The price of progress

Here's a subject affecting millions of Americans that will never come up in tonight's presidential debate: the cost and availability of high-speed telecommunications in the home.

Late on Tuesday, Federal Communications Chairman Kevin Martin proposed a change in the "intercarrier compensation" system, which is telecom carriers figure out how much to pay each other for using each other's networks. It uses the "universal service fund," which -- back in the days when AT&T was broken up -- wasn't much of a big deal at $1 a month. Now it's up $6.50 and Martin proposes it be raised to $8.50.

Part of Martin's plan is to encourage rural carries to provide broadband service to rural America. The Associated Press story cited above says only about 10-percent of America doesn't have access to high-speed service. Others, says there's no real way to know, because the FCC has been adamant about not collecting the data that would tell them.

Says Scot Bradner of Network World:

The law also requires that the FCC figure out how U.S. broadband deployment compares with that in other countries in a systematic, apples-to-apples way. The results of this study will be useful at least to the degree that they may devolve a consistent agreement as to where this country sits. I've seen rankings that vary between No. 8 and 20 in the world -- the number seems to heavily depend on the goals of the person.

Today, a story in a Muskegon, Michigan newspaper chronicles a typical effort to bring the Internet to a rural area: Long delays, poor service when there is some, and a price higher than imagined.

Even for people in metropolitan communities, and especially in a crumbling economy, the promise of high-speed Internet fades with rapidly escalating monthly costs of being connected.

I see a story once or twice a month where the phone or cable utility serving a small town says it is too expensive to build out for high speed internet. Then the town decides to do it themselves and the company then rapidly starts building too.

Too bad that it takes a gun to the head to have a company make a decision that will make them money. There are so many ways to get this done today that it does not have to be a budget killer.

Just wanted to note for readers: the $1, $6.50 and $8.50 amounts refer to the cap for line-charges that a provider can bill each customer each month.

I wish we saw more telecompetition (ha!) for this reason. Some of the rural cooperative telecom (and energy, for that matter) companies offer top-notch service because its actions effectively are those selected by the citizens rather than a corporation siphoning profits out of rural communities. That said, I'm not certain the FCC needs to be regulating this at all. Except if they didn't, and without net neutrality, we'd see small ISPs go under and residents of communities with exclusivity contracts would be stuck with a few bad options; Comcast v. Qwest, for example.

There's a task force studying some of these issues right now. "The purpose of the Taskforce is to study the issues involved in the proposal to provide statewide [ultra-]high-speed Internet access by 2015." Readers can visit the blog of one of the members, Mike O'Connor, to read about the group's activities, share your opinions and ask questions. I believe several other task force members have similar sites as well.

If you have time to read it and are so inclined, here is a great article from 2005 on the state of the US and Broadband penetration as compared to other nations. I've tried to follow this topic the last few years and haven't seen much to indicate the general trajectories have changed, particularly with the Telecom Act of 1996 not having changed and the conversation being bogged down in Net Neutrality in congress as opposed to what should be done to ensure our competitiveness as a nation in the future.

"Summary: Once a leader in Internet innovation, the United States has fallen far behind Japan and other Asian states in deploying broadband and the latest mobile-phone technology. This lag will cost it dearly. By outdoing the United States, Japan and its neighbors are positioning themselves to be the first states to reap the benefits of the broadband era: economic growth, increased productivity, and a better quality of life.

Thomas Bleha, the recipient of an Abe Fellowship, is completing a book on the race for Internet leadership. Previously, he was a Foreign Service officer in Japan for eight years."

The telecoms got 39 billion dollars back in the 90s to build these infrastructures... they just took the money and ran, lot of executive bonuses that year. Now they're making money hand over fist charging money for nothing literally. We need to regulate and recapture the public investment here by forcing these companies to follow through on what they were supposed to do last decade. By the way, this was yet another failed experiment in letting the free market to it's magic.