<i>describes how vastly more efficient the bottom-up Internet is compared to the old telco industry’s top-down model</i><p>Pricing disparities like that between telco services vs Internet services create pressure like differentials in air pressure on opposite sides of a membrane. The membrane represents forces that prevent efficiencies in that market from being realized and enjoyed by consumers in that market. When that membrane is able to prevent the equalization of a pressure differential that is five orders of magnitude, you know that membrane is extraordinarily strong.<p>Unfortunately, membranes like that exist everywhere you turn in society. They do an enormous amount of damage, and the only reason why we see it so starkly in this case is that the Internet grew faster than membrane-supporting-forces could get their boots on its neck.
This is bogus.<p>New Yorkers got a tough lesson about the reliability of "modern" communications infrastructure in the last flood. I remember a circa-1990's ad where an old lady using a pay phone said "This never happened with AT&T" and the answer was "You're not dealing with AT&T."<p>I live in a cell phone dead spot and I depend on a landline because it will work when the the power is out and I really need to call 911. Cell phones, cordless phones, skype, dsl, cable and "magic jack" all disappear when the power goes out.<p>Also with all kinds of communication infrastructure there's the economic problem of paying for it. I got a close look at a proposal to wire a rural area with optic fiber to offer multichannel television and DOCSIS 3 internet.<p>Most of the cost is in getting the fiber to your door. This cost is huge ($1000-$2000 per household) and is necessary to offer the simplest and cheapest services.<p>Triple play bundles are one way of getting more money out of the average customer and then there's the very tricky problem of offering better services to people who value them more, so you get usage caps and overusage fees that are 10-20 or more times than the bulk price (no, i wouldn't complain about spending $20 for an additional 200GB of usage)<p>The outside physical plant that these people were proposing to build could be easily upgraded to support service similar to Google Fiber, but that would be an empty promise unless they upgraded their "middle mile" which again would mean a considerable amount of capex.<p>Regulated telcos are greedy, that's true, but I've looked at the economics of a number of smaller broadband providers and it's definitely a challenging business to be in.
I'm not a huge defender of telco companies, but isn't this like arguing that Adobe Photoshop has a 1,000,000% markup because the DVD they sell for $700 only costs $0.07 to produce?
Am I the only one who realizes that while voice is approaching commoditization, you still have a lot of specialty equipment required for moving calls? It's not the same as IP, where, for instance, the time to reorder the packets on arrival is inconsequential, whereas in VoIP it's death if those packets aren't sorted in under 200ms.<p>Is Voice WAY more expensive than it has to be? Yes. Is it 5 factors overpriced? Probably not.<p>The $ figures cited in the article treat voice like another packet and it just isn't.<p>Source: I work at a company that's trying to open-source core telecom infrastructure.
Yes, but maybe the the internet rate is that low, because it is effectively being subsidized by the telephone revenue (with a hefty profit on the side of course). If telcos all of a sudden started making 10 cents instead of 500 euros then they wouldn't be in business for very long, and then who would manage the network?
This sort of thing is happening on a massive scale in the US as well. David Cay Johnston's book, The Fine Print: How Big Companies Use "Plain English" to Rob you Blind exposes how "regulated" monopolies bereft of competition squeeze money out of their essentially unrepresented customers.
Looks like a good article but the url violates the same origin policy and as a result it render images. Readers will get a better looking page if they knock the 's' out of https until the owner can fix it