Internet Companies Are Robbing You
Internet providers have a vise grip on American consumers.
And because of this, we’ve become hopeless to change our own situation.
While many other developed countries pay around $25–35 a month on high-speed internet…
Americans pay $50 for the same access.
Even Canada pays only $35 a month.
So what’s causing this problems?
Well, if you’ve ever tried to get internet service in your area, you may be already aware of the cause.
Telecom companies oftentimes have what’s called a “natural monopoly” on areas of the United States.
It’s very expensive to dig up streets, lay down cables and hook up different towns for internet access.
And once a company agrees to do it for a new area, there isn’t much incentive for another company to do the same.
This gives the first company a regional monopoly over the area because no one else wants to compete with them.
Therefore, the company who gets there first can charge whatever they want from the new residents.
“And what are you going to do… cancel?”
That’s the exact mentality these telecom companies have.
They know they have you in a stranglehold. And they know that oftentimes you’ll need to completely move to an area with a competing provider.
The other consequence of this is they lock out Americans with lower income.
You would think that this would be the opposite case. It makes sense that states with higher income and cost of living would pay more for internet.
But because of the lack of competition, the poorer areas will often pay more, as illustrated in the graph below.
So How Do We Fix This?
It’s a tricky situation. We can’t force more competition into poorly covered areas. If a company doesn’t want to spend money to compete in a sparsely populated area, that’s their decision.
Bills to increase U.S. infrastructure have been supported by both political parties, but it takes a lot of time, effort and money to bring the rest of America up to speed.
Plus, they’ll only be outshone again when 5G rolls out in larger cities.
The only fix I see happening will come from the skies.
SpaceX’s Starlink wants to provide global high-speed internet to consumers.
Now, satellite internet has existed for a while, but it’s been super slow.
Companies like Iridium and HughesNet have provided this service in the past, but it’s been limited to phone calls and texting.
Starlink hopes to revolutionize this industry and provide high-speed internet to the entire planet.
This would eliminate the competition problem.
Not just for America, but the whole world.
There are billions of people worldwide without access to high-speed internet.
And once Starlink and its competitors get this new tech up and running, the profit potential is huge.
To a bright future,