An updated report by the New America Foundation (NAF) examines whether we are getting a good deal on our broadband in the United States. It does so using fairly straightforward methods: cataloguing advertised prices and speeds for major cities around the world. Unfortunately, to paraphrase H. L. Mencken, for every complex problem there is an answer that is clear, simple, and wrong.
We covered the issue exhaustively in our report from earlier this year, The Whole Picture: Where America’s Broadband Networks Really Stand, and a number of blog posts responding to the original Cost of Connectivity report in 2012. However, their report update makes the same claims as the last one using the same logic: we therefore feel compelled to issue a very similar rebuttal. The NAF report fails to engage the issue in a way that helps us understand what is really going on in our broadband markets.
There are two important questions to consider when examining these broadband markets: are companies offering a fair price for high-quality broadband services given their costs, and are they competing in a way that will offer dynamic improvements in the future? … Read the rest
In its second annual report assessing broadband speeds and prices in various nations, the New America Foundation reports some disturbing findings. Broadband provided by U.S. municipal governments costs much more than broadband provided by private sector providers in other nations. The local government of Bristol, Virginia ranks 31st; Lafayette Louisiana’s service 44th, and Chattanooga Tennessee’s, a recipient of federal stimulus funds for broadband, ranks a dismal 57th in the price of broadband. All of them charge their unsuspecting citizens prices around four times higher than their private sector competitors in other nations.
As they write, “Many American consumers take high prices and slow speeds to be a given, but our data demonstrates that it is possible to have faster, more affordable connectivity in cities of comparable density and size.” New America writes that it will be releasing a report shortly calling for policy solutions to address this terrible situation. Based on their analysis, I am sure they will be calling for Congressional legislation prohibiting socialist local governments from getting into the broadband business.
Of course my reason for pointing this out is to show the absurdity of the New America … Read the rest
On October 16, Akami released its quarterly state of the Internet rankings comparing nations around the world on broadband speeds. The United States continued its upward trajectory, improving in both average connection speed and average peak connection speed. This new data further illustrates that the claims of some broadband Casandras, such as Susan Crawford, regarding the weakness of U.S. broadband networks are highly misleading.
As ITIF has noted, over the last five years America has made great strides in improving average connection speeds and enhancing broadband infrastructure. According to the latest Akami study, the U.S. now ranks eighth in the world in average connection speed, up from ninth last quarter, and 11th in average peak connection speed, which grew 34 percent year over year. It should also be mentioned that the nations ranking above us in both categories either have small, densely populated geographic areas where deployment costs are lower, or enjoy significant government subsidies for broadband deployment and adoption.
The data exemplifies the success of America’s competition-based broadband model in incentivizing innovation and promoting the continued deployment of high speed networks. This is particularly clear when we … Read the rest
Europe’s telecom woes are “coming home to roost.” An article in the September 14th issue of The Economist discusses European Union Digital Commissioner Neelie Kroes’ call for major reforms to the European telecom system to address the poor performance of broadband networks on the Continent. This is just the latest effort by EU regulators to address a broadband system that lags well behind the U.S. and Asia, hampering economic growth and technical innovation.
As the article notes, “Only a quarter of the European Union’s people have access to new 4G networks, according to the European Commission. In America a single company, Verizon…reaches nine out of ten.”
Unfortunately, The Economist article does continue a misleading argument that has been used by some activists to denigrate U.S. broadband successes and justify the European model despite its obvious flaws. “Americans may have faster networks, but they pay a lot more.”
In fact, America enjoys the second lowest prices in the OECD for introductory level broadband. The U.S. does have higher relative prices for faster broadband, but this is not, as some critics have claimed, because of relatively higher profits. Among OECD nations, profits … Read the rest
One of the unfortunate consequences of events like the Northeast “Frankenstorm” is the speed with which they’re exploited for various kinds of gain. When food and water are short, vendors show up on street corners selling goods at exorbitant prices, looters rob stores of computers and that sort of thing. After the fact, many people with a policy ax of some sort will point to various things that happened as examples of tragedies and inconveniences that could have been avoided if only they’d had their way in the policy process. The National Association of Broadcasters jumped on Frankenstorm with a rather thin argument to the effect that the storm proves their networks are great for communication, despite their one-way nature. Another example of this phenomenon that struck me as particularly odd was a blog post written by Harold Feld on Wetmachine before the storm had even hit: If your cell tower loses power, be sure to thank CTIA and the D.C. Circuit. Feld argues that the FCC needs broad Title I authority over Title III cellular networks to keep them running after hurricanes strike:
As we hunker down to
The United Nations Broadband Commission’s new report, The State Of Broadband 2012: Achieving Digital Inclusion For All is worth a read for all broadband policy wonks. It highlights the benefits that Next-Generation Broadband Networks (NGN) bring to economies and to citizens, explores the value of mobility, and celebrates the dramatic progress that nations are making in bringing high speed, “always-on” connectivity to everyone. By the UN’s estimate, there are nearly 6 billion mobile devices in the world already, which exceeds the world’s over-14 population by a billion or so.
Roughly 80 per cent of these connections are narrowband (voice and text only,) so we still have a long way to go in terms of universal broadband. Wireline broadband connections to the home continue to increase worldwide as more people buy computers and carriers offer low-price plans with correspondingly low usage limits, and many carriers price broadband on a pre-paid basis to reach lower income groups. This strategy has worked for cellular quite effectively, so there’s little doubt it will work for wired broadband as well.
By the U. N.’s forecast, the market for machine-to-machine connections may be as high as … Read the rest
Compartmentalization is one of the things people do best. Life is complicated, so it’s a lot easier to deal with its troubles and travails in little pieces. As Scarlett O’Hara said when she lost Rhett Butler in Gone With the Wind: “I can’t think about that right now. If I do, I’ll go crazy. I’ll think about that tomorrow.” Compartmentalization plays a large role in both engineering and Internet policy. Engineers and policy makers can influence the nature of the Internet in countless ways by developing new features and enacting new policies that affect its overall behavior. On the one hand, we’re all tempted to make the Internet better by addressing its various shortcomings, and on the other we’re tempted to leave it alone because it’s produced so many benefits. So we tend to reserve our creativity for the problems that we deem most critical and leave the rest alone. Besides, it’s hard to change the Internet, so every new feature or regulation is likely to cause side effects that we don’t like even if there are net benefits.
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The polemic begins with a superficial look at on-line retailing, arguing that the poor are unable to enjoy shopping deals because they lack wired broadband connections in their homes. The fact that the poor are not notoriously big spenders doesn’t perturb the conclusion: Crawford insists that poor people’s relatively high reliance on mobile networking cuts them off from digital shopping’s … Read the rest
Depending on the next steps, this could either be a good thing or a bad thing. The decision to assign rather than auction is based on faulty assumptions about the best way to meet public safety needs, but sometimes good things can happen for bad reasons. The public safety lobby insists that they have unique requirements that standards-based commercial networks can’t meet – especially for reliability and security – but also insists that it will embrace the LTE standard for the construction of a new network. We’ve examined the “unique requirements” previously, and have found … Read the rest
I suppose this was inevitable. The Internet Society, the non-profit that oversees the development of Internet technical standards and generally promotes Internet adoption, has decided to play politics. ISOC issued a press release last week commenting on the Arab Spring, the UN’s Universal Declaration of Human Rights, and efforts around the world to enlist technical help in dealing with the problem of Internet-enabled crime. As one might expect of good Western adherents of the principles of diversity, inclusion, and human rights, ISOC endorsed the view that the Internet only enables good things, so it has to be left alone by mere national governments concerned with petty “economic, security, or political objectives.”
In particular, the release took aim at the “DNS blocking and filtering” mechanisms that are used to limit spam and which have been proposed as means to limit access to malicious phishing sites, sites that sell counterfeit drugs, and those that deal in pirated movies. The release essentially equates these practices with surveillance technology and the suspension of Internet access.
Not only has ISOC departed from its mission in a very significant way, it has embarked on a slippery … Read the rest