The US Government now Controls the Internet

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The providers must be too heavily regulated and/or taxed, then.


Nothing is immune to inflation. Prices could even drop, but still be affected by inflation.

where I live, it is centurylink and only centurylink. cable internet only available in town, not in county. too many trees for satellite. no competition so they charge more than what big city residents have to pay. I detest the very idea that there should be fast lanes for Richie rich and dial up for everybody else.

http://arstechnica.com/business/2015/02 ... omplaints/

Netflix has officially announced it is filing a complaint to the FCC regarding how ISPs force interconnection (peering) agreements on them.

Netflix claims Comcast, AT&T, Time Warner Cable, and Verizon are fleecing them with the rate they have to pay to each.
Netflix is required to pay each of the above ISPs, to ensure Netflix customers can access Netflix.
Netflix claims the above ISPs will block them, if they don't pay up.

Netflix CEO says

Comcast claims they are being fair and reasonable (Comcast is known for doing horrible things).

Cogent, Which is one of the level 3 transit tier companies (Provides interconnection to most of internet services to the ISPs).
had this to say.



While Cogent has refused to pay Comcast, Level 3 agreed to do so after a dispute in 2010. A Level 3 spokesperson told Ars that the company needs to read and understand the new rules before deciding on any action.

http://arstechnica.com/business/2015/02 ... omplaints/

Hopefully Netflix and others can win and set the Big 6 in their place.

There is another way to handle the cost of Netflix traffic, but you probably wouldn't like it.

Bear in mind that the pricing is based on an average user. With more and more users using Netflix, the bandwidth required by the average user has increased dramatically but prices haven't. The alternate is to either raise prices or reduce the bandwidth cap. How about a cap of 100 gigabytes per month and then a $1 surcharge per gigabyte in excess of that?

Someone has to pay for that bandwidth -- either the users or the largest providers. Netflix doesn't think they should pay. With the new regulations, I suspect it will be the consumers paying more.

You got what you want. Don't start crying when you see the results a year or two down the road.

You're upset about insufficient competition when there is enormous competition throughout most of the country. It is thought that with the new regulations, it will be much more difficult for anyone to compete in any market that they are not already in when they have to go to the FCC to get approval for any new infrastructure. I wonder how long that approval will take. How many months will it take?

From http://arstechnica.com/business/2015/02/netflix-call-your-lawyers-fcc-is-ready-for-interconnection-complaints/:

Note the next part:



In other words, if the backbone is spun off to separate companies that do not sell internet connectivity to consumers, then they won't be covered by the regulations. I wouldn't expect less congestion.

To emphasize that:

Inflation has been driven by the rise in Gas and Oil prices, until recently.
Right now companies do not expect the oil and gas prices to say this low and are refusing to lower the prices to match.

The providers have no real competition, since they have been buying the competition up.
There is no reason to lower the prices, when the consumer has no real choice.


The ISP market is an Oligopoly, which means 5 companies control almost 90% of the market.
This means the companies can set similar prices.

But you do realize you cannot buy broadband as a STANDALONE product!
You must take it as part of bundled entertainment package from one of the ISPs.

AT&T does allow you to buy stand alone DSL, but high speeds are bundled with their cable and phone service.

The FCC has arbitrarily decided that Broadband Internet must be at least 25 Mbps download and 3 Mbps upload.

This is from my laptop:



There is no guarantee of 25 Mbps during the daytime and especially during the evening so I'm not sure it would be classified as Broadband Internet.

where I live there is NO broadband. "dsl-lite" is all there is, somewhere between 56kbs-1.3mbs, highly variable. "too far from the trunkline."

Oh remember when we had dial up and had X amount of minutes per month for a price (minutes and prices varied by ISPs)
Remember the huge overages you had to pay for every minute you went over each month.
Remember how AOL and others took it to the extreme forcing regulators to put the an end to the high overages (which wasn't listed on the CD, packaging and in the terms of agreement).
You either had X amount of minutes and were cut off for the month when you hit that X amount.
or you had unlimited dial up.
It was ISP dependent which choice you had.

You only have to get FCC approval when you want to become an ISP, in order to get spectrum (or TV, Cable, Mobile, and Radio)
Nearly all approval comes from the states, counties and cities.

There was real competition in the 90s, then AT&T, Sprint, Verizon, Comcast, TWC and Charter bought up most of ISPs.

Hell Comcast is trying to get the approval to buy TWC, which would give them over 30% of the U.S. market and give them over 60% of the market in 27 states.


When you have 6 major ISPs commanding 90%+ of the market, you don't get competition or even varying pricing.
Make it worse Big 4 being AT&T, Verizon, Comcast, and TWC control 80% of the U.S. market.

Here's the biggest obstacle to real competition:

AT&T, Verizon, and CenturyLink (Old Southern U.S. ) own the whole landline grid.
Either you have DSL or dial up directly through these companies.
Or you have regional ISP who leases these lines at significant cost and has no control if something goes out.
(The three landline companies are required by law to lease the landlines).

AT&T & Verizon are your only two choices in most areas for DSL and dial up.
Their prices are very similar on everything.

If you don't live in a U.S. metro area, then you don't even have DSL as an option.
This why dial up is still roughly 50% of the U.S. market (it depends on how you define dial up and broadband)

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Now lets talk cable/broadband industry

Top 5 In order of size by customers:

Comcast - 22.5M (Comcast doesn't enter TWC's markets per their agreement, with some exceptions)
TWC - 11M (East coast based provider for the most part. They have deal with Comcast to stay out of each other markets)
AT&T - 6M
Verizon 5.5M
COX 4.3M (only in a few states)
Charter (they are tied for 5th) 4.3M (only in a few states)

These cable companies account for over 85% of the U.S. market and control most cable lines.
http://www.leichtmanresearch.com/press/ ... lease.html

Most cities have a choice between Comcast (or TWC if Comcast is not in your market), AT&T, and Verizon as their only choices.

If you're lucky you also get a choice of Charter and COX.

But here's the catch... Pricing is virtually the same across the board!
The companies don't compete on price, frankly because they act in tangent in pricing (not be confused with collusion)
This is very much legal to have companies raise their prices to match their competitors, when consumers don't have any real choice.

Remember you cannot buy broadband as a standalone product in any U.S. market from ISPs unless they are municipal networks.

If you want broadband, you have to buy the AT&T Triple Play bundle (Cable, Broadband, Phone Service) for very high price, Verizon 3 pack bundle (Cable, Broadband, Phone Service), Comcast Xfinity (Cable, Broadband, VOIP Service), Charter bundle featuring (Cable, Broadband, VOIP Service) same goes for COX.
This for minimum broadband this will run you between $70 - $100 (normally Comcast charges $100, though you do get a few more channels than the rest).

If you want decent broadband you have to go to mid tier bundle from one of these companies which runs you between $100 - $150 (Comcast being the most expensive)

If you want full broadband you must buy top tier bundle which generally includes full cable, runs you over $150 in most markets.

If a new competitor wants to enter the market, they have to convince one of the established ISPs to lease them lines or attempt to get permission to lay their own cable lines.

But most states and cities/towns have already granted AT&T, Verizon and Comcast (TWC in the non Comcast markets) the sole rights to lay cable lines.
They don't want any more companies laying down new lines (in reality the 4 major cable companies lobbied quite hard for these protections).
These protections are currently legal!


You cannot have real competition when the 5 biggest cable companies own the majority of the lines.

---

Now for cell phone providers, who also provide internet service over cell network.

The big 4 are:

AT&T ( also owns Cricket Mobile) has ~120M customers in the U.S.
Verizon (also owns Vodaphone) has ~101M customers in the U.S.
Sprint (also owns Virgin mobile, Boost Mobile, Assurance Wireless) has ~55M customers in the U.S.
T-Mobile US (also owns Metro PCS and Go Smart) has ~55M customers.

This includes business customers.
AT&T and Verizon control 2/3rds of the U.S. Market.
AT&T (and nearly every other carrier uses the GSM standard), Verizon uses CDMA (Sprint is the only other carrier that uses it)

T-Mobile just finished merging with Metro PCS in late 2013, which allowed it to become the 4th biggest carrier in the U.S.
This has created some much need competition on data plans and to some degree cell phone service in certain U.S. markets.

Though in many states and cities you have a choice between Verizon and AT&T as mobile carrier.
Though many areas still don't even have cell phone service due to them being rural.


The point to all of this is, there hasn't been any real competition in the Telecom and ISP industries since the mid 2000s.
This was due to full deregulation of said industries in the hopes that competition would drive down prices.
Instead the dominant companies consolidated the market under their control, while effectively splitting up the market between them.
This allowed them to raise the prices to match one another.

This editorial from the New Yorker explains it better than me.
It also explains how things got to this point.

Actually the FCC's new standard is inline with the rest of the world.

The original definition of broadband is an internet service that comes cable lines through a cable jack.
Internet service via the phone line and jacks are defined as dial up and high speed dial up (DSL)
Internet service via a cell phone tower is defined as wireless
Internet service via a satellite connection is defined as Satellite.

This is defined by the tech industry originally when the developed the technology.

it's all becoming increasingly unaffordable.

That's what usually happens when the government prints too much money.

Call it socialized debt, nationalized debt, quantitative easing or just plain old socialism, creating wealth out of thin air doesn't work and causes harm.

Next thing you know they'll be calling for regulations, price control, nationalizations ... then the riots start when they run out of toilet paper and internet. Not that they don't deserve it.

Lets clear up the confusion.
Net neutrality means that it is illegal for ISP to censure the internet. It is not about government control it is about protecting our freedom. You might not care if the Internet is censured by a multi-national corporation, but I do!

That's not true according to Wikipedia.