Why is American internet so slow?

[Poker_Babe]

http://theweek.com/article/index/257404/why-is-american-internet-so-slow

According to a recent study by Ookla Speedtest, the U.S. ranks a shocking 31st in the world in terms of average download speeds. The leaders in the world are Hong Kong at 72.49 Mbps and Singapore on 58.84 Mbps. And America? Averaging speeds of 20.77 Mbps, it falls behind countries like Estonia, Hungary, Slovakia, and Uruguay.

Its upload speeds are even worse. Globally, the U.S. ranks 42nd with an average upload speed of 6.31 Mbps, behind Lesotho, Belarus, Slovenia, and other countries you only hear mentioned on Jeopardy.

So how did America fall behind? How did the country that literally invented the internet — and the home to world-leading tech companies such as Apple, Microsoft, Netflix, Facebook, Google, and Cisco — fall behind so many others in download speeds?

Susan Crawford argues that "huge telecommunication companies" such as Comcast, Time Warner, Verizon, and AT&T have "divided up markets and put themselves in a position where they're subject to no competition."

How? The 1996 Telecommunications Act — which was meant to foster competition — allowed cable companies and telecoms companies to simply divide markets and merge their way to monopoly, allowing them to charge customers higher and higher prices without the kind of investment in internet infrastructure, especially in next-generation fiber optic connections, that is ongoing in other countries. Fiber optic connections offer a particularly compelling example. While expensive to build, they offer faster and smoother connections than traditional copper wire connections. But Verizon stopped building out fiber optic infrastructure in 2010 — citing high costs — just as other countries were getting to work.

Crawford told the BBC:

We deregulated high-speed internet access 10 years ago and since then we've seen enormous consolidation and monopolies… Left to their own devices, companies that supply internet access will charge high prices, because they face neither competition nor oversight. [BBC]

If a market becomes a monopoly, there's often nothing whatever to force monopolists to invest in infrastructure or improve their service. Of course, in the few places where a new competitor like Google Fiber has appeared, telecoms companies have been spooked and forced to cut prices and improve service in response to the new competition. But that isn't happening everywhere. It's very expensive for a new competitor to come into a market, like telecommunications, that has very high barriers to entry. Laying copper wire or fiber optic cable is expensive, and if the incumbent companies won't grant new competitors access to their infrastructure, then the free market forces of competition don't work and infrastructure stagnates, even as consumer anger and desire for competition rises due to poor service.

Other countries have done more to ensure that the market is open to competition. A 2006 study comparing the American and South Korean broadband markets concluded:

[T]he South Korean market was able to grow rapidly due to fierce competition in the market, mostly facilitated by the Korean government's open access rule and policy choices more favorable to new entrants rather than to the incumbents. Furthermore, near monopoly control of the residential communications infrastructure by cable operators and telephone companies manifests itself as relatively high pricing and lower quality in the U.S. [Professor Richard Taylor and Eun-A Park via Academic.edu]

And the gap between the U.S. and Korea has only grown wider since then.

The idea of a regulated market being more conducive to competition may be alien to free market ideologues, but telecoms and internet is a real world example of deregulation leading to monopolization instead of competition in lots of markets.

The Obama administration is trying to undercut the whole mess by building new publicly-funded wireless networks to offer fast 4G internet across the U.S. Whether this public investment will really prove effective at bringing internet competition to monopolized markets — and nudging the highly profitable private companies like Time Warner and Comcast into improving their services — remains to be seen.

So, many — including Crawford and others — are now calling for stronger regulation of the existing market. At The New Yorker, John Cassidy argued last month:

What we need is a new competition policy that puts the interests of consumers first, seeks to replicate what other countries have done, and treats with extreme skepticism the arguments of monopoly incumbents such as Comcast and Time Warner Cable. [The New Yorker]

But he's skeptical we'll get it, noting that: "The new head of the Federal Communications Commission, Tom Wheeler, is a former lobbyist for two sets of vested interests: the cell-phone operators and, you guessed it, the cable companies."

 

[VenPerv2]

oh hai from australia D14.1 U3.2 average (im lucky to get half that on a good day for $60 a month), our routers are tin cans on strings

 

[JerryBoBerry]

oh hai from australia D14.1 U3.2 average (im lucky to get half that on a good day for $60 a month), our routers are tin cans on strings

15 down and 1 up costs $60 in my town too. I can get as much as 50 down but that costs $100.

 

[MsAllyCat]

oh hai from australia D14.1 U3.2 average (im lucky to get half that on a good day for $60 a month), our routers are tin cans on strings

:lol: Yep, I'm with ya there. I'm getting D9.1 U1.1 tonight. It's a good night.

 

[eclipse76]

30 Down/1 Up for 35USD (closer to 18/1 in reality). But it's an eight year old contact prices.
But I could get optical fiber with 100 Down/5 Up for 40 USD if I bothered. Or 200/20 for 55 USD.
With free phone calls and TV included.

 

[Red7227]

Yep, I usually have 10 down and about .8 up.

As for competition, the only thing that breeds is more CEOs and boards to siphon off profits. Back around 1990 Victoria and New South Wales (2 states ibn Australia) each had a state power company. These were broken up and sold off with the result we had about 6 or 8 power companies between the 2 states and the price of power went up a lot. Nearly 25 years later all of those power companies have amalgamated until their are only 2 left, with 1 each in Victoria and New South Wales, and we are still paying a lot more for power than we used to.

 

[Misono]

Bit miffed that the US claim to have invented the internet, considering the main reason we can access online is down to Sir Tim Berners-Lee, a British citizen!

I'm on a wireless connection in the UK, and get 79mb download, 19mb upload. Pay a lot less per month than those in the US too.

 

[Jesse0328]

I suspect that rural areas might be lumped into that average, dragging it down.

 

[HiGirlsRHot]

Bit miffed that the US claim to have invented the internet, considering the main reason we can access online is down to Sir Tim Berners-Lee, a British citizen!

I'm on a wireless connection in the UK, and get 79mb download, 19mb upload. Pay a lot less per month than those in the US too.

The world wide web isn't the internet. I was using the internet a full decade before Sir Berners-Lee got the first browser working at CERN. Also prior to MOSAIC and Netscape the number of people with access to the world wide web was a couple of million.

I pay for 30 mb but I'm lucky to get 12 down and 2 up. I fear that if Comcast and Time-Warner merger go through things won't improve for the US. So I am rooting for Google Fiber to go everywhere quickly.

 

[MsAllyCat]

I suspect that rural areas might be lumped into that average, dragging it down.

Huh, what? :? That's the point of a national average no?

For me the actual crux of the matter is that rural or metro, everyone (individual, business, govt services) should have access to quality infrastructure capable of delivering the fast internet speeds needed to access vital social, commerce, agriculture, medical, etc etc services. The cattle ranchers of remote Nebraska need fast internet just as much as the stockbrokers of Wall St (and probably to connect and communicate with each other!).

Okay, I am projecting here - but it drives me nuts that people living in rural or remote areas are given a bum deal when it comes to technological infrastructure. I don't live in areas like this by the way. I am pushing 1.1U on a good night and I live in the third largest city in Australia, close to the CBD, and within a kilometer of an exchange. This was a key election issue for me, and we still have jackshit. Sucks balls.

 

[eclipse76]

Considering the density of rural US, it would be suicidal for cable company to do that: such infrastructures cost a lot, and even in dense areas, it's tough to get a decent ROI.

 

[schlmoe]

Considering the density of rural US, it would be suicidal for cable company to do that: such infrastructures cost a lot, and even in dense areas, it's tough to get a decent ROI.

Actually it's the lack of (population) density, but yeah you're right IMO, the best chance for "universal" high speed internet will be in saturation of 4g (and in the next generation) in the rural areas. There are already "cell-based" home phone (landline replacement) and home internet services. I've seen the phone services advertised at $9.99 a month (the device is $99, IIRC). Of course the 4g internet costs quite a bit more, but I think the costs will come down in the near future.

 

[Kradek]

Bit miffed that the US claim to have invented the internet, considering the main reason we can access online is down to Sir Tim Berners-Lee, a British citizen!

Internet Explorer is the internet!

 

[Brad]

As mentioned, in the case of the US it is mainly due to the infrastructure vs the size. At times I tend to forget how huge the US is compared to many of the other countries in the world including many of the ones in Europe. I know when some of my friends in England come over here for a visit they are shocked at how big our country is. So yes, it would be easier, cheaper, and possibly more feasible to wire up a much smaller country then to try and do so in the US. I know that when I was attending SIU in Carbondale, IL it was about 375 miles (603km) from my parents house to my dorm and I never left the state. I would guess that Illinois is probably about 400 miles (630km) from top to bottom. The same drive would lead me through a few different countries in certain areas of Europe. Not counting Russia of course as that country is freaking huge!

 

[Just Me]

As mentioned, in the case of the US it is mainly due to the infrastructure vs the size. At times I tend to forget how huge the US is compared to many of the other countries in the world including many of the ones in Europe. I know when some of my friends in England come over here for a visit they are shocked at how big our country is. So yes, it would be easier, cheaper, and possibly more feasible to wire up a much smaller country then to try and do so in the US. I know that when I was attending SIU in Carbondale, IL it was about 375 miles (603km) from my parents house to my dorm and I never left the state. I would guess that Illinois is probably about 400 miles (630km) from top to bottom. The same drive would lead me through a few different countries in certain areas of Europe. Not counting Russia of course as that country is freaking huge!

Reminds me of the quote: "Americans think 100 yrs is a long time, Europeans think 100 miles is a long way." Do not know who the quote is attributed. :lol: