2017: The Book Of Broken Promises: $400 Billion Broadband Scandal And Free The Net
“Imagine if you could say anything or do anything, with the odds of getting caught being almost nil. Even if you are apprehended, there would be little, if any, repercussions.”
Welcome to The Book of Broken Promises: $400 Billion Broadband Scandal & Free the Net“. It is being pre-released as a PDF version because these are critical times in communications.
It is the third book in a trilogy that started in 1998 and it details some of the largest scandals in American telecommunications history.
So let me tell you a story, which is told in all of its gory details in the book.
$400 Billion Broadband Scandal
By the end of 2014, America will have been charged about $400 billion by the local phone incumbents, Verizon, AT&T and CenturyLink, for a fiber optic future that never showed up. And though it varies by state, counting the taxes, fees and surcharges that you have paid every month (many of these fees are actually revenues to the company or taxes on the company that you paid), it comes to about $4000-$5000.00 per household from 1992-2014, and that’s the low number.
You were also charged about nine times to wire the schools and libraries via state and federal plans designed to help the phone and cable companies.
And if that doesn’t bother you, by year-end of 2010, and based on the commitments made by the phone companies in their press statements, filings on the state and federal level, and the state-based ‘alternative regulation’ plans that were put in place to charge you for broadband upgrades of the telephone company wire in your home, business, as well as the schools and libraries — America, should have been the world’s first fully fibered, leading edge broadband nation.
In fact, in 1992, the speed of broadband, as detailed in state laws, was 45 Mbps in both directions — by 2014, all of us should have been enjoying gigabit speeds (1000 Mbps).
Instead, America is not number 1 or 2 or 5 or even 10th in the world in broadband.
As of Monday, September 15th, 2014, one of the standard testing companies of the speed of broadband, worldwide, Net Index by Ookla, pegged America at 25th in the world in download speeds and 40th in upload speeds. Though this accounting varies daily, America’s download speeds are never in the top 20 countries.
The Information Superhighway to Nowhere (1991-2004)
Starting in 1991, the Clinton-Gore ticket proposed a visionary plan which Al Gore dubbed the “Information Superhighway”: Simply put:
- There is a wire that goes into your home, school or office as everyone in America is entitled to phone service. This was based on a copper wire that was put in as part of the state-based utility and most of them are controlled by what are now AT&T, Verizon and Centurylink. And these networks were aging as almost all of America had been wired for phone service by the 1960’s.
Starting in 1990s, (though it varies by state), this copper wire was supposed to be replaced with a fiber optic wire, which would allow for new innovative services, not to mention cable TV and video. And it was always supposed to be an upgrade of the state-based utility known as the “PSTN”, the “Public Switched Telephone Networks”.
And like fresh blood in shark infested waters, what are now AT&T, Verizon and Centurylink claimed that if they were given more money, they would use it, state-by-state, to wire whole states, not to mention the schools and libraries, or both.
NOTE: At the time, there were seven ‘Baby Bells’, which were created in 1984, when Ma Bell, the original AT&T, was broken up. These included Ameritech, Bell Atlantic, BellSouth, NYNEX, Pacific Telesis, Southwestern Bell (renamed SBC) and US West. There were also some independent companies, like GTE and SNET (Connecticut). But, by 2007, the companies had all merged to what we have today, and the original AT&T was eaten by its own children.
By the 1990s, the ‘Era of Say Anything’ was in full swing with grandiose plans. In 1993, Pacific Bell, California, said it would spend $16 billion by 2000 and have 5.5 million homes wired with fiber optics. Bell Atlantic controlled the East Coast states from New Jersey through Virginia and claimed it would spend $11 billion on 8.75 million homes by 2000, while Ameritech (which included Ohio, Indiana, Illinois, Michigan and Wisconsin) stated it would have 6 million fiber optic lines by 2000. Some states, like New Jersey, would have 100% of Verizon New Jersey’s territory completed by 2010 with 45 Mbps services in both directions, while SNET (Connecticut) said it would spend $4.5 billion and have 100% completed by 2007. Ohio Bell, (now AT&T Ohio) claimed that 100% of schools and libraries would be upgraded to fiber by 2000. And US West, (now Centurylink) which controls many western states, like Wyoming, Idaho, Colorado or North Dakota, told the public, regulators and investors that it would start a major deployment of fiber optic services, adding ½ million households a year.
Alongside of this, the companies filed with the FCC to offer something called “Video-Dialtone”, which was to be able to use the phone networks to offer cable and video services. And almost every company filed to offer millions of customers services by 2000. And these deployments matched the state-based commitments.
And all of these announcements were in the companies’ annual reports, statements to the press, or in state and federal filings; and it was always fiber optics and it would deliver broadband with speeds of 45 Mbps in both directions, and it included a cornucopia of new services, from interactive video and 500 channels of cable TV, to tele-medicine and tele-commuting (but would end up being ‘tell-them-whatever-they-wanted-to-hear’).
But there was a catch... Who would pay for it? Well, you, your business, your school, libraries — anyone with phone service would be paying for these upgrades over and over and over.
Starting in 1991, there were discussions of whether the government should build these networks, but the phone companies who controlled the state-based utilities in every state, saw this as a new mountain of money and said — just give us a little more profit via deregulation (known as ‘alternative regulations’), and we will, of course, upgrade these networks. At this time, the companies’ wires were still monopoly controlled and the networks were closed to competition, so their profits were constrained to 12-14% a year. But, within literally a year after the laws were changed, the profits more than doubled to about 30%, (though it varied by state and phone company).