http://www.pcmag.com/article2/0,2817,2401196,00.asp
Verizon Wireless's Fake Broadband Should Fool No One
Verizon Wireless today announced "HomeFusion Broadband," a totally uncompetitive home broadband service that delivers pretty good 4G speeds to the residents of Birmingham, Alabama, at the punitive price of $59.99 for a mere 10GB.
Nobody who's ever dealt with home broadband thinks that 10GB is an acceptable amount of monthly data for a high-speed, primary home connection. Cell phone carriers get away with low data caps in large part because they aren't primary home connections; buried in most mobile data contracts is a warning not to use the system as your primary Internet link.
Verizon's cap is lower than almost any other service designed for homes, and it's lower than the average broadband user consumes. AT&T says its average U-Verse user gobbles up about 21GB per month, as a justification for imposing a 150GB or 250GB monthly cap. Verizon, meanwhile, caps neither its DSL nor its FiOS at all.
Verizon's $50 for 10GB is half the price of what the company usually charges for mobile-phone data, and on phones, that's the industry standard. But that just shows how mobile-phone data paradigms can't replace a roomy home broadband connection. If phone-level data caps come to our homes, we'd have to give up most of our current ways of using the Internet, never mind future ones.
At home, we use the Internet very differently than we do when we're on the move. We watch video on big screens. We download albums full of music. We play games. We Skype for hours on end. We use several devices in the same house, on the same connection. According to our calculations, you'll be able to use up Verizon's HomeFusion Broadband cap in about six hours of Netflix. Per month. That's all you get.
Internet services are only going to become more data-hungry with time, too. Just look at our TVs, getting larger and higher-resolution. Look at Google and Apple serving up video to them; look at the various Internet-connected gadgets we're buying, and how they all connect to your home Wi-Fi, all at once.
We in the U.S. desparately need more home broadband competition. We have some of the highest broadband prices in the world, largely because of a lack of competition. As The Economist reported in 2010, the U.S. measures poorly in almost every gauge of broadband speed, cost, and penetration. But a service so limited that you can only use it six hours a month doesn't help the problem one bit.
Verizon Tries to Snow the FCC
There's one provider HomeFusion competes well with, of course: HughesNet. HughesNet is the much-beloved, much-despised satellite Internet system people in deep rural America use, and it charges high rates for low data caps because of the inherent high cost of satellite connections. Verizon is describing HomeFusion as a product for cities and suburbs, though, not for deep rural areas.
Yes, you could argue that Verizon's solution would be good for "light users," some small percentage of the population willing to gently sip their Internet as they check their email twice a day or whatever. I know those people exist. Some of them are on HughesNet. But the HughesNet subscribers I know generally chafe at their data caps; they rightfully think their limited Internet is a second-class service compared to what people in metro areas get.
I'm not sure Verizon intends to sell a single subscription here. Its audience is more likely members of Congress and FCC commissioners. You see, up until recently Verizon's parent company was working to build out a true home broadband solution: its award-winning FiOS, a fiber-optic system with great speed and roomy capacity.
But that came to an end in December when Verizon decided to enter a deal with cable companiesto buy some unused wireless spectrum of theirs. In exchange, it seems - though Verizon of course would deny a quid pro quo - the company decided to build out no more FiOS after the next few years, and to just resell cable Internet.
The cable spectrum buy hasn't cleared the government, though, and the FCC has been looking harshly upon wireless deals that appear to reduce competition, like the failed AT&T/T-Mobile merger. So HomeFusion is a smokescreen, a scrim, a paper banner that says "Hey, we aren't out of the competitive broadband business!" If this is their offering, they are absolutely out of the competitive broadband business.
What About the Spectrum Crunch?
The HomeFusion announcement is also odd considering that Verizon has been whining very loudly about how it doesn't have enough spectrum and about how we're on the verge of the mobile Internet becoming a massive traffic jam.
Verizon refuses to make research on its own spectrum usage public, resulting in a long string of hilarious rants from The Verge's mobile editor, Chris Ziegler, on Twitter.
"I can't think of any other industry where it's acceptable to be this vague about how you're using a national resource," he tweeted, and then, later, "this hot dog is made out of [REDACTED]. we estimate that if you don't allow us to acquire oscar meyer, we'll be out of hot dogs by 2015." Oh, just go look at the whole feed.
If Verizon is running out of spectrum, it shouldn't be introducing a new home broadband product. It also shouldn't be afraid to show the public how efficiently it's using its spectrum, if the company wants more. And if Verizon is interested in home broadband competition, it shouldn't be introducing a service with such a limited data cap that it doesn't compete.
At the moment, this all just looks like a transparent land grab, with no benefit for Americans at the end of it.
