XPost: ba.politics, dc.media, soc.penpals   
   XPost: alt.burningman   
   From: rich@mit.edu   
      
   A   
   ccording 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."   
      
   http://theweek.com/article/index/257404/why-is-american-internet-   
   so-slow   
      
       
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)