A new report, paid for by AT&T, makes a very important point I and other critics of the company have been trying to make here for some time.
Analysys was trying to prove that U.S. broadband isn’t that bad compared to what’s available elsewhere, and that it’s competitively priced as well. Their PDF report offered charts showing how there are often big differences between the speed claimed and the speed delivered by broadband offerings worldwide, with those differences often most stark in Asia, and that the price per megabyte of U.S. broadband is within the normal range.
But then there is this kicker (PDF):
IPTV requires significantly larger streams of data, and is much more susceptible to latency, packet loss and jitter, as well as causing much more congestion in the network. Second, whereas IPTV is a paid service that must compete with broadcast or cable television which do not suffer from significant quality defects, streaming video is commonly a free service, leaving customers less apt to complain about quality.
IPTV is short for Internet Protocol TV, which turns Internet bandwidth into a substitute for cable television. Where Internet traffic is interactive, TV traffic is passive.
All of AT&T’s current lobbying and technical efforts are aimed at
putting it into the IPTV business. It is hoarding bits from what
Analysys describes as "best effort Internet" (that is, its broadband
customers) and, as this report makes clear, will have to hoard even
more of its bandwidth, both current and future, in order to deliver a
competitive IPTV offering to the market.
Rather than offering Americans the bandwidth they need, the bandwidth
we were promised for 10 years (and paid for), AT&T plans to squeeze that
bandwidth out of its network to pursue the chimera of competition with
cable.
The only way this works is if it can retain a substantial portion of
its current captive customer base, both phone and Internet, using that
revenue to subsidize its lobbying program and its technical program.
What does this prove? It proves what I have believed for many years,
what 100 years of business history has been telling us. Companies
pursue competitive markets, and shun monopolies, even their own.
We will never get more bits from AT&T so long as it has a monopoly on Internet access, or even a duopoly. The only
way to get more bits is to demand, and create if necessary, competition
for AT&T sufficient to force it into making more Internet
investments.
