European Broadband Makes North American Broadband look like expensive Dialup

Julian Wolfe
July 3rd, 2011

If you leave Canada and the United States and go to England, you will notice a big difference in terms of your internet connection. Not only is it much cheaper, it is much faster. England didn’t pump billions into the system to get its widespread coverage and extremely low prices, they used regulations to increase competition and the companies that feared a loss in profits are now booming.

Currently, there are limited choices when it comes to choosing the best and most affordable internet service.

In the UK, for example, increased completion due to a regulatory action to force the big companies to share their wiring with other companies has boosted access to high-speed internet at much lower costs. Not only do customers pay less for more, the companies that provide this cheaper and better quality service make more than when it was unregulated and companies were greedy, selfish and afraid to lose its profits.

In Britain, users can get phone and broadband internet for as low as 3.49 Pounds per month which translates to $5.38 per month Canadian. That is for both the phone and high speed internet.

In the past, Britain used to have the same internet framework as Canadians and Americans. The British Telecom Company was their largest service provider and ran a monopoly of high prices for low quality service. Regulators noticed this and forced British Telecom to unbundle its copper wires.

This meant that the company still owned its wires but it had to allow other broadband service providers use them to reach their customers. British Telecom initially rejected what the regulators wanted to do, fearing it would lose profits to smaller companies. Regulators, however, kept up the pressure on British Telecom until it finally complied. British Telecom now reports that it is as profitable as ever and the one company monopoly became a place where 400 companies competed for the broadband market share driving costs lower and profits up, as well as the quality of service was more than doubled as a result.

The British government didn’t invest a cent into its broadband infrastructure. The only thing that happened was regulators forced more competition into the market.

Even as Britain significantly improved with this change of ways, it is nothing in comparison with their neighbors.

In Amsterdam, the largest and fasted broadband internet network is being built and it isn’t using any government funding either. As a result of their faster internet services, maintenance costs at many companies dropped and business improved.

The regulator actively embarrassed British Telecom until they complied stating each of its failures as a company in its aggressive standoff.

In the end of the day, what is keeping internet companies from big profits and what is keeping Canadians from high quality low priced service is the right-wing ideology that suggests that government regulation is bad for business and must disappear. In this case, government regulation made internet a win-win for both business and customers. In the end of the day, the Conservatives won’t bring you better internet, nor will any party that promises to boost public funding into the system. As it stands, the best way to increase internet coverage, quality and decrease its costs is to enforce and encourage greater competition.

Meanwhile, British Telecom touts its superiority to the US (and since Canada’s framework is similar) and states that since the US doesn’t have a good competitive base, it will never reduce operating costs or offer the best service to their clients and get greater profits as a result.

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