We’ve arrived in the tech era; we have handhelds that allow us to host Web conferences wherever we roam, we can track our fitness goals with a simple bracelet, and our televisions can record our favorite programs. It’s true that we’re connected now more than ever, but for every inch of progress made, what’s lacking is access to broadband fiber.
According to the Fiber to the Home Council, less than 25 percent of homes in the U.S. have access to fiber broadband, but not all are connected. While many big companies are touting “fiber-like speeds,” the truth is having access and being able to connect are two separate, very big issues that are still being addressed.
Verizon FiOS (News - Alert) is the most widely known fiber provider, but out of 50 states, Verizon only covers 14, and only big metro cities within those states. Then there’s Google (News - Alert), whose name carries more weight than its fiber service; Google Fiber only has three current fiber cities connected, with six upcoming and eight potential on the horizon.
With all this talk about how fiber is the next best thing in connectivity, why does it all seem like a pipe dream, both literally and figuratively?
Most consumers use cable TV or DSL for Internet service. Yet in many areas where new homes are being built, installing fiber-optic cable directly to the home (FTTH) is no more expensive. Verizon’s (News - Alert) FIOS system provides services with typical rates from 50 to 100 Mbits/s, which is quite desirable, but only a precious few are lucky to have it.
Comcast (News - Alert) has its sights on fiber, too. The company has laid out plans to compete directly with Google Fiber, making lofty promises of higher speeds in 2016. A blog post earlier this year tells us that Comcast plans to offer Internet speeds of up to 2 gigabits per second to the majority of its nearly 22 million subscribers. That’s about 80 times as fast as Comcast’s standard broadband Internet plan. It’s a nice idea, but the promises of fiber connectivity have held little promise for those still waiting in the wings for a more updated, faster, better connection.
Studies show that, as broadband availability increases, so does a country’s productivity. People have often laid blame on local governments for lack of fiber, citing more urgent issues than spending public dollars on updated infrastructure. We know that fiber connectivity can create jobs, is sustainable, and provides so much to the communities, both for municipalities and school districts.
Other reasons for fiber’s absence are basically a business point: there are no compelling business incentives for the established players. Cable distribution giants like Time Warner (News - Alert) Cable and Comcast are already making a 97 percent margin on their “almost comically profitable” Internet services, according to Craig Moffet, an analyst at the Wall Street firm Bernstein Research. As Moffet points out, “If you are making that kind of margin, it’s hard to improve it.”
Of course, it’s worth noting that most of us have no other choice than to subscribe to our local cable companies.
Chalk it up to economics. Not every town has a university. Not every mayor can get his or her hands on low-interest financing. Fiber, while a fantastic idea, still has a ways to go in terms of connecting the masses.