Friday, Jul 25, 2008
Now that the telephone companies are finally taking on the cable industry, we just might get fast Internet lines in our homes before we're all dead.
Jan 14, 1999 | Readers who remember the Internet's Pleistocene, about five years ago, will recall that flat-rate, low-cost Net access was not always the norm. Before the Web took off, Internet service typically involved higher monthly fees, start-up costs and hourly rates.
What brought the fees down, making the Internet the reasonably affordable time-waster it is for most U.S. residents today? Competition -- brutal, price-slashing competition that eventually forced even the industry behemoth, America Online, to toss its business model out the window and give up its hourly rates.
Today $20 to $25 a month gets you access, but it's slow access. For years now the cable TV and telephone industries have been promising that faster ("higher-bandwidth" or "broadband," as the jargon has it) Internet connections for the home are just around the corner. And for years, that promise has been a joke.
While the cable companies rolled out reasonably priced cable-modem Internet service from town to town at a painfully slow rate, the telephone companies tried to sell an inferior and overly complex service called ISDN at prices that drove consumers away. Then they began offering DSL, a higher-speed, next-generation service, but only in a few areas and still at overly high prices.
If anything can break this logjam, it will be, once again, plain old competition. We won't get affordable high-speed Net access in our homes until and unless the cable providers and telephone companies lock horns and fight to offer us better service at lower rates.
This week there are some heartening signs that such a telecommunications battle royale may finally be getting started.
On the East Coast, Bell Atlantic and America Online announced a deal to offer Bell Atlantic's DSL service as a $20 upgrade to AOL customers. Here in California, the local phone company -- Pacific Bell, which is now owned by SBC (Southwestern Bell) -- has dropped its price for DSL to the point where it begins to make some sense for the home user. For $40 a month you get service at speeds up to 1.5 megabits per second, with a guaranteed 384 kilobits per second. Even that lower rate is 10 times the typical connect speed of one of today's 56K modems.
Not coincidentally, that $40 is just about what @Home, the cable modem Internet provider, charges for its basic service through TCI, the cable TV giant. SBC will offer its new pricing to its customers in Texas, Missouri, Oklahoma, Arkansas and Kansas as well, and it's likely that other regional Bells will drop their DSL pricing soon to follow suit.
This means that for the first time, home Internet users who want high-speed access will stop being supplicants -- "Please, please bring your broadband service to my neighborhood! Pretty please! I don't care what it costs!" -- and start being consumers with free choice. From now on, we can begin to compare the advantages and disadvantages of cable modems and DSL and make decisions based on which technology is better, faster, cheaper.
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