Broadband in big US cities costs 100% more than overseas

On the topic of broadband – a piece of data that won’t shock anyone here in the U.S. From Ars Technica :

The annoying trend holds true in both wired and wireless service. In the Cost of Connectivity 2013 report being released today by the New America Foundation’s Open Technology Institute, researchers note that “in larger US cities, we continue to observe higher prices for slower speeds… In the US for example, the best deal for a 150Mbps home broadband connection from cable and phone companies is $130/month, offered by Verizon FiOS in limited parts of New York City. By contrast, the international cities we surveyed offer comparable speeds for $77 or less per month, with most coming in at about $50/month. When it comes to mobile broadband, the cheapest price for around 2GB of data in the US ($30/month from T-Mobile) is twice as much as what users in London pay ($15/month from T-Mobile). It costs more to purchase 2GB of data in a US city than it does in any of the cities surveyed in Europe.” The analysis compares costs across countries by using purchasing power parity exchange rates.

Cheapest 150Mbps broadband in big US cities costs 100% more than overseas

Google Fiber and Social Engineering

It uses social engineering: It’s accepted that one of the most costly elements of building out a fiber network is the physical labor associated with strong cable, digging trenches and hiring people to terminate the fiber into the home. Google has already strung cable on power lines throughout Kansas City and lowered those costs by working with the local utility and AT&T to get access to the utility poles without having to pay high fees.

But to reduce the cost of the actual last mile to users’ homes it’s telling people in Kansas City that if they want to be the first to get fiber, they’ll have to convince their neighbors to sign up. The goal is to get a critical mass of between 5 percent and 25 percent of the homes in a given neighborhood (Google calls it a fiberhood) committed to signing up for Google Fiber before ever sending out technicians. Residents have until Sept. 9 to get their fiberhood on the leaderboard before Google starts rolling out its fiber.

Google’s Milo Medin and a Google fiber product manager.

Milo Medin, the VP of access services at Google, explained that with this model the folks in the first fiberhood will have their access within a week. This is also why the free service is so important to Google. If people buy into that process, it can get homes attached in those initial bulk deployments and reduce the number of times Google has to send out trucks and technicians. Medin says the $300 initial connection fee will cover the costs associated with the deployments — it’s not doing that at a loss either.

via http://gigaom.com/2012/07/26/the-economics-of-google-fiber-and-what-it-means-for-u-s-broadband/

We Need a Definition of High-Speed Broadband

< rant >

I sometimes wonder if we need to take some real action to define “Broadband” and “High-Speed” internet services. The range of what is considered high-speed or broadband in the US seems to range from 768K DSL to 50 Mbps fiber.

A good example is a flyer from at&t I received last week that was literally slipped under my front door. The people behind these ads obviously don’t read my blog and what I’ve written about broadband 🙂 Here is the scan of the ad below — notice the “high speed internet” claims with “up to 768 Kbps” downstream speeds:

The current FCC definition of broadband is pretty emblematic of the problem too:

What Is Broadband?
Broadband or high-speed Internet access allows users to access the Internet and Internet-related services at significantly higher speeds than those available through “dial-up” Internet access services. Broadband speeds vary significantly depending on the particular type and level of service ordered and may range from as low as 200 kilobits per second (kbps), or 200,000 bits per second, to six megabits per second (Mbps), or 6,000,000 bits per second. Some recent offerings even include 50 to 100 Mbps. Broadband services for residential consumers typically provide faster downstream speeds (from the Internet to your computer) than upstream speeds (from your computer to the Internet).

As more and more of what we consume online requires real broadband, you see services assuming at least 1.5 Mbps connections, such as the new OnLive gaming service:

What kind of Internet connection do I need to use the OnLive Service?
OnLive works over nearly any broadband connection (DSL, cable modem, fiber, or through the LAN at your college or office). For Standard-Definition TV resolution, OnLive needs a 1.5 Mbps connection. For HDTV resolution (720p60), OnLive needs 5 Mbps.

You could easily see someone signing up for that 768K service and thinking they have broadband, when most web developers would think of them as near dial-up 🙂

The Solution: So while some ISPs battle it out mainly over pricing, I think it would be helpful for a coalition of web companies to declare the minimum speed for broadband for both up and down speeds ( I would argue 3 Mbps down, 1.5 up for 2010) as it related to the services they are offering, and even put together a schedule to increase the minimum requirements over the next 5 years so we get to something closer to what my colleagues in Japan have.

We could then have a site called something like doireallyhavetruebroadband.org that would do a speed test, and tell you where you stand with your ISP, and where to get real broadband if you don’t have it.

Now I realize most people are lucky if they have more than one broadband provider in their area, but with more wireless options out there these days, and markets getting more competitive, I think this would be a good start and would help consumers make the right choices – and ultimately make the web better.

</rant>  🙂

NYT on Broadband in Japan

How is it that in San Francisco, a city where everyone is online 24/7, we barely have anything close to fast broadband ? While in Japan “160 Mbps service costs 6,000 yen ($60) per month” ?

The New York Times explores this with a piece tonight World’s Fastest Broadband at $20 Per Home

The money quote:

Cable executives have given several reasons for why many cable systems in the United States are going very slowly in upgrading to Docsis 3. There’s little competition in areas not served by Verizon’s FiOS system, which soon will offer 50 Mbps service. And some argue there isn’t that much demand for super-high speed.

Mr. Fries added another: Fear. Other cable operators, he said, are concerned that not only will prices fall, but that the super-fast service will encourage customers to watch video on the Web and drop their cable service.

I know in places like Japan and South Korea the vast majority of the population lives in large cities so that’s an advantage VS the large geographic areas here in the US. But the lack of urgency here in the US for real broadband, and not that 768K DSL “dialup pro”, is just amazing to me.