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I, Cringely - The Survival of the Nerdiest with Robert X. Cringely
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The Pulpit
Pulpit Comments
July 20, 2007 -- When Elephants Dance
Status: [CLOSED]

Gee, lower prices and higher speeds are great for people who live in metro areas. I'd still like to see something akin to universal service/competition.

As someone who lives in an expanding rural area, I live too far away from the CO for DSL and the local cable monopoly hasn't seen fit to run a line into our development, so my only choice for both TV and Internet is satellite.

With the inherent latency in two-way satellite internet, that means no VOIP, no online gaming, and speeds that max out at 1.5 Mbps down and 256 kbps up.

What happened to the millions of dollars the US Congress gave the telcos to build out their infrastructure to folks like me?

Rory Wohl | Jul 20, 2007 | 10:11AM

Here in the Netherlands, one pays 20 euro ($30) per month for a limitless 20MB/s download speed.

Due to muich competition in the triple-play market, the prices go down every month...

Sjaak Laan | Jul 20, 2007 | 10:24AM

Did anyone else notice that the static 20/5 price was a good deal less than the static 5/5 price? I don't know if there are multiple technologies represented in that price list or what, but I can't see any reason to pay more for 5/5 than 20/5.

Symmetry is beautiful, but it isn't THAT pretty.

Brian | Jul 20, 2007 | 10:30AM

I wonder.... Is the price in the Netherlands and Japan subsidized by the government? Would faster internet at cheaper prices come with a tax increase?

Sorry, but a tax increase isn't worth that.

Matt | Jul 20, 2007 | 10:38AM

are there some type-Os in the table listing
speeds vs price? there are a couple lines that
change speed but not price. Im a little confused...

steve | Jul 20, 2007 | 10:39AM

Bob, go out of the city once in a while. Price drops in urban areas mean that broadband deployment to the suburbs and rurals will slow even more, from its currently glacial pace. The 'penetration' will slow and possibly even reverse.

Rick | Jul 20, 2007 | 10:45AM

Just a couple of thoughts after reading....

First, all of that is hunky-dory, but how will it realistically translate? We're languishing in mid-Michigan, a technological cesspool. I live in a moderate sized city, 20 minutes from the capital of the state. Less than a mile out from the city limits in some places, cable is not even available. DSL is available to some, but I think the speeds are sketchy.

All this new tech is great, and lower prices for better service are always good, but I don't see any of that happening around here for at least 5-10 years. Fiber? F-, cable's not even run in some places. The broadband situation in this country is a mess, especially if you're not in a dense metro area.

Second is regarding the comment about how telcos won't have to share facilities with competitors. How does this help in the long run? Isn't that the same problem we have now? It's great if Verizon runs fiber to my house, but what if something comes along and suddenly ATT has the tech to leapfrog Verizon's fiber service with their own fiber service? I'm stuck with Verizon unless ATT runs their own lines? Yeah, that'll happen. We're just as well off as we are now. Why wouldn't they get common carrier status?

Pete | Jul 20, 2007 | 11:00AM

I miss the old Bob Cringely. The one that used to write interesting articles about all sorts of juicy topics. But the new Bob, writes article after article able broadband cable and connection speed minutia. In the old days, I just couldn't wait for the next Cringely article. Now, most of his articles just put me to slee... zzzzzzzz

Johnny | Jul 20, 2007 | 11:06AM

Oh, and can we get an RSS feed for comments on each article? :-)

Pete | Jul 20, 2007 | 11:06AM

Crap... I need to learn to proofread before hitting submit. able = about. Sigh...

Johnny | Jul 20, 2007 | 11:09AM

The speeds in the table in the middle around 25M appear to be a wrong typo, or I am not understanding the table.

Chris Nystrom | Jul 20, 2007 | 11:14AM

Boy, I have to agree with the previous posters...it's a wasteland in most of the country. I'm on the fringe, it not very speedy and pricey. Go 5 miles further out and it's spotty at best.

PXLated | Jul 20, 2007 | 11:21AM

One of the best arguments I've seen yet for why Cisco, and for that matter, Juniper, look like the next generation infrastructure winners. Routers will make the world go round...

Bonecrusher | Jul 20, 2007 | 11:23AM

Where does WiMax fit into this?

pete | Jul 20, 2007 | 11:28AM

Question: Since Verizon wants to bail out of NH, Maine, Vermont and Mass (and has suspended FIOS rollout in NH) isn't this talk about FIOS pricing for New England a load of bull?

A Morgan Stanley & Co. Inc. report (which the VT PUC picked up on) reveals concerns about FairPoint Communications Inc.'s cash flow as the Charlotte, N.C., phone company attempts to purchase Verizon Communications Inc.'s land line and broadband operations throughout Vermont, New Hampshire and Maine.

Recently several of my colleages and I participated in a very interesting all day presentation at our Pease Tradeport by Verizon and it's suppliers on FIOS. Verizon admitted to us (the press wasn't there - it was a tech meeting) that the cost savings of migrating from copper to FIOS is $4.5B for the corporation as a whole. They waffled on whether or not FIOS could re-start here in NH if Fairpoint wins. They did not explain why they would not bring out triple play (voice/data/video) in NH (as they are in other areas of the USA except to concede that they would rather deal with the entire state at once than have to get franchise agreements with each town one at a time.

The underlying issue seems to us to be the following:

The whole region, the three states, have about 1.5 million households -- a bit less, perhaps. The ARPU would be something like $1000/year. That would be $1.5 billion.

Profit, realistically, is not likely to be as great as the interest to be paid on $2.7 billion. And the profit would come only after a big additional spending spree -- on the order of $3000 to $10,000 invested for each customer to start (RBOC take rate is about 20% right now, so you have to pass five homes to get one customer, to start.) Even at take rates 3 times the RBOC average right now (which is the verizon average), the numbers are marginal.

There are business customers to feed on. And monopoly rates to charge, but it doesn't look good.

We bet there is no way for Fairpoint to make money off these customers given current economics unless the sales price from Verizon is close to zero or unless there's serious cherry-picking, hitting only communities with a fairly dense town center. Portland, Maine's biggest city, has a population something like 40,000!

So, if the PUC blesses the sale of Verizon New England to Fairpoint you can kiss additional FIOS rollout goodby forever. There will be only cable broadband in those towns that Comcast chooses to cherry pick. There will be no competition without a robust RBOC so prices will remain high and bandwidth will remain low (and in 10 years or less we need 50 megabits/sec for ipTV and 3D holographic HD TV as it's in the lab now). The only good reason for Comcast to increase the bandwidth is competition from Verizon.

And that, my friends is about to evaporate when our NH PUC gives the green light for Verizon to dump it's business in New England.

Bob, now I happen to be an ex-Californian (from dear old San Francisco) so I know folks "way out there" tend to view this end of the USA a bit differently. So I have to tell you that this time you really missed the mark. New England is not going to be Verizon territory and that's a real shame since Alex Bell started in Boston!

What a screwy telecom mess this USA has become....

Thank you, Judge Greene.

Bob Landman | Jul 20, 2007 | 11:41AM

I don't understand why everyone is so surprised/confused about why broadband is cheaper in other countries and non-existent in rural America. Many of the countries that have great broadband services (like Japan or the Netherlands) don't have the huge infrastructure rollout costs that we have here in the states. Compare the population density in Japan to the population density in the USA, for example. The efficiency of the broadband providers' investments in those countries far surpasses the same investment here in terms of subscribers per dollar invested in new/upgraded infrastructure.

Jason | Jul 20, 2007 | 11:43AM

I'm on 56K dialup. I've been on dialup for 10 years. I'll still be on 56K dialup when I die.
My ISP just announced price increases.

There will be no speedup, no price cuts. America is now a third-world country, technologically speaking. Our internet service will get slower and more expensive, year by yearas the rest of the world passes us by.

mclaren | Jul 20, 2007 | 11:45AM

Wunnerful news, I'm sure, but I've been hearing that technology + competition + mergers would drive down US broadband prices for the past 10 years (i.e. ever since TCA '96 passed.)

What's happened instead has been the same ol' monopsony pricing and barnyard-style service we've always had. What's so different about this time around?

Aaron | Jul 20, 2007 | 11:48AM

I'm not sure it's become apparent yet but the lack of true broadband, and I don't count 1.5mbit DSL as broadband, in many areas will have an impact on growth for those area. With more and more people telecommuting they must have reliable broadband service. I personally will never live somewhere I can't get good broadband service which unfortunately limits me to metro areas. Small town America is going to have to solve this problem or they will wither away.

scott | Jul 20, 2007 | 11:50AM

A little reliability would be nice too. I have Comcast cable and BellSouth DSL at home just so I can have a reasonable chance of one of them working.

Andrew Smith | Jul 20, 2007 | 11:54AM

Bob,
Well maybe. I have to question this comment:
"WiFi will become standard for the cellphone industry after years of being blocked by cellular providers."
What exactly do you mean by that?

I used to do VoWifi at SpectaLink (now part of PolyCom). I know for a fact this is hard. The only play that makes sense for Wifi and cellular is to use Wifi for data, and the cell network for voice. That would enable the email, web, and YouTube on the cell phone without hogging bandwidth needed for (relatively) clear voice calls.
Trying to do VoWifi as a Centrex like service sucks. Variable delays make it a very hard problem. For data, the Wifi to internet connection works.
Also, more than 1-2 Wifi voice calls on an AP is a problem. Even the new 802.11e standards will not completely solve the issues. And don't get me started on security, and fast roaming with security. It is a mess!

More bandwidth cheaper is good. With the number 2 Internet phone service going out of business, does more bandwidth really change the market. It may make a Centrex model work. The problem is that the PBX market does not churn quickly. I can't see IT managers throwing out million dollar phone systems to change to an internet based phone service. Can you?

Doug

Doug Withau | Jul 20, 2007 | 11:58AM

That's just great for you folks down in the big city. Up here in rural New Hampshire, Verizon just sold its copper wires to Fairpoint, eliminating all hope of us ever getting a high-speed connection. This is one case where the government needs to step in and require the telcos to connect rural areas in return for allowing them to use all that radio spectrum in the big metro areas.

Jim | Jul 20, 2007 | 12:00PM

Since the Telco Act of 1996 is not applicable to fiber, doesn’t that mean Net Neutrality will become even more of a consumer issue?

Finkster | Jul 20, 2007 | 12:02PM

Weird comment on government subsidy. I edit a magazine on this. No subsidy in Japan except for investment tax breaks (same as in the US). No subsidy in the Netherlands -- in fact, the government cable TV arm is annoyed at upstarts. Some subsidy in Korea, plus government involvement in R&D.

Two big differences:
(1) Other countries have a real policy and vision. We don't.
(2) Providers make big profits on value-added services (thousands of broadband products), many of them proprietary. The services were enabled by the available bandwidth.
Here, Wall Street has been worried about price erosion, but has discounted revenue from new services as too speculative.

Steve Ross | Jul 20, 2007 | 12:02PM

The US lags behind every other country because the market here is rigged so that there is no effective competition. We're in Baton Rouge and our options are ADSL from AT&T, Cable via Cox or move somewhere else. If you're a business then both AT&T and Cox offer much slower speeds than they offer to non-business customers at much higher prices.

There's very little chance that this situation will change - both AT&T and Cox fight any attempt to deregulate or introduce competition and so far have been very successful at protecting their base markets.

Edmund Cramp | Jul 20, 2007 | 12:04PM

WiMax is the G4 (aka 4G) technology that Robert glanced over. If the cellular service providers are going VOIP they'll need that kind of bandwidth to stay alive.

Casey | Jul 20, 2007 | 12:05PM

For the last 40 years, I used to share my time between the USA and the EU.
With unmetered local phone call, the consumers in the USA had an advantage for internet dial up access.
Today, regarding DSL, France is the least expensive place with unmetered triple play for 30 euros per month (including free call for 50 countries)... This is offered by an ISP named Free (http://www.free.fr). They are currently rolling out FTTH (with the same triple play offer) in Paris (and some other cities) at 50Mb symmetrical with no price increase. I forgot to add that their FreeBox also act as a Tivo like device (with an internal 30Gb disk)...

Philippe | Jul 20, 2007 | 12:19PM

Can you refer to cellular generations with the 'G' after the number? Minor niggle, but being in the industry I always need to stop and think about what you're referring to since most other references would be to 2G/3G/3.75G/etc, not G2/G3/G3.75/etc.

Dan | Jul 20, 2007 | 12:22PM

Mr. Cramp,

I think you may have more options that you realize. May I suggest CenturyTel, Megapath or MetTel

Don Kamp | Jul 20, 2007 | 12:22PM

It appears that many of you in the rural areas have to really hope that BPL heads your way soon.

Dwayne | Jul 20, 2007 | 12:28PM

It appears that many of you in the rural areas have to really hope that BPL heads your way soon.

Dwayne | Jul 20, 2007 | 12:28PM

It appears that many of you in the rural areas have to really hope that BPL heads your way soon.

Dwayne | Jul 20, 2007 | 12:29PM

I'm getting this speed at this price from Verizon FIOS right now in Oregon. I've been hooked up about a month.

Dynamic 15M/2M $ 60/mo

Michael H. | Jul 20, 2007 | 12:33PM

Bob,
You are not paying attention to the details. Fiber is reaching a very small, cherry picked, portion of the population. It is non-existent in the Qwest west. Cox and other cable companies charge atrocious prices for business level service that is slower than residential where servers are prohibited. Spend some time at Broadband Reports to get a more detailed and accurate picture of what exists and what is telco/cable smoke blowing.

Barry Winters | Jul 20, 2007 | 12:35PM

Those who read this must keep in mind, even though roughly %85 of Americans have access to some sort of high speed connection (regardless of cost, which I know is the focus of Roberts column) but there are the remaining %15 who may not ever get it, but may have a actual need for it. What is to happen in rural areas where T1, fiber, or other options are not available, and the telcos are not willing to even consider expanding to these areas? Sure they are rural, and in the case of my neck of the woods (NE Oregon) there are many small towns of 500 or less people, but if all could get high-speed at $30-50 each, but also allowing rural cellular co.'s to build more towers to cover more than just larger towns and highways. If the US truly wants to regain its crown as communications leader, Yes, better, faster, cheaper solutions must be implemented in high population areas, but don't forget the "small guys" as well in the rural areas, if seamless communication is lost in these areas, it will all be for nought.

Patrick Flynn | Jul 20, 2007 | 12:39PM

Regarding broadband deficiencies in rural areas, this is exactly why someone (ie, probably govt) needs to step in and treat broadband Internet access as a utility. The free market has failed in this regard. Ubiquitous Internet access is on the cusp of (if not already) being necessary. Would you live in an area where there were no electricity, or no telephone? I may choose to live in the boonies, but I'll be pretty sure to at least be able to have power and telephone out there.



Today's generation is using the Internet as a utility, and it's broadband access should be treated as such. Maybe we need a push to blanket the country (ALL of it) with fiber or something, much like the push for copper. I dunno...but something's broke.

Pete | Jul 20, 2007 | 12:51PM

What is to happen in rural areas...?

Last I looked, people moved to rural areas to be away from the hustle-bustle of urban environments. Even small cities, say, Colorado Springs, features comfortable exurban activities such as kids' soccer as opposed to urban activities such as smoky jazz clubs.

Why should internet access be different? Why not let people cluster for services/activities best served in high-density areas, and not have them obligated to subsidize access to people who want to be remote (and who aren't interested in subsidizing urban types for the expensive rent, food and overhead that goes with the easier-to-access high-speed internet.

You can make a case that our equal-access telephone policy, which subsidized rural users, helped build out the telephone network. But thoughtful people also argue that the high regulation stifled phone innovations, with the loss of leadership showing in Cringely's examples today.

Ditto the internet. However accurate these examples may be of broader trends (I'm a bit less optimistic), some competition for best serving people who most want service, might get things rolling much better than worrying about hypothetical needs from people who are not interested in paying for pleasures of being connected to others. The moral perogative of equal access that accompanies our (lack of) national dialogue on health care hardly applies here.

Walt French | Jul 20, 2007 | 12:59PM

Rural web surfers: WiMax (as presently rolled out in Canada) is your friend. It's not next-gen fast, but it's way better than 56k.

The infrastructure requirements are limited. it's probably the cheapest way to roll broadband service to customers in rural areas.

Canada has roughly the same problems as the US when it comes to speeds and pricing: they're both only so-so.

Ryan Cousineau | Jul 20, 2007 | 1:12PM

I live in Exeter, Maine, phone service provided by TDS. A phone service company they provide acquit phone service(s). They are also the only provider of anything that is faster then dial-up modem. TDS has the monoply on the DSL service it provides. TDS also has this problem of cost on return which keeps them as a phone only company (my opinion) and never to be a real ISP. So as much as I would love to have anything that resemables high speed internet this news means basicly nothing. And I fear much of rural america is in the same position.

For those individuals who are served by Verizion and AT&T this if great news. For the rest of america this news just bring more dispair over the lack of service.

Alvah

alvah | Jul 20, 2007 | 1:13PM

Jim and Bob - you've got it wrong about Fairpoint. I'm in part of New Hampshire where Verizon has stated, explicitly, they'll *never* run DSL or FiOS. They're a big public company with urban customers and it's always going to be more profitable for them to invest there. They're a public company, they *have* to do this. Fairpoint, in contrast, is focused on our sorts of areas. They want to sell me video services over DSL, that's how they make money.
I wrote a bit about this here:
http://blog.bfccomputing.com/articles/2007/02/21/fairpoint-and-gcedc-at-uvcia-2006-02-21

Walt - should we take away their phones and electricity too? They shouldn't expect those luxuries away from the hustle and bustle of the cities. It's far cheaper for us, as a society, to spread people out than to cluster them together. Defense is just one reason. As telecommunications allow people to remain productive in all walks of life, we shouldn't have national policy to discourage this.

Bill McGonigle | Jul 20, 2007 | 1:22PM

I pay about $160 for 6mbps/768kbps DSL from Speakeasy for 8 static IP addresses *and* the right to host anything I want (and VoIP).

My two interests are outbound bandwidth and a butt-out approach to what I do on my connection.

I host DNS, Email, WWW, FTP, etc., so if FIOS doesn't allow for hosted outbound services, it's not for me.

As for the outbound bandwidth, I just don't get what the providers are thinking. With distributed content becoming more and more en vogue, synchronous bandwidth would let the big providers really stop carting so much traffic "through" their peer'd connections and let their local infrastructure shine. IE: lots of sister connections feeding me Joost feeds vs. all of it being streamed from Speakeasy's peer'd connections and competitors. I understand they want me to pay commercial rates for being an outbound user vs. an inbound user, but in web 3.0 not only will the crowd be sourcing the content, the crowd will be hosting it too. I'm just saying.

Paul | Jul 20, 2007 | 1:24PM

Interesting part about FiOS Business Internet prices. Any links to more info on this, or is it anonymously sourced?

Andrew | Jul 20, 2007 | 1:27PM

Actually in regards to Walt's post, I don't think equal access is necessarily what folks in these areas are looking for. It is understood and expected that things will be faster/cheaper/upgraded/more up time than in the rural areas. It's just a given, and the survivalist, frontiersman attitude of a majority of those who live here are just fine with that. But people need to do business, create businesses and survive, and even small cities and urban areas are NOT for everyone. I lived in Boise for a short time, beautiful town, rapidly growing and on the cutting edge of a lot of tech advancements, but there are just too darn many people. I want to be able to conduct my business as smoothly as possible, but I need high speed to do it and Verizon will make darn sure that they will milk me for what they can get for downright poor service.
Just because I want to live in a less populated area, does not mean that I should not get what I pay for in regards to a service, I agree that the utility system is busted, but it's where we are at. Clinton decided to give the teco's millions in taxpayers money per year SPECIFICALLY to expand rural access, and they have NOT fulfilled their end of the bargain.

Patrick Flynn | Jul 20, 2007 | 1:31PM

On DOCSIS-3:

Don´t expect any lower access prices because of this technology. In fact, the equipment vendors will charge slightly MORE per mbit because of the added value for ISPs. DOCSIS-3 is in fact quite disappointing, the main highlight of it is channel bonding which means you don´t have a limit of 40mbit per channel, but rather 160mbit since you use 4 channels on the same modem. So the main users of DOCSIS-3 will actually be business users which can afford the exorbitant prices of 100mbit+ cable connections.

As a matter of fact, DOCSIS CMTS switches have been at pretty much the same cost level for 10 years now. $20.000 for 40mbit/s, while normal Ethernet switches must have dropped by several thousand percent in the same time span. So much for Moore´s law...

Jon Bohmer | Jul 20, 2007 | 1:33PM

Bob, I agree. I am a US-born citizen now living in the UK most of the year.

When I visit my home in the USA, I find amazing techie (not just military) arrogance and ignorance there. At my home office here in the UK, I get 10 Mbit/sec (actual) service for $20 per month. My friends pay over $150 as you note for anything similar in the USA.

It's because the greedy corporations in the USA are so helter-skelter driven by share-price (driven by speculative shareholders not satisfied with dividends), which they gain only through profitability, which means layoffs and higher prices for the suckers, er- customers. And the customers, constantly told how lucky they are to be the greatest people in the world, don't realise how unlucky they are in so many ways (Health, anyone?).

The arrogance of Americans in thinking they are God's gift to the world is stunning. And when you point out failings or mistakes, they go into immediate denial !

The only way to change this is for US citizens to DEMAND more from their representatives in Congress, and to Cut Off the lobbyists funds that control them.

William Donelson | Jul 20, 2007 | 1:45PM

You underestimate the unadulterated greed of all those bell-shaped heads. For example, you say that AT&T has to lower costs nationwide since they can't have two plans (one in Northeast and one elsewhere). They won't. They will maintain their artificially high rates nationwide and offer rebates or other inducements only in the regions where they face a threat from Verizon.

I worked for the DeathStar for six years and this is how they roll. Nothing is ever done for the benefit of the consumer. Every action is merely to maintain an aging and eroding oligopoly. In this regard, they are worse than Microsoft!

Esteban Trabajos | Jul 20, 2007 | 2:01PM

The cost of building out fiber is way less than what the reinstated oligopolies are charging us. And they are creating artificial scarcity so they can muliple bill us for services we could get for free or much cheaper on the open Internet.

But CableTelcos don't want an open Internet. They want to charge us for every bit and then charge us again for "premium" content.

It was a big mistake (and I'm sure some politicians got lots of money) to put AT&T back together. We now have to break them apart again (and this time Cable too). But this time we have to do it right. Horizontally, not vertically. Create an open access regulated monoploy FOR TRANSPORT ONLY. That's Layer 1 for you OSI stack people. That's mostly rights of way, trenches, conduit, utility poles and dark fiber. Plus Central Office like collocation facilities for market based service providers to interface to the open access regulated physical plant.

Then we would have an explosion of innovation and bandwidth with no artificial scarcity thru historical bottlenecks in the way.

Robert Berger | Jul 20, 2007 | 2:13PM

Is it just me, or isn't William Donelson's diatribe on the arrogance of Americans just oozing with the stuff itself?

Then again, I'm probably just in denial...

ged | Jul 20, 2007 | 2:14PM

The math is really easy...
The UK has 8 times as many people per square mile as the US does. Japan has 11 times as many.

Of course the high density countries are going to get new technology sooner and cheaper, the cost per subscriber is so much lower.

David W | Jul 20, 2007 | 2:20PM

"The math is really easy...
The UK has 8 times as many people per square mile as the US does. Japan has 11 times as many."

The US has lots of land area. How about comparison density figures for cities? Tokyo vs NYC vs London for example.

Bob Gustafson | Jul 20, 2007 | 2:53PM

Bob:

Interesting article. Great news we (well the majority of us that live in the developed world) will see lower cost for service.

To the minority in the sticks: Sorry your options for broadband service are so limited. But why are you suprised by this? Doesn't dial tone cost more than in the city? How about electricity? Or water?

MAC84 | Jul 20, 2007 | 3:21PM

Over the years I've paid state and local income taxes in three states, and property/school taxes in one. My taxes are used for such things as building and maintaining roads all over the town and state. Decades earlier my dad's taxes were used for rural electrification and the creation of a municipally-owned electric company.

I'd guess that forward-thinking rural communities will lead the way, building high-speed internet access for all local residents, in much the same way that rural communities provide roadways for vehicles.

Walter Dufresne | Jul 20, 2007 | 3:45PM

FIOS is pretty expensive to rollout. Last time I looked, it was $1K to the curb and another $1K to the house. Ditch digging is expensive. Even with an ARPU of $1K, the ROI is not impressive once one factors in the operating costs.

Similar economics for the ADLS2/VSDL rollout by AT&T.

Even with triple play services, telcos are limited at how much the customer will pay for TV because there is little service differentiation from what the cableCos are offering today.

For rural areas, wireless data sounds good but each sector of each tower has a total of X Mb/s of capacity which means that the sevice better not get too popular. Also don't forget data speed falls off fairly quickly with distance from the tower. All this means wireless data will never be that cheap (or fast) for rural areas.

Spencer | Jul 20, 2007 | 4:45PM

In response to all of the comments regarding broadband service in rural areas, please, please, please, refrain from any sort of governmental solution unless you really want to screw things up.

I agree with previous comments that geography and demographics are working against the U.S. when compared other countries. I think the cable and telcos have no choice but to go the direction they are going. This will create a greater broadband gap in the rural areas which should motivate new and existing businesses to find new technologies to capture that "free" market. The answer will most likely come through either cell networks, BPL or satellite.

I can envision a day when you have a server sitting in your home connected to the internet via BPL and a portable computer disguised as a cell phone connected to the internet via a cell/satellite network. Your home server's main function will be to assist the utility company in remote metering and load balancing, but will also interface with your smart appliances, furnace, air-conditioner, lights, motorized window shades and shutters. You portable computer will be used much as we use our computers today but will provide you with the ability to listen uninterrupted to your favorite Shoutcast radio station (http://www.shoutcast.com/directory/?s=free+frequency) as you drive from Los Angeles to New York.

drewby | Jul 20, 2007 | 5:27PM

Forget the argument about population density. I live in a house in downtown Cupertino, CA (in the heart of Silicon Valley) in the Shadow of Apple and HP and a whole host of other fancy schmancy high tech companies. My options for "high speed" internet are terrible. The DSL here is only good for 386k down (with useless 128k uplink speeds which don't even qualify as broadband!) and they won't even guarantee that rate (lucky to see 80% of that number which is what my neighbor gets and not coincidentially the minimum they'll guarantee) and the prices are high - $75 a month for that service and a static IP. Cable's not much better, it's way overbooked because of the lousy DSL and you can't get a static IP from them, no matter what you pay. I pay $100/month to get a wireless connection with a static IP and 4Mbit symmetric link but I can't transfer more than 32GB/month. And now another neighbor's trees have grown high enough that they're blocking that signal so I can barely get that, anymore (stupid fantastic California growing seasons).
And it's not just me, it's like that across much of the SF bay peninsula. Sevice is strictly pot-luck. Some is awesome, some is terrible, most is just tolerable. It has nothing to do with population density around here (it's ALL dense around here).
I would have built one of Cringely's cantenna links to somebody with a decent rate but there's nobody for miles with a decent rate.


Note to telcos reading this: HellooOOOOOooo! ALL of silicon valley is densely populated!! And we'll pay real money for nerdy things like gigabit connections!! Build us a big freaking fiber link and we'll gladly pay for hooking up to it!! We're still upset that Seattle had DSL before we did but we'll forgive you for some decent fiber!!

Dave P | Jul 20, 2007 | 5:47PM

I agree Cisco and other netowrking gear providers are going to gain, but let's not forget all the hardware in the data centers that will be needed to push all that data through the fiber. High end hardware vendors should stand to gain as well. (See the June 11th press release of AT&T choosing Sun hardware to push IP-based TV for U-verse.)

Rene U. | Jul 20, 2007 | 6:51PM

BPL is mentioned as a contender - can we forget it please? It is a truly dirty technology which generates radio interference (RFI) right across the HF spectrum from 3MHz to 30Mhz. Ask any radio ham how bad it is and he'll weep.

And we are talking not just a whistle or a burp, but total wall-to-wall continuous S9++ crapp.

VK7JJ | Jul 20, 2007 | 7:20PM

BPL is mentioned as a contender - can we forget it please? It is a truly dirty technology which generates radio interference (RFI) right across the HF spectrum from 3MHz to 30Mhz. Ask any radio ham how bad it is and he'll weep.

And we are talking not just a whistle or a burp, but total wall-to-wall continuous S9++ crapp.

VK7JJ | Jul 20, 2007 | 7:21PM

VK7JJ,
I don't think BPL will ever be a contender for data intensive streaming or downloading. I do think that it will be choice for smart home automation as it can use the existing ac wiring for communications. I also think that having some sort of home based server that is tied to the internet via BPL will happen even if the connection speed is slower. Being able to have a home based server connect to the internet so you can monitor things at home over the internet and so forth is almost a certainty to happen. Sorry.

drewby | Jul 20, 2007 | 8:30PM

Bill said "It's far cheaper for us, as a society, to spread people out than to cluster them together."


It's this kind of complete balderdash that's created the nonsensical disaster of US development patterns over the last 50 years. It's *always* cheaper to provide infrastructure to serve people in concentrated clusters. Telecomm, sewer and water, electricity, schools, roads, you name it. The attitude that economics must be bent by regulation to subsidize our God-given right to sprawl all over the place is just one more sign that Americans think the laws of gravity and economics can be defied at will to serve their whims without consequence.


It costs more to provide service to rural areas. It SHOULD be more expensive, rather hidden as a cost by government or regulatory subsidization. That way the market --- and individuals --- can make rational economic decisions. Capitalism won the Cold War; it just works. Free market allocation works better except where moral issues or ignorance come in to play.

Jake Bounds | Jul 20, 2007 | 9:12PM

Having moved to Hong Kong recently from New Zealand, I can see with my own eyes what Jake Bounds is talking about. The apartment block we live in is being wired for faster internet access by one of the telecos. As the workers put in cable to connect one apartment block to the next, they effectively reach 450 potential customers with every 10 meters of cable laid. Compare that with the sprawling suburbs of New Zealand, where 10m of cable would get you one, or possibly two customers.

Richard Drysdall | Jul 20, 2007 | 10:27PM

One thing that is overlooked in my neck of the woods (Somerville, MA (Urban area essentially part of Boston)), is that in order for Verizon to put in FiOS they need far more permits, and parking bans and where the cables run underground even more obstacles are in it's way (if it's even possible).

The infrastructure in Boston and many other cities is in such horrible shape that it get hard for Verizon to justify spending all the time and money to install fiber where it may get ripped up by the next electric company repair, or steam explosion (See NYC this week).

I'm not for suburban sprawl, it makes me ill, but urban areas aren't kept up well enough to make large infrastructure changes without spending large amounts of time, money and inconvenience installing them.

Collin Reisdorf | Jul 20, 2007 | 11:29PM

Jesus, slow down Bob. I can hardly hear you.

Scott | Jul 21, 2007 | 12:20AM

Well the big thing that was around 10 years ago that is dead today is the ILEC corps and twisted pair access. In those days there was tons of competition and a lot less consolidation. Today, there is a lot less competition, and a lot of consolidation, so much so that a lot of the Baby Bells are not so baby anymore.

The key is always competition. The next issue is the desire to innovate, and whether the drive to profit is stronger or weaker. In Japan and much of the world, they like to innovate. In the US, well... there's enough talk about innovation and competition in the US, which itself reveals that profit is too strong a motive here.

Graham | Jul 21, 2007 | 2:17AM

My list of stuff that isn't in Japan:

1) The Grand Canyon
2) The Mississippi River
3) The Great Lakes
4) Texas
5) damn near everywhere and everything else
6) Cheap 100mbit links that get 10mbit from servers with something anyone wants!
Oops...
That IS in Japan

Gamers may love it but it does biz no good until the 100th monkey kicks in. =-)

tplehman | Jul 21, 2007 | 7:04AM

I am in the Network group for a national Cable company providing Telephone, TV, and Internet service to business and residential customers.

I came from "the field" - that is, I started at the company at the 'real-world' side of things. I saw all the bad cabling, bad homes, rusted equipment boxes, and the customer's frustration with the outsourced and un-educated customer service centers.

I was at our headend one day (eg. the Central Office) and spoke to the Headend Manager about fiber-to-the-home and why we should do it and why we don't already do it.

He said, and I quote "simple, it's all politics. If we put in fiber to the home, we will have proved the phone companies right when they all turned to it" [years ago].

My Cable Co. runs fiber up to around 200 (avg) or up to 500 (rural areas) people and then knock it down to RF on the hardline that leaks, is 90% aerial, and has some very bad noise issues. However, not only is the copper cabling outside in need of fiber, but virtually all homes - new and old - have bad interior wiring (phone and TV cables).

In the Wisconsin area, TimeWarner Cable just got a license for TV-over-Phone lines, to make this work - they have to gut the home or business of all existing lines and replace them with new - provider-installed lines (i.e. not from an electrician or the home-owner).

In a rich retiree city, the phone co. put in Fiber to the homes - this is only for the rich people of a small section of newly-developed property (less then 100 homes), and all they provide is phone service.

We also have TV and Internet service at the same homes and typically provide their phone service as well.

I want my company to put fiber to the home - badly, but I am said to report that I doubt it will happen in the next 20 years.

CableGuy | Jul 21, 2007 | 7:21AM

Google announces intent to bid on 700mhz spectrum .. If the FCC will make the auction rules support truly open access.

Article here: http://arstechnica.com/news.ars/post/20070720-google-announces-intent-to-bid-on-700mhz-spectrum-auction-if.html

"Proponents of open access argue that the FCC's hands-off deregulation approach is a significant reason for the sorry state of broadband competition in the US and are fearful that the likes of AT&T and Verizon would snap up the additional spectrum and underutilize it"

Jay Casler | Jul 21, 2007 | 10:17AM

Let me start by saying the Verizon worst phone and internet service provider in the U.S. We are a nationwide company that, unfortunately, has service with them in two of our locations on both the West and East Coasts. We have major issues at both sites. In New York, they can't even keep the data and phone lines up when it rains for the majority of businesses on our block in Manhattan. This has been going on for six years! They don't care. One of the businesses never gets a phone call back from them.

I've been pushing them to replace the POTS lines with FiOS. Well, I had an opportunity to use it for a full day at my father's place in San Diego two weeks ago.

It is the greatest and most horrendous service you can possibly imagine. I downloaded 190gigs of data in just a few minutes, less than 10. I've never seen number move that fast. The next 100gigs took over 50 minutes. It was shocking...

I would run, not walk from any Verizon service if I were you.

Whatever the competition is offering, it's more stable, reliable and consistant.

Juan Miguel | Jul 21, 2007 | 12:29PM

Most everything in Japan is fast ... from Internet to Bullet trains to, well, taking a crap. These guys don't even sit down. Talk about fast!

Neil Anderson | Jul 21, 2007 | 1:55PM

Most everything in Japan is fast ... from Internet to Bullet trains to, well, taking a crap. These guys don't even sit down. Talk about fast!

Neil Anderson | Jul 21, 2007 | 1:56PM
rj | Jul 21, 2007 | 7:05PM

Way to miss the point, Mr Cringely.
What matters in the grand scheme of things is not the speed of broadband but what can be done with it.
Is there any indication that TOS are becoming less rather than more onerous? Any indication that these guys are not going to start dicking around with packet timings (anti-net-neutrality) as soon as they can get away with it?

I'm not interested in a 100Mbps connection that I can't use to serve web pages to my friends, or on which I can't use the 2009 version of iChat (now with 3D-extrapolation and built-in screen-sharing) because Verizon insists that the only VoIP client they will allow is some piece of crap app proudly based on technology from 1995 and that hasn't been updated in 4 years.

Maynard Handley | Jul 21, 2007 | 8:18PM

"Regarding broadband deficiencies in rural areas, this is exactly why someone (ie, probably govt) needs to step in and treat broadband Internet access as a utility. The free market has failed in this regard. "

Maybe if rural voters stopped voting for the GOP this would change? These red state types are all about "no government interference; no new taxes; trust in jesus and free markets" until it comes to something that affects them personally.
I have to tell you, you're not going to get much sympathy from the blue state people who've had to suffer through the past six years of idiocy you bestowed on us. Iraq would have paid for an awful lot of rural broadband, but oh no, let's all rally around commander chimp and believe whatever lies he tells us.

Maynard Handley | Jul 21, 2007 | 8:27PM

With free wi-fi now being offered just about everywhere you go, it seems like faster, cheaper internet is inevitable. With small price drops and modest bandwidth increases, the cable and telcom industries have been plugging holes in the availability dike as fast as they can, but at some point they're going to run out of fingers.

I would say that the industry is watching, with retained breath, if Google will be able to buy the wireless spectrum that the government is offering. If Google gives free wi-fi to the nation, it could be more industry-shattering than Wal-Mart offering $4 generic prescriptions.

Dan | Jul 22, 2007 | 12:59PM

Well, over here in the UK the network providers are doing their best to slow down/restrict/overcharge/and generally foul up the provision of all flavours of broadband - exasperating isn't even close ......

Tom Oliva | Jul 22, 2007 | 3:34PM

Walt: "Last I looked, people moved to rural a

Rural Rae | Jul 22, 2007 | 7:34PM

Here in Australia there is an argument occurring between the federal government, Telstra (the dominant Telco-once state owned) and a group of Telco's labeled the G9 over what technology should be used to provide higher broadband speeds to homes and business. By "higher" they mean ensuring everyone (oh- 95% of the country) has about 12 Mb/s !

what a joke...

Aussie A

Auusie A | Jul 22, 2007 | 7:43PM

I live in Sweden in an immigrant-rich area (=rather poor area), and our (state owned) landlord has installed fiber into each apartment. The network then hosts something around 5 to 10 operators with internet access, ip-phones, and ip-tv on offer. For my 10 Mbit (both up and down of course) with two public dynamic IP-addresses I pay about 36$ a month (including 25% VAT). For about 50$ a month, I can get a 100 Mbit connection, both up and down. The IP-phone extra costs me about 10$ a month.


When reading about communication connections in the US (internet, cell-phones, telephones), I am very, very happy that I live in another country.

Mikael | Jul 23, 2007 | 5:58AM

It still sounds like a bunch of hype. Here in suburban NJ (Verizon's home) we are inundated with fios commercials around the clock, yet fios is after all these months, still not available to me. I believe the roll out Bob talks about is inevitable, but I think it will be much slower (on a large scale) than he hopes. Think of this, Verizon pumps the air waves full of fios promises and existing customers wait and don't jump ship...

Smarsh | Jul 23, 2007 | 9:29AM

I live in Cambridge, Massachussetts. The hot bed of research in information and technology. My apartment is a walk from both M.I.T and Harvard and is surrounded by start-ups and biotech ventures. Yet, no Verizon FIOS availibility... I don't get it.

Nadeem | Jul 23, 2007 | 10:28AM

I'm in Bergen County, NJ. I've had Verizon FiOS since January 2006. I get 10 Mbps down, 2 Mbps up for $42/month including all taxes (I've added FiOS TV for another $50/month). Real world download performance is 1100 kbps in Firefox.

My friend gets similar performance from Cablevision's Optimum Boost service.
http://www.optimum.com/order/boost/
He doesn't get the full 30 Mbps, closer to 10 Mbps, but his uploads are much better than mine. That's pretty damn good for a buck or two less than me. They also offer static IP's for more money.

It sucks for those of you living in rural areas and states, but those of us in rich metropolitan areas are not only getting great speeds, we're finally getting real competition.

NorthNJ | Jul 23, 2007 | 11:47AM

We have a place in rural New Mexico. (Its two miles to the paved road.)

We live in the Dallas area. (Right on the paved road.)

Electricity from the rural electric coop in NM costs about 60% of the same electricity in Texas.

IMHO the politics and corporate silliness are all that keeps the costs in Texas high.

I suspect that rural bandwidth coops could work the same way by providing solid service to rural customers at a reasonable cost. When people as a whole really rate the need for bandwidth up there with the need for electricity, it will happen.

(Phone service, from Qwest, in NM didn't work the same way. We had electricity by the 1960's when we first moved in. A phone wasn't affordable until the mid 1990's. The rates aren't any higher, though, than they are in cities.)

Lee | Jul 23, 2007 | 12:04PM

We've always been behind certain countries; 10 years ago, slow dsl had just been introduced to Portland, OR. Unfortunately, I had just moved to NYC, where there was no broadband available at all. In between, I took a month off and went to France, where high speed cable was cheap, fast and available.



I'd love to see fiber to my home, but I doubt Verizon is going to make that investment for an area where it isn't simply an upsell from their local phone service and Qwest certainly isn't going to invest in anything (except campaign contributions and lobbyists) so progressive. I'm hoping that a wireless provider can give us an alternative to cable sometime soon.

Scott | Jul 23, 2007 | 7:35PM

You guys are frigging moaning but here in South Africa we are still struggling to get over 1 Mb a second from the monopoly ugly giant that is Telkom... and for that we are still paying around $140!!! Finally government and people are gotten fed up (mind u government has a 34% stake in telkom hence why its taken so long to get here) and competition is being introduced and Telkom are finally decreasing their prices and recently increased their 1Mb to... 4Mb WOW! ;-) ... so as u can imagine lots of work still required to get the broadband in this country in a decent state. So when u guys moan about ur speeds take it in perspective and think u could be in South Africa ;-)

Regards
Jose

Jose Correia | Jul 24, 2007 | 9:33AM

Well this is the first time I read here, and the article I read was a june 2004 article on making a disruptive network using WRT54G to create great wonderful wirelesss access for the masses. So since this article was written 3 years ago by a person who seems very clear about the future it seems odd to hear the question in the July 2007 article" what happened to america wrt braodband speeds and access?" THis scam is very clear and you should be well aware of this. The NA telcos have ripped off billions of dollars with all their empty promises that never appeared. So I was a little baffled that you asked this.

America is being scammed as they sleep and no one has woken up. I am a candian who has lived in ASIA(HK)for some time. The base price for 1600 mobile minutes, plus free inter-company calls starts at about 10US$ per month. And that is the basic package.. ON the other end of the spectrum is unlimited free mobile internet with all hutchenson X-series plans... Imagine how I feel when I see the rates here.

As far as broadband access, I feel like I am running 56k modem when I return to NA... In HK we have fiber to the door for less than 30$ per month... GO figure.. I could go on and on.. America you need to wake up cuz your world is slipping away.. ONE more fact-- we also have David Letterman on tv herein HK, but it is only on for 35minutes, since there are no commercails between takes... Think about it hey.. America ask yourself what are you really fighting for? YOU fighting for freedom of what. YOUr technolgy advantage - not. YOur healthcare- not. YOur communications - not.. YOur education - not...AMerica has nothing except what it had. So this comment started by the fact that I am surprised you ask the question in the first place - you being a guru and all... NO disrespect, just want to point out that america is a facade that needs to wake up cuz bush and chainnnnnny are taking what littel america has left and are eating it up.

MOst americans think they are living the dream, but in fact you are living the past. The world is ahead and you all don;t even know it... I think the comment by the telcos about google wanting to enter the game says it all...go read it and ask yourself what the answer is...

me | Jul 24, 2007 | 8:30PM

You left out the Clearwire/Sprint partnership regarding the WiMAX rollout. WiMAX will be an integral part of every device as time marches on. WiMAX provides a bandwidth/cost ratio that is very compelling and pushes all applications to the IP layer, voice included.

WIFI will be the less formal connectivity method while WiMAX will offer the seamless handoffs for compliant devices.

Bill Butler | Jul 25, 2007 | 10:44AM

Keep in mind that in HK, you have population density reducing costs. Even a city like Boston has much lower population density than most of Europe, never the less a massive city like HK.

While the population density isn't the only reason, it certainly is part of it. If the entire North America market was like NYC, then prices could certainly be lower.

Dave G | Jul 25, 2007 | 5:03PM

Hong Kong and Japan are a much smaller area, Verizon is running fiber right now, but we're talking a continent not a postage stamp. Already fiber is being used, so I won't get it for a year, big deal. I am so scared we are behind, since we invented the technology and designed it, HK are just testing labs for new products anyway. The world is integrated and it's not US versus China versus Mid-east we are all inevitibly intertwined. Thanks for testing it for the rest of us. Wireless is the future anyway but what the heck, I am getting too much information anyway and have over 100 channels on basic cable with 99% commercials, just watch a video. Maybe I am one of the Sloskies. I am a tortoise. Do they have the iPhone, way cool device. Made in Taiwan, thanks Taiwan!

knighof | Jul 27, 2007 | 10:38AM

Hong Kong and Japan are a much smaller area, Verizon is running fiber right now, but we're talking a continent not a postage stamp. Already fiber is being used, so I won't get it for a year, big deal. I am so scared we are behind, since we invented the technology and designed it, HK are just testing labs for new products anyway. The world is integrated and it's not US versus China versus Mid-east we are all inevitibly intertwined. Thanks for testing it for the rest of us. Wireless is the future anyway but what the heck, I am getting too much information anyway and have over 100 channels on basic cable with 99% commercials, just watch a video. Maybe I am one of the Sloskies. I am a tortoise. Do they have the iPhone, way cool device. Made in Taiwan, thanks Taiwan!

knighotf | Jul 27, 2007 | 10:39AM

July 27, 2007 - 5:15pm EDT

Faster??? ...for the blogs, the popups, the viruses and spyware, or the insipid content?

This is headed down the same road that radio and TV have already blazed. It's a road to nowhere.

Bob Guzauskas | Jul 27, 2007 | 5:16PM

I predict service won't get better anytime soon here in the states. The telcos got everything where they want and they'll only roll out 'faster' connections if they have to - and that won't be for the good of the nation or from regulation (unfortunately). But whatever I guess. Keep voting for all the politicians that line their pockets with contribs from these industry lobbyists if you think your service is great and that you don't feel these same politicians and companies are digging a deep hole for us.

As for virii, spyware, and popups; that what unix and content/ad/popup/flash blockers are for. :) And why even have cable if it's mostly commercials (which it is) and garbage?! That's what downloads and digital tv - as in free - are for.

JL | Aug 02, 2007 | 2:28AM