Thursday, May 23, 2013

ISPs most hated industry in America

The Huffington Post is running a story on the latest American Consumer Satisfaction Index report issued for 2013. After reading their story, I gathered the report myself and had a look. Of note is this very interesting little tidbit on the state of our economy:

"Cash flow remains strong for corporations, but weak for households. Since the latter accounts for about 70% of the economy, it is difficult to envision a strong economic recovery until wages and employment begin to move in the same direction as customer satisfaction."

That's a very interesting way to open a report on consumer satisfaction. The statement seems to plow into direct conflict with what the press and economists have been urging us to believe for the past 3 decades: that when business does well, consumers do well, too.

More importantly, though, the report shows that the Internet Service Provider industry is universally reviled around the country. We know they charge very high prices for substandard service. I live in a smaller city and am acutely aware of the lack of choice or competition in this industry. I can choose Comcast for fast, expensive service, or I can choose Centurylink for slower, expensive service, but at a discount.

Even Bloomberg has published an article detailing the gaps and problems with our ISP industry. With so much concern *everywhere*, why aren't ISPs taking decisive action?

No competition. Or at least, very little. The reason is simple. The FCC has permitted massive consolidation in the industry and has failed to properly designate the ISPs as common carriers. Once the ISPs are designated as common carriers, we can expect Comcast to get really interested and focused on dealing with the competition that will sprout from the new status. Net neutrality becomes a relatively moot issue when the ISPs are acting and regulated as common carriers.

The competition for the owners of the pipes is in the form of wholesalers who will then have the right to re-sell access to the Comcast network and provide customer service. That is the open access way. It works in Japan, there is no reason why it won't work here.

I'm looking forward to the day that employees in the FCC give up on their hopes of a job at Comcast or Time-Warner and properly regulate these embarrassing monopolies.
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