Phillipines was tricky to get decent coverage, but when it was there it was cheap.

Cafes in SE Asia offer free wifi with a coffee. Berlin nope.

I get the price differences are a function of relative GDP. But the performance differences should be the other way around. Tech should work better in developed countries, not worse.

Plasmoid2000ad• 6 years ago

I understand there are some specifics going on in Germany. While I've never quite understood, I've seen many German posters call out a national broadband backbone based on Copper as the root cause. I don't know if this is true, but I am in Ireland and know that also the UK did a rollout of a Fibre backbone network, and in both there's widespread availability of 1GB+ consumer connections.

I think what's happened is in many or some European countries there was a rush to increase Broadband adoption and speeds, where being the first mover left them with now outdated backbone infrastructure. Those who moved later, more gradually, or chose a more future proof backbone network benefited. The sunk cost and possibly inflexibility of the network to upgrades holds back the push for better speeds. If the service is good enough, the push from consumers for more is lessened.

MrBuddyCasino• 6 years ago

I think what's happened is in many or some European countries there was a rush to increase Broadband adoption and speeds, where being the first mover left them with now outdated backbone infrastructure.

If you are referring to the copper network built in the 80s under Kohl, that is not what happened. Some call it "conflict of interest", some blatant corruption.

kinkrtyavimoodh3• 6 years ago

European cafes won't even give you tap water (even if you have bought other stuff) for free, let alone free wifi.

maest• 6 years ago

I'm not sure what you're basing this off of, but it's largely not true.

swiley• 6 years ago

effectively-unlimited

I mean, that's what everyone in the US has.

I've heard enough stories of people in SE Asia having to pay by the megabyte to know that it's not the same everywhere.

zbentley• 6 years ago

In 10-15 major cities, or a handful of high-throughput areas (if mobile). The US's internet quality is not great.

Aunche• 6 years ago

In Cambodia, your 4G is subsidized by the low cost of living. The household income per capita in Cambodia is ~$1,400. Also infrastructure in SE Asia doesn't seem to regulated, seeing as there are cables everywhere, which also cuts costs.

marcus_holmes8• 6 years ago

You're absolutely right, not sure why you're being downvoted. As I said, I get that the cost is a function of GDP, so the cheapness is kinda expected. Though I'm doubtful that the driving force behind broadband costs is labour, so I'm not sure why the costs are a function of GDP. Even with the ability to string cable everywhere at will.

But I still expect that the tech would work better in a developed country.

Maybe all those NIMBYs objecting to mobile towers near schools are the problem.

amaccuish2• 6 years ago

In Berlin, it's 40 euros a month for 5Gb,

What network? I pay 12 euros for 5gb (aldi talk, running off o2, so i can still use my phone in the u-bahn)

There's also lidl connect runnning off telekom if you like that network

amaccuish2• 6 years ago

In fact, I think your comment is actually disingenuous and you've not researched the market properly if you're paying that much and not receiving a phone included.

jeroenhd• 6 years ago

Don't confuse the internet situation in Germany for the internet situation in the whole of Europe. Some countries have cheap data, others are unreasonably expensive. European internet infrastructure isn't as homogeneous as people seem to think.

Here in the Netherlands, you've got national coverage with unlimited data for €25 per month (practically unlimited, not theoretically unlimited, of couse, because fair use policies exist everywhere).

One country to the south is Belgium, where even the landlines have data caps, something that would be unthinkable here.

There's some connection between GDP/purchasing power and the price of data, but there's much more going on. Things like nationalised internet connections, government investment in public internet infrastructure and geography are more important than how much money someone in a certain country makes on average.

carapace• 6 years ago

I was just talking to a person today, it turns out there are parts of Western San Francisco that can't get good connectivity (without shelling out ~$100K to dig a trench or some shit.)

terinjokes• 6 years ago

You don't event have to go very far west. I was quoted $87k to get anything better than 8Mbps/1Mbps in the middle of SoMa just a few years ago.

wombatmobile• 6 years ago

How can TFA and all these comments here be correct if this report from The Economist, "paid for by Facebook", is correct?

Comcast and Charter cited an Economist Intelligence Unit report paid for by Facebook that ranks the US first in the world for Internet affordability.

https://theinclusiveinternet.eiu.com/explore/countries/US/?c...

ocdtrekkie3• 6 years ago

Actually, everyone is talking about this: Big Tech has been beating this drum for years, and paying everyone else to talk about it. The source of this article, Conde Nast, has an incredibly close partnership with Google, and this whataboutism has no real place here.

This entire article is tech companies' public policy teams screaming "please look somewhere else!"

Meanwhile, Big Tech is vastly larger, vastly more profitable, has little regulation, and blanket immunity for what they do online (Section 230) while ISPs are heavily regulated, and report a fraction of the profits.

magicalist2• 6 years ago

Conde Nast's parent company is a part-owner of Charter Communications, which bought Time Warner Cable to become the second biggest US ISP. That fact is listed in a disclaimer on all the articles Ars Technica writes about what a scummy monopolist Charter is[1]

[1] https://duckduckgo.com/?q=charter+communications+site%3Aarst...

kinkrtyavimoodh3• 6 years ago

(Section 230)

https://www.techdirt.com/articles/20200531/23325444617/hello...

ocdtrekkie3• 6 years ago

TechDirt (via the "Copia Institute") is paid by Google's Public Policy team, as disclosed at Google's Public Policy Transparency page: https://www.google.com/publicpolicy/transparency/ in https://kstatic.googleusercontent.com/files/4b9e2caa400b9cd5... (pdf)

Mike Masnick is, as disclosed, a Google shill on payroll. If you didn't realize this, Google's public policy team is doing their job well.

comeonseriously• 6 years ago

Because traditional media is owned/owns the ISPs. This means MSM will never talk about it and therefore it will never be an issue politicians or voters will care about.

jrochkind1• 6 years ago

I live in a medium-large city, and have only ONE choice for broadband.

Comcast.

They don't make their pricing super public, but you can enter a zipcode and say you're a new customer to see it. Their prices are significantly higher here than they are in regions with competition from FiOS etc.

gberger• 6 years ago

What is the X axis representing in the chart in the article?

https://cdn.arstechnica.net/wp-content/uploads/2020/10/broad...

Edit: second quarter of 2019, third quarter of 2019, etc.

I read the Q as a 0...

x87678r• 6 years ago

I'm not convinced Comcast is ripping off everyone as much as everyone says. USA is a big country and its expensive to wire everyone up. Lots of companies around have tried including Google who basically decided its easier to do make money from ads and self driving cars rather than wiring up neighborhoods and dealing with local regulations.

The ISPs and cell networks actually do the hard and expensive work of installing hardware, while FANG companies make most of the profits on the back of it.

Would you rather own shares in Google/FB/Amazon or Comcast/Verizon/ATT?

bob1029• 6 years ago

I know its a rhetorical question but I very much prefer having shares of CMCSA/VZ/T over the alternatives.

I've always viewed Google, Facebook, Twitter, et. al. as very "soft" companies in terms of their competitive advantage. AT&T literally owns parts of the electromagnetic spectrum for their exclusive use. This is a completely different dimension of advantage.

treis6• 6 years ago

The market disagrees with you. Any one of the GAFAMs is worth more than all the ISPs in the US put together. And that's with those ISPs largely being conglomerates that own other businesses outside of being an ISP.

kinjba11• 6 years ago

It is expensive to wire rural areas up. That is why the [government is paying for it](https://arstechnica.com/information-technology/2015/08/att-g...). Why isn't this a utility again?

Comcast and Charter essentially have a [duopoly](https://arstechnica.com/information-technology/2018/07/comca...) over much of the United States. Where is the competition? The actual competition is in lobbying local governments to make ISP-as-utility illegal. See the [case of Wilson, North Carolina](https://www.npr.org/2020/05/29/865908114/small-america-vs-bi...).

People seem to easily forget that every major corporation is evil by default. If it is profitable, it gets done. Laws and public image are the only thing holding them back.

Karunamon2• 6 years ago

Where is the competition?

60 to 90 percent of households have access to two or more options for fixed (wired) broadband[1] depending on how you classify broadband, and that's not even counting the wireless options.

That, to me, seems as about as competitive as you're reasonably ever going to get across a medium that is a natural monopoly without putting the government in the same line of business, which quite frankly, I don't see as their place.

[1] https://arstechnica.com/information-technology/2017/06/50-mi...

daniellarusso3• 6 years ago

The latter group own alot of copyrighted media.

ogre_codes3• 6 years ago

Comcast has spent more than $10 million on lobbying in Washington this year

One of the remarkable things about our political system is how little money (relatively) it takes to lock in a multi-billion dollar advantage. In terms of benefits per dollar spent, lobbying is one of the most profitable investments an established company can make.

Want to shut out new competition? $100k Prevent municipal broadband? $10m Get affordable access to a low-cost corridor for your facilities/ network? $20m

etc etc.

marketingPro• 6 years ago

I live in an area where we have at least 3 providers, I pay 20$/mo and never have to call to lower my rate.

If government didn't create regulations or horrible contracts this is a solvable issue.

This reminds me of another complaint about regulation in healthcare... Does any party support deregulation? Or is that a sure way to lose donors?

afrojack123• 6 years ago

Infrastructure is naturally monopoly. Every so often the companies will have a bunch of customer facing shill companies that customers buy. The shill companies then send purchase the infrastructure from the main provider. Examples are MVNO's, natural gas, etc.

The real antitrust problem is DuckDuckGo.

klyrs• 6 years ago

Title is clickbait. "Broadband monopolies are an unaddressed tech antitrust problem" might be better?

woeirua• 6 years ago

I was all in favor of breaking up the ISPs a few years ago, but Starlink is coming on like a freight train, and it alone may break up the current monopoly structure. Tack on 5G from the major wireless providers in urban areas, and we might have a situation where the price of broadband plummets before an antitrust action from the DOJ would even get to trial. Not sure it's worth the effort at this point.

walterbell2• 6 years ago

Plus we broke them up already and know what happened next.

dekhn3• 6 years ago

I'm a bit of a weirdo but at the current time, my gigabit is provided by a company whose name histortically was associated with a monopolistic company (AT&T) but really was cobbled out of the bones of several large dead telecom companies and is now a monopoly again. It costs $100/month, is delivered by fiber straight to my house from a pole, works as described (in terms of latency and speed tests), and I don't want it to change at all for the next decade. I don't feel overcharged and the service is excellent compared to every broadband I've had before.

The counterargument is that I happen to live in an area where it makes economic sense for AT&T to do this (high density homes, high level of internet use).

anamexis• 6 years ago

I have the exact same arrangement as you (CenturyLink gigabit FTTP that I am very happy with), but it costs $60/month.

sib2• 6 years ago

That's great for you (no sarcasm!)

Where I live - in the city of Los Angeles, hardly distant, rural America - AT&T is happy to provide me "broadband" internet at speeds of up to 10mbps for the low, low price of $45 / month (with a 12-month contract!)

Ironically, I get faster speeds on my AT&T-powered iPhone.

dekhn3• 6 years ago

Are you sure? It looks like many cities in LA have AT&T Gigabit fiber. My guess is they deployed in San Mateo pretty early, and are filling out the major cities now. It's also possible that they don't put the service in cities where the expected subscription rate is too low.

pkaye2• 6 years ago

I've read somewhere that AT&T is only doing this as part of an deal for the approval of the Dish Networks sale. So they will just upgrade only the place that make economic sense and only to the degree needed to satisfy that deal.

maxerickson3• 6 years ago

Spectrum charges me 2x what they charge people in areas with more competition.

pb77• 6 years ago

In some of the newer neighborhood around my place, the telecom providers pay a fee to the neighborhood developer to make them the only sole provider. So in these new neighborhoods there is only one option. I don't know if DOJ can do anything about it or how they can fix it.

xxpor• 6 years ago

The FCC declared those unenforcable in 2007.

https://www.fcc.gov/document/exclusive-service-contracts-pro...

donor20• 6 years ago

Not uncommon - rental buildings are almost all like this (building owner get's a cut / provides one option).

Commercial buildings similar but usually one preferred and pre-wired, but if you are negotiating for a floor etc you can get what you want.

HOA's etc generally don't like new holes in walls especially common walls. So generally one preferred.

exabrial3• 6 years ago

The problem is the proposed solutions really just entrench existing providers, specifically net neutrality policies: They legalize monopolies as long as they're "following the rules!"

_You_ _cannot_ _legislate_ _good_ _behavior_ _into_ _monopolies_. So while I appreciate the spirit of Net Neutrality rules, the solution is fundamentally flawed.

Let's say you want to open an ISP in your neighborhood. Based on their history (When Google Fiber moved into my area), Comcast will call their existing customer base and offer them services below cost but at the price of a 3year contract. This delays profitability for you as a new player into the space. Comcast can take money from one market (another state) and move the profits into subsidizing a loss to prevent players from entering the space in another market. By breaking this cash flow, you end the stagnation of consumer choice, driving innovation forward.

bosswipe• 6 years ago

_You_ _cannot_ _legislate_ _good_ _behavior_ _into_ _monopolies_

Why not? Yes, breaking up monopolies is good but that doesn't mean we can't regulate industries before the point where things get so bad that there is enough political will to break them up.

exabrial3• 6 years ago

I mean, feel free to provide an example where we successfully regulated a monopoly to encourage competition and consumer choice...

zbrozek• 6 years ago

Because companies are really good at optimizing and the outcomes are usually bad behavior that is not-yet legislated. It's a cat and mouse game. Much better to have a plethora of competition so that the competitive market provides the tight feedback loop. With wireless carriers the MVNO rules mean that I can shop around and jump ship pretty easily. I just switched providers a couple of months ago.

Look at PG&E. They're badly behaved but also highly regulated.

dredmorbius2• 6 years ago

If you want to emphasize a word or phrase, put asterisks around it and it will get italicized.

https://news.ycombinator.com/newsguidelines.html

exabrial3• 6 years ago

Sorry :( I come from planet markdown

jandrese• 6 years ago

My water company is pretty well behaved. Sewer too. Trash pickup is without headaches although I don't know the cost. Even my power company is ok now. They had a bad part in the early 2000s when they were trying to semi-privatize and Enron was trying to horn in on the management, but once they went back to being an ordinary utility the bad behavior stopped.

zdragnar2• 6 years ago

I have had horrendous experienced with Waste Management on three occasions. Moving out of the neighborhood they had a city-enforced monopoly on was the only solution (granted, i moved for other reasons, but getting someone else was a delight all its own).

sneak4• 6 years ago

I extremely do not want the situation where the state owns and operates the communications infrastructure of the general population.

That's turnkey tyranny, censorship both ways (what you can send, what you can read). Right now it's just expensive, but you can still use a few different (overpriced and anti-competitive) providers.

If the state decides you're a threat and unplugs you, it could be months or years before you can invoke your legal rights to get reinstated.

toast02• 6 years ago

Water, sewer, trash pickup, and power have very easy to understand quality metrics, and can be easily regulated.

An internet connection is not so easy to measure. You could have a very well provisioned and maintained local loop, and poor connectivity from there. I strongly support local loop unbundling --- you can regulate the local loop in simple terms, and let competition manage the messy network interconnection bit.

kanox3• 6 years ago

I don't think this is a monopoly problem as much as a collusion problem: multiple providers exist but many regions each have a single provider. If this is a deliberate agreement then it's extremely illegal.

Where I live there are multiple high-quality ISPs at my building, the US should find a way to encourage multiple ISPs to be present in every single neighborhood.

People who complain about "too many ugly wires" should be ignored: it's much better to have ugly cables on poles than slow internet.

nimish2• 6 years ago

Most good theories of monopoly power encompass the abuse of natural monopolies via collusion

omegabravo• 6 years ago

Wouldn't it make sense to share the pipes the dumb light pipes and compete on service?

nine_k3• 6 years ago

Your building, you say. I can choose between at least two providers in my apartment in Brooklyn, NY.

But somebody in upstate suburbia cannot, and they are lucky if their only provider is not utterly bad.

Density is key here. Suburbia is not dense enough, and is finicky enough about digging or running wires, to make building a competing network lucrative. And the US has a ton of low-density suburban population, even in formally urban agglomerations like LA or Houston.

One solution is to live in a proper city, but proper cities are not very numerous in US, and living there is more expensive.

unishark• 6 years ago

Agreements between the local government and the provider aren't really collusion, just government created monopolies.

As for some kind of collusion between providers, if not competing is preferable for companies, why does anyone ever compete? Verbal agreements or not. Common sense says if you undercut someone's price they will cut their price too in response. Just offer the same price, stay out of their neighborhood, etc. Don't need to wink and nod about it. Yet we see fierce competition all over the place because that strategy doesn't work. New entrants always come along and they can't make a profit by playing that game when others already have all the market share. If you only see a single provider it's either a govt-protected monopoly as I mentioned above, or a beneficial monopoly that is holding prices too low for competition to see an opportunity.

cabalamat• 6 years ago

Banning states from banning municipal broadband would help (by making broadband providers less monopolisitic).

s_dev• 6 years ago

All incumbents have some advantage over a new player -- that doesn't mean monopoly.

A good example of how Comcast will be disrupted is Starlink. Though I'll concede that US Internet infrastructure seems outdated compared to the EU. So perhaps this aging infrastructure suggest monopolistic practices as does any phenomena characterized by stagnation.

vonwoodson• 6 years ago

It’s not a monopoly if it’s a well regulated utility.

m0zg• 6 years ago

Solving this problem is not worth the effort at this point. They will all have competition by the end of 2021 in the form of Starlink, which itself will have competition within a couple of years from whatever Bezos is launching. Then there will be still more competition from 5G everywhere. We will be drowning in bandwidth within a couple of years, planet-wide. Capitalism is pretty great like that.

mastazi3• 6 years ago

As a non-American, the first time I heard about the situation with broadband monopolies in the US, it was hard for me to believe! Apparently in huge parts of the country you can only choose one single provider? Is that true just in "regional areas" or in suburbs and urban areas too? Are there stats about how much of the population has no choice?

Edit: the article gives numbers in terms of how many people have access to broadband (and how many haven't) - but what I'm asking is different - what percentage of the population can connect to one and only one broadband provider, based on their location?

pkaye2• 6 years ago

This the FCC statistics on broadband availability.

https://broadbandmap.fcc.gov/#/area-comparison?version=jun20...

mastazi3• 6 years ago

Thank you! this is what I was looking for!

aidenn02• 6 years ago

If DSL counts as broadband, then it's about 1/4 the population, if DSL does not count as broadband then it's about 80% of the population.

Note that the FCC numbers linked elsewhere are optimistic because of their coarse granularity; if there is a single household with two options in a census region, then all of the population is counted as having it.

There's obviously the issues with suburban and rural housing, where density is insufficient for two last-mile solutions (and all local-loop unbundling regulations were so successful in the late 90s that the telecom companies lobbied them out of existence).

Something less talked about are the urban apartments where you can only get broadband from the company that contracts with your landlord. If someone that doesn't use the broadband can pick which broadband you use from several options, does that count as competition?

austincheney2• 6 years ago

When ever ISPs come up people are so quick to ignore the obvious to entertain some absurd entrenched political opinion.

The reality is that service is generally pretty good when the cost of advancing infrastructure is lowest and horrid where it is most expensive. That generally means that suburbs have it best due to high population densities and physically segmented real estate. Rural areas have it worst where the most material is required between the population and the service provider. An additional factor is that service providers are more willing to provide new infrastructure at their own expense when the path to profit is shortest, which also appears to preference the suburbs.

While a lack of competition might be a problem it is insignificant compared to the more obvious problem: a lack of incentive. In some areas service providers are eager to compete while in other areas they aren’t, which isn’t a monopoly problem.

thayne• 6 years ago

Plenty of people talk about it. Just mostly not the people with the power to do something about it.

ergwwrt• 6 years ago

Musk's Starlink is going to destroy broadband monopolies

ksec• 6 years ago

5G could change that equation. We are actually not far off from having a totally Wireless Broadband Network. At least in 2010 using something like 3G /4G for broadband was nearly unthinkable. Now it is only a matter of time in terms of technical feasibility. And in lower population density area like in Europe. This has already happened. It forces ISP to provide faster Wired Connection at a much lower price in other to compete.

The problem in the US is that Broadband and Mobile Companies are one and the same.

spacemanmatt• 6 years ago

My ISP is literally not allowed to do business in some parts of my town. This is because a cable monopoly bought local laws that prevent other companies from deploying new service (specifically, prevents pole/underground conduit access) and it's absolutely abusive.

DrStartup• 6 years ago

IMO the government (the people) should own the transmission & delivery infrastructure - water, sewer, gas, electric, fiber - and companies provide the service within constraints.

cashsterling• 6 years ago

I pay 50 USD a month for 1 Gb/s symmetric internet service run by the city of Longmont, CO. It is great... by far the best internet service I have had. I had comcast in many different cities, Cablevision, AT&T, etc.

Hopefully more cities will consider municipal broadband.

ianmf• 6 years ago

I am about to move and where I am moving to, only has a sole Residential ISP... Comcast. I seriously considered not moving to that place because of that fact. I have had very bad experiences with Comcast. Parting from Verizon FIOS will be hard.

alexfromapex• 6 years ago

The crazy thing is that our society could be so much more innovative if we made room for innovation in the network infrastructure industry but thus far the giants have priced out and lobbied against all of the competition

A tech antitrust problem no one is talking about: US broadband providers

Related Stories