Public vs private infrastructure

[DJQuag]

https://motherboard.vice.com/en_us/article/tennessee-could-give-taxpayers-americas-fastest-internet-for-free-but-it-will-give-comcast-and-atandt-dollar45-million-instead

The public company was stopped from expanding to rural areas due to a law that was lobbied for by cable companies.

They were offering to build this infrastructure with cash on hand and private loans - not a penny in government funds.

Their service was 10 times faster then the private lines.

So the government decided to give 45 mil of taxpayer money to AT&T and Comcast to build the infrastructure.

This is rank insanity.

[Fenring]

Seems normal enough to me. It's the main way infrastructure like railroads and the oil market were developed in the 1800's: bribery and government collusion to grant monopolies. Until the laws are changed to prevent corruption why should anyone expect things to change?

[DJQuag]

Of course it's normal. That's the *problem.* You end up with private companies providing 1/10 the service and it's okay because of capitalism and bribes at the expense of taxpayer money.

It ain't right.

I know there are people around here who don't think collective companies can't do anything right. This was mostly for them. I'm asking them. This collective company gives a x 10 better service and is willing to extend it to rural areas without taking a cent of taxpayer money. Meanwhile, we're handing 45 mil tax dollars to private companies to install substandard wiring and be able to charge whatever they want because capitalism.

You conservatives out there. Anyone willing to defend this? Because the alternative is to admit that sometimes public ownership is best.

[msquared]

I am a conservative and I think it is crap.  I wish more local groups would do what they are doing.

[DJQuag]

The issue in the current environment msquared, is that capitalists control the media.

So they'll do their best to paint this as socialist companies *censored*ing up. They won't back it up. But since when do partisan orgs ever back anything up?

Any collective or socialist org or business gets a hell of a lot of grief in all aspects. But guess what? Sometimes the socialist way works. Work for your masters or accept what is.

[cherrypoptart]

How much did the other company donate to the campaign coffers of politicians versus how much AT&T donated?

I think we largely have a consensus here that much of our government and economy runs on legalized bribery.

[yossarian22c]

The NC legislature passed a similar law prohibiting municipalities from providing broadband service even if the big companies hadn't decided to lay lines there yet.  Republicans seem intent on making sure the government doesn't start providing services to people who want them. 

[TheDrake]

This has been going on in that area for a while.

http://www.timesfreepress.com/news/local/story/2015/may/06/athens-tn-get-fiber-optic-internet-thanks-epb/302745/

The article is pretty badly misleading. Giving 45m of taxpayer money is inaccurate. It was 45m in tax breaks - this is at least partly equivalent to not taxing the public utility. Further, the utility has "cash on hand". Where did that come from? Among other things, the rate set for electric power by the government.

On to the wider point, municipal and other public entities can operate anti-competitively. An interesting article describes why you sometimes see "low low prices" - because they are actually charging customers less than marginal cost for a service.

My analysis (and common sense) concludes that a need for subsidies and the lack of concern for profits implies these government networks are prone to be predatory in nature, pricing services below economic cost.

linky

As for how Chattanooga got this wondrous 10 Gb network?

EPB was awarded a $111 million federal stimulus grant in 2010 to build its smart grid. EPB spokesman John Pless said the money expedited the build-out of the fiber optic network for the smart grid, and the communications services were an extra benefit.

linky

Let's not kid ourselves that high speed internet magically sprouts for free. The money is coming from somewhere.

[LetterRip]

If there is a tax liability in excess of 45 million, and you give a tax break for 45 million, the economic and tax result exactly the same thing as giving 45 million.

[DJQuag]

The Drake

In addition to what Letterrip said, of course the public company got stake money from the government. That's generally how it works. But when we talk about cash on hand, the cash that this company has on hand is from the hands of consumers, not the government. This public company is providing a good service and making a profit on it; therefore, it has cash, which it wants to use to advance the service to even more citizens.

What is going on here is that private companies bribed politicians to pass a law making it so that this public company couldn't provide x10 the service at $45 mil less cost to the taxpayers. It's outrageous, and it's the main reason I'm in despair over the current system on a bone deep level. The fact that our system allows and encourages this kind of thing.

[TheDeamon]

If there is a tax liability in excess of 45 million, and you give a tax break for 45 million, the economic and tax result exactly the same thing as giving 45 million.

Depends on the exact nature of the "tax break." Is it simply a reduction in taxable income, or is it a raw reduction in the amount of taxes paid?

Because if it's simply a reduction in taxable income, then the value is Dollar Amount Specified * the relevant tax rate.

For example, this is a reason why the "Home owners tax deduction" is a stupid thing to maintain simply for the sake of having the deduction available. If you're paying $7,000/year in interest on your mortgage, and you're being taxed at 20%, that $7,000 you knocked off your taxable income saved you a whopping $1,400. Which is all well and good if you actually needed that line of credit to be extended, but otherwise, spending 7 grand in order to save $1400 isn't that much of an incentive, unless you were going to do it anyway.

[Crunch]

If there is a tax liability in excess of 45 million, and you give a tax break for 45 million, the economic and tax result exactly the same thing as giving 45 million.

There is a very big difference, economically and ethically, between allowing a company to keep its earnings instead of taking it. Just as there is a difference between letting a company keep $45 million and outright granting its competitor $111 million in public  money.

Why would people oppose letting companies keep money it's earned as a public cost but find it reasonable to give more than twice that to another?

[DJQuag]

Well for one thing, the public company won't be charging the absolute highest fees that it can (despite getting infrastructure covered by the gov), like the private companies will.

This is the crux of the matter and why I'm so salty. The public company took a modest amount as stake money and returned the value of that money in spades. They provide a far superior service and are currently making a profit.

The private companies responded by using *their* money to buy off politicians to enforce a monopoly. And let's make this clear; broadband and Internet service in the US is absolutely a monopoly. I pay 30 dollars a month to a private company in the UK for unlimited broadband. 25 a month for unlimited everything on my mobile phone (including data). How much are YOU all paying?

It's wrong. If people want to make the case that public utilities can't compete against private, fair enough. Make the case. But in this instance public was kicking the ass of private and in response private just hamstrung them. They didn't get better. Or more efficient. They didn't offer a better service. They just crippled their opponent.

I guess that's okay because boooo socialism.

[Crunch]

It's not really making a profit. EPB is currently paying off a $200 million bond (tax exempt) and took in $110 million in public subsidies. It's currently cash flow positive but I think  it'll be some time before it's actually profitable - unless there's some balance sheet out there I've been unable to find that shows otherwise.

[Seriati]

This is one where I feel like we're not getting all the facts.  There are usually good reasons for both sides.

I will point out that it's not just private companies "bribing" people to put "super competitive" public utilities out of business, it's also public utilities manipulating regulations, putting in false barriers to entry and even fining private groups that out compete them and make them even more unprofitable than they are.

It's the nature of public utilities to overspend their actual profits.  Look at any metro system, public transit system and you see a subsidized service that ends up being a major tax burden and a source of fighting. 

[Crunch]

I agree about not getting all the facts, it's very hard to pull together. EPB had $200 million in tax exempt bonds but reissued over $250 million in bonds in 2015 (it got them more capital and refinanced the prior bond at a lower rate). With over $110 million in federal grants and over $250 million in tax exempt financing on the books now, it's hard to claim profitability at this point.

It seem giving private companies $45 million in tax breaks is cheaper than $110 million in grants and providing $250 million in tax exempt financing. Maybe service won't be as good, but you get what you pay for, I guess.

[DJQuag]

I agree about not getting all the facts, it's very hard to pull together. EPB had $200 million in tax exempt bonds but reissued over $250 million in bonds in 2015 (it got them more capital and refinanced the prior bond at a lower rate). With over $110 million in federal grants and over $250 million in tax exempt financing on the books now, it's hard to claim profitability at this point.

It seem giving private companies $45 million in tax breaks is cheaper than $110 million in grants and providing $250 million in tax exempt financing. Maybe service won't be as good, but you get what you pay for, I guess.

But they've *already* paid out those grants and bonds. It's a sunk cost. So the 45 mil is an additional expenditure for a x10 substandard service. Why would anyone support  that? Why is it that the private companies can't provide the same service?

[DJQuag]

This is one where I feel like we're not getting all the facts.  There are usually good reasons for both sides.

I will point out that it's not just private companies "bribing" people to put "super competitive" public utilities out of business, it's also public utilities manipulating regulations, putting in false barriers to entry and even fining private groups that out compete them and make them even more unprofitable than they are.

It's the nature of public utilities to overspend their actual profits.  Look at any metro system, public transit system and you see a subsidized service that ends up being a major tax burden and a source of fighting.

Whatever regulations are in place, they aren't working. I'll agree with you on that. Because ya'll people are paying 2x or more for substandard service over what we pay in Europe.

I don't care if it needs to be.a public service or a deregulation that allows companies to compete with the monopoly, but there is absolutely an issue with Internet and cable service in the US.

I'll just point out that in the "socialist" UK I had options between several private companies. They have already implemented the best solution; enforced competition with the government stepping in when a monopoly showed it's ugly face. Why wouldn't that work in the US?

[Crunch]

I agree about not getting all the facts, it's very hard to pull together. EPB had $200 million in tax exempt bonds but reissued over $250 million in bonds in 2015 (it got them more capital and refinanced the prior bond at a lower rate). With over $110 million in federal grants and over $250 million in tax exempt financing on the books now, it's hard to claim profitability at this point.

It seem giving private companies $45 million in tax breaks is cheaper than $110 million in grants and providing $250 million in tax exempt financing. Maybe service won't be as good, but you get what you pay for, I guess.

But they've *already* paid out those grants and bonds. It's a sunk cost. So the 45 mil is an additional expenditure for a x10 substandard service. Why would anyone support  that? Why is it that the private companies can't provide the same service?

Were those grants and bonds paid out to support expansion beyond the current limit or were the funds from it set aside for such expansion ? They were done 2+ years ago so I'm guessing not but I don't really know for sure.

I think private companies could provide the same service if they got $110 million in federal grants to get started in a limited area and could then sell a quarter billion in tax exempt bonds to raise new funds as needed.

[Crunch]

This is one where I feel like we're not getting all the facts.  There are usually good reasons for both sides.

I will point out that it's not just private companies "bribing" people to put "super competitive" public utilities out of business, it's also public utilities manipulating regulations, putting in false barriers to entry and even fining private groups that out compete them and make them even more unprofitable than they are.

It's the nature of public utilities to overspend their actual profits.  Look at any metro system, public transit system and you see a subsidized service that ends up being a major tax burden and a source of fighting.

Whatever regulations are in place, they aren't working. I'll agree with you on that. Because ya'll people are paying 2x or more for substandard service over what we pay in Europe.

I don't care if it needs to be.a public service or a deregulation that allows companies to compete with the monopoly, but there is absolutely an issue with Internet and cable service in the US.

I'll just point out that in the "socialist" UK I had options between several private companies. They have already implemented the best solution; enforced competition with the government stepping in when a monopoly showed it's ugly face. Why wouldn't that work in the US?

I think the geographic size of the US is part of it. Building out and then upgrading infrastructure at this scale is difficult and very expensive. In my area, I do have 1 GB internet connections for $60/month and unlimited usage. How's that compare with yours?

[DJQuag]

This is one where I feel like we're not getting all the facts.  There are usually good reasons for both sides.

I will point out that it's not just private companies "bribing" people to put "super competitive" public utilities out of business, it's also public utilities manipulating regulations, putting in false barriers to entry and even fining private groups that out compete them and make them even more unprofitable than they are.

It's the nature of public utilities to overspend their actual profits.  Look at any metro system, public transit system and you see a subsidized service that ends up being a major tax burden and a source of fighting.

Whatever regulations are in place, they aren't working. I'll agree with you on that. Because ya'll people are paying 2x or more for substandard service over what we pay in Europe.

I don't care if it needs to be.a public service or a deregulation that allows companies to compete with the monopoly, but there is absolutely an issue with Internet and cable service in the US.

I'll just point out that in the "socialist" UK I had options between several private companies. They have already implemented the best solution; enforced competition with the government stepping in when a monopoly showed it's ugly face. Why wouldn't that work in the US?

I think the geographic size of the US is part of it. Building out and then upgrading infrastructure at this scale is difficult and very expensive. In my area, I do have 1 GB internet connections for $60/month and unlimited usage. How's that compare with yours?

Was that a serious challenge?  Seriously, don't bother dropping that glove, because the US will never win versus EU.

I get absolutely unlimited broadband at 2 gigs a second for 30 dollars a month. This is a contract that I'm looking down my nose at atm because others offer better

And that is because we have government regulated competition versus the monopoly system where you live.

[Crunch]

Challenge?  Not at all. Just wondering for sake of comparison., no need to get defensive. The US is vastly larger than your area with generally very low population densities vs the EU so it's not an easy thing to pit the technology infrastructures against each other and make valid conclusions.

Where I live, it's far from a monopoly. It's have at least 4 companies I can choose from for internet access (off the top of mt head, may be more), all with speeds approaching 1 GB. I have 5 or 6 cellular services that offer unlimited data plans, they don't quite compete with broadband yet but it's getting there.

[Fenring]

I think private companies could provide the same service if they got $110 million in federal grants to get started in a limited area and could then sell a quarter billion in tax exempt bonds to raise new funds as needed.

Supposedly they've received a heck of a lot more than that, and entirely pocketed the money:

http://www.huffingtonpost.com/bruce-kushnick/the-book-of-broken-promis_b_5839394.html

[/quote]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.[/quote]

Perhaps one might contest the numbers involved, or exactly what was involved in the wastage even if it wasn't pure greed and corruption. But I have no doubt at all that the current corporate mentality in the U.S. (governed by Wall Street) will tend towards screwing customers, and sometimes even the company itself, when there is the opportunity to do so. Give them a pile of money and they'll find a way to effectively embezzle it, rather than invest long-term in either the company's future or the well-being of the public (which indirectly would benefit the company).

[Crunch]

I don't doubt that these companies have pulled some shady stuff and there's plenty of reasons they end up on the lists for worst customer service so I won't defend them. I will say it's a big difference in wiring out a land area the size of the USA and a single city or an EU nation.

I'll also add that giving any person/organization $100's of millions with limited or no oversight and they'll find a way to misuse it to its own benefit - whether that organization is public or private. Being a public entity is no magic bullet.

[Seriati]

Whatever regulations are in place, they aren't working. I'll agree with you on that. Because ya'll people are paying 2x or more for substandard service over what we pay in Europe.

I think LR actually answered this without even realizing it.  US services in this area lag and stink because they are still trying to use last century's government backed model to get them off the ground.  Granting a monopoly to a company that was willing to engage in the hassle of laying cable and building infrastructure from the ground up, let the US use government resources to explode its penetration across a very large land-base.  Most modern subsidies are not truly necessary and are used to prop up non-competitive businesses to keep better competitors out.  It's like people are not capable of evaluating why a policy makes sense and the problems it was designed to address anymore, and once you have a government sponsored feeding trough it always becomes about getting the best place in line rather than realizing you don't need it anymore.

[TheDeamon]

I'll just point out that in the "socialist" UK I had options between several private companies. They have already implemented the best solution; enforced competition with the government stepping in when a monopoly showed it's ugly face. Why wouldn't that work in the US?

I think the geographic size of the US is part of it. Building out and then upgrading infrastructure at this scale is difficult and very expensive. In my area, I do have 1 GB internet connections for $60/month and unlimited usage. How's that compare with yours?

Was that a serious challenge?  Seriously, don't bother dropping that glove, because the US will never win versus EU.

I get absolutely unlimited broadband at 2 gigs a second for 30 dollars a month. This is a contract that I'm looking down my nose at atm because others offer better

Geography is a factor in this. It isn't even just a strict urban vs rural split either in the case of the US because so many of the the urban areas are so far apart from each other as well.

Europeans often have a hard time appreciating the sheer scale and size of the United States. I'm not saying you're necessarily in that camp, but that there is no shortage of people who are.

A quick comparison:
The United Kingdom, with a population of 65.1 Million people, covers about 93,628 square miles of land.

Now compare this to the state of California, which has a population of 39.2 Million people, and covers about 155,779 square miles of land.

That makes for a much lower population density in "the big picture" sense now doesn't it?

Now if you wanted a better comparison in term of area size:
Oregon covers 95,988 square miles of land, but only has a population of just under 4.1 Million people.

Maybe we should look at France and Germany now?
France covers 248,573 square miles of land, and is just shy of the 67 Million persons mark. So in terms of population density, in terms of persons per square mile, it's roughly close to California. But in terms of area covered... We get Texas which covers 261,231 square miles, but only has a population of  just under 27.9 Million people.

Germany now covers a land area of 137,983 square miles, with a population of 82.1 Million people. Which actually makes California slightly larger than Germany in physical terms, but with less than half the population.

So just going through the "big 3" within the EU on geographic terms. We have France in place of Texas(but nearly 3 times the population). We get Germany in place of California(with 2x the population). And the UK swaps with Oregon(with nearly 16 times the population).

But let's keep going. Belgium has an area of 11,787 square miles, which makes it larger than Maryland(9,707 square miles of land, it does cover a total area of 12,405 square miles however), but much smaller than West Virginia(24,038 square miles of land).

So going with Maryland, we have a state population of 6 Million people, compared to Belgium's 11.2 Million citizens.

Now the Netherlands gives us 16,040 square miles, and a population of 16.8 Million people. As previously mentioned, that also puts it between Maryland and West Virginia. So we'll use West Virginia as the stand in with it's population of 1.8 Million people, about 1/9th of the population of the Netherlands.

Alternately, The Netherlands when combined with Belgium gives a combined land area 27,827 square miles, making it about 3,500 square miles larger than West Virginia as previously disclosed, but 2,200 square miles shy of the 30,060 square miles of land covered by South Carolina(total area of the state is actually claimed as 32,020 square miles), South Carolina only boasts a population of just under 5 million souls compared to the combined total of 28 Million people for Belgium and The Netherlands.

Denmark also claims a land area of 16,574 square miles, and a population of 5.6 Million people, so it's also stuck in that "sweet spot" between states with no close comparison. Although South Carolina nearly matches it in population with just shy of half the area claimed.

So let us combine it with Belgium and The Netherlands just to see what match could be made that way, giving us 44,401 square miles between those three nations, and a total population of 33.6 Million people. Pennsylvania has a land area of 44,742 square miles(total area of 46,054 square miles), and a population of 12.8 Million people. So comparable land area, but just over 1/3rd the population density. As an alternate, Ohio has a total land area of 40,860 square miles, or total area(includes water) of 44,825 square miles, and a population of 11.6 Million people which is almost exactly 1/3rd the population.

So in this latest case we have:
1. California -> Germany (double Cali's population)
2. Texas -> France (3x the population of Texas)
3. Oregon -> United Kingdom (16 times the population of Oregon)
4. Either Pennsylvania or Ohio -> Belgium + The Netherlands + Denmark (roughly 3x the population of either state)

But I've forgotten about Italy, with 116,347 square miles of area, and a population of 59.8 Million people. Which nearly matches Arizona at 113,594 square miles of land area with New Mexico as an alternate at 121,298 square miles of land area. I'm going to opt for Arizona in this case, with its population of 6.8 Million people. Which gives Arizona a comparable land mass, but only about 1/9th the population that Italy has.

For completeness: Switzerland is a bit of an outlier, while it also "falls in the hole" that The Netherlands/Belgium/Denmark did, at 15,940 square miles, it only boasts a population of 8 Million people, which makes it larger than Maryland, but on terms of people/square mile, it's less dense than Maryland is in theory(without getting into the matter of the topology of Switzerland which most closely matches West Virginia).

Spain is a "fun one" because it hits a hole on the other end, at 195,364 square miles putting it squarely between California and Texas in terms of size, and both of which have already "been used" so I'd have to start amalgamating states much like I did with EU nations earlier.

Although perhaps non-ironically, Utah(82,169 sq miles of land; 84,896 sq miles total) and Nevada(109,781 sq miles of land; 110,571 sq miles in total) come close. But once more population numbers: Spain has just shy of 46.8 million compared to Utah having less than 3.1 million and Nevada's 2.9 Million for a total of 5 million people between the two. Where once more we end up with Spain having over 9 times the population.

I could keep working my way into Eastern Europe, but I think it generally stands on its own. Population density helps immensely when it comes to doing certain things, like viable and self-sufficient mass transit systems, mass communications technologies(which includes broadband internet services), and so on.

"Economy of scale" is very much a thing, and while the United States does have sufficient scale present in many locations, the problem is many of those same locations are widely dispersed across the countryside that building the infrastructure needed for those various population centers to interact in such manners is anything but trivial. You're often talking about "trunk lines" that extend hundreds, if not thousands of miles in order to reach the next city with a population anywhere near 1 million people, rather than the dozens of miles that often is the case in Europe.

[NobleHunter]

It's the same in Canada. Though *a lot* of our land is just flat out empty. Though it really sucks to be the one dot of population a couple hundred or so kilometers from the next dot.

http://www.huffingtonpost.ca/2014/04/17/canada-empty-maps_n_5169055.html

Unless you want coverage to just end at the city limits, telecoms are going to cost more.

[TheDeamon]

It's the same in Canada. Though *a lot* of our land is just flat out empty. Though it really sucks to be the one dot of population a couple hundred or so kilometers from the next dot.

http://www.huffingtonpost.ca/2014/04/17/canada-empty-maps_n_5169055.html

Unless you want coverage to just end at the city limits, telecoms are going to cost more.

The satellite photos make the best point. which prompts a google image search:
global:
http://www.sciencephoto.com/media/96434/view

US East Coast at night:
http://www.sciencephoto.com/media/658920/view
USA at night:
http://www.sciencephoto.com/media/662981/view
Compared to:
Europe at night:
http://www.sciencephoto.com/media/160013/view

http://www.sciencephoto.com/media/662971/view

UK at night from the ISS:
http://www.sciencephoto.com/media/396173/view

[NobleHunter]

I'd actually be surprised if there were more than notional trans-Canada connections, with most traffic going south to hook into American networks rather than East/West.

[TheDeamon]

I'd actually be surprised if there were more than notional trans-Canada connections, with most traffic going south to hook into American networks rather than East/West.

Depends? Some of it is seasonal too. Customs and brokerage fees tend to encourage keeping stuff north of the border but NAFTA made it a little more reasonable for them to put loads "into bond" and run it through the US before returning it to Canada.

Mostly though, you're talking freight moving to/from Vancouver, BC (or Victoria Island) and the southern portions of Ontario, in particular the regions near Lake Erie. Likewise, there is some U.S. freight that moves from Michigan into Ontario before returning in New York or elsewhere in New England.

The TCH-1 is actually pretty good road right up until you hit the BC border where it spends much of its time as a 2 lane road(1 lane each way). At a minimum in most other places it is a divided highway with two lanes going in each direction. Grade separation of intersections is another matter entirely. Most of the more urban areas have either been bypassed, or grade separated at this point, but not all of it just yet(Medicine Hat, AB; and a portion of Calgary. The Stony Trail bypass has a couple stoplights on the west end still, both north and south of the 1, IIRC. Swift Current, SK has a couple lights, and Regina, SK is in the process of building a major bypass to the south and west. Manitoba has a few other spots where you get caught by stoplights, mostly around Winnipeg where even the bypasses have lights). Of course, I can only speak to British Columbia, Alberta, Saskatchewan, and Manitoba. I've avoided Ontario and Quebec like the plague.

TCH-16 I've only seen from Saskatoon, SK to Edson, AB and it once again is mostly divided highway, with stoplights in Edson, Edmonton(which can now be completely bypassed with no light if you go north on Henday Dr(hwy-216) as of last summer, IIRC there is a light still lurking in the SW quadrant of that belt), Lloydminster, AB and SK; North Battleford, SK, and Saskatoon, SK.

TCH-3 is its own little critter, in particular when talking about BC. There is a reason why TCH-1, TCH-3, and BC-5(a shortcut for TCH-1; aka "The Coq") are featured roads on the program "Highway thru Hell." Although they are working on widening and improving TCH 1 and 3 to be wider/better highways, you're talking about a lot of mountain passes with lots and lots of rock, which means lots and lots of blasting to make a wider/straighter passage. Not a cheap or trivial undertaking. The Crowsnest Highway(TCH-3) is an interesting road to drive on, plenty to see if you want to play tourist, but it can scare the pants off of you at times as well, particularly in winter driving conditions.

[NobleHunter]

I meant telecommunication, not freight. But it is usually better to cut across the states rather than going up through Northern Ontario.

[TheDeamon]

I meant telecommunication, not freight. But it is usually better to cut across the states rather than going up through Northern Ontario.

Well, here's an article talking about a published map of the ("long haul") internet backbone for the lower 48 states in the US. They even include the image.

http://blogs.voanews.com/all-about-america/2015/09/30/detailed-map-reveals-hidden-backbone-of-us-internet/

[yossarian22c]

The backbone of the internet is a system of very high speed lines running between large servers then lower speed lines branching into cities.  If we had European style regulations we should expect to see some slightly higher costs of running those high speed lines longer distances between cities but we should see comparable speeds within the cities/high population density areas.  Instead we see 1/10 to 1/2 the speed for double the cost.  That extra money hasn't been spent to get broadband to the rural areas of the country either.  The US has one of the lowest broadband penetration rates in the first world.  In my state in 2012 there were towns (some as large as 10-50 thousand people) that were prevented by the state legislature from building out their own broadband (despite the cable companies not getting around to it yet.)  So we aren't talking about just "list mile" penetration but failure to build out within fair sized communities.  I think this has improved somewhat in the last 5 years but there are still pretty significant gaps in access in the state.

[TheDeamon]

Someone is failing to understand how "economy of scale" works when it pertains to infrastructure, which communications qualifies as.

The larger the area an infrastructure covers, the more it costs to maintain.

So when you're dealing with an infrastructure that covers many times as much land area, and only has a fraction of the population. You end up with (costs * distance(extra infrastucture))/population paying for it. When you have 3 to 9 times the population to work with, and 1/4th of the distance you need to cover, then the fact that you're only paying half of much for twice the bandwidth DOES imply there are "inefficiencies" within your own system.

Where the BIG difference happens between public vs private infrastructure is if I only have a fixed amount of money to spend at a given time. If I have the choice between upgrading an area where I can recover my costs in 5 years, or upgrading an area where it will take a decade or longer, I'm going to choose the "5 year option" every time, particularly if I'm a for-profit entity. The outlying areas will only get attention when their stuff becomes so expensive to maintain that upgrading it becomes cheaper than maintaining the existing system(s).

But if I'm a local publicly owned utility, I don't get that choice, I can only upgrade the area I'm in. As such, upgrades will happen there. If "the public" is also willing to front the cost(issue a public bond) to finance the work, even better, as that allows me to decide to throw money at projects which very well may take decades in order to recover the cost.

[TheDeamon]

It should be noted that my last post is less an endorsement of "small public utilities." It is more of an indictment of large nation-wide or multi-regional business interests. Go-go-gadget-co-ops, in much of the US, it probably isn't a bad business model at this point to gather together everything you need to privately finance a "Fiber-upgrade" of your local area, get it deployed, hope it makes a reasonable amount of money, and wait for one of the larger operators to come around and buy you out rather than build out their own network in the same area.