Earthling Blog, July 13, 2006
By Dave Coustan

The fairly highfalutin terms "duopoly" or "data duopoly" or "broadband duopoly" have shown up on Earthling a few times, and I've also seen them around in net neutrality discussions, and heard them in the public speeches of some of our execs. It's not a term you generally use in polite conversation unless you find yourself cornered with no other option but to discuss economics or net neutrality. I read an article at Ars Technica yesterday that layed out the idea of duopoly really well, and it also linked to another blog entry that sums it up nicely. Now that I'm writing about it, maybe I'll be able to do a better job of explaining it next time someone asks. See if this helps you:

...just about everyone who has broadband gets it from either the telephone company or the cable company. The FCC has affirmatively pursued the policy of creating this situation, and it's one of the main reasons we need a Net Neutrality policy. There is no real choice. [ Art Brodsky at PublicKnowledge.org ]

The article goes on to point out that in some markets, you get a choice between cable or DSL, but in many you only can get service one way. In the areas where you do have choice between the two, they don't give you much choice as far as price is concerned. Art continues:

Not only are there only two "choices," in supplier, there's little evidence of competition on one factor that really counts - price. In their July 6 Insights email newsletter, Kagan puts it fairly simply: "Though the battle for broadband access subscribers is intense, there's no screaming price war between cable TV and telcos, and Kagan Research doesn't expect one in the foreseeable future."

The whole article is worth a read.

So that's what duopoly means — it's two suppliers of comparable services controlling choice by keeping their prices in step with each other. When EarthLink CEO Garry Betty said at the launch of the Anaheim network that he believes municipal Wi-Fi will provide competition to the broadband incumbents, that's what he meant. Even though 1 megabit service is slower than cable speeds, it's plenty fast enough to be considered "broadband" and at $22 a month it provides a cheaper way to sidestep the cable/DSL duopoly.

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