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TheStreet Open House

FCC Net Neutrality Debate Obscures 'Last Mile' Dilemma

Customers are being pushed to let AT&T watch what they do online and sell ads accordingly, according to the tech site Ars Technica. 

Against this onslaught, consumer rights groups have only one effective answer -- let cities build their own networks to be run as a public utility. Phone company lobbyists are moving to prevent that but even if they didn't it would be ferociously expensive and few cities could afford it.

The fact is, it costs more to serve the "last mile" than it does to serve every other mile combined. The Internet was designed to connect offices and university campuses, where traffic was equal in both directions and where the telephone switches needed to make connections were nearby.

For residential customers, this distance varies. I have a phone switch a block from my house but most people don't. Suburbs, exurbs, and rural areas may be many miles from either a switch or a cable head-end. It may cost many thousands of dollars to run trucks and wires to each such location.

How will these customers get the future, and who will pay for it?

 

At the time of publication the author had a position in GOOG.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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