Here's why internet services are so abysmal in America

There's a new internet service on the horizon that promises to deliver extremely fast internet speeds for cheap, wirelessly.

Called Starry, it's exciting enough on its own terms. But the startup's generating MJ-moonwalking-on-MTV-level enthusiasm in our newsroom not only because it rocks, but also because its competitors, frankly, are pretty bad.

Here are the main reasons many Americans still can't access quality internet service:

ISPs operate as monopolies in most of the country

Until recently, I lived on the north side of Chicago and had a home broadband plan from Comcast. But the corporate megalith failed for months to deliver anything close to promised speeds, and repeatedly tried to bill my roommates and me for a router we never rented or received. So we decided to switch services.

That turned out not to be an option.

In Rogers Park, a bustling, dense neighborhood in the third-largest American city, Comcast is the only broadband option. This isn't an aberration – the vast majority of the country lacks even two broadband providers to choose from. In that anti-competitive atmosphere, ISPs have little incentive to drop prices, improve service, or not bill you for imaginary routers.

The providers have gotten away with their monopolies for so long in part because until 2015, the Federal Communications Commission (FCC) had defined any ISP delivering even 4 megabytes per second — which is not very fast at all — as "broadband." That meant Time Warner or Comcast could point to junky local providers and claim to face real competition in the high speed market. A recent shift to a 25 Mbps standard has exposed the nonsense in that claim.

Broadband investment has gone down in recent years

Most of the country still lacks the basic infrastructure for internet speeds that can keep pace with the modern internet. Yes, most of the country is also sparsely populated farmland, but it's not only Wyoming ranchers getting screwed out of access to the modern web.

Many mid-sized cities like Madison, Indianapolis, and Eugene, Oregon lack a variety of affordable options over 25 Mbps.

Expanding broadband access requires laying cross-country fiber-optic cables and doing the hard work of wiring up individual homes. That's an expensive project, but it's also necessary if every American is going to have access to the most important economic resource of the 21st Century. However, ISPs are investing less and less per year in getting it done.

According to their own numbers (which they try to bury in the hilariously bad chart to the right) the cable companies have invested 26% less in broadband infrastructure in the last six years than they did in the previous five.

When the FCC does pressure ISPs to improve their services, or at least be honest about how bad their existing services really are, all hell breaks loose. After complaints from AT&T, Verizon, and the cable companies about the broadband upgrade to 25 Mbps, six senators stepped in to argue that the agency was meddling with the free market. Which brings us to the most fundamental reason the American internet still runs so slow in 2016:

We still haven't decided if we should treat the internet as a utility or a consumer product

There are two basic models in this country for services that flow through the walls of our homes.

First there are essential utilities: electricity, water, and, in cold climates, natural gas. The vast majority of Americans agree that everyone should have access to these. When governments or the heavily-regulated private utilities they contract fail to deliver them consistently and safely – as is currently happening in Flint, Michigan – we're rightly horrified and demand action.

At the other end of the spectrum are luxury goods like pay-TV. Premium cable services generally operate like monopolies, but there isn't a huge push to break them up. That's because we recognize that HBO access is a nice thing if you can afford it, but most people can get by without it just fine.

As a country we still haven't decided whether high-speed internet falls closer to running water or Tyrion Lannister on the hierarchy of needs. Government still puts up barriers that restrict the ISP market to a few wealthy, powerful megacorps – often the same ones that provide premium cable, like Comcast, Verizon, and Time Warner. Then when the FCC steps in to demand a higher quality of service, politicians complain about invasions of the free market – an argument that only works if the internet is an inessential service.

But in a country where broadband access is increasingly important for employment, healthcare, and education, that model makes less and less sense. It's no wonder people are getting so excited about Starry: ISPs have sorely needed some competition.


By Rafi Letzter for Tech Insider


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