There is a groundswell of public opinion that government intervention is going to increase the availability and decrease the price of broadband. Read this sentence again. See the problem?
As a college freshman, I had an Economics professor (Carrington-Crouch) who told me that the scariest words you will ever hear are the following:
Hello, I’m here from the government and I’m here to help you.
He told me that if you ever heard someone say this to you, start running. I agree.
Reading this article this morning pushed me over the edge. It exemplifies the ‘groupthink’ on the net that every other country has better broadband, and that the only solution is for the government to intervene and break up the ‘monopolies’. It’s the umpteenth post I’ve seen with this viewpoint on the issue, if there is even an issue anymore.
Be afraid. The digeratii and the blogerati think Uncle Sam Bell is better. It won’t be. It’s how we got here in the first place.
We might have had more fiber to the home today, except for government regulation overturned over the last 3 years (2003, 2004, 2005). The regulation forced ILECs (The only ones with the cash to do it) that installed new infrastructure to lease it back to CLECs like Covad, Earthlink, etc. at ‘cost plus’ (another great government term). Why would you make a risky, multi-billion dollar investment if you would never realize a decent return?
Only recently, as these laws have been rolled back, do we see companies like Verizon and SBC deploying advanced broadband architectures. Even now, as Verizon pushes ahead with FiOS, the market views this investment negatively.
Where is the detailed unbiased data about how terrible broadband is in the US? I’ve yet to see it. Even my Dad, who vacations on a mountain in North Carolina, can get a 3Mbs cable modem for $35 a month.
People that point out other countries have better broadband overlook the fact that this may be the result of several factors that we do not have nor want here in the US. Europe is put up on a pedestal – but Europe has a much higher density population than the US making it easier and more economical to offer broadband. If you live in the boondocks in Europe you are just as likely to not have broadband as if you live in the sticks here in the US.
Japan and Korea (really the only places with better broadband than the US) have high density topologies suitable for fiber deployment and government subsidized carriers. That means you pay for broadband whether you want it or not- is it such a surprise that these blog-heads want you to pay for their DSL or fiber connection?
The latest craze is the push for network neutrality, which effectively means that carriers are not allowed to set variable pricing for services over the infrastructure they own. The analogy here would be if the government told major airlines they needed to start charging flat fares for travelers regardless of whether they flew the all-nighter on a Saturday night or the 8AM shuttle. The logical outcome is that some people end up paying more for the same service so the ‘Elites’ who push these laws can pay less. Om Malik recently had a fair and balanced podcast on the subject (transcript here).
With the insanity of forced leasing of new infrastructure ending and positive legal decisions like Brand X, Broadband in the US has turned a corner. I wouldn’t be surprised that in 10 years the US has the most advanced and – more importantly – cost effective infrastructure in the world, perhaps with China and Japan the only real contenders.
If the only way to get better broadband is for the federal government to pay for it then we don’t really need it. Ronald Reagan:
If it moves, tax it. If it keeps moving, regulate it. If it stops moving, subsidize it.
If there is a market need you can bet someone, somewhere will find a way to meet it. You need to be patient and wait for the Industrial Accident. The only way this can happen is if the FCC and government stay out of the way.