The U.S.'s crap infrastructure threatens the cloud

State-sponsored cable/phone duopolies keep U.S. broadband slow and expensive

According to the broadband testing firm NetIndex, U.S. consumer broadband speeds rank 33rd in the world, right behind the Ukraine. Personally, I pay more than $1,500 per month for 30/30MB fiber for our office. This is ridiculously expensive and slower than the average household Internet in many other countries. It's a serious impediment to the United States maintaining its economic competitiveness -- and to enabling all of us to take full advantage of the cloud, which is clearly the next phase of computing.

As a patriotic American, I find the current political atmosphere where telecom lobbyists set the agenda to be a nightmare. All over the world, high-end fiber is being deployed while powerful monopolies in the United States work to prevent it from coming here. Some of those monopolies are even drafting "model legislation" to protect themselves from both community broadband and commercial competition.

Poor laws and regulations have protected a duopoly in most areas of the country. You can buy Internet from the local cable monopoly or the local phone monopoly, period. Neither have much motivation to make it much faster nor any cheaper.

Lobbying for lock-in

In my state, North Carolina, Time Warner Cable's lobbying group managed to get our rather technology-unfriendly legislature to pass a horrible law to "protect private enterprise" by making it nearly impossible for local communities to build out their own municipal fiber without the burden of onerous regulations. Apparently, what's good for Time Warner isn't good for the rest of us. (Forgive me, but I don't consider state-sponsored monopolies to be "private enterprise.")

On its face, such mischief appears to be a local problem in the United States, with at least 20 states having passed legislation to protect Ma Bell and Pa Cable. But clearly, it's a coordinated national effort. Multiple national lobbying organizations pretend to protect private business from unwarranted government competition, but are actually shielding large, state-sponsored, franchise monopolies.

For many small businesses, $1,500 per month is out of reach. In the case of my business, we expect to have to upgrade this connection pretty rapidly as we expand -- and, sadly, pay even more. This kind of a cost, plus the speed disadvantage, puts us on an uneven playing field with similar companies in other countries. Plus, in some rural areas of my state and the rest of the country, there is no broadband at all.

Originally, my company used the same cable broadband you get in the home with 50MB down and 5MB up (believe it or not, this is perceptibly slower than 30/30MB fiber in general). When we moved from local servers to the cloud, we knew the 5MB uplink would be a serious problem. Also, with clients and partners in Europe who love Skype, it seemed prudent to reduce the packet loss and latency endemic to normal business cable.

We've been here before

The current situation brings to mind the battle over rural electrification in the 1930s, where the utility monopolies tried to prevent the government from expanding the electrical grid outside of the wealthiest parts of the country. The argument was that the utilities couldn't pay for it -- and if the government got involved, it would cost jobs.

What happened? Electrified rural areas quickly prospered and there weren't very many (if any) unprofitable rural electrification projects. Millions were lifted out of poverty. Today, the argument is that municipal fiber -- as well as other efforts to both increase the speed and availability of broadband and make the United States competitive with the rest of the world -- will cost telecommunication jobs.

In reality, most evidence points to the opposite net effect. Yes, it would cut into Time Warner's short-term profitability. But it would increase my company's short and long-term profitability -- and create other higher-paying jobs associated with technology and communication throughout the economy.

The effect on the cloud

One would expect that the United States would lead in "cloudification," since Amazon and most of the other cloud pioneers are located here. But I can't help but wonder if the broadband advantage outside our borders will not only make those countries more competitive in technology, but also speed up their cloud adoption. If you're moving out of your local network or local data center, then not only burst capacity, but packet loss and latency are seriously important.

After the initial cloud rush, where everyone will be talking but only a few will be doing, I expect that cloud adoption will closely match broadband speed, cost, and availability curves. Those companies living in countries where the broadband monopoly is protected will adopt the cloud at a slower rate than those with competitive markets and municipal fiber. There's a good chance U.S. firms will fall into that group.

This article, "The U.S.'s crap infrastructure threatens the cloud," was originally published at Keep up on the latest developments in application development, and read more of Andrew Oliver's Strategic Developer blog at For the latest business technology news, follow on Twitter.

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