Lithuanian Exceptionalism

In Lithuania, fiber broadband equivalent in speed to the service purchased by most Americans (10/1 Mbps) is $14.72 a month. The Lithuanian telco just doubled speeds with no rate increase, and you can get 40/40 Mbps service for $55, with no caps.

In the United States, I pay $40/month for 10/1 service. Recently, my ISP (Time Warner Cable) announced that they’ll sell you 30/5 for $70/month, and 50/5 for $100/month. I can’t buy the top end of Lithuanian-grade service (300/40) for any price. But I still count myself as a lucky moocher, because 56% of my fellow leeches have capped Internet service.

My mailbox and email inbox are inundated with offers from the local cable and telco trying to sell me shit I don’t want (more telephone service, more “premium” channels, and various bundles of those two things), along with either underpowered or overpriced Internet access. In the meantime, former collectivists are getting free upgrades to service levels unimaginable in our capitalist paradise. Sometimes I wonder who really won the Cold War.






53 replies
  1. 1
    Taylor says:

    Any guesses at WHY this might be?

  2. 2
    Damien says:

    And until the internet service providers are regulated properly as the utility providers they are the lubeless bend-over will continue.

  3. 3
    RossInDetroit says:

    We have ATT here and the price is competitive because there are other ISPs in the market. We’re buried under pitches to switch to Uverse combined Internet/phone/TV no matter how many times I tell them I haven’t watched television in 35 years and hate the phone. They even sent people door to door to sign up subscribers.
    When you’re rigidly selling what you want to sell instead of finding out what the customer wants and finding a way to get it for him your marketing and product model is Fail.

  4. 4
    The Republic of Stupidity says:

    Sometimes I wonder who really won the Cold War.

    Do I really even need to answer this question?

  5. 5
    WereBear says:

    @RossInDetroit: When you’re rigidly selling what you want to sell instead of finding out what the customer wants and finding a way to get it for him your marketing and product model is Fail.

    In any form of endeavor, modern corporate thinking is to get the cheapest, stupidest, and least useful form; and figure Good Marketing will fill any gaps.

    Being a monopoly, in this particular instance, don’t hurt.

  6. 6
    Omnes Omnibus says:

    As long as we are on this, compare Euro cell service to that in the US as well. I see people using phones in subways in London, Paris, and Rome. My ATT service gets spotty if I am in a brick building. And don’t get me started on the broad swathe of territory where no service exists at all.

  7. 7
    jon says:

    Sometimes I wonder who really won the Cold War.

    Don’t forget Poland!

  8. 8
    fhtagn says:

    Comcast certainly ought to roll out a new slogan:

    “Comcast – a service only Sarah Palin could love!”

    Or do I mean Xfinity? The crap-peddling weasels tried to rebrand recently, after all. Puzzles me why they didn’t just go for honesty and call themselves Concast.

  9. 9
    RossInDetroit says:

    In our market I think ATT has decided to throw all their weight behind one product, Uverse, coerce as many customers into it as possible with low buy-in cost, own the market and then force it on the holdouts. When they’ve achieved effective monopoly they’ll bloat it with cheap ‘features’ to push up the cost and the profit.

  10. 10
    c u n d gulag says:

    I was a trainer for Time Warner for years. They are a really shitty company to its customers and employees.

    And as far as the cable companies and the internet – HSD saved that greedy industry.

    Cable operators used to get 30-40% profit margins back in the old days.
    In the late ’90’s that profit margin was declining drastically down to a rate that most not totally psychopathically greedy companies would be happy with.

    Well, HSD let them keep their profit margins high.

    All cable companies are out to screw us out of every last sheckel. HSD is just the latest way. And that’s why they price it the way they do. If they had their way, and without competition and limited regulation, you’d pay $100 a month for service that’s beyond the kps range.

  11. 11
    RossInDetroit says:

    My dad lives in a rural area with one incompetent cable provider. He’s retired and hates the provider. They save a seat for him at city council meetings and probably ought to make his list of grievances a standing agenda item.

  12. 12
    cmorenc says:

    We have a local telco (ATMC) serving Sunset Beach, NC, where I have a beach house, who’s so awful they make me envious of all the lucky ducks in every other beach town in the county who are served instead by Time-Warner. (No, this isn’t any love-note to Time-Warner). ATMC has the local monopoly on both the cable franchise and the telephone land-line franchise. The vast majority of homes out on the island are second homes, with no need whatever of a land-line telephone connection, including ours. So does ATMC offer an internet-television bundle via cable (to which every house on the island or mainland is connected?) Nooo. In order to get television service AND internet service you have to BOTH have a cable subscription AND a land line AND a DSL connection, with the top-speed premium-rate internet service topping out at…6.2MbS.

    Did I mention they have a local monopoly on both telephone line and cable service? Thank our lucky stars they didn’t manage to get exclusive rights on local cell tower service (which used to be very sketchy five or six years ago, but is now very solid).

  13. 13
    Walker says:

    In Lithuania, fiber broadband equivalent in speed to the service purchased by most Americans (10/1 Mbps) is $14.72 a month. The Lithuanian telco just doubled speeds with no rate increase, and you can get 40/40 Mbps service for $55, with no caps.

    I wish I could get this. I am looking at property outside of the Ithaca town limits and almost nowhere gets numbers like that. In a few areas, Clarity has an RF solution that will give me 3/3, but not as far ranging as I would like.

  14. 14
    Mandramas says:

    Hey,I thought that market based solutions solves any problem, in any case, even in obvious natural monopolies that should be controlled by the government.
    In any case, mistermix, you should check the real purchace power of the lituanian Litas. Direct straight litas to dollars comparisons are inadequate due that currency market are almost always heavily operated.

  15. 15
    Sly says:

    It’s like a brand of import substitution industrialization, the kind you use to see a lot of in Latin America, where state-owned (or heavily subsidized) industries would be used to promote economic independence and liberalization throughout the country.

    Put more plainly, Lithuania is investing in Teo LT as a kind of infrastructure project for their own information economy. Presumably, neoliberal theory would argue that as soon as this infrastructure is viable it should be sold off to the highest (or the most politically-connected one) bidder.

  16. 16
    RSA says:

    While AT&T is placing limits on their broadband customers, the people of Lithuania are celebrating news that the part-state-owned telephone company — Teo LT — is increasing broadband speeds for their customers at no additional charge.

    It’s obviously the superiority of the free market that we have to thank.

  17. 17
    fhtagn says:

    @Mandramas:

    I believe the comparison is actually dollar to dollar. What you need is a comparison between the income of an average Lithuanian household relative to its US counterpart – i.e. how far does $14.72 go in Lithuania, relative to how far 40 bucks goes in the US.

  18. 18
    Viva BrisVegas says:

    In the United States, I pay $40/month for 10/1 service.

    Lucky bastard. Here in Oz I’m paying the equivalent of $100 for 8/0.4 with a 200Gb cap. Mainly due to crappy non-competitive monopolistic corporate arseholery.

    To get around the private Telcos the Labor government is trying to install a state owned nationwide optic fibre network to provide 100 Mb+ to 93% of the population, and wouldn’t you know it the conservatives hate the idea and have sworn to kill it. Not free market enough apparently.

  19. 19
    Amanda in the South Bay says:

    @Omnes Omnibus:
    And ATT seemingly has cash around to buy Tmob, but to invest in infrastructure.

  20. 20
    Sasha says:

    Sometimes I wonder who really won the Cold War.

    Considering that they scored the Google fiber-optic sweepstakes, I’d say Kansas City.

    Even money says Google chose KC in order to have nearby BBQ.

  21. 21
    Mandramas says:

    The point of a corporation is to make money, not to generate a strong infrastructure; just a profitable one. And in the case of natural monopolies, where the entry barriers are higher and no competitor can appear, it is a lot easier to make profits. That is why the government should be interested in control the natural monopolies, specially the ones that are critical to the economy like telecommunications.

  22. 22
    Omnes Omnibus says:

    @Mandramas: The markets solve everything bit is a strawman. You have been around here long enough to know that few, if any, of the people who hang around this blog are free market absolutists.

  23. 23
    fhtagn says:

    @Omnes Omnibus:

    Except matoko, in her confused and demonic way.

  24. 24
    Nylund says:

    Two things.

    1. I believe that even if there are multiple ISP’s in a neighborhood, the underlying infrastructure could be owned by just one of them, the rest rent it from that one. There may be a monopoly in the infrastructure even if there is competition in the service.

    2. My parents live in Silicon Valley, just a few minutes from Google HQ and Apple HQ. Neighbors include some pretty high up people at big companies. No provider is willing to dig a trench the extra couple hundred feet down their cul-de-sac for just 9 more customers (satellite doesn’t work due to hills.) Some neighbors are so rich that they’ve even offered to PAY to have this trench dug so the lines can be extended, but the cable company still says no. This results in the humorous outcome of a few high-level executives of internet companies having to use dial-up at home. Quite literally, the guy who invented the PDF can’t even email a decent sized one while at home. Its quite a thing to go over to a multi-millionaire’s house in 2011 and hear the sound of the modem squealing and beeping so someone can check their email.

    My parents, by pure luck of geography, get their internet beamed to them via microwave from a husband/wife ISP company with a transmitter on a nearby hill. My parents get a discount because they, in turn, relay the microwave signal to a couple of the neighbors. Its still not fast enough to do things like stream Netflix. They also have strict bandwidth limits. Use the internet too much and they slow down your connection and start imposing pretty heft “overuse” fees.

  25. 25
    PIGL says:

    @Sly: Well what probably will happen is the banksters will game their currency and jack their interest rates so as to create impose an economic crisis. Then the IMF will step in and force to sell their infratstructure to local organised crime or a western monopolist.

    See this interesting diary in the European Tribune.

  26. 26
    Amanda in the South Bay says:

    @Nylund:

    I can believe it. I live here, and as a comparison, sometimes right smack dab in the middle of suburban Santa Clara County you can’t get a decent cell signal.

  27. 27
    Walker says:

    My parents, by pure luck of geography, get their internet beamed to them via microwave from a husband/wife ISP company with a transmitter on a nearby hill. My parents get a discount because they, in turn, relay the microwave signal to a couple of the neighbors. Its still not fast enough to do things like stream Netflix.

    That is what Clarity offers in the Ithaca area, but I cannot guarantee line of sight everywhere in the county.

  28. 28
    slag says:

    I have to say…there’s very little the “free market” has to offer that I actually want. But nothing inspires me to despise it more than our national internet connectivity. Every time I go online, I want to punch Ayn Rand and all of her acolytes right in their stupid Transcontinental.

  29. 29
    Fred says:

    Oh boo hoo! Try moving to Canada. We pay more for all that stuff and have less choice. Don’t even get me started about cell phone and data plans!

    I’m guessing the wages in Lithuania are no where near what they are in the US for the people who work at the telcos including the installers. That is a big part of a telcos overhead.

  30. 30
    AZERTY says:

    Silly Americans…

    American living in Paris where I pay 29.90€ a month for 10/1 ADSL, HD TV AND free long distance to land lines in over 100 countries. Since the US telco numbers don’t differentiate between landlines/fax/mobile, I can call ANY number in the US for free. And that’s for about $40 a month. Plus, if fibre is available in my area, I can get that with all the bells & whistles for about 45€/month.

  31. 31
    Nick says:

    I’m currently getting fiber internet, 50/50 Mbps symmetrical, all for $57.95/mo. Yes, I know I’m very lucky to be getting this, purely because of where I’m living. The municipality-owned-and-run utility company already had a fiber-loop around the city to handle their meter readings, so they simply expanded that to offer some nice speeds for rather modest costs.

    And where would this be? Lafayette, Louisiana, USA. Yes, in the middle of BFE red-state Louisiana, in a very conservative big town/little city of 120,000, we managed to be socialist enough to basically get the city to string fiber to every house and business.

    Yes, the naysayers were very vocal (I don’t know how many people claimed that we would be stuck with the tax bill when it “inevitably” failed), Cox Communications and AT&T* kept playing legal games that delayed this project for a couple years (which ended up saving the utility money on the build out because the price of fiber equipment dropped drastically in those two years), but even when a city-wide referendum was put out, the citizens of the city overwhelmingly voted to implement the plan.

    And now, I don’t have to bundle other services that I don’t use (like TV or a land line, Internet is all this house-hold uses), and the price you see on the advertisement is what I’ve been paying every month on the bill (no installation costs, added fees, or strange “taxes” that seem to change (usually upwards) every month).

    http://lusfiber.com/index.php/.....cing-guide

    And so far, it’s been running like a dream. Even more than the speeds, my ping times are drastically reduced (pings of 8-20 ms to servers in Texas, sub 100 ms pings to game servers in Canada, even getting around 150 ms latency when I’ve connected to a few servers in the UK, these are from various first-person-shooter games).

    I know that Chattanooga, TN also started offering municipality-run internet service, offering speeds up to 1 Gb/s: http://chattanoogagig.com/

    I really hope this is going to be the future of internet access for Americans; Rather than having the same companies in charge of content-production, back-end routing, AND end-user connectivity (and being very interested in controlling what that end-user can access on the “free and open” internet), we have each city consider internet as another utility and wire up their own infrastructure for it.

    * As an aside, I before AT&T bought out BellSouth, I’d like to say that “This city was served by Cox and BS.”

  32. 32
    Arclite says:

    I was getting 5/1 service for $40/month, when HawaiiTel called and said if I upgrade my phone service (call waiting, etc.) they’ll boost my internet to 9/1 and the whole deal is only $35/month. So I went for it. So *sometimes* you can get more for less.

  33. 33
    Nutella says:

    former collectivists are getting free upgrades to service levels unimaginable in our capitalist paradise. Sometimes I wonder who really won the Cold War.

    Speaking of the wonders of capitalism, have you read this article about the Koch fortune? Grandpa Koch built a better mousetrap here in the capitalist paradise of the USA back in 1925 and the only people beating a path to his door were lawyers for big companies suing him right out of business. So he went to the communists in the Stalinist USSR who appreciated and paid for his superior technology and only came back here when he was big enough to be a monopolist himself.

  34. 34
    Mandramas says:

    @Omnes Omnibus: I really, really need to upgrade my sarcasm. Nobody is getting it. :(

  35. 35
    Yutsano says:

    @Mandramas: Snark tags. Snark tags help.

  36. 36
    leo says:

    Welcome to the New Guilded Age — only now we’re talking about the tyranny of the Railroad Companies (short haul, long haul, etc.) but that of the Telecoms running the Intertubes.

    It’s 2nd Rate all the way.

  37. 37
    Barry says:

    (replying to AZERTY)

    However, you probably can’t get a decent chili dog to save your life, so USA!111!!!! :)

  38. 38
  39. 39
    fhtagn says:

    @Barry:

    Indecent chili dogs are more fun IMHO. Go the Moulin Rouge!

  40. 40
    Calouste says:

    Speaking of which, do you know how retarded it feels to people from civilized countries that in the US you can’t just pick up the phone and call any number in the world (or even the country) unless you pay a monthly fee first?

  41. 41
    burnspbesq says:

    @Amanda in the South Bay:

    And ATT seemingly has cash around to buy Tmob, but [not] to invest in infrastructure.

    Say what, girl? If you buy T-Mobile, its infrastructure is part of what you buy.

  42. 42
    Judas Escargot says:

    Your internet connection is fast enough to let you shop for curbside trash collection and emergency health care online, isn’t it?

    So what’s the problem?

    Lucky Duckies.

  43. 43
    fhtagn says:

    @burnspbesq:

    I think she means that they are happy to buy other companies, rather than improving their own wretched infrastructure.

  44. 44
    Judas Escargot says:

    @burnspbesq:

    If you buy T-Mobile, its infrastructure is part of what you buy. Sprint goes out of business in a year or two, giving you even less reason to upgrade your network.

    FTFY.

    BTW I still think it’s hilarious that our two biggest telco providers grew from the ashes of “The Phone Company”, which absolutely had to be broken up into little privatized pieces to maximize competition for consumers.

    Choice. You’re soaking in it.

  45. 45
    fhtagn says:

    @Judas Escargot:

    Indeed. Golden showers all round and hooray for the free market!

  46. 46
    Head Like An Orange says:

    I’ll just leave this here…

    http://articles.cnn.com/2009-1....._s=PM:TECH

    I pay 27 USD for my 150M-7M connection…

  47. 47
    AZERTY says:

    @Barry: Ha! Vegetarian here so no chili dogs in France is win|win.

    But the cheeses… ooh-la-la !

  48. 48
    Shelton Lankford says:

    Who won the cold war? Easy – Comcast, Verizon, and AT&T…

  49. 49
    mclaren says:

    @Taylor:

    Any guesses at WHY this might be?

    No guesses required. Robert X. Cringely explained clearly and simply why America’s broadband prices are among the world’s highest and why America’s broadband speeds are among the world’s slowest:

    “The $200 Billion Rip-Off: Our broadband future was stolen,” I, Cringely, 10 August 2007.

    Cringely also explained why America has permanently lost the broadband speed and price race, and why American broadband will never catch up with the rest of the world, but will instead continue to lag farther and farther behind:

    “Game Over: The U.S. is unlikely to ever regain its broadband leadership,” I, Cringely, 3 August 2007.

    The conclusions are as obvious as they are inescapable. As America’s broadband becomes comparatively slower by contrast with the rest of the world’s internet speeds and comparatively more costly year after year, fewer and fewer foreign companies will have any interest in doing business in America. Increasingly, America won’t have the basic necessary information infrastructure to support the advanced technology companies that want to start businesses in America or do business here.

    As just one example, consider that AT&T U-Verse is throttled and capped in such a way that it is not practical to make remote backups of a server over the net using AT&T’s broadband service. This is being done to prevent users from downloading movies and TV shows and mp3s, but it has the unintended consequence of also making impossible businesses services like teleconfercing or remote data backups.

    As the rest of the world rolls out an increasing array of new products and new technologies based on ever higher broadband speeds, America will find itself increasingly left out of the global economy by our increasingly inadequate and overpriced broadband services. At some point, America’s broadband speeds will become so slow and so expensive compared to the rest of the world that advanced technology companies will simply give up and abandon the U.S. market.

    This appears to be a deliberate part of American industrial policy. In the 1950s, Paul Nitze’s NSC-68 established Military Keynesianism, which explicitly replaced private enterprise with cost-plus military contracting in a military garrison state. America is now a highly militarized garrison state devoted to building weapons and imprisoning our own people and conducting multiple endless unwinnable wars worldwide (the global war on terror which can never be won and will never end; the global war on drugs which can never be won and will never end; the global war on copyright infringement which can never be won and will never end…and so on).

    The increasing inadequacy of America’s broadband internet infrastructure is only one symptom of America’s accelerating degeneration and collapse into a bankrupt and dysfunctional military-industrial-police-terror complex whose main industries involve killing and imprisoning and punishing and spying on our own population.

  50. 50
    Michael Finn says:

    I pay $40 a month for 100MB/100MB internet access with unlimited caps.

    Our Public Utility District built fiber to each house because the two phone companies, AT&T and Verizon, refused to do any investment in the infrastructure. So our State board gave us the go ahead to do so. It has worked out well.

  51. 51
    LB says:

    @fhtagn: per capita income in Lithuania is about 3 times lower compared to US (about $12,000). Still, a lot of costs (e.g. equipment) are not proportional to income.

  52. 52
    AAA Bonds says:

    Lithuania clearly “won” the Cold War.

  53. 53
    Dr. Psycho says:

    @leo: No, we’d be better off if we were living in a “Guilded Age” where working people belonged to guilds (unions).

    This is more like a Gelded Age, where working men (and women) get to line up for our geldings….

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