
The $200 Billion Rip-Off: Our broadband future was stolen (2007) - bane
http://www.pbs.org/cringely/pulpit/2007/pulpit_20070810_002683.html?ref
======
brownbat
It took fierce competition to even get broadband companies to advertise what
they are offering. I had to deal with a very small local monopoly in Western
Maryland that just advertised "faster than dial up," had typical pings of over
200. It was thick on the local board, had a deal with local government as the
sole authorized supplier in the county.

Now I'm in a different part of the country, can get FiOS, but while Verizon's
service always delivers over 50 Mbps on speedtest sites, it often chokes on
Youtube or Netflix. When that happens, there's no simple way to determine if
it's the provider or some random provisioner in the middle. This is the future
of getting screwed by telecoms: worthless metrics and plausible deniability
for service degradation.

I happened to get a deal by calling all the providers in the area, then
playing their offers off of each other. I recommend everyone does this every
few months. But the fact that was so easy doesn't really make me feel very
comfortable. If they can haggle, it just signals how much rent they're
charging from all the unwary customers.

~~~
gcb0
lol at calling all the providers. the free market fails if left alone, under
shady regulations it is almost a joke.

i found a aDSL number for ATT that was not advertised (and you reached a
person on the first minute!) that was the result of some obscure regulation
that they had to provide dsl without charging for a phone line if so i wanted.
it was a very good service. as i was next door to their trunk.

i moved, less than 20miles, but another city. called att to transfer service,
the rep read something and the burst out a sad "ah, sorry, this is verizon
territory".

and that is exactly what i get here. verizon. nothing else. the 2nd or 3rd
biggest city in los angeles, and i can choose, verizon.

~~~
hippiehippo
Eastern Europe, especially Bulgaria and Romania, would beg to differ about the
"free market fails if left alone". Between 2000 and 2010 it was basically a
free-for-all for ISPs and each city had almost dozens of them running wires on
poles, on apartment building facades, on... trees.

And today you can get a 1 Gbps connection (in reality it works at 900 mbps in
Europe and at around 300 mbps across the Atlantic) for less than $20 per
month.

How could you call the banning of new infrastructure (through an insane
ammount of regulation) by local authorities in the USA as Free Market?

~~~
ash
Something like this happened in Russian cities too. Broadband is cheap, fast,
lot's of competition, cables hanging between apartment buildings etc.

Recently there have been some troubling signs when (government) monopolies
started to buy smaller private ISPs. Internet is still cheap and fast, but who
knows what will happen…

------
EEGuy
I'm _so_ glad the concept of "dial tone", video or otherwise, never crossed
the demand for and rollout of content-neutral, flat-rate-billed, backbone-
peering-supported Internet Service.

Having worked in voice telecom billing for 11 years, it is my observation that
phone companies adore detail billing. Imagine an ISP bill which details all
the websites you visit, and bills each visit according to some value _the
phone company_ might opaquely ascribe. It might have gone that way with a
thankfully unimplemented evolution of the amorphous notion of "video dial
tone".

Had this $200 billion boondoggle actually given us megabit access, then it
would be... access to what, exactly? I can't imagine phone companies providing
access to the flat-rate, always on, servers-allowed, content-neutral Internet
we have now, no matter the bit rate.

The thought of all phone companies collectively coming up with a service like
Netflix is, to me, as unimaginable as the thought of those same phone
companies coming up with the iPhone.

Yes, $200 billion is a shameful waste of ratepayer funds and a regulatory
failure. But thankfully, it neither collared nor crossed with the Internet.

In my opinion, separation of ownership of content (and applications, and
platforms, and end users) from the common carriers who own some of the
"plumbing" which connects routers to routers to routers becomes fundamental to
a free Internet.

(Edits for grammar, clarity, tone)

------
JoshTriplett
> Then there were regulatory problems as the FCC tried to control deployment
> centrally while states and cities tended to view video dial tone as just
> another cable company to be taxed and regulated.

That seems like the most egregious thing in the article: treating Internet-
based video delivery as a cable company. The concept of local cable franchise
monopolies is ridiculous enough to begin with, and the only possible
justification hinges on not wanting to have multiple sets of cables wired
everywhere. Content delivered over the Internet completely eliminates that
justification, leaving no possible rationale for making such services subject
to franchise regulations.

~~~
001sky
They should be subject to regulation; they should not be granted monopolies.
These are two entirely different concepts. The current system grants them
monopolies, and fails to regulate them appropriately. This is exactly the
wrong way round. But this is the problem with politicians: monopoly provides
concentration of cash, and this can be tapped into far more efficiently from
the perspective of political exploitation. Its much easier to garner a
donation from a rich individual with concentrated cash, than many individuals.
Likewise, its much easier tax a few firms or not with tax {X} in return for
special favours. Its much harder to garner the support of the diffuse and
middle classes (not to mention, even get/keep their attention). So, this is
sort of a classic case of _political economy_ in the instrumental sense...on
both sides.

~~~
rhizome
_Actually_ , campaigns nowadays run on the concept of "bundlers," who are rich
people who act as a funnel for their rich friends.

[http://en.wikipedia.org/wiki/Campaign_finance_in_the_United_...](http://en.wikipedia.org/wiki/Campaign_finance_in_the_United_States#Bundling)

~~~
Bud
You mean they used to, until the limits on secret donations from one rich guy
were gotten rid of.

~~~
rhizome
I'm guessing that you're referring to something in particular?

------
ojbyrne
The first comment on the page sums it up:

"America is the only country in the world where BRIBERY is legalized and
stupidly called lobbying."

~~~
jjoonathan
To be precise, bribery isn't just legal, it's mandatory under the current
campaign finance setup.

Campaign finance reform is a prerequisite for addressing any of the anti-
consumer legislation we are stuck with today. Best of all, it hasn't been
turned into a partisan wedge yet, so there's hope, assuming we can find a way
to make people care.

Unfortunately, last time I saw a campaign finance reform proposal cross the HN
frontpage, it fell off within 5 minutes :(

~~~
uxp
Campaign finance reform has always been a partisan wedge, insofar as the party
that loses the most seats in a given election cycle is the one touting how
much it's needed, but shuts up the next cycle when they gain the most seats.
Thus, the only politicians willing to put money into that fight are either
already outnumbered, or just crazy (or smart) enough to vote against their own
future reelection.

~~~
jjoonathan
> the only politicians willing to put money into that fight are either already
> outnumbered, or just crazy (or smart) enough to vote against their own
> future reelection

1\. This division doesn't fall strictly on party lines, which was my point.

2\. With a modicum of cleverness you can get around the immediate issue
(politicians don't want to give their opponents a leg up in the next election)
by engineering the changes to phase in one position at a time and "lock in
place" only when beneficial to the incumbent (e.g. in a year when corporate
support backs out for one reason or another).

------
catmanjan
I'm Australian, am I to understand that our internet quality and distribution
is only just approaching what the American's had in 2007? WTF!?

I wish poor internet connection was something I could really get upset about,
but I guess the rest of my life is a lot better than most around the world.

~~~
grecy
As an Australian that lived in America for a long time, trust me when I say
life in Australia with crappy internet is significantly better than life in
America with fast internet.

You don't want to live there, trust me.

~~~
MichaelApproved
You've got to be more specific when you say "there" or at least mention what
you found wrong. The US is a large country with vast differences between the
cities. Your experience in one area could be dramatically different from
another area in the US.

~~~
robzyb
I understand that a significant majority of the United States' healthcare
system is lacklustre.

I understand that a significant majority of the United States' only offer
limited annual leave (compared to Australia's 4 weeks).

I understand that a significant majority of the United States' suffers from an
extremely high murder rate for a 1st world country.

This is a sample of why I don't want to live in the US, even though they have
fast internet.

~~~
mikeash
The health care system is fine if you can afford it. The main problem with
American health care is financial, and if you have good insurance (which
should come with any good job) it's fine. Not great, but on par with the rest
of the first world.

Limited annual leave depends on the job. If you're in software engineering or
similar, you're unlikely to have a problem. If you get offered a job that
doesn't offer the annual leave you want, either negotiate for more, or just
don't take that job.

I doubt your statement that a majority of the US has an extremely high murder
rate. Some parts of the country certainly do, but much of the country is
perfectly safe. The overall average rate is higher than other first-world
countries, but that does not imply that most of the country has a higher rate.
Crime is not spread out evenly.

You may want to look into why you understand things that aren't really
correct, and figure out how that happened.

~~~
Goladus
Murder rate thing is probably because an Australian national named Christopher
Lane, in the US playing Baseball at college, was randomly murdered in Oklahoma
this year. He was out jogging when a couple of teenagers ran up and shot him
in the back for no obvious reason.

Australian politicians immediately started telling people not to visit the US
because it's so full of guns.

~~~
robzyb
I've never heard of Christopher Lane before.

Wait, actually, on second thought, I have. But that didn't have any impact on
my opinion of the US.

The murder rate statistic "thing" (as you described it) is based on the actual
murder rate statistics. And my knowledge of US gun control.

~~~
Goladus
Clearly, not a very nuanced understanding of what those statistics actually
say (see post from mikeash above) or an intelligent perspective on the
relevance of gun control.

------
kevinalexbrown
Anyone who comes up with a reasonable way of bypassing the natural local
monopolies of cable companies is going to make a fortune.

I would think dense wireless networks in urban areas could work. I'm not an
expert, and would be interested in hearing from one, but I imagine that
wireless networks could benefit from algorithmic advances in a way that might
be more difficult in traditional copper/fiber networks.

If you gave me (someone with very little wireless experience but used to be a
cable guy) carte blanche, here's what I would investigate:

Several routers in an urban area which require minimal installation and can be
mass-produced and immediately interchanged - think roof access, and could be
turned on and off remotely, maybe battery operated, flowing to relatively few
fiber hubs.

Infrastructure advantages: Network algorithms have come a long way, and the
ability to dynamically add or scale nodes as needed could have great
performance/cost balances that aren't possible with fixed nodes. And upgrades
do not require new lines, just more and better routers. If a router dies,
replace, and send the old one to a shop somewhere inexpensive. No midnight
service restoration pay.

Customer advantages: I connect to wifi the same way I do right now. Zero home
installation (google Comcast horror stories if you need imagery).

If I were to start, I would do it in an urban area with a landowner that had a
monopoly. Hyde Park, Chicago is like that. There are basically two landowners:
University of Chicago and Mac Apartments. You have to make one community love
you to pieces before branching out, and that would require a lot of
cooperation. Of course a danger here is if Mac suddenly decides that they hate
you and removes access privileges. But if that worked, and you got more
funding to expand, imagine the word of mouth: "Here's how installation works:
it's a wifi network and you connect to it".

A la "it's a folder, and it syncs" dropbox. Presumably something like this has
been tried before, but that's true of many things that end up working (like
search engines or social networks).

~~~
speleding
> Anyone who comes up with a reasonable way of bypassing the natural local
> monopolies of cable companies...

I'm nowhere near a socialist, but government intervention is a perfectly
reasonable way to deal with natural monopolies. How do you think Northern
European and Asian countries pulled so far ahead of the US on this?

~~~
josu
Disclaimer: This is an observation, unsupported by facts, and please take it
as such.

I'm pretty sure that the ISP sector is not constrained in any way by a natural
monopoly. Take a look at the Internet in Romania wikipedia article[0]. In my
view telecom companies have grown to disproportionate sizes, almost everywhere
in the world, and this has given them enough power to buy the lawmakers. A lot
of legislation has been passed to protect them, state laws, national laws and
even international laws. So no, I think that the telecom sector has been
intervened enough since its creation, what the consumer needs is to completely
deregulate it, and to let the free market work its magic.

[0]
[http://en.wikipedia.org/wiki/Internet_in_Romania](http://en.wikipedia.org/wiki/Internet_in_Romania)

~~~
lotyrin
So just anyone can dig wherever they want whenever they want, laying redundant
fiber and tearing up the streets?

~~~
josu
Somehow I doubt that that would be the most efficient way to do it. But maybe
a couple or three companies could lay redundant fiber, while another two used
existing infrastructures with new implementations, and maybe a couple more
could offer satellite connections.

I don't know, this is just pure speculation. What I know for sure is that the
reason to protect companies that exploit "natural monopolies" is to protect
the consumer. And right now, the protection of these companies is hurting the
consumer, more than helping him.

Yeah, in an ideal situation the state would be able to provide "free" internet
at a really low cost. But that solution overlooks this huge problem:
[https://www.youtube.com/watch?v=mgJ644LPL6g](https://www.youtube.com/watch?v=mgJ644LPL6g)

~~~
hbags
I strongly suggest that if you're going to espouse these opinions, you do some
math first.

In this case, I suggest you model rural America's density, and the cost to lay
down a wire, or fiber, or whatever in a town, along with all the needed
infrastructure.

Then I suggest you model the financial returns of that investment under
conditions where there are multiple players.

If you do this well, you'll find that as you add competition, you add
marketing cost, and you're also forced to amortize the fixed infrastructure
costs over smaller and smaller numbers of consumers. And you'll also find that
whoever was first to market in that area has a dominant position from a game
theoretical perspective, and can make moves that would make it essentially
impossible for any competitor to enter the marketplace profitably.

Natural monopolies aren't made-up things.

~~~
josu
Assuming that natural monopolies do exist, you just described how they
actually work. They don't need the protection of the government because the
incumbent has so many advantages over the entrant, that (most of the times)
there is no need to offer any incentives to any company for it to be the first
one to exploit a natural monopoly.

~~~
hbags
The government regulations aren't there to create or protect monopolies.
They're there to control monopolies that were likely to occur anyway, so that
the monopolists can't use their position in an overly extractive manner.

Since these regulations occur at a local level, some of the rules are more
effective than others, and some of them are straight-up corrupt. But the
common case is not government creating monopolies, but rather government
restraining them by regulating them.

~~~
josu
Ok, I guess I was looking at it wrong.I was thinking about government-granted
monopolies where the government willingly prevents competition. It is my
understanding that this was how of most of the telecommunication companies
around the world started.

~~~
hbags
I've heard of other scenarios where the government prevented competition, but
they nearly all boil down to the same core: the constituents want X, but some
sort of market failure is occurring (or likely to occur) and a temporary
market intervention was able to resolve it.

------
zw123456
I have tried posting this idea a couple of times before and have been roundly
scolded, but oh well, here goes again. I think... that readers of this forum
are ideally equipped to find a way around this problem. What I mean to say is
that it is universally felt by everyone that they hate their broadband
provider, phone company etc. Why can't we, the tech community come up with a
competing technology? I know many have tried to do "open source" types of mesh
wifi networks, but I think something more robust than that is needed. Everyone
agrees current companies are leaving their customers unsatisfied, hence there
must be an opportunity there for someone clever enough to come up with a good
alternative.

~~~
wtallis
It's not a technological problem. The technological barriers have been taken
care of. Google Fiber exists and is awesome and affordable. The reasons we
don't all have Google Fiber level of service are political: regulatory
capture, monopolies and oligopolies, conflicts of interest, etc.

~~~
alayne
It's only not a tech problem if every service has Google levels of server
capacity and performance. Websites still regularly fall over when posted on
aggregation sites.

~~~
dangrossman
They fall over because they're misconfigured (namely, default Apache config on
a $5 VPS; works fine at low traffic, but throw some more at it and Apache
spawns more processes than you have RAM, starving the DB and OS filesystem
cache, then swapping to death), not because websites are bandwidth-limited.

~~~
alayne
I'm not just talking about simple static websites. Please, let's not pretend
that upgrading everyone to fiber will be sufficient. You know better than
that.

~~~
dangrossman
I don't know what systemic tech problem you think exists for web hosts.
There's no lack of bandwidth on their side of the internet -- heck, if you
excluded Netflix and YouTube, over 60% of last mile capacity in the country
would be completely unused during peak hours. Those few sites, like video
streaming services, that are bandwidth-limited also tie their revenue to
consumption -- more bandwidth on the consumer end just widens their potential
customer base.

~~~
alayne
There are many infrastructure changes that are needed in order to increase the
performance of the Internet besides faster home connections. CDNs / caching /
DNS performance / SPDY / distributed computation and on and on and on. The OP
makes it sound like the only thing between us and 0 ms response times on every
service and every web page is some politics.

In other words the reason we don't have Google Fiber levels of performance is
because 1) we don't have Google Fiber and 2) all the infrastructure to
maximize the potential of that last mile connection isn't there. 2) is a
problem!

------
baddox
Just remember to resist the urge to think of this as corporations stealing
money from the government. This is government stealing money from citizens.

~~~
hbags
Absolutely. Corporations do nothing but good. They bear no responsibility for
their purposeful misuse of the funds.

And government does nothing but bad.

Swear on your stack of Ayn Rand books that the world would be better if we had
more corporations, because they are perfectly ethical and never screw anybody
over.

Yes, that's right. Never blame the con artists^W^Wcorporations who didn't do
what they promised. Instead blame the government for trusting them.

~~~
ihsw
You're taking what he said and swinging it so fully in the opposite direction
it makes you look as crazy as him.

Can't we both agree that corporations and governments abuse their power as a
matter of fact?

~~~
corin_
Why not tone down even more to get to the fact that not only can they both
abuse their power, but they can both not do so too. Not all politicians and
corporations are created equal.

------
knodi
Nothing will change until we get to the root cause. Get corporate money out of
politics. Its really sad to tell you the truth.

------
ams6110
We need to remove the local legal monopoly protection granted to cable
operators and telcos.

------
zurn
This is not really an American problem. In nearly all developed countries the
delivered broadband "moore's law" has been abysmal compared to what technology
allows.

In an apartment building the cost of per apartment gigabit ethernet with a
couple of trunked 10 gig ports for last mile would be very very low.

(And we'd have much faster tech for same money, but development stalled due to
lack of deployment - 10 gig ethernet is what 12 years old now?)

~~~
dubcanada
It's mostly a North American and maybe Australia thing tbh. Europe and
Northern Europe and most of Asia/Africa is significantly better then NA.

~~~
fulafel
It's bad in Europe too, you get just ADSL2 or bad cable in cities for the most
part. I'd say ADSL2 worse for >90% of the population and improvement is very
slow.

ref: [http://www.ispreview.co.uk/index.php/2013/07/average-
global-...](http://www.ispreview.co.uk/index.php/2013/07/average-global-
internet-speeds-climb-to-3-1mbps-as-uk-tops-7-9mbps.html)

(also shows that US bandwidths are better than Europe on average)

------
msandford
I remember reading this years ago. It's just as sad today as it was back then.

------
jmspring
In the bay area, if you can get our bandwidth needs at the level you need from
them, I highly recommend Sonic.Net. They seem to be trying to do the right
thing/build infrastructure/and bring better broadband speeds to people in the
bay area.

I recently left them to go from DSL to go to Wireless w/ a local reseller of
some of Sonic's service. I gave up a few static IPs to get 20Mbps symmetric.
I'm one of those where upload is just as important as down. Price is
reasonable given I could get rid of my land line and some other costs.

------
ChrisNorstrom
My Charter High Speed internet went from $60 to $40 a month on the spot just
by threatening to leave them and go with AT&T U-Verse. And I did it all
through their chat with a sales rep online without calling anyone. They even
gave me a free cable modem.

Moral of the Story: Shop around and make threats, you are the customer they
need you and your money. They'd rather lose $20 a month than lose $40 so you
can almost always talk the prices down.

~~~
dangrossman
That's because you have two options to choose between. Many have none, so it's
either pay the price or have no home internet. Where the only choices are
Comcast and Verizon, which offer near-identical packages and pricing in most
markets, Comcast's retention department no longer negotiates. If you threaten
to switch, they'll tell you to go ahead, and send a door-to-door sales rep to
your home every 6 months.

------
Aloha
PacBell had built one of these next gen networks, it was even in limited
deployments, as soon as SBC bought them, they killed it. It was an HFC network
(hybrid fiber/coax)and was a commercial ready product. I'm not in a position
to find citations right now, but if you google Pacific Bell and Hybrid Fiber
Coax, you'll find the cites.

------
MBCook
[2007]

------
huhalu
[http://www.theconnectivist.com/2013/11/the-worlds-
cheapest-a...](http://www.theconnectivist.com/2013/11/the-worlds-cheapest-and-
most-expensive-internet/)

Internet cost as part of income is more accurate

~~~
9999
More accurate than what?

Cringely's claim is that various subsidies and tax breaks, totaling 200
billion dollars, were given to telco operators with the understanding that a
45 mbps symmetrical connection would be developed and offered to end users.
The companies received those subsidies and tax breaks, but didn't develop the
system they claimed they would develop and instead built a system that is
nearly 27 times slower (I use the term built loosely there since the ADSL
network sits on top of the same old copper wire infrastructure that has
existed for decades and decades).

------
amjaeger
funny how this article came back today, I'm visiting my grandma, she has an
ipad as her computer (first successful adoption of a computer for her btw, she
previously had bought 2 computers and didn't take to either one) and I'm
looking at her internet speeds and I can't deal with it. She is paying $28 for
3 mbps (max) speeds. It's dsl from at&t. I ran a speed test and she only gets
about .5 mbps. I get about 300mbps(when plugged into ethernet) when I'm at
school...

------
lukateake
Last-Mile solution: blimps.

------
paul_f
what's the tl;dr please?

~~~
dijit
ISP's took lots of money to build better internets, then told politicians that
the current set up is what they asked for.

------
andyl
My broadband service is terrible. Far to expensive, it is slow and drops
packets. And the competitive environment sucks. Comcast and Regulators: go to
hell.

I'll vote for any politician who is interested in improving the situation.

~~~
fragsworth
> My broadband service is terrible

My business gets 10mbps down, 2mbps up, for $90/month in Los Angeles. It also
goes down frequently (5-6 times a year). I think the next best upload rate
(5mbps) was $400/month or so with some bullshit "enterprise" plan.

It takes way too long to do simple file transfers from my office to a remote
machine. I fucking hate it and our culture of monopolies can go to hell.

~~~
gonzo
My business has a redundant 10Gbps connection to our cabinet at zColo. We
lease the dark fiber (but it doesn't run very far, so it's not very
expensive.) The cabinet has a 1Gbps uplink for Internet.

Home is 50Mbps FTTH right now. Google should start to deploy in ATX during
2014, and when they come to my neighborhood, I plan to switch to Google Fiber.

I also have a Time Warner fiber service on premise, mainly for one of my
employees who lives just outside Elgin, TX. (but also because we get a
redundant 100Mbps connection.

While I spent an order of magnitude more than you, I also have much better
service. :-)

~~~
Moru
I have lived in a number of places in northern Sweden. All had fiber to the
house. New houses doesn't even have copper-lines for phones any more, they all
go fiber. Some houses don't even have phone-outlets, only a 100 Mbit/s RJ45.

A town with 2500 people (100 Mbit/s the last 20 years, Between $60 and $30 per
month)

Smaller town with 250 people (100 Mbit/s the last 15 years, $30 per month)

Small city with 100 000 people (100-1000 Mbit/s the last 15 years, $35 per
month including IP-phone box and phone-account)

Been wondering how long it would take for you guys to do something about your
internet connections. You keep blaming the big distances and so on but
everyone I know is living in big cities and still has realy bad DSL...

~~~
MrBuddyCasino
Oh Sweden, is there anything you can't do? I'm impressed by this country,
especially considering what they manage to pull off with such a small
population.

