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The biggest Internet service providers (ISPs) in the US are spending progressively less on network upgrades. This may explain why subscribers aren’t getting the service they deserve. And it signals a tendency for connection reliability to degrade over time. Internet users have turned to VPN website access to supplement slower speeds. But this cannot be a permanent solution.
ISP Network Upgrades
The biggest ISPs are just not giving much of their profits for network upgrades. Comcast is the worst offender, with Time Warner and Verizon in close second and third place. AT&T has not reduced their allocation for upgrades as much as the other three. When we look at the actual dollar amounts, only AT&T has actually shelled out more cash for capital expenditures.
Regular ISP network upgrades are very important to the proper functioning of these providers. They want to keep costs down to keep subscribers happy with low rates. But they also need to provide competitive service quality to stay on top. What seems to be happening is that they are providing just enough quality to stay at par with other services. This means that Internet users don’t have a lot of choice when they choose their providers.
All of the above is pretty standard marketing strategy. And broadband infrastructure is pretty much a huge one-time investment. But the recent Comcast-Time Warner Cable merger and net neutrality commotion has added a new angle to it. As technologies improve, companies need to upgrade their systems to provide better service. The four companies mentioned have done so to some degree in the past decade. But they have not done as much as expected. Now, net neutrality principles may be pushed aside in favor of ISP control. If that happens, broadband providers may not have to upgrade. Their current infrastructure will be enough for all their customers because they won’t have to treat everyone equally.
VPN Website Access
For many, fast and slow lanes are a big problem. It means preferential treatment for those who can afford to pay more. This means higher monthly fees for heavy traffic services. Currently, VPN website access is the only technology they can rely on to ensure that they get treated equally. Once ISPs are given permission to discriminate against certain traffic, it will become the norm.
Over the last ten years, ISPs have spent from 12 to 37 percent of their revenues on infrastructure like network upgrades. They do not need to spend a lot after the initial investment in infrastructure. So if they don’t upgrade, what they take in from customers is almost 100% profit. The four providers above can afford upgrades, but have chosen not to do so recently, except for AT&T.