The United States of America — the plucky little democracy that survived a brutal civil war, and is today the world’s technology leader, with the fastest Internet speeds on Earth.
Oh wait, I’m sorry — I meant to say South Korea, the plucky little democracy that survived a brutal civil war, and is today the world’s technology leader, with the fastest Internet speeds on Earth.
But that’s okay, because America has the second-best Internet, right? Third? Well, heh, top ten, I’m sure. Wait, what?
America, the nation that invented the Internet, which is home to Google, Apple, Microsoft, Yahoo!, Amazon, and the entire Silicon Valley, ranks 31st in Internet speeds. In case you missed that, let me spell it out for you — according to a study by Ookla Speedtest quoted by The Week, the US ranks thirty-first in the world in average download speeds, behind Estonia, Moldovia, Bulgaria, Latvia, and the Åland Islands, which I now know is an autonomous part of Finland, because I looked it up.
In a free market, competition will drive prices down, and spur companies to upgrade their services. That hasn’t happened here…
This past January, South Korea announced it was building a “5G” wireless data backbone for the entire semi-peninsular nation, which is 1,000 times faster than the 4G network Europe currently enjoys. America supposedly has 4G Internet — except we don’t. We just call it that. Europe’s speed are roughly twice as fast as ours.
So the question is, why? Why should America have some of the slowest (yet priciest) Internet service in the developed world? The answer is shocking, especially if you share Conservative political beliefs.
The answer is deregulation.
The Clinton-era Telecommunications Act of 1996 was the first significant overhaul of US telecom law since 1934. According to the FCC, the goal of the law was to “let anyone enter any communications business — to let any communications business compete in any market against any other.” In other words, it lifted the previously-existing, onerous laws restricting media ownership. The idea, and a good one, was to promote competition.
And that’s what could have happened. But the telecom industry had other ideas. In a free market, competition will drive prices down, and spur companies to upgrade their services in order to attract customers. That hasn’t happened here — prices are high, and only Google is trying to upgrade the US Internet infrastructure with their Google Fiber initiative. But the major telecoms have no plans to follow suit. And Google, for all its money and power, is not a telecom company.
The big telecom companies have used their freedom under deregulation to not compete. Why should they? They control regional monopolies. And if someone else lowers prices or beefs up their backbone — in the few markets with Google Fiber, the existing telecoms have been forced to at least drop prices — they have to as well. But no one does. Is it actual collusion? Or just a nod and a wink across the table?
As we’ve seen over the past few years, government funding cuts are good — but indiscriminate funding cuts that shut down vital services are bad. Likewise, deregulation is good — but indiscriminate deregulation that can be abused to prevent competition is bad. Some so-called “conservatives” want “cut, cut, cut, deregulate, deregulate, deregulate” — and we’ll worry about the consequences later. What we need are smart funding cuts, smart deregulation.
The Week quotes a study that compared the situations in South Korea and the US:
[T]he South Korean market was able to grow rapidly due to fierce competition in the market, mostly facilitated by the Korean government’s open access rule and policy choices more favorable to new entrants rather than to the incumbents. Furthermore, near monopoly control of the residential communications infrastructure by cable operators and telephone companies manifests itself as relatively high pricing and lower quality in the US.
See, South Korea didn’t just let loose the Wild West — they allowed free market competition while rewarding innovation and new businesses. And if Americans are ever going to get the Internet we deserve, we need to start demanding it, from our ISPs, cable companies, telecoms, and wireless providers. And maybe this is one of those rare instances where the government is going to have to step in and do something — or the rest of our business community, which relies on the Internet, as well as our students and families, won’t be able to compete with those in countries with modern, fast Internet service. And it’s hard to see how that helps the American economy at all.
Sources: The Week | The Mirror | Wikipedia