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1 Gbps Hype in the Era of 'Fiber to the Press Release'
by Karl Bode 12:30PM Wednesday Sep 03 2014
It's fairly obvious that Google Fiber's entry into the broadband market has made significant waves. While the actual deployments have been limited (with only just Kansas City significantly online just yet), the service's very presence has rekindled debate over the abysmal state of broadband competition in the United States. It has also resulted in a flood of competitive responses geared around providing speeds of 1 Gbps, even if many tend to be somewhat theatrical in nature.

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But how much impact has Google Fiber had really? A new report (pdf) by GigU and Blair Levin (who co-wrote the country's national relatively underwhelming broadband plan) takes a relatively rosy view of the benefits of Google's impact on the market.

The report is quick to point out how Kansas City saw a 97% improvement of average speeds to 34.4 Mpbs, a jump the report states is the largest in the country. The report is also quick to highlight the resulting deployment promises by Cox, AT&T, CenturyLink and others in regards to 1 Gbps services, an idea laughed at by ISP executives just last year.

"A year ago ISPs such as Cox and Time Warner Cable were antagonistic toward gigabit upgrades," Levin notes in the report. "They responded to gigabit initiatives with comments suggesting that upgrades were too expensive, and further, that they knew best what their customers wanted." Time Warner Cable was particularly vocal about how users didn't need 1 Gbps and that demand simply isn't there for such speeds.

"A year ago ISPs such as Cox and Time Warner Cable were antagonistic toward gigabit upgrades."
-Blair Levin, GigU
Now carriers "are singing a different tune," says Levin -- politely insisting that "we don’t mean this as criticism" but that the report is simply pointing out how these ISPs "deserve credit for recognizing how the landscape has changed."

All of that said, while the focus has shifted to ultra-fast speeds, lost in the shuffle has been a potentially more important metric of competition: price.

Google's $70 price point for 1 Gbps services is certainly welcome, and in some looming markets ISPs have responded with some lower pricing. In other Google Fiber markets they haven't; preferring to simply try and lock down users in long-term contracts before Google Fiber comes to town.

The problem is such a limited footprint isn't placing national pricing pressure on companies like CenturyLink, AT&T, Verizon and Comcast -- who all seem stuck in a national race toward the next rate hike or new, obnoxious fee.

Another problem is that many of these promised 1 Gbps deployments are highly theatrical in nature. It's a term I've coined called "fiber to the press release," where a carrier makes a lot of marketing noise about deploying 1 Gbps, but in reality is making the minimal effort to appear competitive, only offering those speeds to a handful of college campuses and high-end development communities. These deployments are so limited, the companies tell investors the upgrades won't actually cost them much of anything.

What kind of network investment doesn't cost you anything? The kind that's either minimal or doesn't really exist. I was interested to see Levin and the report specifically address my concerns, though Levin brushes them aside as a "misunderstanding of the moment we are in":
quote:
Some have expressed skepticism that anything will result from these efforts, suggesting instead that this is all simply a version of "Fiber to the Press Release.” We understand the skepticism—after all, many of the players have not yet told Wall Street that their capital budgets will reflect the new investments necessary to upgrade their networks. We believe, however, that such a response demonstrates a misunderstanding of the moment we are in.

Companies don’t undertake new capital expenditures because they want to; they do so because they can justify the expense in light of a new opportunity or to defend an existing revenue stream. It should be remembered that in 2009, when the National Broadband Plan was gathering information about planned investments, no incumbent providers had publicly announced plans for world-leading networks in the United States. That some have done so now represents a positive change in their perception of both the opportunity and the threat.
First, it's worth noting that I've never argued that "nothing will result from these efforts" -- the conversation Google Fiber has generated about United States competition alone is worth its weight in gold. Cox, AT&T, C Spire, Google Fiber and other customers able to get 1 Gbps at a reasonable price should be pleased as punch. However, pointing out that some of these 1 Gbps announcements are more marketing than real deployment isn't "skepticism" -- it's a fundamental acknowledgement of fact.

AT&T's planned deployment of 1 Gbps to "100 cities" isn't supported by any serious CAPEX bump because they're very selectively deploying to tiny areas, and the upgrades will never reach the vast majority of AT&T users. Cox's deployment of 1 Gbps services, heavily cited in the report, won't even begin on any meaningful scale until 2016, if it actually happens at all. Even Alaska's GCI, with real competitors nowhere in sight, has jumped in on the 1 Gbps game, ambiguously promising 1 Gbps to select users, maybe, someday.

What AT&T, CenturyLink, Cox and others are doing is putting on a stage play -- designed to give the illusion they're on the cutting edge of broadband competition.
There's no need to "defend an existing revenue stream" if Google Fiber only reaches a handful of markets, and from the pace of deployment and Google comments, that's likely all they'll ever reach. What AT&T, CenturyLink, Cox and others are doing is putting on a stage play -- designed to give the illusion they're on the cutting edge of broadband competition. Ask any of the millions of CenturyLink customers paying $50 a month (or more if forced to bundle a landline) for barely 1.5 Mbps just how cutting edge they feel.

The intent here isn't to be a curmudgeonly killjoy -- it's to keep people focused on reality. There are tens of millions of users paying an arm and a leg for sluggish DSL lines who won't be seeing improvement anytime soon courtesy of limited competition, napping regulators, and the "new normal" of cherry picking only a few locations for next-generation upgrades.

People obviously truly love Google Fiber. Maybe sometimes a little too much. But obsessing about 1 Gbps for a few few emboldens the industry's willful obliviousness when it comes to real price competition for all. Granted that's precisely what Levin did at the FCC when he crafted a national broadband plan that failed to seriously focus on price competition whatsoever. Raw speed isn't the end all be all; ask anybody impacted by the Netflix direct interconnection feud, which has resulted in people on 300 Mbps connections unable to handle a simple video stream.

While Gig U and Levin applaud the rush to 1 Gbps, in reality the combined impact of the Comcast merger and AT&T and Verizon's sharp retreat from DSL markets means we're actually looking at less competition in many markets than ever before. Even in markets where we actually have a little competition like New York, companies like Cablevision and Verizon FiOS have simply stopped competing on price -- because they can.

There's plenty of other, less sexy industry issues that need the same if not more attention than the march toward 1 Gbps speeds. While AT&T holds the public's attention with "Gigapower" upgrades, the company's "IP transition" stands to effectively pull DSL lines out from under the feet of tens of millions of active users, who'll then be forced to either expensive, heavily-capped LTE lines -- or cable competitors suddenly emboldened by less competition than ever before. The fight over potentially purging the country of ISP-written, protectionist state-level laws is also as important as offering 1 Gbps ever was.

1 Gbps to select communities, developments and apartment buildings is certainly something to applaud. But it's in no way the measuring stick for what's happening for the vast majority of broadband customers, who remain stuck in a pricey duopoly market if they're lucky, with inexpensive and ultra-fast broadband nothing but a pipe dream.

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pandora
Premium
join:2001-06-01
Outland
kudos:2
Reviews:
·ooma
·Google Voice
·Comcast
·Future Nine Corp..

3 recommendations

Faster speeds don't always help

Faster speeds don't always help. If Netflix, Amazon or other streaming services are forced through congested routers and won't play, who cares what the speed is on the intranet.

Maybe advertising internet speeds, not intranet speeds would be helpful.
--
Congress could mess up a one piece jigsaw puzzle.

MDA
From Monkey to Man
Premium
join:2013-09-10
Minneapolis, MN
Reviews:
·Comcast

5 recommendations

Re: Faster speeds don't always help

That's why ISPs are saying "there isn't a demand". They know that if they even deployed gig internet, it wouldn't flow that fast through their network or mostly anyone else's network, majorly due to lack of innovation and upgrading (laziness).

Solution? STOP BEING LAZY. Upgrade your networks. You (big cable companies) are holding back innovation. Netflix still mostly relies on 3rd party CDN and backbone transit.
Drakemoore

join:2005-02-03
Hawthorne, FL

Re: Faster speeds don't always help

Sometimes it's not even the speeds.. I'm not sure about AT&T's '1gbps' but DSL and UVerse have 150/250gb caps respectively, which is low in my opinion.

v6movement

@206.51.28.x

Re: Faster speeds don't always help

said by Drakemoore:

Sometimes it's not even the speeds.. I'm not sure about AT&T's '1gbps' but DSL and UVerse have 150/250gb caps respectively, which is low in my opinion.

Low is an understatement for those slow connection speeds never mind moving up into the 100+ Mbps speeds and even worse 1Gbps. The caps make the connection close to unusable.
en103

join:2011-05-02
Its less of "there's no demand" than we'll do this if we're forced to by competition. Until then, its smoke and mirrors to make ourselves look good (yeah right) with lies and statistics.

battleop

join:2005-09-28
00000
This is something that EVERYONE has to do not just the ISPs. If I deliver you 1Gb but the service you are accessing is rate limited to 50-100Mb then it's not the ISP.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
rradina

join:2000-08-08
Chesterfield, MO

Re: Faster speeds don't always help

Some sites limit a single connection's ability to consume large amounts of bandwidth. That isn't the same as they don't have the bandwidth though. They are shaping their outbound traffic to make sure everyone gets a piece.

battleop

join:2005-09-28
00000

1 recommendation

Re: Faster speeds don't always help

Yet people want to blame the ISP for these slow downs. Seeing 1Gb to the end user is a TEAM effort between the ISP and the service they are accessing. It's not something that falls 100% on the ISP.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
existenz

join:2014-02-12
kudos:2

Re: Faster speeds don't always help

Though not all ISPs are doing their part and are indirectly choosing who can perform well and who cannot.
existenz

join:2014-02-12
kudos:2
Reviews:
·Google Fiber

3 recommendations

However Google Fiber is near Gbit end to end, with no Netflix peering bottlenecks. GF will deliver as fast as other end can and multiple users in home wont conflict with each other. Is not really about having a Gbit, is about having effectively a limitless connection.
pandora
Premium
join:2001-06-01
Outland
kudos:2

1 recommendation

Re: Faster speeds don't always help

Yup, I wonder if Google will be able to continue it's expansion. I'd love to have them as a choice at my home.
--
Congress could mess up a one piece jigsaw puzzle.
waycoolphil

join:2000-09-22
Cathedral City, CA
Reviews:
·Time Warner Cable
·Verizon Online DSL
I just finished playing the Netflix won't stream in HD from 7-11pm game with Time Warner Cable. It worked fine in the daytime but not in the evening. I assumed it was due to everybody in the neighborhood streaming video at the same time.

I ended up calling TWC four times about it. Each time they checked my modem and router from their end as said everything was fine and I should call Netflix about it. After the third time of them whining that it was Netflix's fault I called Netflix. Of course they said it was TWC's fault. So I called TWC and told them Netflix said it was congestion in TWC land.

Then the Internet broadband fairy waived her magic wand and took care of everything. I read about TWC's deal with Netflix and guess what--Netflix now streams in HD all evening with no buffering at all.

So now, with TWC getting revenue from Nexflix, I want them to reduce my bill. Fat chance I guess.
existenz

join:2014-02-12
kudos:2

Re: Faster speeds don't always help

Google Fiber gave Netflix free CDN connectivity, allows unlimited data (unlimited Netflix) - no extra fees for either Netflix or customer.
waycoolphil

join:2000-09-22
Cathedral City, CA

Re: Faster speeds don't always help

That's great but I don't live in Kansas City. TWC has a lock on the Coachella Valley. Verizon won't expand FiOS here and TWC sells Verizon Wireless. Nice.

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1

Comcast?

Why isn't Comcast in the 1 Gbps race?

telcodad
Premium
join:2011-09-16
Lincroft, NJ
kudos:15

1 edit

Re: Comcast?

said by IPPlanMan:

Why isn't Comcast in the 1 Gbps race?

Are you asking why they aren't included in this (with their small amount of FTTP offerings right now), or why they haven't entered the 1 Gbps race?

If it's the first case, it's because their residential FTTP only goes up to 505 Mbps (down) right now:

»[Speed] Extreme 505 coming to Chicago

»[Speed] Comcast 505 Atlanta vs. Google Fiber

»Re: [Connectivity] comcast running fttp in florida to 530 homes
praetoralpha

join:2005-08-06
Pittsburgh, PA

Re: Comcast?

said by telcodad:

If it's the first case, it's because their residential FTTP only goes up to 505 Gbps (down) right now

What?

telcodad
Premium
join:2011-09-16
Lincroft, NJ
kudos:15

Re: Comcast?

said by praetoralpha:

said by telcodad:

If it's the first case, it's because their residential FTTP only goes up to 505 Gbps (down) right now

What?

Oops! Thanks, I fixed that to be Mbps now!

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1
Ok... So what about the second case? Why haven't they entered the 1 Gbps race?

tshirt
Premium,MVM
join:2004-07-11
Snohomish, WA
kudos:5
Reviews:
·Comcast

3 recommendations

Re: Comcast?

said by IPPlanMan:

Ok... So what about the second case? Why haven't they entered the 1 Gbps race

Perhaps They feel the 1GBPS to the press release to be childish, and that working toward wide spread, real-world 105/150/505 and even 50/10 is more useful.
It certainly fills the need of far more people then googlefiber will reach in my lifetime (and probably yours) even if GF cranks up the deployment rate AND stays the course.
jprice8905

join:2002-07-29
Mercer Island, WA

Re: Comcast?

You actually used "Comcast" and "useful" in the same sentence? How long have you worked there?

What is "childish" is Comcast's playing political games (pushing for protectionist laws, fighting net neutrality, buying competitors) instead of upgrading their service.

Comcast (and their ilk) is the reason municipal fiber and competitors such as Google will not be able to achieve significant penetration in our lifetimes.

Comcast speeds and prices are consistently better in areas where they are faced with legitimate competition, so it is laughable to suggest that providing faster service is a big priority.

MDA
From Monkey to Man
Premium
join:2013-09-10
Minneapolis, MN
Reviews:
·Comcast

2 recommendations

As I said above:

said by MDA:

That's why ISPs are saying "there isn't a demand". They know that if they even deployed gig internet, it wouldn't flow that fast through their network or mostly anyone else's network, majorly due to lack of innovation and upgrading (laziness).

Comcast is a big offender. They know where to kink the pipe of requirement for upgrades and milk more out of the customer. That is, until we become aware of the shortcomings they have been hiding under a blanket of lies.

buzz_4_20

join:2003-09-20
Limestone, ME
Reviews:
·ObiVoice
·Pioneer Wireless

My Theory

They don't want to roll out gigabit connections for 2 main reasons.

1. They don't want to spend the money that they're going to have to spend someday.

2. Gigabit connections would erode the many many high priced options that are lower than 50 megabits.
Why would a customer pay more than $50 a month for 15/1 when it's a tiny fraction of what else is available.
ISurfTooMuch

join:2007-04-23
Tuscaloosa, AL

3 recommendations

Re: My Theory

That, and people might actually use these shiny new connections and slam up against those caps very quickly. Then those same people are going to start asking why the caps need to be there in the first place. And, as has been demonstrated here several times, the big cable companies and telcos really don't want to have that conversation.

Jason Levine
Premium
join:2001-07-13
USA

Re: My Theory

Or, to rephrase it a bit:

Faster connections will mean more people will be able to get their entertainment from Internet Video sources instead of from cable TV. This will erode Comcast's Cable TV profits so Internet speeds must be kept as slow as possible. (Super fast speeds are ok so long as you price it so that most users won't pay for the super fast speed.)
--
-Jason Levine
Kearnstd
Space Elf
Premium
join:2002-01-22
Mullica Hill, NJ
kudos:1

Re: My Theory

Or cap it so they cannot exploit the really fast speeds.

I call this high speed advertising. they can advertise really fast available speeds but you cannot actually use it to the fullest because if everybody was using PS3(or any media device) and Netflix in a home and getting the full possible quality they will hit a cap pretty fast and need to fall back to cable TV.
--
Filan - Aurin Spellslinger - Pago - Team Legacy

Jason Levine
Premium
join:2001-07-13
USA

1 recommendation

Re: My Theory

Exactly. If Comcast had Gigabit Internet speeds, people would be able to use the service at full speed for under an hour before they hit their monthly cap.

Of course, then they would be able to collect tons of overage fees.
--
-Jason Levine
ISurfTooMuch

join:2007-04-23
Tuscaloosa, AL

Re: My Theory

said by Jason Levine:

Of course, then they would be able to collect tons of overage fees.

Yes, but then people would start to ask why Comcast is selling a month's worth of service that you can burn through in an hour. And, when everyone's burning through their caps, things could get a bit uncomfortable for Comcast, especially if people notice that the residents of cities with muni broadband don't have this problem.

Jason Levine
Premium
join:2001-07-13
USA

1 recommendation

Re: My Theory

Comcast is hoping that things don't get to that point. In their "best case scenario", they manage to:

a) Get Muni broadband banned so if you want wired broadband, you likely only have Comcast (or another big ISP) as your only option.

and

b) Kill off (or at least marginalize) Internet Video so that people don't use it much and keep most of their video watching on cable TV.

Of course, they could change to keep up with how the industry is headed (remove caps and invest in Internet Video services), but doing that is scarier to them than using their clout to protect their existing revenue streams.
--
-Jason Levine

caster

@198.41.85.x

iptv

Fiber IPTV is cool and can beat cable QAM (fios is good and VOD is iptv) ATT is ok (needs better bitrates) and more steams. Google cool but max of 8 steams will not cut for commercial or hotel settings. Also can use all the alt / overflow slots that ATT / directv has.

sat can cover non fiber area maybe even let att move uverse video over to it with uverse still there for rain fade backup / subs with no LOS to sat but no more saved speed for tv.
tmc8080

join:2004-04-24
Brooklyn, NY

boardwalk, but not park place?

L.A., Ca can have gigabit press reelease, but not NY?
That's like boardwalk wthout park place... and that can be laid at the doorsteps of three companies:
verizon, cablevision and time warner.
Dampier
Phillip M Dampier

join:2003-03-23
Rochester, NY

Blair Needs to Get His Head Out of the Clouds

I see too many people rely on these press releases as evidence of broadband greatness and transformation, when the reality is more of the same.

Even Google is overhyped considering the actual number of homes that can buy the service.

Google demonstrated you can run gigabit fiber and not charge several hundred dollars a month for the service. Now every politician wants to see that kind of game-changing speed in their area and incumbent telcos and cablecos are making excuses or promising gigabit networks themselves they honestly won't really build to most.

Frontier is still telling anyone that will listen that 6Mbps is more than enough for most people, but even they have promised a phantom gigabit project that will ultimately serve almost no one.

AT&T is the biggest fibber around on this subject. Their gigabit promises are built with almost no budget to construct the actual networks needed on the scale they claim. Wall Street analysts know the game too well, and I've chatted with more than a few. If AT&T was serious, it would have to disclose major capex increases to investors. Analysts would howl suggesting return on that investment wasn't worth spending that kind of money. Look at Verizon FiOS and the attack dogs like Craig Moffett who trashed Verizon's fiber spend every chance he got. He wasn't alone. Yet they are all silent about AT&T because they know what we do -- there is no massive gigabit upgrade coming.

These phantom fiber upgrades will turn up in new housing developments where it is cheap to toss a fiber in a conduit. Multi-dwelling units are often served by fiber now in many areas so cranking up some speed in a demonstration project isn't hard or costly.

Someone show me where residential streets are being torn up on a massive scale to install GigaPower or one of these other cable/telco fiber builds. I see the reports when a community broadband project is doing it or someone is building out fiber to an office park or for an institutional network, but nobody is screaming that AT&T has torn up entire neighborhoods to install fiber to the home service. Just more ugly lawn refrigerators and giant pole mounted boxes to support the usual U-verse fiber to the neighborhood expansion, such as that turned out to be.

Blair thinks empty promises and cheap talk about gigabit broadband is as good as actual gigabit broadband, but it isn't. Someone needs to hold these guys accountable, particularly when they use their fake networks to argue for yet more goodies from Washington or various state legislatures.
--
Phillip M. Dampier
Editor, Stop the Cap!
»stopthecap.com

fg8578

join:2009-04-26
Salem, OR

Re: Blair Needs to Get His Head Out of the Clouds

said by Dampier:

Blair Needs to Get His Head Out of the Clouds

Agreed. Even this report is kinda goofy. It reads like Gig.U is taking credit for the "explosion" in gigabit services.
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·ooma
·Optimum Online
·Verizon FiOS
Don't count out municipalities & 3rd party companies from eating away at ATT's customer base. When Comcast has docsis 3.1 installed (less than 4 years).. the gulf between ATT and Comcast will be bigger than that of Intel vs AMD.. it will be concluded that Comcast is a MONOPOLY in many communities for broadband and not a de-facto monopoly/duopoly. A ONE WIRE monopoly is NOT acceptable by the federal government and they will be forced to act...

Selenia
I love Debian
Premium
join:2006-09-22
Fort Smith, AR
kudos:2

Not so sure

I would lump Cox in with AT&T. True, they do have selectively enforced caps. They are a smaller regional cable company from whom I have seen consistent speed bumps without price hikes, even here with limited competition(some does exist but not all across the city as AT&T UVerse has limited scope and fiber is around the University housing developments only, neither of which reach me. Keep in mind, as well that part of the city is Comcast territory and Cox blows them away). They recently, before my vacation and temporary gig out of town, bumped my speed from 25/5 to 50/10 with no rate hike. In fact, they doubled all speed packages. The 75/10 became 150/20 but the current 50/10 is economical and fast enough.