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A tech antitrust problem no one is talking about: US broadband providers

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281–290 of 354 posts

Re: A tech antitrust problem no one is talking about: US broadband providers

#281

Seriously, I feel like I say it every time it comes up: WHY aren't people taking action against ISP monopolies? It seems like such a cut-and-dried political issue: they're utilities and they overcharge you whether you're a Republican or Democrat. And taking action doesn't require new antitrust concepts, because it's just your garden-variety utility. It's the same established principles as electric or natural gas. Yet…

> And I'm not talking about politicians being bought. It baffles me why voters aren't writing letters to their city councils, their mayors, their state reps, their governors. If voters actually care, politicians do respond.

Concentrated benefits, disparate costs. Paying $20/month too much for internet is a pain in the ass, but it's a pretty minor issue for most people compared to (say) healthcare.

Re: A tech antitrust problem no one is talking about: US broadband providers

#282
post #236

The problem is the proposed solutions really just entrench existing providers, specifically net neutrality policies: They legalize monopolies as long as they're "following the rules!" _You_ _cannot_ _legislate_ _good_ _behavior_ _into_ _monopolies_. So while I appreciate the spirit of Net Neutrality rules, the solution is fundamentally flawed. Let's say you want to open an ISP in your neighborhood. Based on their his…

I don't think this is a monopoly problem as much as a collusion problem: multiple providers exist but many regions each have a single provider. If this is a deliberate agreement then it's extremely illegal. Where I live there are multiple high-quality ISPs at my building, the US should find a way to encourage multiple ISPs to be present in every single neighborhood. People who complain about "too many ugly wires" sho…

Your building, you say. I can choose between at least two providers in my apartment in Brooklyn, NY.

But somebody in upstate suburbia cannot, and they are lucky if their only provider is not utterly bad.

Density is key here. Suburbia is not dense enough, and is finicky enough about digging or running wires, to make building a competing network lucrative. And the US has a ton of low-density suburban population, even in formally urban agglomerations like LA or Houston.

One solution is to live in a proper city, but proper cities are not very numerous in US, and living there is more expensive.

Re: A tech antitrust problem no one is talking about: US broadband providers

#283
post #236

The problem is the proposed solutions really just entrench existing providers, specifically net neutrality policies: They legalize monopolies as long as they're "following the rules!" _You_ _cannot_ _legislate_ _good_ _behavior_ _into_ _monopolies_. So while I appreciate the spirit of Net Neutrality rules, the solution is fundamentally flawed. Let's say you want to open an ISP in your neighborhood. Based on their his…

I don't think this is a monopoly problem as much as a collusion problem: multiple providers exist but many regions each have a single provider. If this is a deliberate agreement then it's extremely illegal. Where I live there are multiple high-quality ISPs at my building, the US should find a way to encourage multiple ISPs to be present in every single neighborhood. People who complain about "too many ugly wires" sho…

Agreements between the local government and the provider aren't really collusion, just government created monopolies.

As for some kind of collusion between providers, if not competing is preferable for companies, why does anyone ever compete? Verbal agreements or not. Common sense says if you undercut someone's price they will cut their price too in response. Just offer the same price, stay out of their neighborhood, etc. Don't need to wink and nod about it. Yet we see fierce competition all over the place because that strategy doesn't work. New entrants always come along and they can't make a profit by playing that game when others already have all the market share. If you only see a single provider it's either a govt-protected monopoly as I mentioned above, or a beneficial monopoly that is holding prices too low for competition to see an opportunity.

Re: A tech antitrust problem no one is talking about: US broadband providers

#284

Earlier quoted context omitted.

I'd say that's treating econmics as pure math rather than science.

No, no it's not. It's treating economics as some bastardized version of philosophy, not math. Mathematical axioms are based on the principle that you cannot imagine an alternative axiomatic system, I can easily imagine a different axiomatic system for economics, and that the axioms cannot be empirically contradicted. And I can actually justify it empirically.

You maybe right, but not the way you interpret math. Mathematical axioms are not empirical, and contradictions do arose from those axioms. Non-Euclidean geometry[0] would be a good starting point, Russell's paradox[1] is also worth entertaining. Mathematical axioms are assumptions made that works treated as truth, not the truth taken for granted.

[0]: https://en.wikipedia.org/wiki/Non-Euclidean_geometry

[1]: https://en.wikipedia.org/wiki/Russell's_paradox

Re: A tech antitrust problem no one is talking about: US broadband providers

#285

I'm always surprised this isn't discussed more. Big tech is accused of being monopolistic, but there is a constant flow of new players in the field, all gaining market shares and building the Next Big Thing, while telecom providers are pretty stagnant. I'm curious why cities don't directly lay down the infrastructure work for broadband access. In some cases that might raise property value enough that the town could m…

> I'm curious why cities don't directly lay down the infrastructure work for broadband access. Wondering the same thing here (Switzerland), but I might not understand the context: decoupling the "cable" from the "provider" is not common in the US, or there are some other complexities that I don't understand? In my case the company "Swisscom" opened half of the sidewalk, connected my apartment building to their FTTH i…

Many municipalities expressly made contracts with cable TV networks to wire their towns / neighborhoods in exchange for a monopoly in cable access. Else the cable company did not have enough incentive (or pretended to) to lay the cable at all.

So the cable company owned the only copper capable of broadband internet, and also the underground channels to lay fiber in. They naturally upgraded their hub spots to allow Internet traffic, and laying the last mile all over again is prohibitively expensive, or even administratively prohibited, in a lot of places.

There is, of course, phone infrastructure! But Bell was a textbook monopoly, and pieces if it retained the infrastructure after its split. So in some places they can profitably reuse the copper they have to also provide Internet service, and sometimes you can even get fiber from them in newer houses which were wired with fiber backbone for the phone service anyway. In some areas the fixed-line copper is not good enough, and running fiber is too expensive because of low housing density.

In large proper cities, of course, the situation is much better, because infrastructure cost per reached customer is much lower.

Re: A tech antitrust problem no one is talking about: US broadband providers

#286

This is such a weird thing. After spending time in SE Asia, where bandwidth is cheap and plentiful (in the cities), it's painful coming back to Europe (and Australia). I'm in Berlin atm, and the wifi is shit, bandwidth is expensive and unreliable. And the phone plans suck. I was in Perth (Australia) before that, and access there is terrible. In Cambodia, 120Gb (per week) of download cost me US$1 (per week) over good-…

> In Berlin, it's 40 euros a month for 5Gb,

What network? I pay 12 euros for 5gb (aldi talk, running off o2, so i can still use my phone in the u-bahn)

There's also lidl connect runnning off telekom if you like that network

Re: A tech antitrust problem no one is talking about: US broadband providers

#287

I'm always surprised this isn't discussed more. Big tech is accused of being monopolistic, but there is a constant flow of new players in the field, all gaining market shares and building the Next Big Thing, while telecom providers are pretty stagnant. I'm curious why cities don't directly lay down the infrastructure work for broadband access. In some cases that might raise property value enough that the town could m…

Stagnation isn't directly related to market dominance.

Re: A tech antitrust problem no one is talking about: US broadband providers

#288

I'm always surprised this isn't discussed more. Big tech is accused of being monopolistic, but there is a constant flow of new players in the field, all gaining market shares and building the Next Big Thing, while telecom providers are pretty stagnant. I'm curious why cities don't directly lay down the infrastructure work for broadband access. In some cases that might raise property value enough that the town could m…

> I'm curious why cities don't directly lay down the infrastructure work for broadband access. Wondering the same thing here (Switzerland), but I might not understand the context: decoupling the "cable" from the "provider" is not common in the US, or there are some other complexities that I don't understand? In my case the company "Swisscom" opened half of the sidewalk, connected my apartment building to their FTTH i…

> I might not understand the context: decoupling the "cable" from the "provider" is not common in the US, or there are some other complexities that I don't understand?

So the US context in a nutshell; in most places, the provider of the cable is the provider of the service.

In a bit more detail. Up until 1982, almost all telephone service was provided by AT&T (also known as the Bell System or just "The Phone Company"); at that point, it was split up through anti-trust into regional local phone companies (the baby Bells, ex Pacific Bell in California, Bell South in the south), and a long distance phone company (AT&T), and it became possible to choose a long distance carrier, if you wanted to make long distance calls. The local phone companies were not permitted to provide this service, although AT&T may have been allowed to be a default choice. This unleashed real competition in long distance service, it was now fairly easy to switch, and as easy to dial, and there were several companies ready to go, because they had been offering less usable services already (dial a local number, get a second dial tone and dial the actual destination, etc); prices dropped, quality improved, etc, etc.

In 1996, we got a Telecommunications Act which among other things, required the incumbent local telephone services to lease access to their lines at cost based rates. Under these terms, if there was sufficient space in the central office, a competitive local carrier could install equipment and provide local (and long distance) calling and DSL.

However, the regulator (FCC) said this only applied to telephone service and not to "new" services like phone and internet via cable TV lines.

Additionally, DSL length restrictions meant many customers weren't close enough to the Central Offices to get good service, and phone companies began building out remote terminals to house the equipment closer to the customers. But there's no space in a remote terminal for competitive carrier equipment, so that wasn't necessarily required to be available either.

Finally, courts ruled that it wasn't fair to impose leased access requirements on telephone companies but not cable companies, and the regulator declared the market competitive because consumers could chose from their telephone company, their cable company, internet over power lines (which I don't think every actually happened!), or wireless, so line sharing wasn't important.

An additional wrinkle is that although the leased access prices were regulated, and supposed to be based on cost, incumbent carriers would regularly price retail accounts below the leased access prices, making competition unfair.

There are a few open access networks that were explicitly built out for this, but it's pretty rare, or it comes with big caveats: I can get on my municipal fiber network where I live, but I'd have to pay all the construction costs to get the network extended; if I organize a group, we can split the costs, but interest is low, I'd rather be able to do it, but get partially reimbursed if someone else connects up on the line I extended (within a reasonable time).

TL;DR: we almost had it, but it was a bit broken, and then it was taken away.

Re: A tech antitrust problem no one is talking about: US broadband providers

#289
post #237

Earlier quoted context omitted.

ISPs are NOT a natural monopoly, you can have multiple sets of wires going to every building. This is the situation in my part of Europe and my internet is pretty damn fast. Treating ISPs as a monopoly is fundamentally wrong.

Multiple sets of wires going to every building is feasible and perhaps even reasonable when we're talking about an apartment building. But digging multiple trenches along suburban and rural roads and driveways leading to single-family homes is very wasteful. It's usually prohibitively expensive for the second company that wants to come into town, and is basically guaranteed to be a negative ROI for the third company…

Also in Europe the owner of a cable to a build is required to rent it out to other providers at cost. So if DTAG builds a cable to my apartment complex, then I can later go an buy a DSL from Vodafone, despite the line begin DTAG. Since it's at cost, Vodafone has no further costs than what they would pay if they put down the line themselves, they even save some since they typically delegate support to DTAG technicians for on-site issues.

Re: A tech antitrust problem no one is talking about: US broadband providers

#290
post #264

Earlier quoted context omitted.

My water company is pretty well behaved. Sewer too. Trash pickup is without headaches although I don't know the cost. Even my power company is ok now. They had a bad part in the early 2000s when they were trying to semi-privatize and Enron was trying to horn in on the management, but once they went back to being an ordinary utility the bad behavior stopped.

Water, sewer, trash pickup, and power have very easy to understand quality metrics, and can be easily regulated. An internet connection is not so easy to measure. You could have a very well provisioned and maintained local loop, and poor connectivity from there. I strongly support local loop unbundling --- you can regulate the local loop in simple terms, and let competition manage the messy network interconnection bi…

Btw, the same argument you make about an internet connection also applies to money. And money is not even a natural monopoly.
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