Industry News from Conferencing

TMCNet:  EDITORIAL: U.S. lags in internet speed, access

[January 03, 2013]

EDITORIAL: U.S. lags in internet speed, access

Jan 03, 2013 (The Virginian-Pilot - McClatchy-Tribune Information Services via COMTEX) -- Considering that the Internet was born in America, it's especially troubling that new technologies are reaching their potential everywhere else.

South Korea has widely available, superfast broadband service priced lower than most Americans pay for access through a cable or telephone company. Studies show that America's average Internet speeds are middling and expensive compared with the rest of the developed world. And unavailable in much of the nation.

Now a report by the Open Technology Institute finds that even as video conferencing, movie-streaming and online education demand more bandwidth, Internet service providers are limiting service and charging more for it.

This isn't a surprise. Net-flix movie streaming -- which makes up a huge portion of all Internet traffic -- has prompted cable companies across America to look for ways to slow down service to limit competition and the disruption to their networks.

Internet providers claim they're trying to keep their network from breaking. But such throttling turns out to be more about money than technology.

While the amount of data trafficked at the average house keeps rising, the cost of moving those bits keeps falling. Sending data is now cheaper than ever.

The result, the report concludes: "Broadband is an incredibly profitable business, particularly for cable ISPs." Businesses are built to make money. But in a data environment where most people have only one or two options, the Internet-access market in America starts to look like a monopoly.

Wireless data service was once thought to be a potential solution to poor access and slow speeds. It would provide the competition the Internet access industry needed.

Instead, wireless companies charge more for data service, a model they discovered in the days of text-messaging, when they charged considerable sums for a service that cost them essentially nothing.

"Tiered pricing and data caps have also become a cash cow for the two largest mobile providers, Verizon and AT&T, who already were making impressive margins on their mobile data service before abandoning unlimited plans," the report concludes.

The rest of us might conclude that competition without true competition means bigger, protected profits for the competitors and higher prices for their hostage customers.

___ (c)2013 The Virginian-Pilot (Norfolk, Va.) Visit The Virginian-Pilot (Norfolk, Va.) at Distributed by MCT Information Services

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