Don’t Blame Big Cable. It’s Local Governments That Choke Broadband Competition

http://www.wired.com/2013/07/we-need-to-stop-focusing-on-just-cable-companies-and-blame-local-government-for-dismal-broadband-competition/

by apu • 12 years ago

162 152 12 years ago

wired.com

sp332• 12 years ago

Every local government in America?

Aloha2• 12 years ago

No, but the places that HN commentators are likely to live, yes. The bigger the city, the more likely.

higherpurpose2• 12 years ago

I heard something about 20 states doing this recently.

Aloha2• 12 years ago

I work for a major wireless carrier - we see this all the time with permitting - many of our rural sites dont even require a permit - we can just go out and swap the equipment on the pad, hand the new stuff on the tower. Our urban sites, some of them are just now getting permits that were applied for in 2011, not to mention the couple hundred bucks in fees (or more) to get said permits - all to simply change a bit of hardware bolted to a concrete pad - and on top, often costs for reinspection once were done bolting the new stuff on.

stcredzero• 12 years ago

We seem to be in as bad a situation now, as we were in when the telephone company had a monopoly running right up to the jacks in your house. (And most likely sold you the phone that plugged into that jac on top of it!)

Sanddancer2• 12 years ago

Oh, it was worse than that. You used to not even own your phone, only rent it from the telephone company; a lot of elderly couples are still getting charged for that phone they rented, and threw out, decades ago [1]. Thankfully, most customers are now at least allowed the tiny luxury of their own cable modem.

http://www.consumerwarningnetwork.com/2009/03/25/is-grandmom...

zdw• 12 years ago

The fundamental problem here is that in most places we've arbitrarily decided that certain things like:

    - Roads
    - Water/Trash/Sewer
    - Police/Fire service

Are a part of municipal government, whereas:

    - Electrical
    - Telephone
    - Cable TV

Are frequently not, but are regulated. Frequently, one of these last 3 will own the poles (usually the Electrical company, but sometimes the municipality) and the Phone/Cable companies lease the poles to put up their lines.

So, what do you do? Make the Electric company put up New Companies A-Z's lines for free? That doesn't work and would quickly lead to companies covering the lucrative part of town (read: "rich") and widening the digital divide.

It comes back to the bad decision that didn't force Cable to be a common carrier. Had that happened, we'd end up with a situation like DSL where there are multiple vendors, except the lines would have the same speed capabilities as Cable.

So, in short, it comes back to a bad FCC decision. Requiring a bunch of new physical infrastructure isn't needed when the existing could just be broken up and leased out as dumb pipes.

epistasis• 12 years ago

I believe that to be an eminently reasonable interpretation of the history and current situation.

What was the history that led to a the non-common carrier ruling? Was it thought that cable companies would upgrade infrastructure more quickly if they didn't have to sell access to their lines?

Here's what the NCTA has to say about it now: https://www.ncta.com/platform/public-policy/why-its-a-good-t... Given the success of broadband in areas where the lines are sold like they would be in a common carrier situation, it's hard to believe anything they say.

tbrownaw• 12 years ago

The version I learned is that it's a historical artifact from dial-up Internet.

You had the phone lines from the phone company (natural monopoly, common carrier), and completely separately you had an ISP with a modem bank hooked up to an Internet uplink (competitive, information service).

Then you had the Telecommunications Act of 1996 (I turned twelve that year!), where the phone company had to allow the ISPs to use the phone lines at wholesale rates. So you get ISDN and later DSL with that same split between who controls the wires and who controls the Internet uplink.

Then you get cable Internet. Which does not use common-carrier wires (I assume this is related to not-so-modern TV being entirely one-way). And which end up classified the same way as potentially-unbundled Internet that runs over the phone company's wires, despite being controlled by the same people as the wires it runs on.

Then for whatever reason all the independent DSL providers disappeared (or at least shrunk to where they can't afford noticeable advertising campaigns). I don't know if the phone companies found a way around having to share their lines, or put less effort into maintaining lines used by independent ISPs to discourage people using them (I know I heard this suggested back when it was new, no idea if it was reasonable or just a conspiracy theory), or just out-competed them based on there being a single bill and a single point-of-contact (and no finger-pointing) for problems. I guess it can't be the first option, since I've heard that a few parts of the country actually have more than 2 choices (cable company & phone company) for Internet service.

rayiner11• 12 years ago

Had that happened, we'd end up with a situation like DSL

A situation where nobody wants to invest in DSL and everyone is looking to get out of the wireline telephone business?

chc• 12 years ago

Isn't that because of dwindling demand rather than companies finding DSL onerous?

nostromo3• 12 years ago

The problem is that eliminates the incentive for companies to build faster, better internet. We'd be stuck with what we have now for a very long time.

I do think it's fair to blame municipalities. Look at something that is much easier to build out: wireless networks. Cell coverage has dramatically improved over the past 10 years. In part, that's because multiple carriers are competing for customers and municipalities have largely stayed out of their way.

One could even argue that we're reliant on cable providers because there were no incentives for the highly regulated phone line providers to improve their networks.

kumbasha• 12 years ago

How can you eliminate competition that does not exist? By definition, what the cable companies are doing now is eliminating competition, because there is none. Any change is an improvement.

bduerst3• 12 years ago

Nope.

Regional competition for services which require expensive infrastructure is non-existent once the first player has entered the market.

Any competitor trying to enter would need to build out the expensive infrastructure, only to be undercut in the following price war and lose because of recent costs. It's textbook game theory.

This lack of competition leads to a deterioration of quality of the service as the sole market holder doesn't need to continue to invest in infrastructure. Instead they can invest in lobbying which helps further cement their hold on their market, or invest in advertising to take customers away from shittier service alternatives, like DSL.

Quality is the exact reason why something like transportation is handled by local governments, as opposed to letting private toll roads dominate the market, which have no incentive to patch pot holes when it's the only option available.

bluthru• 12 years ago

We'd be stuck with what we have now for a very long time.

Being stuck at the speed of light sounds ok to me.

saraid216• 12 years ago

I honestly don't understand why we don't just consider them utilities and incorporate them into the municipal government. Including internet.

These are essentially utilities (excepting Cable TV, but I'm pretty sure there's not a meaningful infrastructure difference there).

dnautics• 12 years ago

Would shifting these responsibilities to the government necessarily solve the problem? After all, the police (and the fire department, in SoCal, anyways) don't do a job of equitably serving the poor relative to the rich, either.

VikingCoder• 12 years ago

Wow, it can double the cost?

Well, then we should have seen $150 billion in delivered broadband, since we have given $300 billion in tax subsidies to broadband providers, in exchange for broadband development.

We have not seen $150 billion in delivered broadband value.

Ergo, this argument is wrong. I do blame Big Cable.

NoPiece5• 12 years ago

Do you have a primary source for the $300 billion tax subsidy claim (which would be an indictment of the telcos if true). Something besides a link to a link to a link to something Bruce Kushnick has claimed?

I've read his reports, and while there seems to be a kernel of truth, the numbers are not, IMO, substantiated. He gets big numbers by claiming the telcos are making undeserved profits, which even if true, is not a subsidy.

adventured2• 12 years ago

This is a constantly repeated urban legend. The telcos never received anywhere near $300 billion in tax subsidies. It comes up constantly in threads like this, and the people claiming it can never back it up with actual data or proof of any sort, just vague statements.

mikeyouse6• 12 years ago

You can easily get to $200B from the spectrum value alone.

In 2008, as part of the digital transition, 52 MHz in the 700-band were auctioned off for $19B. The telcos were gifted 295mhz of spectrum for the digital expansion when they agreed to invest in broadband. Even if it's only half as valuable as that 52 MHz allotment, simple math indicates a value of over $400B.

LA Times article from the era making the same point (valuing the spectrum at $70B at the time) -- http://articles.latimes.com/1998/dec/07/local/me-51464

kushnick2• 12 years ago

The Urban legend speaks – I wrote 3 books on this topic, which outline, in detail how New Networks generated the numbers.

In the 1990s, all of the phone companies in the US applied for and received alternative regulations which was based on their commitment to replace the copper utility wire, known as the PSTN, Public Switched Telephone Networks, with a fiber optic wire. This was based on then Al Gore’s call for America to be completely upgraded by 2010, called the information superhighway.

And the state laws were changed to give the companies billions of dollars per state and this was done by multiple financial incentives—where the phone companies’ services were no longer examined for profits, even though there was no competition at the time – so ‘call waiting’ cost less than a penny, and the companies charged $4.00 – and this included almost all services, such as non-published numbers. Their profift jumped from 12-14% to 35-40%; they had major increases in dividends, they took massive tax write-offs for the networks, among other things.

And the companies lied about their deployments but continued to keep the excess profits. – So, all rate increases were tied to these financial perks, where the state never went back and changed the laws or got refunds when the companies failed to deploy.

While states, like New Jersey, where they collected about $15 billion, were supposed to be upgraded by 2010 with a fiber optic service capable of 45 Mbps in both directions. http://newnetworks.com/verizonnjbroadbandresources/

And it continues today with more rate increases. Our new report shows that regular POTS, plain old telephone service, customers were charged about $4 billion in New York State for ‘massive deployment of fiber optics’, even though the majority will never get any upgraded service.

http://newnetworks.com/verizonfiostitle2/

I wrote 3 books on this. The first is about 1980-1998, with Foreword by Dr. Bob Metcalfe, second was in 2005 and the third book is coming out next month. Book 2: http://www.newnetworks.com/broadbandscandals.htm

And we filed in multiples states over this since 1999, we have separate reports about the revenues and profits that’s been published.

If you got specific questions after you read the books, -contact me. I’ve been a telecom analyst for 32 years—and used to work for those who are now called Verizon, AT&T and Centurylink as a senior analyst at multiple telecom consulting firms. bruce@newnetworks.com

NorthGuy1• 12 years ago

Can I blame both?

closetnerd2• 12 years ago

yes please

jinushaun• 12 years ago

Seattle and SF

wnevets• 12 years ago

Bullshit.

When local governments (i.e counties) attempt to roll out their own broadband, big cable (i.e comcast) sue to prevent it from happening.

imgabe2• 12 years ago

So the cable companies aren't aggressively lobbying municipal governments to keep out competition? Where do you think these costs came from?

And god forbid the municipality try to build out its own network. That will just inspire the incumbent cable company to take them to court until the project gets scrapped.

No, I think we can pretty easily blame Big Cable for this one.

nostromo3• 12 years ago

The thought of getting my internet from the City of San Francisco gives me cold sweats.

ericingram• 12 years ago

Governments create and enforce laws, so they must be held accountable for them. If the government didn't have such discretionary power, lobbying would not be a thing at all.

I don't blame the big cable companies for doing it, since they'd be at a competitive disadvantage otherwise.

Remember that humans operate companies and governments alike. Except governments use force and companies are subject to it.

dhmholley• 12 years ago

It astounds me how people will happily let companies off the hook for causing negative externalities, while simultaneously blaming the government for failing to regulate them effectively and decrying the regulation in the first place.

"Remember that humans operate companies and governments alike. Except governments use force and companies are subject to it."

What utter drivel.

briandh• 12 years ago

You should blame both. They feed off of each other.

yaur• 12 years ago

Municipally owned/maintained FTTH with ISP access from an analog to a CO is a good thing IMO and something that the incumbents have used the courts to shut down in the past[1]. The Wired piece makes a seemingly legitimate argument (franchise agreements increase the cost for new entrants) while ignoring the actual alternative (which would dramatically decrease the cost for new entrants) that those outside of the industry may not even be aware of and in that regard is a bit dishonest.

Why is this coming up now? One of the interesting tidbits I picked up from industry coverage[2] of the current round of FCC rule making is "Wheeler intends to nullify state laws that prevent local governments from establishing broadband service". Which is something I don't think the industry wants to happen. So, yeah open access is great but giving cities the "If you don't provide acceptable internet service we will" stick is valuable as well.

[1] http://arstechnica.com/uncategorized/2008/07/telco-wont-inst... [2] http://www.cedmagazine.com/blogs/2014/05/fcc-four-more-month...

Spooky23• 12 years ago

Hopefully, they are successful. Municipal governments aren't equipped to make these decisions.

In my city (Albany, NY), the city signed a 10 year franchise agreeing giving Time Warner a monopoly on tv services, which makes the city much less attractive for FIOS, which is available in most surrounding communities.

Why did they do this? Some idiot activists got the city to demand that TWC provide a public access channel (hello, 1982) and to build a "TV studio" in the local high school.

dba7dba• 12 years ago

Wow, really? It's the local govt fault that our internet connectivity sxxxxs?

spikels• 12 years ago

Yes - were it not for municipalities' ability to enforce monopoly rights we would often have multiple landline, cable, garbage, electric and other providers competing on quality and cost. Some say these are "natural monopolies" but there are cities around the world where consumers have a choice of providers for these services. True natural monopolies are very, very rare but are almost always created by government action. Patents are another example.

gnopgnip• 12 years ago

The natural affect of this is that many neighborhoods would not be served at all.

bsder2• 12 years ago

Yes - were it not for municipalities' ability to enforce monopoly rights we would often have multiple landline, cable, garbage, electric and other providers competing on quality and cost.

You are conflating different types of problems.

Things which are natural monopolies are phone, cable, internet, electricity, water, etc. It is needlessly expensive to lay in multiple cables/pipes to a house solely in order to provide competition. Oddly, cable/internet is one of the few places where this actually isn't completely true since pulling a single fiber is almost as expensive as pulling multiple fibers.

I don't know why you cite garbage collection, though. Garbage collection is completely different. I know many towns that have multiple garbage collection services. You don't have to lay in an infrastructure in order to collect garbage.

rayiner11• 12 years ago

I think it is absolutely key to look past all the rhetoric and see what Google is actually asking for in return for building fiber.

In Kansas City and Austin, local governments wanted Google Fiber more than they wanted kickbacks. So they expedited the permitting process, gave Google rights-of-way access for little to no cost, and allowed Google to build-out selectively — i.e., in neighborhoods where consumers actually expressed demand.

Kansas City agreed to get the permits done in 5 days. Provo sold Google for $1 a fiber network they had spent over $30 million constructing. Most if not all of the cities declined to impose build-out requirements: enough users had to sign up in each "Fiberhood" to justify Google deploying there.

This stands in stark contrast to what happens when companies try to deploy fiber or cable in other places.

Read Comcast's franchise agreement for Wilmington, DE, a small, poor, city of about 70,000 people: http://www.wilmingtonde.gov/docs/1320/3716Rev1.pdf.

In addition to the hefty franchise fee, paid out of gross, the city extracts a couple of million dollars in funding for government programs, and imposes a built-out requirement that requires Comcast to build out to every neighborhood above a certain (low) density, even if enough customers don't sign up to make it profitable. Similar build-out requirements killed FIOS deployment in the city: http://www.fiercetelecom.com/story/verizon-defends-honor-wil....

In short, I can't have FIOS because Verizon wasn't willing to build it out to all the neighborhoods in the city that have 30-50% of its residents living under the poverty line.

This sort of article typifies the local response: http://seattletimes.com/html/businesstechnology/2023420101_b....

("Once cities provide these handouts, they don’t have much leverage. They’ll end up bowing and scraping and hoping that Uncle Google throws a bit more fiber their way, someday. The experience in Kansas City — where suburbs are stuck waiting for Google to extend its fiberhoods — suggests that cities in a region targeted by Google Fiber should work together on setting expectations and deadlines. Yes, a provider like Google may abandon a city that doesn’t play along. But is that such a loss if the company ends up cherry-picking and making the market less attractive to other providers — including public utilities — that might come and provide fast broadband for everyone?")

In other words, they want to subject fiber deployment to the typical class warfare that characterizes municipal politics. It's better for nobody to have fiber than for wealthier areas to get it while communities that can't afford it don't. In New York City, the mayor has turned Verizon's FIOS deployment into an economic justice issue and hired a civil rights lawyer: http://www.crainsnewyork.com/article/20140219/TECHNOLOGY/140....

Who do you blame for not having fiber? How many cities would already have competitors deploying fiber if they had adopted the kind of regulatory regimes Google is demanding as a pre-condition for launching fiber?

cortesoft• 12 years ago

Your arguments make sense in many ways, but I do think ensuring that everyone has access to broadband internet is something that is worth worrying about. If we just allow market forces to determine who gets access to the new broadband, a lot of (poorer) people will not get access. I think just saying "well it sucks to be them" is not a satisfactory answer.

criley2• 12 years ago

Now I agree that everyone should have access to broadband but this raises many questions for me.

Why can't the rich get access to gigabit while the poor has access to a few megabit?

Just like ten years ago, when the rich had access to megabit and the poor used kilobit access.

Or ten years before that, when the richest could pay for high kilobit access while the poor were stuck to dialup low kilobit access.

I don't understand what's wrong with a long term rollout plan that finances the future scale with large costs to those willing to pay them.

Is it wrong because it's a utility? Why aren't we up in arms about the non-megabit (or barely megabit) non-low-latency access that so much of rural america is already stuck with?

I just don't get this. Fiber will get cheaper, but only if we train tens thousands about it in smaller rollouts while building up the supply side with increasingly larger rollouts.

sliverstorm• 12 years ago

It's important everyone has access, but just about every technology in the history of technology has gone through a cycle of early adopter => general use => commodity. If wealthy neighborhoods are never allowed to adopt fiber, fiber will never be cheap enough to deploy in Nowhere, USA.

There's always a fixed labor cost for laying the pipes, but the endpoint hardware for fiber is currently pretty pricey. Compare to cable, whose modems used to be hundreds of dollars, and can now be had for $30.

rayiner11• 12 years ago

The question isn't whether you subsidize access for the poor, it's how. Build-out requirements and forcing ISP's to discount services for the poor is an attempt to shift the burden from taxpayers to ISP's, and has the unintended consequence of making it so that only the de-facto monopolies find it worthwhile to build in most cities.

naturalethic• 12 years ago

They should all get free Netflix accounts too.

j2kun• 12 years ago

Is every one of the cities on Google's list of upcoming cities to receive Fiber agreeing to the same thing? And will Google stop deploying fiber once they've exhausted all of this low-hanging fruit? It seems unlikely.

wmf4• 12 years ago

And will Google stop deploying fiber once they've exhausted all of this low-hanging fruit?

Either that or they can raise prices to, say, $300/month. The Google Fiber business model appears to require political concessions to be even remotely viable.

qq662• 12 years ago

Ensuring universal service is something that governments try to do for things considered "essential": electricity, water, postal service, and broadband Internet.

The reason that Verizon signs contracts to serve all of a city like Wilmington, DE is that there are enough households who can afford it to make it worth their while. If Google comes and picks off the highest-value customers, the mix of remaining customers may not be worth serving from Verizon's perspective, and they may exit the market. (And even if Google is blocked by municipal governments, alternatives like WiMAX and its successors are much harder to block).

I don't think there's an easy solution to this problem. If you just let the market do its thing, then fewer people will have access to Internet overall. The tradeoff isn't easy.

jessriedel4• 12 years ago

There is an easy econ 101 answer response. If you're really trying to help the poor at the (presumably managable) expense of everyone else, then subsidize the subscriptions of the poor households by explicitly taxing. This dramatically reduces market distortions and makes clear exactly what's happening. Putting up rules that require the rich to indirectly subsidize the poor in the way being described (making the tax invisible) predictably leads to an awful situation.

People often reply "this isn't politically feasible", but that's giving up the game. If the opaque, inefficient, and difficult-to-measure strategy is politically feasible but the transparent one is not, that's a good sign it's a bad choice.

magila2• 12 years ago

Putting broadband internet on the same level as electricity and water seems absurd to me. By far the most common use cases for broadband are streaming video, gaming/DLC, and piracy. Is there really a point where it becomes reasonable to consider Netflix, Xbox live, and The Pirate Bay essential services?

rayiner11• 12 years ago

I think wireless obviates the universal access angle for wired broadband. Its already how most poor people access the internet. They very often don't have personal computers.

zo14• 12 years ago

"* If you just let the market do its thing, then fewer people will have access to Internet overall.*"

Care to add some justification or reasoning behind this gigantic leap?

Shivetya• 12 years ago

I am still not convinced broad band internet is a life necessity. We assume everyone wants it as we are techies, but even I know tech oriented people without home internet service, they cut that cable too. They live totally by what they get through celluar.

smsm428• 12 years ago

So let me understand this. The government wants to have everybody to have fast internet, regardless of the ability to pay for it. The government does not have the clout to force the taxpayers to pay for it collectively (e.g. by raising taxes) so it tries to make providers to pay for it by building out. The providers don't go for it, so nobody has fast internet at all. Yeah, sounds logical, I don't see any easy solution for it.

Except, you know, for the government to stop being control freaks for a minute, let the people that can pay to pay, and as the cost of basic service eventually and inevitably drops have more and more people enjoy it. Of course, that means that somebody who doesn't have any money wouldn't be able to enjoy the fastest broadband service available on the market, so if it's absolutely imperative everybody would be equal - the solution is always the same, the lowest common denominator.

There is an easy solution, you just should be willing to see it.

lchengify• 12 years ago

The counterbalance is that Google offers free plans after install for "Basic Speeds". IIRC they also threw in free internet for municipal buildings such as libraries.

Nothing Verizon, Comcast, or Time Warner offers compares to 5 Mbps/1 Mbps for a one-time $300 install cost.

[1] https://fiber.google.com/cities/kansascity/plans/

chimeracoder2• 12 years ago

In New York City, the mayor has turned Verizon's FIOS deployment into an economic justice issue and hired a civil rights lawyer: http://www.crainsnewyork.com/article/20140219/TECHNOLOGY/140....

I can't speak to the other cities, but please do not cite NYC as an example in your argument. De Blasio is not what's preventing FiOS expantion in NYC - Verizon is[0].

As someone who actually lives in NYC and has tried to get FiOS installed in multiple buildings, there are two problems. One is that buildings have exclusive agreements to provide television service through either Time Warner or Comcast (usually because the superintendant and/or owner gets free cable as a result of this agreement), and that Verizon refuses to provide FiOS Internet unless they can also provide television service.

Verizon is fully aware of this problem, and they've framed it in a way that allows them conveniently to point the finger at another entity.

Verizon is "trying" to deploy FiOS in New York, but they're not really interested in expanding their coverage.

De Blasio has hired a civil rights lawyer to look into the issue of poor people not being able to afford FIOS! I would say the bottleneck is definitely NYC's government

This would only be relevant if the NYC government were the ones actively blocking people who can afford to pay for FiOS from having it installed, but as explained above, that's not the case.

(You mentioned this point in another thread, but I responded rather late, so perhaps you didn't see it. In any case, my response is still relevant here. )

[0] This should be evident even from the fact that De Blasio's only been in office for less than 6 months, and it's been years since Verizon made an honest effort to expand FiOS coverage in New York.

rayiner11• 12 years ago

How is that Verizon's fault and not your building's?

dingaling• 12 years ago

Provo sold Google for $1 a fiber network they had spent over $30 million constructing.

I hope the Councillors were impeached for that. Lease it for $1 per year, sure, but to hand over public infrastructure to a corporation in that manner is appalling.

littlelebowski• 12 years ago

If, for example, I call up a pizzeria and ask whether they offer delivery, both common sense and common “usage,” […] would prevent them from answering: ‘No, we do not offer delivery–but if you order a pizza from us, we’ll bake it for you and then bring it to your house.’ The logical response to this would be something on the order of, ‘so, you do offer delivery.’ But our pizza-man may continue to deny the obvious and explain, paraphrasing the FCC and the Court: ‘No, even though we bring the pizza to your house, we are not actually “offering” you delivery, because the delivery that we provide to our end users is “part and parcel” of our pizzeria-pizza-at-home service and is “integral to its other capabilities.”’

maxharris• 12 years ago

It's better for nobody to have fiber than for wealthier areas to get it while communities that can't afford it don't.

This is like saying that if you can't bring poor people up, the answer is to bring rich people down, keeping everything frozen until the technology is cheap. And I presume that the assumption that underlies this is that the wealthy have done nothing, or not enough to deserve the lives they lead?

Do you have any idea how vicious that sounds?

(Also, the revenues generated from early adopters often pave the way for later generations of lower-priced goods. Do you have any idea where we'd be if no one was allowed to sell smartphones until they became cheap enough for "everyone?" We'd still be stuck with those awful feature phones if that were the case.)

tormeh• 12 years ago

Who would want an ISP to innovate? Latency, bandwidth and cost are the only things that matter. ISPs should be prohibited from offering anything else than internet access. No phone, no video, no toilet cover delivery.

NoPiece5• 12 years ago

Doesn't it require innovation to improve latency, bandwidth, and cost?

wmf4• 12 years ago

Does replacing a router with a newer model count as innovation? Some would say yes, but I wouldn't.

dublinben2• 12 years ago

Not by the ISP. All their equipment is made by other companies (like Cisco, Juniper, etc.) who do that kind of innovation. They're just buying the pieces and snapping them together.

higherpurpose2• 12 years ago

Blame both. The cable companies asked for the local monopoly in the first place...

adventured2• 12 years ago

Where I live Comcast is barred from offering me Internet access due to the small city I live in offering another cable company a long term monopoly.

So I pay $75 for 15 mbps. I could be paying $25 less and getting twice the speed if I lived 10 minutes another direction.

Local governments are at least half the problem, but it's clearly a public + private collusion problem, in which both parties work together to establish monopolies. And the solution is simple (but will never happen): all telecom monopoly contracts should be voided nationally, immediately.

dublinben2• 12 years ago

Cable franchise monopolies have been illegal since 1992. I highly doubt the situation in your town is as simple as that.

rayiner11• 12 years ago

The 1992 Cable Act made it illegal to grant exclusive cable franchises. Since the franchises were generally renewed every 10-12 years, very few places (I don't know of any) still have legal monopolies.

jsz03• 12 years ago

Where I live Comcast is barred from offering me Internet access

You can partly thank the FCC for this. They imposed limitations on Comcast's growth that effectively require Comcast to sell off an existing market if they want to enter a new market. I'm sure their intentions were good at the time but it turns out if you limit the growth of company they might try to find new revenue streams like I dunno... paid traffic prioritization.

Goronmon• 12 years ago

So, say that every town/city in the country streamlined the process for handling "right of way" and reduced the asking price for access.

Would this actually lead to an increase in competition or would it just lead to greater profits for the incumbents?

Sanddancer2• 12 years ago

There are a number of cities in the San Francisco Bay area that do offer such agreements, and competition has sprung up. When I used to live in Daly City, there was a choice between Comcast and Astound, and from what I could see by reviews, both services seemed to be better than the neighboring cities because of it.

closetnerd2• 12 years ago

no blame both big cable AND local governments ... its always a distraction to polarize the argument ...

ozten• 12 years ago

Many local governments have given exclusive rights to a single private company. I wish that opinion editorial had some data to backup it's assertions.

saalweachter• 12 years ago

If I'm reading Wikipedia correctly, Wired is owned by Conde Nast, which is owned by Advance Publications, which also has a large stake in the Discovery network.

Hooray for an independent press!

z3t4• 12 years ago

I'd say blame the people that don't want more then 10 Mbit. And think that everyone who has 10+ Mbit only use it for "illegal activities".

Don’t Blame Big Cable. It’s Local Governments That Choke Broadband Competition

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