Peter Svensson at the Associated Press notes that phone companies collectively lost broadband subscribers last quarter for the first time ever. According to the AP, the top eight largest phone companies lost a collective 70,000 broadband subscribers on the quarter, while the top four cable operators saw a net gain of 290,000 subscribers. As we've been discussing, AT&T and Verizon no longer much care about residential broadband. They consider these networks too expensive to upgrade and would rather focus on wireless services.
That leaves huge chunks of the country on slower DSL services, and even in places where some carriers have upgraded, they've cut corners with fiber-to-the-node services that still leave them in a poor competitive position against cable. The poster children of telco network upgrades, Verizon FiOS and AT&T U-Verse, have also seen frozen expansion and increasingly less emphasis on competing on price. That's great for cable but the result, as Susan Crawford informs the AP, is going to be a cable monopoly in a larger chunk of the country than ever before:
quote:Susan Crawford, a professor at Cardozo Law School in New York and a former assistant to President Obama on telecommunications, has argued that a looming cable monopoly in three-quarters of the country is "the central crisis of our communications era." She suggests that the U.S. follow the example of countries that have forced cable providers to allow other companies provide Internet service over their cables. The service-providers would compete with each other and provide some choice to the consumer, she says.
There are of course a smattering of smaller, more rural-focused telcos (Windstream, Frontier, Fairpoint, CenturyLink), but like their larger incumbent brothers, investor pressure has them treating network upgrades as some kind of disease, leaving them incapable of adequately competing with cable services and speeds. Fortunately for them, most of them operate in uncompetitive markets where they can jack up costs and skimp on improvements as they see fit. Unfortunately for you, a stronger cable monopoly means an even less competitive market than we've had. A less competitive market means even higher prices and lower-quality service -- a major problem given that by nearly every objective metric (speed, price, penetration) the United States was already thoroughly average to begin with.
Where I live (Springfield, MA), Comcast is the only viable option as the only other options are DSL (becoming the new dial-up), Verizon LTE HomeFusion (expensive with low caps) and the satellite providers (high latency with plenty of throttling and expensive). Comcast Internet is decent except when there is a problem as getting them to fix anything is just like pulling teeth.
· 2012-Aug-14 1:22 pm: ·
antdude A Ninja Ant VIP join:2001-03-25 United State kudos:5
How many places does Verizon want to lay FiOS? That's the problem.
This is why we have caps and overages, not because of network congestion, but because there's nothing stopping the cable companies from just gouging their customers.
Where will they go? The internet is basically crippled on DSL.
So what did you expect the telco's do? They can't magically rewire everyone to something more robust than copper, and can't suspend the laws of DSL delivered physics. In short, they're stuck with an obsolete technology that can't compete with cable. And face it, fibre, or FIOS is just too expensive right now. Despite google's tiny subsidized 'experiment', FTTH is not a viable option in the US.
Putting their eggs in wireless is the only smart choice they have.
The telcos simply fell victim to digital communications, which allowed Triple Play services to be offered over the same line. A historical accident left them with a lower-capacity network than their competitor. So they found themselves in an overbuild situation to remain competitive.
But in this overbuild situation, the cable companies were the incumbent, and the telcos were the challenger. That's not a good position to be in. If your competitor gets to use their existing plant, and you have to build a brand-new one from scratch, then you'll be at a severe cost disadvantage.
The only way this situation could turn around is if bandwidth demands exceeded the carrying capacity of coax, such that fiber-to-the-premises became a necessity. Then the odds would be evened, and neither party would have an advantage.
(Well, not the only way. There could be government intervention. China Telecom and China Unicom are in the middle of a project to replace their entire copper networks with fiber. Their current target is one HUNDRED million homes passed, each, by the end of the current Five-Year Plan: 2011-2015. But, well, that's socialism, and we can't have that.)
Perhaps Fios EXPANSION is dead. Fios is alive & well and bringing me the intertubes on a daily basis.
Verizon & AT&T built their next generation plants out to the areas they chose to serve probably based mostly on economics & market research. They have no desire to expand.
Verizon would rather focus on their more profitable non union wireless division than deal with their rickety old copper plant
That maybe so, but your not going to expand subscribers by simply not upgrading more areas that are under your footprint.. sure you can have the best service around, but if people with "no" service options cannot subscribe then your losing potential income.. If the current landline division isn't profitable, figure out how to make it so.. Either by selling it, or leasing it, or redoing it all together.. Just letting a huge chunk of people go unserviced is irresponsible.. And no, i'm not talking about the areas where you drive 15 miles and see only one house.. There are many many many places undeserved where the potential for adding subscribers is very high as they would be the only provider in the area...
I don't get comcast/att's math.. I've heard comcast wants 12 house's per mile before building out.. Yet we now have over 125 homes right on the road for 3.8 miles.. Do we have services? No.. Neither att or comcast have yet to bother.. Keep in mind these are homes right on the main stretch here, there are many branch off roads with many many more house's.. Yet this area is just a black hole for broadband for some reason..
I've seen VRADS and cable ran out to practically the middle of nowhere just to service one house.. There was absolutely nothing else in the whole area..... It just doesn't make sense...
· 2012-Aug-14 2:44 pm: ·
WhatNow Premium Member join:2009-05-06 Charlotte, NC
AT&T placed vrads where there was a fiber feed first. in some cases the neighborhoods the local elected officials live in were a prime choice. From what I have seen income was not the driving factor.
I don't see anyone laying fiber without government intervention.
Punitive caps and high costs on both cable and wireless will all but stifle technological development, and the world will laugh as they leave us in the dust and take our tech jobs.
I don't see anyone laying fiber without government intervention.
Punitive caps and high costs on both cable and wireless will all but stifle technological development, and the world will laugh as they leave us in the dust and take our tech jobs.
Utter nonsense.
Caps are rarely "punitive", and cable broadband is not expensive. Neither will "stifle" development of any kind.
$30 for unlimited data to $50 for 1GB is not punitive?
What incentive does cable not have to rip people off when they're the only game in town?
That is what is coming. You can't have a natural monopoly without regulation, the end result without that is massive inefficiency and terrible service at high prices.
$30 for unlimited wireless broadband - was never unlimited, as we witnessed time and again with the rush to saturation. Where are you forced to pay $50 for 1GB? Please, dispense with the hyperbole.
Given the right circumstances, you're correct, any last-mile entity could find itself able to set pricing if they truly fear no competition, i.e. Frontier. But those situations are the rare exception, not the rule, and the margins are that fat, they will invite a competitor.
In our case, we have but one wired broadband option, but the de facto monopoly provider isn't sophisticated enough to know they have us, so their rates reflect the potential of nearby competitors.
I've always agreed with your assertion - the last mile is a natural monopoly, and therefore would be best served by a regulated entity. But that isn't on the table; instead, we have the socialists rallying for yet another expansion of government, which would yield the highest rates of all.
A newly re-regulated monopoly would assure that wired "universal service" could be delivered to 95% of the country, and for the 5% beyond reasonable reach of cabling, we could have a reasonable fixed-LTE tariff - not unlimited, but generous enough to retire satellite service.
There are plenty of large sized urban AT&T communities without uverse. I just don't get why the costs are that outrageous. It's not like they have to dig up people's yards to get fiber to the home.
Despite what you may feel about fiber to the node, it is at least better than the current reality with AT&T dsl.
This whole system is just so broken. The government is nowhere to be seen and is about to rubber stamp yet another uncompetitive deal with Verizon and the cable companies. I'm at the point where I think AT&T and Verizon should be forced to spin off their entire landline business.
It really just puts everything into perspective that these Telcos are letting everything else die in favor of AT&T Wireless and Verizon Wireless.
I left my DSl service for Comcast a year ago and I did not want to make that move. Sure DSL is slower but it worked for me. I left because of the absolutely crappy service Qwest/Century Link offered. Sure Comcast is just as bad but at least I am getting higher bandwidth for the same cost. Too bad these large companies simply miss Customer Service as something to sell besides high speeds. I'd gladly take slower bandwidth for high end customer service.
· 2012-Aug-14 3:18 pm: ·
majortom1029 join:2006-10-19 Lindenhurst, NY kudos:1
They have only have themselves to blame. I live on long island and Verizon will not finish their fios rollout. It has nothing to do with money since most of long island is middle class.
I cannot get dsl or satellite and I can only get cablevision tv and internet.
so, at one point, it will be nothing but churn, as people jump from 1 uncompetitive ISP to the next. Lets just hope by then, that there has been some regulation to improve competing based on prices.
Letting the lines degrade on purpose, then whining that they are losing customers. I have had Dsl 4 different times, most of the time the problem was the signal fluctuated constantly. Fix the damn line problems and they will come back! When dsl works it was perfectly fine, lowest latency I have ever seen when it stays synced up.
· 2012-Aug-14 6:52 pm: ·
a333 A hot cup of integrals please join:2007-06-12 Rego Park, NY
Gotta say I agree with that... only on a 1 Mbps DSL plan here, but FastPath + short loop length + underground utilities means I have NEVER had a single case of dropped sync, and latency (almost always 8-10 ms to the DSLAM) and jitter (pretty close to 0) make the connection "feel" so much better than even my phone on T-mobile despite it having something like 3 - 5 times the bandwidth most of the time.
remember how broken records loop a few seconds of recorded audio/music.. well, that's basicaly what you have for telecom competition in much of the country..
add to that the lust for profits similar to oil companies in wireless and you have the makings of an abandonment of even the competitive chunk of wireline too!
AT&T made out like a bandit acquiring Bell South and then stopped u-verse dead in it's tracks... WTF?!? Wasn't that a condition of the merger? That major cities in the southern USA would be upgraded to u-verse, with is a piss-poor dsl technology? It would be nice if they saw the wisdom of changing over to FTTP, but they actually plan on doing NOTHING with wireline and will pursue wireless at ALL costs..
The public interest is being neglected for years, so the question is how long will the federal government let this go on for? How many lines will AT&T, Comcast and Verizon have to cross before more federal action takes place in telecom?
AT&T made out like a bandit acquiring Bell South and then stopped u-verse dead in it's tracks... WTF?!? Wasn't that a condition of the merger?
Was it?
BellSouth was acquired in 2006. U-verse deployment did not begin until 2008.
Deployment was in the works in Bell South pre-merger to deploy a combination of FTTP and DSL where market demand met each ROI goal (ie numbers of customer interest). AT&T had very little interest in FTTP for residential use from the very beginning, but it looked good in the press release. So-called greenfield builds are a vaporware way of promising the moon and delivering a paper moon. Docsis 2.0 was freshly minted capable of 30 (spec'd for 42 down) megabits.. paltry 8 megabit DSL was no longer adequate.
· 2012-Aug-15 8:31 am: ·
ARGONAUT Have a nice day. Premium Member join:2006-01-24 New Albany, IN kudos:1
thank Judge Greene for this mess he started in 1984. things were a lot better when the government had oversight of these companies.
It's easy to look back with rose-colored glasses, and remember only the good stuff.
The Bell System myth of uniform excellence in service is exactly that -- a myth. Some Bell operating companies were better than others, and some areas were better-served than others. In 1984, you could find areas with electronic switching and private lines to every household. You could also find areas -- in Bell territory, not at some tiny independent rural telecom -- that had party lines and crossbar switching systems.
For example, Pacific Bell was one of the more neglected companies in the Bell System. The California public-utilities commission had a highly adversarial relationship with Pacific Bell, so Ma Bell preferred to direct its money towards friendlier locales. California became the neglected stepchild of the Bell System, where they did the minimum that they could get away with.
In other words, the golden days of the regulated past are hardly the panancea that they're made out to be. A public utilities commission had limited ability to force upgrades. They can force maintenance, but they cannot force upgrades.
This would solve the problem of "Our phones have crosstalk, and our DSL keeps losing sync -- why won't they fix the rotting copper?" It would not solve the problem of "We have no cable, the DSL maxes out at 1 Mbps, and nobody is willing to build fiber-to-the-premises."
I just switch from Comcast to CenturyLink/Qwest, and got an upgraded internet connection. I had 25/5(?) with Comcast, now have VDSL2 at 40/20. When I had Qwest in the past, virtually all of my problems were related to house wiring as the source. Does the average person need more than 40/20 at this point? Not in my view, but I suppose in a large household with lots of gaming and video streaming. But with myself and 3 boys mid-teens to early 20s, it's plenty. But I understand 40/20 is the exception for Telcos. Up until the last month or so, 7M DSL was the limit for my house.
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