Krugman On the Connectivity Power Shift 360
In today's NYTimes (registration required), Paul Krugman's op-ed piece lays out in simple terms the statistical power shift in the online economy among Europe, Japan, and the US. This shift has been discussed here for some time, but it's good to see it coming to the attention of a wider audience. Quoting: "As recently as 2001, the percentage of the population with high-speed access in Japan and Germany was only half that in the United States. In France it was less than a quarter. By the end of 2006, however, all three countries had more broadband subscribers per 100 people than we did... [W]hen the Bush administration put Michael Powell in charge of the FCC, the digital robber barons were basically set free to do whatever they liked. As a result, there's little competition in U.S. broadband — if you're lucky, you have a choice between the services offered by the local cable monopoly and the local phone monopoly. The price is high and the service is poor, but there's nowhere else to go."
Another problem... (Score:4, Insightful)
It's like the problem we had in the US of upgrading television stations to Hi-Def. In Europe, you only have to upgrade two or three transmitters per country. In the US you have hundreds of transmitters dotted throughout the country (not to mention the added trickiness of local ownership of individual local television stations)...
Re:Really? (Score:5, Insightful)
Re:Another problem... (Score:2, Insightful)
You clearly neither work in telecom, nor have you spent much time in the country, because you got it completely ass backwards. Dense population centers are the hardest, because of the politics, the coordination with all the other infrastructure (you don't just start methodically shutting down roads in cities on a whim), there are few clear lines of sight, etc. Out in the country, you can see for miles, the legal system is far less complicated, etc. That doesn't mean that there aren't hilly backwoods that are hard to get to; but there are vast swaths of the country with few impediments to high speed access. And they have it - fiber to the home carrying all your phone, cable, and internet. Does Boston? Does NYC? No and no.
Re:Comparing US to other countries (Score:2, Insightful)
So why is Germany's broadband access so much better than New York's? Why is France's broadband so much better than California's?
Re:well, (Score:1, Insightful)
Not this old lame excuse again (Score:5, Insightful)
Every time somebody trots out this lame excuse I will persist in pointing out that in bucolic Ephrata, Washinton - the middle of nowhere on the road to nowhere - they have gigabit broadband. That's fiber to the premises and gigabit Ethernet to the house, a symmetrical unmetered gigabit link to each subscriber, for less than I pay to Comcast each month.
They get it through their power company and they're grandfathered in but I can't get that deal because the big players bought legislation prohibiting municipal broadband.
So stop already with the story that the last mile is expensive, bandwidth is costly, density is the key lies already. It's about the incumbent monopolies maintaining their profits at the cost of depriving the average citizen of necessary infrastructure full stop.
Re:Another problem... (Score:1, Insightful)
Re:Krugman's a fruit (Score:5, Insightful)
That seems like a reasonable arguement but if that were the case then with the massive housing boom we have been in for the past 10 years we should have a significant number of homes with the latest fiber optic last mile technology, but guess what, we dont.
I've watched thousands of houses go up and hundreds of new neighborhoods, and whats going in the ground you ask, the same coax and twisted pair copper they've been using for the past 30+ years.
And when people get fed up and try to band together to build there own fiber optic network because the digital robber barons refuse to invest in the latest technology do we finally get the latest technology, no we get lawyers and lobbying to turn citizens into criminals and outlaws.
And now with our pathetic outdated infrastructure that provides limited broadband at high prices what are the robber barons trying to do, drop their requirements for network neutrality and charge us and content providers even more for what we've already paid for.
Its not distance or age, its plain and simple greed and governmental complicity with illegal monpolization of markets. This country is getting passed by in the name of capitalism for the few and screw the other half.
Contradicting myself again (Score:3, Insightful)
Lots of those high rise office buildings have fibre connections. The cities you mention are among some of the prime switching points for the internet. The available bandwidth is obscene.
There are available technologies for getting the bandwidth from where it's switched to the common citizen without negotiating a million rights of way. They are not employed for the reason in my post below: the incumbent monopolies have an unlimited budget to maintain the scarcity - and as such the price - of their product.
Let us not pretend there is some other reason. If you can see that skyscraper on the horizon from your roof, it could hit you with more broadband than you and your million neighbors could use, even if you shared it further out. This is about money and nothing else.
Re:Another problem... (Score:5, Insightful)
And this is the final kicker. AT&T is putting fiber in our area, but first in the neighborhoods that already have DSL. They are going to let the cable company continue to have a monopoly in the other areas. To make matters worse, AT&T will not sell you just internet access. You have to buy a package.
I tell you what our president has done. He has reduced America to third world status. INstead of being able to pay a private company to give you good access to the internet, you have pay a monopoly. And you can't pay for what you need, you have to pay for what they want you to have. BTW, this is not a new revelation. Foreign affairs did an write on this a few years back. We did not just all of the sudden lose our edge. It was a predictable part of policy,and has been obvious since before out president got reelected.
Strange definition of "lucky" (Score:2, Insightful)
A rough estimate would be that 70% or more of the US population is "lucky" by the above definition.
"Broadband" connections in the US are not hard to get, are not prohibitively expensive, and generally work as advertised with little tech support required. The people who are not well served in the US are rural users, and some users in old inner city areas with a poor existing infrastructure. The people with the most technical support issues are those attempting to host servers and other business class services on residential networks, or those using old, outdated, or unsupported combinations of hardware & software; the average user, with an average hardware/software mix for the most part achieves plug & play connectivity. Tech support loads at most ISPs are 1:10 or higher (in other words, less than 10% of the customers need tech support for connectivity issues) and in most cases, tech support problems are traced to user error.
I suspect that the poor adoption rates for broadband in the US have more to do with lack of interest on the part of consumers than with technical availability. Many people don't view the internet as something they need or want - especially the 40+ percent of the US population 50 and older, who grew up without it don't know what they're missing.
Re:Another problem... (Score:4, Insightful)
I tell you what our president has done. He has reduced America to third world status.
Anyone who's spent time in third-world nations knows the falsehood of this ignorant commentary. Let's objectively criticize people for what they really have done - as Bush, Reid and Pelosi have no shortage of legitimate criticisms. Our President (and his Congressional counterparts) has exclusively represented the powerful special interests that put him in office in a manner no different than Clinton, Lyndon Johnson (Halliburton's Man, who's wife was a major shareholder of Halliburton until her recent death), FDR, Harry Truman, Nixon, and numerous others. Actually, you'd be hard pressed to find any President who didn't represent elites.
Regarding broadband and the U.S. Federal Government, the Ag bill passed by Congress ~2002/2003 set aside record funds for rural broadband. Senator Harkin (D) of our state was instrumental in its passage, and also instrumental in having the actual rules written to exclusively benefit the incumbent fat-cat monopoly local telcos. Competitors to these tired old local monopolies were written out in the details. This wasn't BushHitlerCo, this was Democrats in Congress along with a Republican administration.
Having worked for a competitor to the incumbents, covering 10 counties, we found funds dried up while tired old ILECs got tens of millions only to sit on the money. Worse yet, permissions for formerly illegal cross-subsidies were enacted, allowing monopolies like Iowa Telecom to apply $3.50 charges to every phone line and dump it into their broadband entity, driving competition out of the market. They kicked competition off of the copper, subsidized from their monopoly business and used monopoly subsidized operations and infrastructure to lower the cost of their broadband business and killed off any real threat. Both Democrats and Republicans were implicit in this gift to their fat-cat buddies.
the Bush administration put Michael Powell in charge of the FCC, the digital robber barons were basically set free to do whatever they liked.
Except the Clinton FCC already set the pace for special deals with incumbents and as mentioned, numerous persons of both parties made sure only their fat cat buddies would get new slush funds.
Read up on the infamous Representative from Bell South, Billy Tauzin, and his efforts [llrx.com] with powerful Democratic Senator Dingell to further reinforce monopoly power in broadband. Tauzin was a Republican and Dingell a Democrat. Both are bought and paid for by the incumbents.
As long as we have fools who believe one side is good and the other evil, we'll have a government exclusively representing fat-cat special interests while us fools get screwed. Get your head out of the sand if you don't like being screwed.
Re:well, (Score:1, Insightful)
Naked truth (Score:3, Insightful)
Look regardless of how much you might dispute the desirability of the French health care system, the analogy he is making is logically correct. That is, the French are not holding themselves prisoner to free-market ideology.
Simple reason in germany (Score:3, Insightful)
Traditionally you had to pay for every single phonecall, even local ones. So dialing-in into an ISP _really_ cost you a lot of money. In fact back then most ISPs didn't charge you for their services so you only had to pay to your local phone company.
Then with DSL and cable modems you suddenly got a flat-rate for a moderately low price.
Currently the costs are about this: (all in Euro)
dial-up 0.1 cents/minute => 43.2 Euro a month (wow, this suddenly even became affordable)
DSL is about 50 Euros a month including an ISDN phone-line with flat-rate service for data-calls for all of germany.
Dial-up used to be even more expensive, costing as much as 3 cents per minute.
Re:Naked truth (Score:2, Insightful)
Re:well, (Score:5, Insightful)
Exactly. Libertarians will hate this idea, but the free market can not fix everything. That is because the free market has a weakness: monopolies. Over time, companies purchase and consume one another until one, dominant entity takes over a section of the market. Copyright, patent, and trademark law protect the monopoly and prevent competitors from establishing themselves. At that point, all innovation stops. The evidence is out there in industry after industry from telephones to software.
And again, libertarians will hate this, but the government must step in for cases like this. The government needs to shake these companies up and break up their monopolies. Only once we get some actual competition will we get good service.
Re:well, (Score:3, Insightful)
So you need government to prevent what government created, and you think libertarians are confused?
Telecom companies stole 200 billion from US taxpay (Score:1, Insightful)
They took the money to invest in the profitable long distance market while still laying down old copper. They invented the barely faster than dialup technology we all know as DSL.
This was to trick the government into thinking people were getting the faster speeds they were supposed to without having to remove those old copper wires.
Educate yourselves, spread the news, and call your local representative.
http://www.niemanwatchdog.org/index.cfm?fuseactio
http://www.newnetworks.com/broadbandscandals.htm [newnetworks.com]
Re:well, (Score:2, Insightful)
There's lots of precedent for a market regulated for maximum competitiveness being a very productive force. If you let the free market stay completely unregulated, you get the restoration of the monopolies. Markets hate to be free, because everybody's always trying to corner it. So it takes regulation to keep everybody honest.
Re:Krugman's a fruit (Score:2, Insightful)
Re:Another problem... (Score:3, Insightful)
Re:well, (Score:3, Insightful)
The copyright that protects a musician should not, also, be used to allow the RIAA to dictate technology policy throughout the U.S.. In the same way, specific patents that protect the start up biomedical company are good while overly broad, obvious patents in the hands of huge companies should not be used to bury competitors under a mountain of lawsuits.
Re:Another problem... (Score:2, Insightful)
Why "of all people?"
You know we're in serious trouble wheh Michael Moore sounds (at least on this one occasion) like a beacon of reason
His hit to miss ratio is better than the mass market media's and VASTLY better than the right wing's.
Re:Another problem... (Score:3, Insightful)
I now live across the river in Jersey City, which pretty much existed entirely of abandoned factories and docks in 1990. They started building a city here from the ground up in the mid-late 90's, and the process continues today, with high rise apartment and offices building popping up like weeds.
I only had and have 10 down 1 up broadband for $40. Where is my 100MB Connection?!
By these arguments (age of infrastructure, population density, "last mile difficulty") I should have 10 GBPS for about 5 cents a month, but I have the same bandwidth as just about everyone else.
These arguments just don't hold up.
Re:well, (Score:2, Insightful)
The real question is, does anyone really know what would happen in a completely free market? Would the government still have to step in to try to discourage cooperation between companies and other monopolistic practices, or is such cooperation completely inherent in the system and very difficult to prevent?
When us young capitalists were taught in the classroom about how communism meant no choice, and capitalism meant lots of choice, we were also taught that competition between companies was the reason. But, what happens when companies put down their swords, and realize that cooperating is much more beneficial than competition? Perhaps competition is an old theory back in the days when business owners had too much testosterone that, now days, no longer applies.I'm still amazed how this practice isn't being banned by the U.S. government. The E.U. has some sense to block similar practices in support of consumers, but of course here in the U.S. we apparently love our monopolistic practices. Contract agreements like these are extremely common here, the consumers all get fucked over, and no one seems to care, or realize the goods and prices they *could* be getting, simply because they can't see them in front of their noses.
Re:Another problem... (Score:3, Insightful)