Author: When It Comes To High-Speed Internet, U.S. 'Falling Way Behind'February 6, 2014
For an increasing number of Americans, access to high-speed Internet has become an essential part of our lives. We do work, email friends, find restaurants, watch videos and movies, and check the weather. And the Internet is increasingly used for important services, like video medical consults and online education, and is relied upon by businesses for critical operations.
Under a recent court decision, Internet service providers, primarily cable companies, aren't required to treat all websites equally. They can make deals to provide faster service to some, or slow down sites that refuse to pay them extra fees. Law professor Susan Crawford says you may be experiencing the effects of this — without realizing it.
Why, for example, do you have to wait for YouTube videos to buffer? Crawford explains: "You may think it's the YouTube application. You may think there is something wrong with your computer. It's probably the network provider making life unpleasant for YouTube because YouTube has refused to pay in order to cross its wires to reach you. And we'll be seeing much more of that kind of activity in the future."
Crawford, author of Captive Audience: The Telecom Industry and Monopoly Power in the Gilded Age, explains how we got to this point. "The [Federal Communications Commission] in the early 2000s really thought that competition would do the job of regulatory oversight — that that would protect Americans," she tells Fresh Air's Dave Davies. The idea was that cable, telephone and wireless companies would battle it out, which would yield low prices for American consumers. "As it turns out, they were wrong and we've come into an era where these markets have consolidated and for most Americans, their only choice for high-speed, high-capacity Internet connection is their local cable monopoly."
Crawford says that American Internet service is falling behind other nations because cable companies have such dominance in many markets, and that will undermine our ability to compete in a global economy. She warns: "Unless somebody in the system has industrial policy in mind, a long-term picture of where the United States needs to be and has the political power to act on it, we'll be a Third World country when it comes to communications."
On how the Internet is like the railroad
For every part of our modern lives we depend on information flows coming into our houses and our businesses. They're just like the railroad in that if you were a farmer in the 1890s, the only way to get your goods to market would be to work through the railroad. ... We just can't operate without it. They're also like them in that they're expensive businesses to build in the first place — it's very hard to come in and compete against one of these guys once they've built one of these giant networks. They're also like the railroad in that it takes intentional policy to make them stretch all the way across the United States. We wouldn't have had the transcontinental railroad without Lincoln; we wouldn't have had the federal highway system without Eisenhower; because markets, left alone, don't provide this kind of universal access.
On why communications access shouldn't be treated as a luxury
I think the problem is actually much more profound than mere discrimination by a few cable actors when it comes to high-speed Internet access. We seem to currently assume that communications access is a luxury, something that should be entirely left to the private market unconstrained by any form of oversight. The problem is that it's just not true in the modern era. You can't get a job, you can't get access to adequate health care, you can't educate your children, we can't keep up with other countries in the developed world without having very high capacity, very high speed access for everybody in the country. And the only way you get there is through government involvement in this market. That's how we did it for the telephone, that's how we did it for the federal highway system, and we seem to have forgotten that when it comes to these utility basic services, we can't create a level playing field for all Americans or indeed compete on the world stage without having some form of government involvement.
On the recent lawsuit between Verizon and the FCC
Verizon was irritated at the December 2010 open Internet rules that had been adopted by the FCC, and [it] came before the D.C. Circuit [court] saying, "Look, we'd like to be able to charge actors like Netflix and Google additional amounts to cross our wires to reach our subscribers, and to pick subscribers to charge more, too, depending on how much bandwidth they're using." And what [Verizon] said was, "Look, you can't allow the FCC to deregulate with one hand, as they had done in the early 2000s, and then impose this open Internet rule, which essentially treats us like a common carrier with the other." And the D.C. Circuit agreed.
On how U.S. service compares with service in other developed countries
[Cable companies] are extracting enormous rents, enormous profits, from what Americans perceive to be a basic service. And the competitive argument they make is a complete canard. If you tried to swap out your wireless connection or use your wireless connection instead of a cable connection for let's say, watching online video — so the average user of a wired high-speed Internet connection uses 50 gigabytes of data a month — if you tried to do that over a mobile wireless device you'd be spending $500 a month. That's because you may get wireless at about the same speeds, but [there are] very low capacity caps, data caps, on the usage of that connection. So it's not a substitute; it's a complement. We love mobile wireless services. It's never going to take the place of a wire.
What's even more disturbing is that in other countries — I've visited both Seoul and Stockholm recently — they take these services for granted. For about $25 a month they're getting gigabits symmetrical service, which is 100 times faster than the very fastest connection available in the United States and for a 17th of the price. It really is astonishing what's going on in America. Americans aren't quite aware of it because we don't look beyond our borders, but we're falling way behind in the pack of developed nations when it comes to high-speed Internet access, capacity and prices.
On what's at stake
What's at stake is whether the new jobs, new ideas, new services of the 21st century will come from the United States or they'll come from Stockholm, Seoul, Beijing, where there are kids already playing in the virtual sandboxes of these very high capacity networks. They take them for granted over there the same way we take for granted electricity. It's a real risk to the country not to be the place where new ideas come from. That's always been our advantage as an entrepreneurial, individualistic society.
On ways to address the problem
There are two routes out of this puzzle for the United States: One is greater oversights, setting a national standard, making sure that everybody gets high-speed fiber access. The other is just leave these guys behind and build better alternative fiber networks in each city in America. And a lot of mayors are extremely interested in doing this because they see it as a street grid or a tree canopy — this is just infrastructure. ... We'll see a lot of developments along these lines the next few years as we try to get out from under the thumb of the cable monopoly for wired service in America.
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