Today, I experienced my first bandwidth throttling by my ISP.
Randomly: ISPs claim that they cannot provide the service at the speeds we contract for. This would be called "breach of contract", except, of course, we have no contract, not one that previous eras would recognize. An ISP contract says, in so many words, that you contract to give them money, and per terms, cannot change the contract. However, they reserve the right to alter the contract at any time. Therefore, you, as a customer, have all the rights of a telephone pole. They can change the service terms, raise the price, alter your service, allow Homeland Security to monitor, and you can go pay them, or cancel and pay an enormous fee for the privilege. This is not how business is run in a "free market". The market is only free for them.
They claim costs have risen. I know for a fact they contract out the labor to what are really day workers with no benefits, people just this side of janitorial labor. Labor costs are down since 1990, when I last yakked about this. The ISPs in general seem to have billions to buy each other, so apparently they aren't broke.
Equipment costs are high, but are they high in proportion to the growth in the customer base and revenue? If not, perhaps we need more competition in the equipment industry, because Cisco is gouging. Free market seems to have failed there.
In 1992 and 1993, lumber prices jumped 300% or so overnight. During the Bush and Reagan administrations, corporate buyouts and mergers of local lumber companies created a de facto polyopoly that had the power to jack board feet prices. They blamed Clinton. In 1996, a congressional investigation of the collusion to fix prices was shut forcefully down by the Contract on America crew. At this date, the WTO has sanctioned the US over a dozen times for refusing to permit Canadians to import lumber at lower cost to consumers than our thieves are charging. We now build furniture out of steel; we build our walls from steel and cover it with chalk and paper boards. There is no shortage of wood in Canada, but somehow we can't buy it at costs that threaten the men who cornered the commodity and distribution markets.
In 1996, the ISPs of the US demanded and received billions in tax cuts specifically to roll out fiber-to-the-home to prevent just this "bottleneck" in available bandwidth. That money was directed to profit, and was stolen, in plain language. They were paid to build high speed networks from federal taxes, and they ran away with the money. Now they lecture us about the costs of running underbuilt networks and the need to raise prices and throttle bandwidth.
In 1990, we were happily speculating that we would build our own ethernet-based local community ISPs with gigabit speeds to the home. The equipment was relatively cheap then: cards and routers and old PCs could do the switching, and we would buy T1s or T3s to access the broader network. Wireless was an even bigger possibility. Wouldn't even have to run wires! Now we have PCs the size of matchbooks that can act as routers. Cheaper, faster, better.
Some actually went and did it; then towns themselves started to build their own ISPs. And the ISPs sued. Now it's pretty much impossible to build a cheap community net, because it would be "unfair" to the businesses who wouldn't be able to compete. Communists, they were called. The free market religion explicitly killed all real competition. And under Bush, there is no one to stop them, especially not the FCC, loaded with the very people they are supposed to be regulating.
Remember also that ISPs are exempted from responsibility for content on their networks because they are a common carrier, like a phone company or a mail service. If they are actively monitoring, throttling and blocking communications based on their profit needs, they are not a common carrier. Certain legal protections are not valid for non-common carriers, freedom from lawsuits about copyright infringement the biggest.
As I warned eight years ago, the company that builds plumbing should not own the water going through. It has led to the situation in which the ISPs are jealously watching their users, trying to determine if they are using the Internet to host servers. HEY! the Internet is designed to be a web of servers! It can't work as designed if businessmen are shutting off the water if they think they see we are pumping our own water (content) at cheaper prices.
The pipes are NOT theirs. Number one, they create monopoly status rather quickly, so granting them that eliminates competition and raises prices. Two, they were given billions in 1996 to pay for the networks, whether they built them as agreed or not. Three, they are given rights of way by communities and are expected to provide service at reasonable prices, not whatever they can get away with. Four, cable and phone companies got their start by being granted monopolies in whatever cities they built. They were hardly businessmen taking their chances. They were handed the profits on a platter for decades.
There is no shortage of bandwidth. There is a concerted non-effort not to build pipe after they were paid to do so. A lot of pipe was built,fiber optic pipe, that stayed dark because they deemed it uneconomical to light it up. Said they overbuilt, and no one needed the glass after all. They stole the money we gave them to fiber our homes. They are classically creating an artificial shortage, exactly the way Enron's "geniuses" did in California with electricity. They are playing commodity broker games, jacking prices by simply not doing what their business dictates they should: increase capacity. It's win-win for them: refuse to build capacity and price per byte transmitted goes up... High demand? Kill the supply, price goes up.
And now it's pretty much illegal for Bob Smith to set up a wireless community network and provide megabits for dollars a month. That's competition for you: buy a lawyer, no more competition.
Internet capacity is not all that expensive. We could build wireless mesh networks, coupled with ethernet land lines, and maybe someday use LED or laser light to provide backbones on community line-of-sight networks. We don't need them. The big boys are using the eight year loss of signal from the regulators to brainwash da publick into thinking that the way they provide pipe is the only way it can be.