Broadband services have a way of leapfrogging each other in small increments. One providers offers 10 Mbps downstream speeds and 2 Mbps upstream speeds, and another comes out with a 12 Mbps/3 Mbps plan. The recession seems to have slowed this trend, and some cities have not seem the fierce competition that parts of California and New England have due to their comparatively high population densities. In fact, some major markets are still being served by providers offering broadband limited in performance to 10 Mbps downstream speeds or less due to the lack of infrastructure investment. At the same time companies such as Verizon offer blazing fast Fios services with 50 Mbps downstream speeds and Comcast has even started deploying services with 100 Mbps downstream speeds.
Unfortunately, these deployments are not serving the bulk of American households and businesses at this time. This profit motive based problem has led the FCC to get involved in order to ensure that America does not lose its competitive edge in the broadband arena.
100 is the Magic Number
FCC Chairman Julius Genachowski announced a bold plan that will forever change the landscape of broadband in the United States. The plan itself is the culmination of several months worth of meetings with technical experts in various fields, the goal is simple: to ensure that 100 million homes have access to broadband service that offers at least 100 Mbps downstream speeds by the year 2020. While the goal certainly sounds lofty, a decade is a long time and many are also questioning how the FCC can motivate broadband providers to get the ball rolling. Incentives are likely to be offered in many forms, but there was surprisingly little mention of a stick to go along with these carrots. It is unclear whether taxes or other penalties might await providers that decide that the new broadband plan is not something that they feel safe enough to invest in, and would rather make smaller incremental gains to receive the greatest return on their investments in marketing and infrastructure.
With just over 100 months to go until the start of 2020, the challenge of expanding networks to the doorsteps of millions of new customers coupled with the increase in performance of nearly 1 Mbps worth of downstream speed every month or two seems hard to swallow from the perspective of a provider.
Density Matters to Providers
After all, the U.S. is a very large geographical region and its population density is less than 85 per square mile. This places the U.S. someplace around the 175th in the world in terms of population density, but certain regions of the U.S. have far higher population densities than the national average. These areas are almost uniformly those that are served by faster broadband connections while areas that are sparsely populated tend to be stuck with 1 Mbps download speeds at best, or perhaps relegated to using wireless broadband and/or satellite broadband services.
This trend is no coincidence, it is simply good business and it helps to illustrate why infrastructure investment is much easier to justify in densely packed European nations such as Italy with its population density of over 500 per square mile, the United Kingdom with a collective population density of over 650 per square mile, and Germany with approximately 600 people per square mile. With so many customers and economies that typically do quite well, these countries are cash cows for service providers. From the perspective of a broadband provider here in the U.S. it must seem difficult to justify the expenses involved with increasing broadband performance so dramatically in such a short period of time. This ultimately makes it understandable why some publicly wonder if the entire plan will happen or just go down in the history books as another lesson in the difference between a great idea and a cold reality.
Is 2020 Too Late?
British Telecom plans to release 100 Mbps broadband services in the U.K. by 2012, and may be well on their way to gigabit connections that are not dissimilar to Google’s planned broadband offerings by the time that 100 Mbps connections are available to the majority of U.S. households and businesses. France and other leading European nations are also planning similar networks to serve their citizens and businesses with the latest and greatest broadband services. Perhaps it is a game of one-upmanship between European nations combined with their high population densities that creates such rapid advances, but it certainly leaves the state of broadband in the U.S. looking pale and sickly by comparison.
The big question is: what can people do with the extra bandwidth that they could not do at a slower pace with less bandwidth. That is certainly a valid question to ask, but by the time someone answers that question with a new must-have technology, the U.S. could be a decade behind in terms of broadband infrastructure. A current example of this limitation might be found in certain IPTV implementations that only stream two or three HD channels to a given consumer. For the average American family that is not a problem, but it is unacceptable for a small hotel, or many other small and medium sized businesses that cannot afford enterprise class services.