All Tech Considered
5:41 pm
Sun January 12, 2014

Internet In America: An On Again, Off Again Relationship

Originally published on Sun January 12, 2014 5:50 pm

The American Customer Satisfaction Index surveys large swaths of consumers about various industries. And in last year's survey, Americans rated Internet service providers at the very bottom for satisfaction. That puts them below the postal service, health insurance and even airlines.

Critics of the telecom industry say Americans are paying too much money for slow speeds and bad service. The industry says those charges are way overblown.

All Things Considered recently asked its fans on Facebook, "How satisfied are you with your Internet service provider?" Many responded that they didn't like their Internet service, that it often goes out and that their connection was often "painfully slow."

But not everyone we spoke to has had a bad experience. Jon Lemich of Columbia, Md., said he really liked his service. "It very rarely has any problems. And their customer service has been great," he says.

Lemich also says he has several options; his neighborhood has cable as well as access to Verizon's high-speed fiber optic Internet.

But that's not true for everyone, because the map of broadband access is still a patchwork in the U.S.

Highs And Lows

In rural areas, you might only have satellite, and even in big cities the menu can be limited. Some people just get access through their smartphones, while others might be stuck with a single cable provider or slower DSL connections.

Having a slow Internet connection is more serious than not being able to keep up with your favorite TV show on Hulu or Netflix. Working from home or online banking can be fraught with headaches and delays.

Breann Neal of Hudson, Ill., says her only viable option is a DSL connection, which can be frustrating. "There's no incentive for them to make it better for us because we're still paying them every month ... and there's no competition," Neal says.

That might be expected in a small town like Hudson. But even in a big city like Chicago? Samantha Laws, who gets her Internet through her cable provider, says she also only has one option.

"It goes out at least once a day, and it's been getting worse the last few months," Laws says. She works with a pet-sitting company that handles all of its scheduling through email and the company website. At times she can't do her job because of the spotting connection.

There are parts of the country, however, where things are substantially better: like in Chattanooga, Tenn. Mayor Andy Berke says the city has "the largest, fastest, most pervasive Internet in the Western hemisphere."

About four years ago, the public electric utility EPB upgraded Chattanooga's power grid to fiber optic, mostly to help deal with power outages. But the utility realized an added benefit: That same grid can carry very high-speed Internet. So, for $70 a month, the company now offers customers upload and download speeds of up to 1 gigabit per second, about 100 times faster than the average U.S. connection.

Berke tells NPR's Arun Rath that the fiber optic grid is an investment in the future, when more businesses will need that superfast broadband.

"We're starting to see companies who are looking at us ... who understand that they will need more capacity in the future, and Chattanooga has that today," he says.

For example, he says a tech startup called Quickcue is growing and creating jobs in Chattanooga.

But it's all come at a steep price. Installing the grid cost about $300 million.

Few Alternatives For Many

In some other places, private companies have made the investment in high-speed infrastructure. There's Verizon's fiber optic network FiOS, and Google has installed fiber in Kansas City and plans to expand to Austin, Texas and Provo, Utah.

Elsewhere in the country, options remain limited. If you're unsatisfied, the government has a block-by-block database of broadband providers where you can find out if you have other options. Or, maybe like some, you're stuck with service you just don't like.

"[For] at least 77 percent of the country, your only choice for a high-capacity, high-speed Internet connection is your local cable monopoly," says Susan Crawford, a visiting professor at Harvard Law School. She is also the author of Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age.

Crawford says that today's high-speed Internet infrastructure is equivalent to when the railroad lines were controlled by a very few moguls who divided up the country between themselves and gouged everybody on prices.

She says the U.S. has fallen behind other countries in providing broadband. At best, Crawford says, the U.S. is at the middle of the pack and is far below many countries when it comes to fiber optic penetration. Given that the Internet was developed in the U.S., she says the gap is a result of failures in policy.

"These major infrastructure businesses aren't like other market businesses," Crawford says. "It is very expensive to install them in the first place, and then they build up enormous barriers of entry around them. It really doesn't make sense to try to compete with a player like Comcast or Time Warner Cable."

So Crawford is calling for is a major public works projects to install fiber optic infrastructure — a public grid that private companies could then use to deliver Internet service.

An Inaccurate Assessment

Not everyone agrees with Crawford's comparison of the broadband market to "gilded age" railroad barons. Michael Powell, the former chairman of the Federal Communications Commission, calls it a "badly exaggerated view."

Powell is now the president of the National Cable and Telecommunications Association, which lobbies Congress on behalf of the industry. He tells NPR that Crawford fails to mention the telephone industry and the robust U.S. wireless market as competitors.

"I think to exclude it as a substitutable, competitive alternative is an error that leads you to believe the market is substantially more concentrated that it actually is," Powell says.

Powell also says that the U.S. is not significantly behind other countries when it comes to broadband access and speeds.

"I think taking a snapshot and declaring us as somehow dangerously falling behind is just not substantiated by the data," he says. He says it is like taking a snapshot of speed skaters, where there might be a few seconds separating the leaders, but no one is "meaningfully out of the race."

As far as customers rating Internet service providers so poorly on the American Customer Satisfaction Index, Powell says he hasn't seen the data, but that because of the way we package Internet in this country it is hard to separate the dissatisfaction of one service from the entire package.

"Customer satisfaction is really critical," he says, "but at the same time, the growth and the use of those services — and the amount of increased money consumers tend to invest in communications services even when they have other alternatives — to some degree speaks for itself."

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

ARUN RATH, HOST:

It's ALL THINGS CONSIDERED from NPR West. I'm Arun Rath.

We posed a simple question on our Facebook page this week: How satisfied are you with your Internet service provider? We heard a lot of frustration.

UNIDENTIFIED WOMAN #1: How do I like my Internet service? I hate my Internet service right now.

UNIDENTIFIED MAN #1: I'm not a big fan of my Internet service.

UNIDENTIFIED WOMAN #2: I don't like my Internet service.

UNIDENTIFIED WOMAN #3: It goes out at least once a day.

UNIDENTIFIED MAN #2: It's overpriced.

UNIDENTIFIED WOMAN #4: Painfully slow, painfully slow.

UNIDENTIFIED WOMAN #5: But there aren't any other quality options in my area.

RATH: The American Customer Satisfaction Index surveys large swaths of consumers about various industries. And in last year's survey, Americans rated Internet service providers at the very bottom for satisfaction. That puts ISPs below the postal service, health insurance, even airlines. Critics of the telecom industry say Americans are paying too much money for slow speeds and bad service. The industry says those charges are way overblown. That's our cover story today: Has the country that invented the Internet fallen behind?

(SOUNDBITE OF MUSIC)

RATH: Now, not everyone we spoke to has had a bad experience.

JON LEMICH: I'm Jon Lemich. I live in Columbia, Maryland. I really like my Internet service actually. I get pretty good download and upload speeds, exactly as advertised. It very rarely has any problems. And their customer service has been great.

RATH: And Lemich says he has several options. His neighborhood has cable but also access to Verizon's high-speed fiber optic Internet. That's not true for everyone, because the map of broadband access is a patchwork. In rural areas, you might have only satellite. Even in cities, the menu can be limited. Some people just get access through their smartphone. Others might be stuck with a single cable provider or DSL.

BREANN NEAL: My name is Breann Neal, and I am from Hudson, Illinois.

RATH: Breann Neal has DSL, and her service is much slower than advertised. That makes life frustrating, especially for her daughter who spends a lot of time waiting for a video to load.

NEAL: She watches a lot of TV series on Netflix. I think "Vampire Diaries" is the one she's currently watching.

RATH: But it's more serious than keeping up with the vampires. Working from home or online banking can be fraught with headaches and delays. Neal says there are no other viable options in their area. She and her family are stuck.

NEAL: There's no incentive for them to make it better for us because we're still paying them every month, and they're still making money as a company, and there's no competition.

RATH: Hudson, Illinois, is a small town, so you might think there would be more options in a big city a few hours north.

SAMANTHA LAWS: Samantha Laws, Chicago.

RATH: Samantha Laws gets Internet through her cable provider. She says it's her only option, and she does not like it.

LAWS: It goes out at least once a day, and it's been getting worse the last few months. With the pet-sitting company I work for, we handle all of our scheduling through email and our company website. So there's been times where the Internet's down, so I can't do my job. And then I have to text my boss and ask her if she can do it because I don't have Internet access at the moment.

RATH: We also heard from one part of the country where things sound a bit better.

MAYOR ANDY BERKE: My name is Andy Berke from Chattanooga, Tennessee. We have the largest, fastest, most pervasive Internet in the Western Hemisphere.

RATH: Andy Berke isn't just any resident of Chattanooga. He's the mayor. Several years ago, the public electric utility, the EPB, upgraded the power grid to fiber optic, mostly to help deal with power outages. But the utility saw an added benefit: That same grid can carry very high-speed Internet. So for $70 a month, the utility now offers customers upload and download speeds of up to one gigabit per second. That's more than 100 times faster than the average U.S. connection.

Just to give you a sense of that speed, imagine this six-second Black Sabbath riff is a gigabit per second.

(SOUNDBITE OF SONG, "IRON MAN")

RATH: And now, here it is slowed down to the average U.S. connection speed.

(SOUNDBITE OF SONG, "IRON MAN")

RATH: Those six seconds turn into more than 10 minutes. For a lot of people, going to a gig a second might be a little overkill.

BERKE: Well, it's funny, because I tell people all the time, you don't need gigabit per second technology to load espn.com faster.

RATH: But Mayor Berke says the fiber optic grid is an investment in the future when more businesses will need that superfast broadband.

BERKE: We're starting to see companies who are looking at us, coming here making decisions, who understand that they will need more capacity in the future, and Chattanooga has that today.

RATH: For example, he says a text startup called Quickcue is growing and creating jobs in Chattanooga. But it's all come at a steep price. Installing the grid cost about $300 million. In some other places, private companies have made the investment. There's Verizon FiOS, and Google has installed fiber in Kansas City and plans to expand to Austin, Texas, and Provo, Utah. Elsewhere in the country, options are more limited.

SUSAN CRAWFORD: At least 77 percent of the country, your only choice for a high-capacity, high-speed Internet connection is your local cable monopoly.

RATH: That's Susan Crawford. She's a visiting professor at Harvard Law School and the author of "Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age."

CRAWFORD: Imagine that you run a gold mine, and there's just one single railroad line running to your gold mine. That single railroad line on which you depend for getting your product out from the world and for hearing from the outside world, the equivalent of that is high-speed Internet access infrastructure. And just as in the gilded age, those railroad lines were controlled by a very few moguls who divided up the country between themselves and never competed and gouged everybody. Today, high-speed Internet access in America is controlled by a series of local cable monopolies who are similarly not subject to competition and also not subject to any kind of oversight.

RATH: Crawford says as a consequence, the U.S. has fallen far behind other countries in providing broadband.

CRAWFORD: I think it's fair to say the U.S. is at best in the middle of the pack. And when it comes to fiber optic penetration, we're way down at the bottom in terms of speed and price.

RATH: Well, how did, you know, America did invent the Internet. How did we get so far behind?

CRAWFORD: We got there because of failures in policy. This doesn't happen by magic. These major infrastructure businesses aren't like other market businesses. It's very expensive to install them in the first place. And then they build up enormous barriers of entry around them. It really doesn't make sense to try to compete with a player like Comcast or Time Warner Cable for another private actor to do it.

RATH: So what Crawford is calling for is a major public works project to install fiber optic infrastructure, a public grid that private companies could then use to deliver Internet service.

CRAWFORD: The right approach for us is to have the mayors of America stand up and say, this is ridiculous. You know, we need to make sure that businesses move to us. And the way to do that is to use your power over your rights of way and your streets and simply rip up the streets once. And then make sure that every home and every business in your city has this fiber to the home connection, which is upgradable into infinity.

RATH: Not everyone agrees with Crawford's comparison of the broadband market to gilded age railroad barons.

MICHAEL POWELL: I think it's a badly exaggerated view, and the analogy's not particularly compelling.

RATH: Michael Powell is a former chairman of the Federal Communications Commission. And he's now the president of the National Cable and Telecommunications Association, which lobbies Congress on behalf of the industry.

POWELL: She mentions the cable industry but fails to mention the telephone industry, which is a very vigorous competitor for broadband as well. And I also think, with all respect, she tends to admit - omit the entire wireless market in which the United States is one of the world's leading providers. And I think to exclude it as a substitutable competitive alternative I just think is an error that leads you to believe the market is substantially more concentrated than it actually is.

RATH: Another complaint Susan Crawford and other critics have is that the U.S. has fallen behind a lot of other countries in terms of broadband affordability and speed. You found those comparisons false, right?

POWELL: I think by any measure, America is unquestionably in the leadership pack. This reminds me a little bit of an Olympic speed skating race. And if you take a picture, maybe there's a few seconds separating them, and you could rank them, but nobody's meaningfully out of the race. I think taking a snapshot and declaring us as somehow dangerously falling behind is just not substantiated by the data and is an inaccurate way to look at these comparisons.

RATH: Well, you know, however we do compare it, you know, American Customer Satisfaction Index surveys rate Internet service providers at the bottom of their ranking. It seems that customers across America are not happy. They're feeling like it is too slow and too costly. So why do you think that providers are getting the low marks?

POWELL: Yeah. You know, I read that. I haven't seen the data behind it. So specifically, is it because of speed or cost is unclear. I do think there is an experience that's very different in the United States, which can bring in a whole host of feelings. And that is most Internet high speed is sold in bundles in this country. You know, there are feelings and there are reactions around that total package. It sometimes can't be that easily separated into its parts.

You know, and I think we as an industry have recognized that is an important deficiency that we're working hard to address. I think customer satisfaction's really critical. But at the same time, you know, the growth and use of those services and the amount of increased money consumers tend to invest in communication services, even when they have other alternatives, I think, to some degree, speaks for itself.

RATH: What do you make of efforts for cities to provide municipal broadband in places like Chattanooga, Tennessee?

POWELL: I'm one of the people who don't scream about this. I think the citizens of individual communities are free to make those choices through their elected representatives if they want. I think as a citizen, I would raise serious questions about the value of using public funding to the degree that is required to both build and I think what often is missed in localities, the constant expensive maintenance over years and decades worth of operation.

And given that there is a robust private market serving virtually every corner of the country, I think it can be a questionable public decision. But, you know, these are choices to be made by local citizens.

RATH: That's Michael Powell, president and CEO of the National Cable and Telecommunications Association.

As we heard, a lot of people are unhappy with their Internet service. If you're unsatisfied, the government has a block-by-block database of broadband providers. We'll link to that at npr.org. There, you can find out if you have other options, or maybe, like some, you're stuck with service you just don't like. This is NPR News. Transcript provided by NPR, Copyright NPR.