Customer.io CEO Colin Nederkoorn made headlines when he decided to stream Netflix at 3000kbps through a VPN service and found out that Verizon capped his data at an appalling .373 mbps when using Netflix. For the past month, Netflix has engaged Verizon in a public war of net neutrality accusing Verizon of intentionally lagging broadband streaming speeds of Netflix users.
The FCC has yet to determine whether or not to find Verizon at fault, but the public dispute has brought to light the fact that telecommunication companies still rely on outdated, legacy copper lines to connect their customers to the internet while other countries have already switched to more efficient forms of streaming such as fiber optics.
Below is a brief overview of why Telco companies have chosen to rely on outdated technology to deliver high-speed internet leaving users over-paying for a mediocre streaming experience in comparison to other countries.
The Case for Copper Wire
It’s been over a hundred years since Alexander Graham Bell first twisted copper pairs together and they have remained a staple of telecommunication technology since then. Research labs continue to optimize the utility of copper lines which enables Telco companies to avert the cost of implementing new technology.
For example, Alcatel Lucem’s Bell Lab recently broke a record successfully transmitting data at broadband speeds of 10 Gbps over 30 meters of traditional phone lines and 1Gbps over 70 meters. Such breakthroughs influence Telco companies to postpone the much needed upgrade from old technology.
Telco companies currently balk at the investment costs needed to upgrade their networks from traditional copper-wires to fiber optics. Verizon halted the deployment of fiber optics in 2010 after investing $23 billion dollars.
Telecommunication companies have formed oligopolies that leave American consumers paying exaggerated fees for subpar services.
John Aziz, economics and business editor of The Week, attributes the delay in network improvement to the 1996 Telecommunications Act which “allowed cable companies and telecoms companies to simply divide markets and merge their way to monopoly, allowing them to charge customers higher and higher prices without the kind of investment in internet infrastructure” like fiber optics for example.
Healthy competition between internet service providers in other countries have granted consumers with faster access to broadband connections at much lower costs when compared to the United States.
Just how cheap are broadband speeds in other countries?
For the lucky denizens of Seol, internet consumers pay about $22.50 dollars for a 1GB for network. In Hong Kong, consumers pay $25 dollars a month for 500Mbps. Sony’s Nuro Network will be offering an even faster alternative of 2Gbps for $51 a month in Japan.
Internet Speeds in Other Countries
Currently, South Korea, Hong Kong and Japan enjoy the fastest internet connection speeds with South Korea boasting average streaming speeds of 53 Mbps and Japan, 49 MBPS.
The United States falls behind Romania with average streaming speeds of 48 Mbps, Latvia at 45 Mpbs, and Switzerland at 41 Mbps.
The United States ranks even lower in terms of the amount of population that utilizes high-speed internet. According to the International Telecommunication Union, only 28.35% of the United States population enjoys high-speed internet and falls behind countries like Canada, France, and New Zealand.
In countries like China, internet service providers don’t have to go through the precautions of city “regulations” and companies can easily bring fiber optics to their new customers without third-party monitoring. The combination of regulations and oligopolies makes it difficult for US internet consumers to receive faster broadband services that are available for other countries at cheaper prices.
Are you filled with envy knowing that you’re getting subpar connection speeds at overpriced prices?