Broadband Pricing & Gouging
September 9, 2020 7:32 AM Subscribe
Insane speed to price ratio for rural broadband. Details below.
I am in a rural Northeastern state. For our internet, a local cable company charges us about $70/mo for 8mbs down / 1mbs up.
The company offers 100/10 dn/up for $180/mo.
This seems, it should seem, steep. It's doubly irritating that this is a seasonal area, where the customer base (including ourselves) drops by more than half in the winter, yet the company insists on a 12 mo contract.
There is no realistic alternative; satellite and beamed service are not really suitable alternatives, nor does the phone company offer broadband.
My local state government tells me that broadband pricing and standards are a federal issue.
Do consumers have any recourse to get this local cable co to revise its pricing? Is there a way to accelerate speed, especially uploads, w/o cooperation from the ISP?
I am in a rural Northeastern state. For our internet, a local cable company charges us about $70/mo for 8mbs down / 1mbs up.
The company offers 100/10 dn/up for $180/mo.
This seems, it should seem, steep. It's doubly irritating that this is a seasonal area, where the customer base (including ourselves) drops by more than half in the winter, yet the company insists on a 12 mo contract.
There is no realistic alternative; satellite and beamed service are not really suitable alternatives, nor does the phone company offer broadband.
My local state government tells me that broadband pricing and standards are a federal issue.
Do consumers have any recourse to get this local cable co to revise its pricing? Is there a way to accelerate speed, especially uploads, w/o cooperation from the ISP?
Have you looked into cellular / LTE data for your area? Some companies offer LTE plans for rural users. If your cell has LTE, you can probably setup a hotspot, etc.
posted by cgg at 7:54 AM on September 9, 2020 [2 favorites]
posted by cgg at 7:54 AM on September 9, 2020 [2 favorites]
Insane speed to price ratio for rural broadband
I question your assumptions. I am a "power user" - I stream 100% of my entertainment, have two people working from home 100% (with frequent video conferences), and currently have 28 devices connected to the internet at my house. I have a 1 Gb/s symmetric fiber link to my house.
Over the last 30 days, I have used, on average, 1.7 Mb/s down, and 0.52 Mb/s up (measured at my router). Clearly, that's not a particularly good metric - my usage is significantly lower during the night, and I have short term bursts for downloads. However, I would not necessarily be a bad candidate for the 8 Mb/s down / 1 Mb/s up service that's offered.
Of the people who buy the 8/1 service, the vast majority of them will use significantly less than that. Even with my usage, it's not an unreasonable guess that the provider would have a 2-4:1 oversubscription ratio (ie, they can sell more bandwidth than they actually have). With more "normal" users, oversubscription ratios of 100:1 are not unheard of. On the other hand, for the people using 100/10 service, nearly 100% of the users are using at least 8/1 - otherwise they wouldn't buy it. With the 100/10 service, the maximum oversubscription ratio that's possible is roughly 10:1 - and will generally be lower than that. It's not unreasonable for the cost to be 157% higher - they will have significantly more usage on their higher tier, and hence, have to pay for it.
The real question is not why the higher tier service is so expensive, it's why the lower tier service is so expensive. I suspect your provider is overpricing the lower price tier and the higher price tier is closer to a correct price.
posted by saeculorum at 9:01 AM on September 9, 2020 [1 favorite]
I question your assumptions. I am a "power user" - I stream 100% of my entertainment, have two people working from home 100% (with frequent video conferences), and currently have 28 devices connected to the internet at my house. I have a 1 Gb/s symmetric fiber link to my house.
Over the last 30 days, I have used, on average, 1.7 Mb/s down, and 0.52 Mb/s up (measured at my router). Clearly, that's not a particularly good metric - my usage is significantly lower during the night, and I have short term bursts for downloads. However, I would not necessarily be a bad candidate for the 8 Mb/s down / 1 Mb/s up service that's offered.
Of the people who buy the 8/1 service, the vast majority of them will use significantly less than that. Even with my usage, it's not an unreasonable guess that the provider would have a 2-4:1 oversubscription ratio (ie, they can sell more bandwidth than they actually have). With more "normal" users, oversubscription ratios of 100:1 are not unheard of. On the other hand, for the people using 100/10 service, nearly 100% of the users are using at least 8/1 - otherwise they wouldn't buy it. With the 100/10 service, the maximum oversubscription ratio that's possible is roughly 10:1 - and will generally be lower than that. It's not unreasonable for the cost to be 157% higher - they will have significantly more usage on their higher tier, and hence, have to pay for it.
The real question is not why the higher tier service is so expensive, it's why the lower tier service is so expensive. I suspect your provider is overpricing the lower price tier and the higher price tier is closer to a correct price.
posted by saeculorum at 9:01 AM on September 9, 2020 [1 favorite]
I second MonsieurBon's recommendation for a hotspot linked to a cellular account through Verizon, Sprint, AT&T, etc. You can get routers that can create both a wireless network and also have ports for wired connections.
posted by akk2014 at 9:38 AM on September 9, 2020
posted by akk2014 at 9:38 AM on September 9, 2020
Do consumers have any recourse to get this local cable co to revise its pricing?
Barring Federal action (ie., the removal of the GOP), no, there's pretty much nothing you can do.
More broadly, this is par for the course in rural broadband, because the cost per customer is so high in the first place. Draw a circle a mile across, centered on your property -- how many other customers fit in that circle? In a city it'll be hundreds or thousands of people. Each of those people are amortizing the deployment cost -- so fewer people, higher costs. Higher costs means trying to use cheaper (slower) gear.
The Federal government has some programs to reduce the cost by making city folk pay for your internet (you're welcome by the way) but those have been poorly managed (on purpose, see GOP remark above) so they're not as effective as they could be. It's the rural electrification project all over again, except run by mendacious assholes and capitalists (but I repeat myself).
This shit is expensive and someone has to pay for it somehow. You could perhaps go in together with some of your neighbors and offer to pay the deployment cost of a higher speed link to everyone in your area, or even create your own ISP (there's a group in the UK that's been spectacularly successful at this), but that's gonna be quite a lot of work (years).
I have a friend in rural WI who tried to get dedicated internet to her house (only had dialup), and was quoted a couple hundred grand to string the wires (not including the actual service itself, just the wires). Now, some of that was probably taking advantage (they wanted to replace poles), but even so there's one benchmark.
posted by aramaic at 9:45 AM on September 9, 2020 [1 favorite]
Barring Federal action (ie., the removal of the GOP), no, there's pretty much nothing you can do.
More broadly, this is par for the course in rural broadband, because the cost per customer is so high in the first place. Draw a circle a mile across, centered on your property -- how many other customers fit in that circle? In a city it'll be hundreds or thousands of people. Each of those people are amortizing the deployment cost -- so fewer people, higher costs. Higher costs means trying to use cheaper (slower) gear.
The Federal government has some programs to reduce the cost by making city folk pay for your internet (you're welcome by the way) but those have been poorly managed (on purpose, see GOP remark above) so they're not as effective as they could be. It's the rural electrification project all over again, except run by mendacious assholes and capitalists (but I repeat myself).
This shit is expensive and someone has to pay for it somehow. You could perhaps go in together with some of your neighbors and offer to pay the deployment cost of a higher speed link to everyone in your area, or even create your own ISP (there's a group in the UK that's been spectacularly successful at this), but that's gonna be quite a lot of work (years).
I have a friend in rural WI who tried to get dedicated internet to her house (only had dialup), and was quoted a couple hundred grand to string the wires (not including the actual service itself, just the wires). Now, some of that was probably taking advantage (they wanted to replace poles), but even so there's one benchmark.
posted by aramaic at 9:45 AM on September 9, 2020 [1 favorite]
I know someone working on this issue in your area. I'll try to get them to come comment here.
posted by minervous at 10:07 AM on September 9, 2020
posted by minervous at 10:07 AM on September 9, 2020
Response by poster: The download speed of 8 down is not so much the problem as the up. It’s not really possible to do video conferencing, which has become a bigger priority now for us, just like others, and also we do a tiny bit of posting of pictures on a business website hosted elsewhere. It can take hours to upload a dozen pictures. At our other address, a large national ISP charges us less and we get 110 d/12 up.
posted by nothing.especially.clever at 11:57 AM on September 9, 2020
posted by nothing.especially.clever at 11:57 AM on September 9, 2020
Best answer: is your other address rural? i pay 70$ a month for 80Mbps or so. my parents in rural michigan pay $100 for 2Mbps and barely get that. i understand your frustration as i shared it when i worked up there. but slow internet is the price you (currently) pay for living rural. the way our american system is set up, there's really nothing you can do about it except move to a place with faster internet.
posted by misanthropicsarah at 12:30 PM on September 9, 2020
posted by misanthropicsarah at 12:30 PM on September 9, 2020
Best answer: Man I'd kill for a 100 MBps option in my semi-rural area (Grass Valley, CA). Here's the price sheet for the only realistic ISP option I have, a fixed wireless network. I'm paying $90 for 12/2. The fastest they offer is 25/5 for $250/mo.
To answer your question about petitioning for lower rates etc; not a chance. The FCC should be leading the way on this but like so many things right now it's corrupted, in this case by Ajit Pai. They are knowingly taking falsified data from the ISPs about how great and cheap their services are and doing anything but requiring better service. Particularly for rural areas. Your only hope is a competitive market but again, in a rural area that's unlikely. You might get somewhere with a state legislator if you're lucky enough to have one that cares. Either that or cross your fingers that Starlink works and provides meaningful competition.
posted by Nelson at 8:57 AM on September 10, 2020
To answer your question about petitioning for lower rates etc; not a chance. The FCC should be leading the way on this but like so many things right now it's corrupted, in this case by Ajit Pai. They are knowingly taking falsified data from the ISPs about how great and cheap their services are and doing anything but requiring better service. Particularly for rural areas. Your only hope is a competitive market but again, in a rural area that's unlikely. You might get somewhere with a state legislator if you're lucky enough to have one that cares. Either that or cross your fingers that Starlink works and provides meaningful competition.
posted by Nelson at 8:57 AM on September 10, 2020
This thread is closed to new comments.
No, short of building an internal proxy server that pre-caches your most-frequented websites.
At our rural property, where both cable and DSL are available, one can only subscribe when an existing customer leaves. The cable company explained there isn't enough bandwidth to add any more customers until someone leaves, and my neighbors say they get maybe 3mbps down, 1mbps up, but often much slower than that. So for you to get ~10x the bandwidth for ~2.5x the price doesn't sound too bad, especially if it's taking away from their ability to offer the $70 tier to 9 other people.
posted by MonsieurBon at 7:46 AM on September 9, 2020 [1 favorite]