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The newest innovation from Silly-con Valley: Slow Internet!

By Scott McCollum
SPECIAL TO WORLD TRIBUNE.COM
November 11, 2001

Some of you are fed up with 56K modems and you want broadband Internet access. You've heard the tales from those who have a cable modem or have their houses wired for DSL. The men and women with cable/DSL services swear by these digital connections to the Internet. The conventional wisdom is: once you have experienced the difference between the insufferable wait imposed by an analog AOL connection and an always-on digital cable modem, you'd be crazy to ever want to go back.

Apparently, there are many more crazy people in Silicon Valley than I originally thought. A recent incendiary and lopsided story from the Ziff Davis Network proclaims that a "dump broadband movement is growing" amongst Bay Area Internet users. According to the article, many early adopters of broadband Internet access are bailing out and presumably returning to the old days of clunky modem connections. Factors like a "sour economy, broadband price hikes... the demise of 'Napster' (the peer-to-peer software that allowed people to transmit illegal copies of copyrighted music, movies and books across the Internet)... as a 'killer app' (an application that would make users immediately pay for broadband access no matter what the cost)" are supposedly forcing some early adopters to drop their DSL and can their cable modems. The sources for this article were an out of work dot-com telecommuter and a guy working for a financial software company that uses the high-speed Internet at work for "free" rather than paying for it at his home.

Even though several spokesmen for broadband ISPs and industry analyst firms all agreed "everything's fine Ñ situation normal," the article takes pains to make the "evil broadband providers" out to be the bad guys. The whole article reads like some greasy hippie kid was shouting it into a bullhorn to a crowd at UC Berkeley: "The evil corporations raise rates and make it too high for the proletariat! The evil corporations have taken away Napster, thereby destroying our freedom to share copyrighted songs and movies, because it cuts into their precious profits! The corporate fools don't know that Napster was their broadband killer app and they have committed an atrocity to themselves and their bourgeois consumers! In protest, we shall use the 'free as in beer' corporate high-speed Internet connections at our jobs instead! Then we can get overtime pay AND have a proper Internet experience. Power to the people!" Amazingly, millions of South Korean and Japanese users pay around $42 (US) a month for broadband without complaint for the "killer app" of email.

Internet users outside of California are much less apt to attend dump broadband protest marches. Leonard Thompson in Raleigh, NC explains that his costs were actually lowered by broadband access. "I recently went from dial-up to cable and the difference for me was cheaper and much faster."

Mr. Thompson said. "I was paying $24 for an ISP and $21 for a second phone line. Cable costs me $40. Who's dumping who?" I have heard similar comments from regular folks from Dallas, Texas to Suwon, South Korea that all say the same thing. Broadband, if you can get it, is the way to go.

The problem is that not everyone can get broadband. "I would dearly love to have a high-speed connection," said Liz Courts of Bend, OR. "But unfortunately, where I live, which is a semi-rural area, it's next to impossible." The reason why the United States doesn't have ubiquitous inexpensive broadband is government regulations. Thank the Clinton Administration pushing for "fairness and competition" from the big phone companies by way of the Telecommunications Act of 1996.

The Telco Act works like this: if you are a company like AT&T or Verizon that spends billions on wiring the country with fiber optic cable, any and all of your competitors have the right to siphon off of your bandwidth for cost. Say you own "Company A," one of the largest telecommunications companies in America. Company A spends billions of dollars to lay down fiber optic cable, repeaters, boosters, switches, flux capacitors and whatever else in the interest of widespread broadband access for her customers in Metro City. It will be a few years and the initial costs will be high, but after a fashion the money invested by your company and the early adopters of your service will pay for furthering the dream of ubiquitous broadband.

Enter the competition. Since your competition doesn't want to spend the billions for their own infrastructure but would like to get in on that easy Internet money, they cry to Metro City elders. "Company A has a monopoly on all the Internet service!" the competition screams. "We cannot afford to spend all our money to compete so we want to use Company A's equipment to foster competition and help consumers."

The Metro City elders see that you seem to have the only network around these parts and judges that you indeed hold a monopoly position on networking infrastructure. The elders decree that all competitors of Company A may now lease bandwidth off of Company A's lines at cost in the interest of fairness. Since youÕve spent billions on big pipes the bandwidth is more than enough for several companies to use (You were forward-thinking enough to realize that your customers' needs would grow in the future, and bought the highest capacity lines). There is no loss of speed when a dozen other companies lease/leech off of your infrastructure.

Company A now stops dead in her tracks when it comes to rolling out more lines to reach the rest of the customers in Metro City. Why spend the needed billions on laying down more cable when dozens of little companies will come in, use the infrastructure you paid for and then undercut you in the interest of "fairness?" This is the Telecommunications Act in action. It is why Ms. Courts will have a difficult time getting DSL or cable in her rural Oregon town, not some corporate conspiracy. Believe me, these companies want more broadband customers Ñ not fewer.

To fix this problem, fix the Telecommunications Act. Make the companies with fiber optic backbones between cities have a regulated monopoly (they own the cables but cannot charge more or less to their customers), and allow local "last mile" providers to resell the bandwidth from these big companies with added service and support. Dumping broadband and reverting back to old technology is not a solution. That option is a Luddite punishment for which the so-called "innovators" in Silly-con Valley should be ashamed.

What are your thoughts about this issue? Email me scott@worldtechtribune.comwith your opinions and comments.
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