Harvard Study Shows Why Big Telecoms Are Petrified by Community ISPs

Monopoly pricing leads to monopoly profits, and that’s the reason for big ISPs attempting to limit competition. If democracy is such an important value, then why shouldn’t ISPs — which control access to the key infrastructure known as the Internet — be run democratically by regional communities?

A new study out of Harvard once again makes it clear why incumbent ISPs like Comcast, Verizon and AT&T are so terrified by the idea of communities building their own broadband networks.

According to the new study by the Berkman Klein Center for Internet and Society at Harvard University, community-owned broadband networks provide consumers with significantly lower rates than their private-sector counterparts.

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A lack of competition in countless US broadband markets consistently contributes to not only high prices and slower speeds, but some of the worst customer service ratings in any industry in America. This lack of competition is another reason why ISPs can get away with implementing punitive and arbitrary usage caps and overage fees.

Harvard’s latest study found that community-owned broadband networks are not only consistently cheaper than traditional private networks, but pricing for broadband service also tends to be notably more transparent, more consistent, and less confusing.

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ISPs also have a nasty habit of trying to make direct price comparisons impossible as well, lest the public realize what a profound impact the lack of competition has on broadband pricing. It’s a major reason why the FCC spent $300 million in taxpayer dollars on a national broadband map that completely omits pricing data at incumbent ISP request.

“Language in the website “terms of service” (TOS) of some private ISPs strongly inhibits research on pricing,” noted the Harvard study. “The TOS for AT&T, Verizon, and Time Warner Cable (now owned by Charter), were particularly strong in deterring such efforts; as a result, we did not record data from these three companies.”

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To retain this status quo, ISPs have spent decades writing and buying state laws that prohibit towns and cities from exploring community owned and operated broadband networks. More than twenty-one states have passed such laws, which not only hamstring municipal broadband providers, but often ban towns and cities from striking public/private partnerships.

It’s also why ISPs like Comcast pay countless think tankers, academics, consultants, and other policy voices to endlessly demonize community-run broadband networks as an automatic taxpayer boondoggles, ignoring the countless areas where such networks (like in Chattanooga) have dramatically benefited the local community.

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ISPs like Comcast could nip this movement in the bud by simply offering cheaper, better service. Instead, they’ve decided to buy protectionist laws, spread disinformation about how these networks operate, and sue local communities for simply trying to find creative solutions to the broadband monopoly logjam.

As we’ve noted previously, community owned and operated broadband networks are a fantastic alternative to the broken status quo. For those outraged by the Trump administration’s attempt to kill net neutrality (and soon all remaining oversight of the nation’s entrenched monopolies) building or supporting local broadband networks is one practical avenue for retaliation.

Big Tech as the New Predatory Capitalism

Big Tech has become corrupted with the immense power it wields, and there is growing awareness of the side effects of this phenomenon. I am personally a little too pedantic to agree with all of the article here, but it is definitely the type of analysis worth linking to in an era where corporations such as Google and Facebook are largely unregulated monopolies.

The five largest global corporations by market value are the five tech firms named above. Google has near-total dominance of the search market. Facebook welcomes two billion monthly users and manages six of the top ten social media apps globally. Amazon controls nearly half of e-commerce and over two-thirds of the emerging voice-activated digital assistant market. Apple and Google share control of the operating systems for mobile phones and tablet gadgets; add Microsoft and Amazon and you’ve covered virtually all electronic computing devices. Facebook and Google dominate digital advertising. Amazon is increasingly the only player for cloud services.

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The effects of tech monopolization have been detailed, at book length, over the past year (see companion book review essay by K. Sabeel Rahman, page 104). We already know these firms have crippled entrepreneurship, by either buying out competitors or copying their features and using overwhelming market share to destroy them—tactics that would be familiar to the authors of the Sherman and Clayton antitrust acts. We already know they’ve concentrated economic gains in a few small enclaves, leaving large swathes of the country behind. We already know they religiously avoid taxes and cut special deals with intimidated public officials, burdening the rest of society. We already know their surveillance capabilities rival any in history, handing over a comprehensive profile of your every waking moment for advertisers and behaviorists to exploit. We already know the addictive qualities of their products have undermined social relationships, expanded divisiveness, and transformed what it means to be human. We already know their drive for profits ignores how their platforms can be weaponized, scarring millions and undermining democracy.