Is the U.S. really so terribly behind in broadband?
It has been a sob story for American politicians, technology companies, and advocacy groups for at least half a decade: the United States, which developed the Internet, is consistently trounced by the likes of Korea and Iceland in how widely it delivers broadband access to its citizens.
But do the latest statistics from the often cited Organization for Economic Cooperation and Development (OECD), which ranked the United States 15th out of 30 countries for broadband penetration rates in 2006, tell the whole story?
Maybe not. Which is one reason, it seems, that the Federal Communications Commission is coming up with a new approach that may change the way broadband penetration is evaluated.
One argument is that a truly accurate picture of the U.S. broadband marketplace--and, in turn, the process of achieving "universal" coverage--won't be possible until better data is available. Yet the FCC continues to work with data that deems 200 kilobits per second (Kbps) service "high speed" and to consider such access to be widely available even in ZIP codes that may, in reality, have only one connection.
On Wednesday, this may start to change. That's when the FCC is planning to consider--and most likely adopt--changes to the way it measures "reasonable and timely deployment of advanced services to all Americans," as required by federal law. (A Democratic bill approved by a U.S. Senate committee last year may have helped to apply additional pressure.)
At the moment, Internet service providers are required to fill out forms about their service offerings and submit them to the FCC semiannually. From those forms, the FCC produces reports that attempt to reflect on the state of Internet access availability, and in recent years, they have claimed to document "significant and steady progress" in broadband availability nationwide.
But critics charge that the information the FCC collects is not granular enough to be useful. Judging from their statements in recent months, there's consensus among the five commission members, too, that some refinements are necessary.
"By improving our data collection, we will be able to identify more precisely those areas of the country where additional broadband deployment is needed," FCC Chairman Kevin Martin said last spring, when the agency began soliciting public comments on how it should proceed.
How significant those changes will be--and what happens next--remains to be seen.
Cable and telephone companies have generally been more hostile to major changes in the FCC's process. One major clash, for instance, concerns whether broadband providers should be required to do more reporting about the price of their offerings.
Liberal consumer advocacy groups like Free Press, Consumers Union, and the Consumer Federation of America argue that would be a productive step--and that the FCC should, at a minimum, survey Americans about how much they're paying for Internet service--to compare price and service menus across different locales.
But major cable and telephone companies strongly oppose the idea. They contend that no meaningful price comparison could be achieved through government collection of that data because a wide variety of factors--including the term of contract, bundling with other services, and promotions--influence an individual's bill and because there would inevitably be a lag time in publishing those statistics anyway.
Tracking broadband speed
The FCC is famously quiet about its policy plans before formally adopting them, but Martin previewed some of them during a briefing with reporters earlier this month.
First, Martin said, the FCC plans to "move away" from one often criticized component of its data collection process: a requirement that Internet service providers report all of the ZIP codes in which they have as few as one broadband connection. The FCC has used that data to suggest in recent reports that there are broadband connections in every state but no "high speed" connections in 12 percent of all U.S. ZIP codes.
As the FCC itself has acknowledged, that technique has the potential to significantly overstate broadband availability. For instance, in a rural area, one or two customers who happen to live close enough to telephone or cable facilities could get service, but people located miles or even blocks away may not.
It's not clear exactly what a new proposal would entail, although the commission said it's weighing whether to ask providers to submit customer counts and number of houses served along with the ZIP code data. Free Press, Consumers Union, and the Consumer Federation of America have suggested that the FCC should ask for the number of subscribers not just within a particular ZIP code, but in an even more granular way--say, using the ZIP code plus its four-digit extension, or through census blocks, which California state officials have used.
The cable industry says it supports the nine-digit ZIP code idea, but there's considerable resistance from Internet service providers like AT&T and Verizon, who suggested the requirement would be burdensome, costly, and potentially "competitively sensitive"--that is, allowing rivals to target their operations based on where they see more or fewer customers.
Martin said the commission also plans to overhaul the way it accounts for broadband speeds offered by various providers. Right now, it lumps those service offerings into six big buckets: 1) exceeding 200Kbps in the download or upload direction; 2) greater than 200Kbps and less than 2.5 Megabits per second (Mbps) in the faster direction; 3) between 2.5 and 10Mbps in the faster direction; 4) between 10 and 25Mbps in the faster direction; 5) between 25 and 100Mbps in the faster direction; and 6) 100Mbps or higher in the faster direction.
The trouble with that approach, critics say, is it inherently raises the possibility that the number of faster connections could be overstated and the number of slower connections could be understated.
By Martin's description earlier this month, the FCC is planning to break down the lower-end categories into six smaller tiers: 200 to 768Kbps at the low end, 768Kbps to 1.5Mbps for "basic" service, 1.5 to 3Mbps for "high speed" service, 3 to 6Mbps for "robust" service, and a 6 to 10Mbps for "premium" service. He didn't say, however, whether the FCC plans to collect information about those speed offerings on anything but a nationwide basis, which is currently the procedure.
None of the Internet service providers that filed comments with the FCC recommended chopping the broadband tiers into as many pieces as Martin suggested. The cable industry, for example, argued against changing the tiers at all, saying it would make comparisons over time more difficult. (That position isn't exactly surprising, since cable's typical 6Mbps offerings already fit neatly into a category that also includes speeds above that level.)
The FCC is also considering collecting more information about wireless broadband and Internet phone subscribership and use, although it's unclear how those issues will be incorporated into the order it's expected to consider Wednesday. More details may be left for future rulemaking jaunts: the FCC, as is typical, is also expected to ask for additional comments.
The end result - Comcast has a monopoly on high speed internet service here. So much for the "competitive marketplace".
Korea has a very dense population and has extremely dense urban zones, while America has a much higher suburban population and a higher level of towns that are geographically dispersed.
This means that in Korea you can serve far more people with far less cable. You could supply a population of a million Koreans with the same infrastructure that it would take to supply 100,000 people in the US because in the US that infrastructure would need to cover not only people's homes but also the distance between those home, even the distance between 2 or three small towns.
It's not the difference between providing internet access to a rich and a not so rich country, its the difference between wiring up a high rise for web access, and wiring up an entire neighborhood.
America also has a lot of legacy infrastructure that needs to be upgrades, plus more local phone companies and ISPs who aren't so good at cooperating with other companies in order ot build a single unified network.
Thankfully, this is privately done, and profitable. No government intervention needed. I have a choice of three service providers even.
Different infrastructures make sense in different areas.
No, the US phone companies, who were dragged kicking and screaming into offering DSL by the now-defunct CLECs (which they drove out of business), just don't want to spend anything. Their managers, like the execs of most large US companies, don't understand technology and its' implications, and have no clue what to do. Kind of like our government.
Our current pathetic internet infrastructure is preventing the deployment of new services. 3 Mbps is not fast enough, and it doesn't cost a lot more for phone companies to upgrade to 15mbps, they just don't want to spend the money.
OK, Verizon is making an attempt to move into the 21st century with FIOS, but it's just Verizon and it's not a very broad deployment. If the phone companies would stop worrying about how to make money on content that traverses their networks, and focus on selling the best possible communications, everyone would be better off.
It will happen eventually, but don't think it is economically feasible for telecoms to completely redesign their infrastructure every few years. Remember that due to cell phone and VoIP services becoming largely popular, we are losing phone customers left and right, which is definitely hurting the bottom line. Fortunately my company had the foresight to invest heavily in wholesale and transport services, along with residential DSL and digital TV services, which are growing faster than we are losing phone services.
Don't just assume that all telecom companies are evil and have tons of money and can't wait to cheat their customers out of even more. Obviously I am a bit biased, but at the same time, I'd like to think I offer some inside perspective. After all, I'm a consumer too, and I don't like to see people get burned by bad deals, high rates, and poor service. The fact remains that fiber and wireless services are the wave of the future, and until the telecoms can afford to invest in those new mediums, it will be difficult for broadband speeds to pick up.
Another thing to keep in mind is that the US has tons of rural areas that require significant infrastructure investment with very little return. Penetrating those areas doesn't really make good business sense in the grand scheme of things. Cities in countries like China and Japan have tons of people packed into small spaces, so laying in fiber to one distribution point can serve lots and lots of customers. In rural areas, one distribution point may only reach a handful of people, and not every one is guaranteed to subscribe to services from it. It really is a difficult situation, and for many areas, there simply is no good solution at this time. Unless mandated by law, no ISP is going to put tens or hundreds of thousands of dollars into miles and miles of fiber installation for just a handful of customers. And honestly, I don't blame them.
Rural areas, and some suburbs, are a different situation, and will require more investment. But so what? Fiber can be amortized over 20 or 30 years, as it will last that long (if done right), and the equipment that connects to it will stay economically viable for 10 years. DSL is a huge money-maker right now for phone companies, the cost to provision a user is just a few months worth of subscriber revenue. That means that the equipment pays for itself very quickly.
I don't think phone companies are evil (ok, maybe ATT is, they have no problems giving copies of emails or recording of phone calls to the government), they're just run by a bunch of stupid (or at least uninformed and shortsighted) executives. I think the smaller phone companies tend to be less so, because they don't have the economic power the large telcos do.
I don't understand why people defend their politicians so much - politicians are supposed to serve people, and the executives of giant publicly owned corporations are no different than politicians, other than they make a lot more money. Unfortunately, neither the public nor the private politicians are held accountable, and we end up with 2nd world service, whether it's phone calls (yeah, those mobile calls are cheap, but the bit rate must be very low, as the voice quality is horrible), internet access, health care, or anything else we depend on large institutions for. Why is everybody so willing to accept mediocrity, especially from people who get paid so much?
Say what you will about regulated monopolies, but their service was excellent. They were customer focused because complaints to the local State Corporation Commission were taken into account at rate evaluation time.
It was a given fact that city dwellers subsidized the universal service of the rural areas. This was the idea of universal service - the same standard of service for everyone.
The Bell System was broken up, ironically enough, so that AT&T could compete in the business of selling computers without subsidizing it from revenue earned by the regulated monopoly.
NCR was acquired in September 1991 by AT&T for $7.4 billion. After losing billions, NCR was spun off from AT&T in January 1997 for $3.9 billion - about half of what AT&T paid for it in 1991.
As the Bell System has been slowly reassembled as the "New AT&T", the standards of quality and service have dramatically diminished.
If the FCC wants to begin to move telcos back towards the concept of universal service, and if it would bring back accountability, then I am all for it.
As far as not being evil? Ha. Telcos DO only exist to screw over their customers. Ask me about my experiences with SBC (former Ohio Bell/Ameritech) DSL in 2002. They (accidentally) put a bridge tap on my DSL line which generated so much noise I couldn't even make a phone call. Obviously, the DSL was unusable too. Took 2 months to get it fixed and a complaint filed with the Ohio Public Utilities commission to get the DSL and POTS charges credited back to my account. They refused to credit more than $5 because I had dialtone (I DID, technically, but the lines were still unusable).
And I was lucky. The only reason PUCO could even do anything was because the complaint involved telephone service; DSL is not regulated in Ohio.
During this time, I had an SBC employee tell me flat-out that it seemed like the company would rather ignore problems until complaints were filed, rather than fix them. I believe it. Many consumers have no idea that they have rights and can get problems fixed.
And remember, all of the phone companies wanted to sit on their 50-year-old physical plant, just making more and more money off the copper phone lines that they didn't need to spend tons of bucks on, rather than roll out new services.
Don't tell me the phone companies aren't evil.
Should be DUE not DO.
But no, that is not the case for most Internet users. The most popular communication services include IM, email and social networks. None of these services require the 15Mbps bandwidth. Matter of fact, IM and email can be done just fine at 56kbps.
IMHO, bandwidth is like cheap RAM and primary storage for PCs. Because RAM and hard disk are cheap, it allows software developers get away with writing bloated software, instead of working on optimizing their code. Same thing with bandwidth - many of these web sites "assume" you have the bandwidth and pack its sites with Flash videos and large-sized images. I think the bloatedness of these web sites is due to a chip on the web designer's shoulders. All it demonstrates is expertise in Flash but fail at good static web page design. If web pages were designed with good design concepts and are small in size, you could surf these sites with any bandwidth you have.
Instead of focusing only on the pipe, focus on better optimization of the technologies that make up the content.
- Oh please
- by ewelch March 18, 2008 9:42 PM PDT
- Like the Bush administration could possibly be trusted to tell the
- Like this Reply to this comment
-
(22 Comments)truth about their dismal efforts - especially by their lapdogs at
the FCC.
It's like the Rhinoceros party in Canada. They proposed to
devalue gold to $1 an ounce and then once everyone buys a
bunch, they're re-value it to the previous price. Thus making
everyone rich. Or doing away with unemployment in Canada by
closing the government office "Statistics Canada."
Only the Bush Administration isn't a parody of a political party
(somewhat).