The Fiber Optic Scandal

It’s likely that you may have been hearing more and more about something called Fiber Optic Internet lately. You have probably seen ads on T.V, or on billboards while commuting to work. If you don’t know what fiber optic internet is it’s essentially an extremely fast internet connection compared to what most people currently experience in their households. It’s the next step, the next evolution, in the world of surfing the web, streaming content, and playing online multiplayer video games. To put it into technical terms, fiber optic internet is comprised of fiber-optic cables that are designed to transmit light pulses quickly over long distances. The inside of a fiber-optic cable is packed with optical fibers made of glass, each about as thick as a strand of human hair. Currently, 25% of Americans have this type of internet in their homes, while the other 75% have DSL or cable which uses copper wiring. DSL and cable are not as efficient as fiber optics as most companies can only promise you at least 60 mbps (Megabits per second). So why do 75% of American households still use copper connections? The story you’re about to read may come as a bit of a shock as to why.  

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This all started back in the year 1991 with former Vice-President Al Gore. During this time Mr. Gore was focused on what was called “Information Superhighway”. Even back in the year 1991 internet speeds had the capability of reaching 45 mbps, just 15 less than what the promised amounts are in 2017. The Information Superhighway essentially was a plan to have all copper wiring replaced with fiber optic wiring across the U.S. This would allow for new innovative services such as streaming content with little buffering, increased reliability, and fiber wiring was always planned to be an upgrade of the state-based utility known as PSTN (Public Switched Telephone Networks).

 

The plan eventually was put into place and the ISP’s were on board with it; essentially stating they could have fiber optics rolled out to half a million American households each year by the year 2007. However, before any of this could happen the decision had to be made on who would pay for all of this. The answer: anyone with phone service would be paying for these upgrades over and over as an added tax to consumers. By charging consumers an additional tax the ISP’s, in return, could help build a fiber optic network  across America. The next decision that had to be made was if the government should be responsible for building the networks. However, the phone companies had an interesting idea. The deal was made stating the government will give them a little more in profit via deregulation, and in return they would upgrade all of the existing DSL and cable networks. By the year 1995, almost every state had granted deregulations that took away the profit ceiling on most of the phone service companies. Their profits increased by an average of 30% depending on   the state that company was in. A call on average would cost a penny and the companies would charge customers $4.00 – $7.00 for a call.

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By the end of it all $400 billion  of extra money was given from American taxpayers to help build a fiber optic internet network across America. Unfortunately, only 25% of American Households have fiber optics (the 25% only recently installed to homes) because the money allocated to private industry  was never used for its intended purpose. Instead of investing in the fiber optic network,  companies invested overseas or built other businesses, like wireless phone service, that should have been used to upgrade the utility networks to fiber optics. On top of all this no state ever went back and either amended the laws to stop the phone companies overcharging customers,  and none of these companies have been audited by the IRS. The money will never be seen again and there is nothing to show for it. In fact, the United States is now ranked as 18th in the world for fiber optic connections. This reduces our ability to compete with  other countries drastically; especially when it comes to streaming content in 4K, virtual reality, and 360° video.. These technologies  are the future and will be used by everyone when the time comes. Sadly, because of the lack of fiber optic installations we will continue to see ourselves fall behind  in the great internet race.

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