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in Filmmaking
on Feb 13, 2012

Broadband in the U.S. sucks. In fact, the U.S. has become a second-rate telecommunications nation. This is especially evident with regard to two key indicators – broadband adoption and data speed. The degradation of broadband Internet service has significant consequences for the nation and for independent filmmakers.

The latest findings from leading government and private source speak for itself:

  • As of June 2011, Europe’s Organization for Economic Co-operation and Development (OECD) ranked the U.S. 15th in “broadband” subscribers; the consulting group, Strategy Analytics, is even more pessimistic, ranking the U.S. 20th with a “broadband” penetration rate of 67 percent compared to South Korea (95%), Netherlands (85%) and Canada (76%).
  • As of Q-2 2011, Akamai ranked the U.S. 12th globally in average (downstream) data rate speed of 5.8 Megabytes per second (Mbps); this assessment was confirmed by Ookla, a broadband testing service, which ranked the U.S. 33rd with data rate speed of 12.02 Mbps.

Even the FCC has confirmed this bleek prognosis. In a 2011 report, it found:

  • Only 1.2 million Americans have broadband Internet upstream data rates at or above 25 Mbps;
  • Only 48,000 people have data rates “at least 100 Mbps.”

It should be noted that the FCC defines “broadband” as a speed of 200 kilobit per second (kbps) that is 1/5th the rate of a megabit per second.

This situation is even worse on wireless networks:

  • 91 percent of the wireless customers have downstream speeds of less then 6 Mbps.
  • 96 percent of subscribers have upstream speed of “at least 3 Mbps.”

Since the adoption of the 1996 Telecommunications Act, hundreds of billions of dollars have been raised and spent to upgrade the nation’s telecom infrastructure. Unfortunately, we have little to show for it. All-to-much of this money has been wasted, squandered as subsidizes for the giant telcos.

The FCC laid out America’s telecommunications future in the 2010 National Broadband Plan. In it, the FCC calls for all Americans to have access to a two-way or bi-directional network with data rates at 100 Mbps. It asserts:

The United States must lead the world in the number of homes and people with access to affordable, world-class broadband connections. As such, 100 million U.S. homes should have affordable access to actual download speeds of at least 100 Mbps and actual upload speeds of at least 50 Mbps by 2020. This will create the world’s most attractive market for broadband applications, devices and infrastructure .

This is a bold, if deceptive, statement. Bi-directional broadband data speeds of 100 Mbps are currently the standard speed in many advanced nations, including France, South Korea and Japan. In fact, Hong Kong’s telecom companies are offering 1 Gigabit per second (Gbps) services and at prices that are less than conventional America teleco’s Asymmetric Digital Subscriber Line (DSL) services. America’s current average speed is about 5 Mbps and in only one direction, downstream.

Why is this important for indie media makers? Telecom subscribers are increasing their reliance on wireless devices, even for the viewing of video programming including movies. This trend is suggested by the enormous popularity of the iPad and other tablet devices. The telcos are abandoning their historical investment upgrades of wireline networks as evident in the staled implementation of AT&T’s U-verse and Verizon’s FiOS systems.

In a New York Times editorial, Susan Crawford, a professor at the Cardoza Law School, recognized the long-term consequences of the telco duopoly’s push to wireless. As she points out:

Even if a smartphone had the technical potential to compete with wired, users would be hampered by the monthly data caps put in place by AT&T and Verizon. For example, well before finishing the download of a single two-hour, high-definition movie from iTunes over a 4G wireless network, a typical subscriber would hit or her monthly cap and start incurring $10 per gigabyte in overage charges.

This development signals not only a triumph of inferior technology, poor quality service and jacked-up pricing, but the end to meaningful competition in communications.

The telcos are repositioning themselves in the media, entertainment food chain. Where once they were passive carriers, they now want to serve as a would-be movie theatre of old on the Information Highway.  They plan to charge the online movie “goer” a fee (in addition to a customer’s normal monthly charges) to screen a streaming movie.

The movie marketplace is tough enough. Adding a new gatekeeper to jack-up prices and threaten free distribution is a game changer.  This is especially the case when gatekeepers like Comcast and Cablevision own programming (“content”) companies as well.

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David Rosen is a writer and business-development consultant.  He is author of the indie classic, Off-Hollywood: The Making & Marketing of Independent Films (Grove), originally commissioned by the Sundance Institute and the Independent Feature Project. He can be reached at drosennyc@verizon.net. For more information, check out www.DavidRosenWrites.com and www.DavidRosenConsultants.com.


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