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by thejammahimself
1390 days ago
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Its interesting to compare ISPs from my country: the UK. Here, we have a decent selection of ISPs, and the industry is tightly regulated by OFCOM. I believe the network that most ISPs use is the same (owned by Openreach) but there is also a network owned by Virgin as well. Consumers have rights such as the ability to back out of a contract you signed if you are not getting the speeds you were promised by the ISP, and you can also escalate complaints to the regulator if you're not getting anywhere with your ISP. I think you also have a right to back out of a contract when they put up the price. Otherwise you have to pay a termination fee. Switching companies is really easy. You just contact the ISP you want to switch to, and they pretty much sort out everything from there. Prices across the market are pretty similar although there is some non-price competition going on. For example, Sky (the UK provider of satellite TV) will give you a discount if you subscribe to their satellite service making your internet cheaper than it otherwise would've been. In the UK there is the concept of the 'loyalty penalty', a term not only used in regard to the ISP industry but also other services like gas, and electric. It is used to describe the situation where people who stick to one provider tend to be paying higher prices than those who frequently switch providers, and hunt for better deals therefore people are often encouraged to take advantage of how easy switching is. I hear these stories from the US where people find they only have one provider in their region which is a completely foreign concept to myself. And when I was in British Columbia where some of my family reside, I noticed there seemed to be a duopoly on the ISP market: Shaw, and Telus. They also remarked on how expensive their service was. I don't know what the comparison is but it doesn't surprise me at all under such a market. |
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So what is an ISP? Well, it's like an electricity "supplier" in the UK (eg Bulb passim): it's a thin shell company that buys in a wholesale market and sells to the retail one, while running a call centre to deal with the annoying retail customers. Some people have called this the "playing at shops" theory of market operation.