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Broadband Envy
Fixing American broadband
by Karl Bode 12:29PM Wednesday Sep 01 2004
Bombarded with tales of South Koreans and Swedes watching high-definition soap-operas via 100Mbps connections, the media has apparently developed a nasty case of broadband envy. This Reuters article suggests the US has "missed the high speed revolution", while last week Business Week dubbed America a "broadband backwater".

When did we become the village idiots of the broadband universe? Apparently since 2003, when the Organization for Economic Cooperation & Development released numbers showing the U.S. had dropped from third to tenth in broadband penetration; behind countries like Belgium. Since that report, there's been a flood of worry reports using the OECD report as their center-piece.

To be sure, American broadband does have its problems. Many portions of the country remain either poorly or under-served. Providers avoid areas they deem unprofitable, then lobby against those same communities when they want to provide affordable service to themselves. While CLECs are being crushed, the FCC chief embraces BPL (an untested and interference laden niche technology) as the broadband competitive holy grail.

As most will note, there's a big difference between wiring a compact South Korean urban sprawl, and draping fiber across the Rocky Mountains and into the rural communities of the plain states. A more just comparison would likely be Canada, but wait: they're not only offering faster speeds than American providers, but consumers pay less, and Canada rivals South Korea when it comes to broadband penetration.

So what exactly is the United States doing wrong? It depends who you ask. Ask the bells, and they'll tell you they're being prevented from creating a broadband wonderland because of pesky regulation. Deregulate the industry and force CLECs to build their own infrastructure, they argue, and every man, woman and child will be delivered fiber connectivity and a bevy of next generation services.

Ask consumer advocates and analysts like Gordon Cook, and he'll tell you there's an unholy profit cabal between the FCC and incumbents, who limit expansion because they like the current profit margins from vanilla DSL and cable connections. With geographic monopolies, they've got the game rigged exactly how they like it, and it's their influence on the political machinery that's to blame for the country's broadband stall.

AOL's broadband president Lisa Hook, suggests the OECD rankings are more "an ego thing more than an economic issue." Mercury News columnist Mike Langberg shares a similar opinion, and suggests that trusting in Powell's deregulatory vision is the answer. "Broadbandits" author Om Malik suggests that "backward looking regulatory policies are to blame for US falling behind in the broadband sweepstakes".

Who's right? Where do we go from here?

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Berkeley, CA

2 recommendations

Urbanization/Population Density

AFAIK, South Korea is much denser in terms of population than the United States is. That makes it difficult to make broadband available to everyone, as it's much more expensive per capita to run lines to rural areas. It's also much cheaper to run FTTP in a massive apartment complex than it is to a suburban subdivsion, because there are so many termini to run to. (see fiber in most college dorms for an example).

What we need is something like the Rural Electrification Act (»en.wikipedia.org/wiki/Rural_Elec ··· tion_Act ), which would setup more ISP co-ops, which is good for both government and consumer. Once broadband is seen as a quality-of-life improvement vs a luxury, I think it will happen. Today it's not seen as a necessity, but in the future it might be.
if a dream becomes indistingushable from reality, at what point does reality cease to be relevant and the dream takes its place