David Kirkpatrick

September 14, 2010

Broadband in the U.S. is overpriced

Filed under: Business, Technology — Tags: , , , — David Kirkpatrick @ 2:55 pm

Not too surprising given the near monopoly status of the industry.

From the link:

The reasons for the stagnation of U.S. broadband are multifactorial, but one of the authors, Shane Greenstein, argues that the 2003 decision allowing the broadband industry to regulate itself has caused much of the stagnation.

(For perspective, check out how much faster most of Europe and Asia is than the U.S., when it comes to broadband.)

Greenstein says that by now, broadband companies should have paid off almost all the costs associated with building out their infrastructure.

“We are approaching the end of the first buildout, so competitive pressures should have led to price drops by now, if there are any. Like many observers, I expected to see prices drop by now, and I am surprised they have not,”Greenstein told Kelogg Insight, a house organ for the university.

This means that broadband companies are now operating their broadband as almost “pure profit,” devoting only a small fraction of subscriber revenues to maintenance.

Without new entries on the market — most urban areas have at most two different broadband suppliers to choose from, the phone company and the cable company — Greenstein argues there is no incentive to lower prices.

October 22, 2009

Wireless broadband over television spectrum

Also known as a “white space” network. This tech is now a a reality in Virginia.

From the link:

Wireless technology that’s been touted as the best hope for providing high-speed Internet access to rural communities is about to get its first true test. The first “white space” wireless network will use unused portions of TV spectrum to distribute broadband access to residents of Claudville, VA.

Advocates for rural broadband say that high-speed Internet access is needed to improve healthcare and education in isolated communities. Others simply don’t want their communities left behind while urban areas access ever more services over the Internet.

But bringing broadband to rural areas is easier said than done. Roger Hayden, director of the Claudville Computer Center and chairman of the Patrick County Broadband Task Force, said at a press conference Wednesday that in 2004, he called every carrier he could find, and none was willing to deliver a high-speed wired Internet service to Claudville. In the years since, local officials have been looking for another way to get better access.