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Peer-to-Peer Wireless Is Increasing Competition Worldwide

Beyond the U.S., many ISPs have less of a grip on their communications markets.

A lack of competition increases the cost of communications services, and can lead to unfair practices.

U.S. regulators have been attempting to deal with the negative effect that a few large Internet providers might have on competition. Meanwhile, elsewhere in the world, new mobile technologies have been encouraging competition.

Yesterday, at Mobile World Congress in Barcelona, Spain, the chairman of the U.S. Federal Communications Commission, Tom Wheeler, promoted the net neutrality rules that the FCC recently voted to adopt, and bragged that the U.S. would “continue to be the world leader” in high-tech telecommunications. The FCC’s rules would prevent Internet service providers (ISPs) from prioritizing certain content. Critics say such “fast lanes” would undermine the principles that have led to online innovation (see “FCC Chief Proposes Broader Net Neutrality Rules”).

In some countries, big ISPs have less of a grip on their markets, and new wireless technology is creating a more open marketplace. Emerging technologies could accelerate this trend. The experimental LTE Direct protocol, for example, provides peer-to-peer communication without cell towers (see “Future Smartphones Won’t Need Cell Towers to Connect”).

Here in Spain, engineers and volunteers have pioneered a peer-to-peer network called Guifi.net that uses long-range wireless nodes. Its creators are advocates of net neutrality and have the means to ensure that all content that passes through their network gets equal treatment.

In some markets—including large swaths of the U.S.—just one or two companies have the right to transmit over the most versatile bands of radio spectrum or to build cable connections using public rights of way. This means those companies can dictate the terms and price of the connection, and as a result, an Internet connection in most U.S. cities is costlier and slower than it would be in cities in comparable countries, reports the New American Foundation.

“The entire net neutrality debate would not exist if there were competition at all layers of the Internet,” says Steve Song, a part-time researcher at the Network Startup Resource Center at the University of Oregon who also builds and sells kits for peer-to-peer mobile networks.

Increased competition could force telecom operators to treat content more neutrally without the threat of federal regulations (see “This FCC Rule Will Matter More Than Net Neutrality Will”). Kampala, Uganda, provides one model. There, Google provided wholesale fiber optic connections to anyone who wanted to buy. At first, Song says, the established telecommunications companies snubbed the shared service, arguing that they needed control over the infrastructure to guarantee its quality. When they saw how many of their customers went to the small ISPs that snatched up and resold the service, however, they joined the fray.

Wireless technologies often have a distinct cost advantage. In Kenya, for example, fiber optic provider Liquid Telecom has added free public Wi-Fi networks in Nairobi’s Central Business District, enabling users to browse the Internet or make voice calls for free. The service will one day compete with the established networks, says Ben Roberts, CEO of Liquid Telecom Kenya. In remote parts of Mexico, meanwhile, where a fiber optic line is often not cost-effective, more than a dozen rural communities have built and are operating their own mobile networks, bypassing national mobile network operators with low-cost open software and hardware.

The U.S. and other countries have a new opportunity, since more radio spectrum is available thanks to improved antenna technology. As governments have shifted analog television to digital technology, they are freeing up parts of the radio spectrum. Instead of auctioning national blocks to the biggest players, Song says, governments could create rules that would enable smaller players to access unused spectrum in underserved regions (see “New Airwave-Sharing Scheme Will Launch a Wireless Revolution”).

In some places where no alternatives exist, this is already happening. Following a successful demonstration by an organization called Rhizomatica, in the southern state of Oaxaca, Mexico, the country’s telecom regulator reserved 10 percent of the nation’s airwaves for use by indigenous communities, and opened the way community-driven networks.

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