Thursday, November 29, 2012

A need for change in the way we get internet access

On the surface, American internet access looks entirely tolerable.  At this point, it's not too hard to get a solid ten megabits/second download connection and a five hundred kilobits/second upload connection.  However, a broadband connection is expensive--frequently $50 a month, and coverage isn't great in rural areas.  Places like South Korea offer internet access that is faster and cheaper than what we get here--by enormous margins.  A high-speed internet connection in South Korea is about half the price that it is here.  Surprisingly, the average internet connection speed in Romania is higher than it is here!  Since 2009, access to a one-megabit internet connection has been considered a legal right in Finland, with a scheduled increase to a hundred-megabit connection by 2015.


Clearly, the United States is getting left in the dust.  With more and more Americans turning to cell networks for internet access both at home and on the go, we should be worried by the terrible ratings given to networks such as Verizon and AT&T.  Comcast is widely regarded as one of the worst companies to deal with in any industry, charging absurd prices, offering terrible customer support, and refusing to help deal with problems as they occur.  An increasing number of service providers are trying to install data caps, claiming that otherwise they won't be able to turn a profit.  One is forced to wonder why American providers would have to institute caps on their slower, more expensive, more unreliable networks when foreign networks do not, but I suspect that when one starts to probe this statement too deeply it starts to collapse.  Google Fiber could be the impetus that is needed for change.  While it is tragically available in only a very few markets right now, Google has some amazing deals: a gigabit connection for $70 a month or a 5 megabit connection for $25 a month for a year and then free for five years after that.  Furthermore, it comes with no data caps.  If only Google could expand coverage to more areas, the effect could be dramatic.

Why are things in such an unfortunate state?  Well, the biggest reason is that many service providers have effective monopolies in their areas.  Currently, there are two big conglomerates offering internet service: AT&T-DirectTV and Verizon-Bright House-Cox-Comcast-TimeWarner.  In large, part, the maps where these two conglomerations offer service don't overlap.  Consequently, many customers are stranded with access to only one company--either they have to pay unreasonable prices and deal with mediocre services or do without.  For example, TV, internet access, and phone service will, together, cost about $160 a month.  In France, all of that can be had for less than $40 a month, with far faster internet access and more countries covered in their free long-distance phone service.  While common sense would dictate that we need more regulation in order to break up these conglomerations and offer real competition and yearly improvements,  they have unfortunately been successful at convincing the government that they need less regulation.  Ultimately, what we need is more regulations governing how such companies can act and a break-up of the big ISPs into smaller more competitive companies.

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