[jmyeet]

This is just pure nonsense. The only reason for "cartels" is regulatory capture.

Most of the cost of an ISP is the so-called "last mile". Depending on your locale this is usually either stringing up cables on existing telephone poles or digging trenches, typically in the setback area between the road and the sidewalk that you might maintain but you don't technically own (or the municipality maintains an easement on, it varies).

Once you go from the premises to a central POP, the costs basically go to zero (per install). Backhaul bandwidth for a residential ISP is incredibly cheap, even free with peering arrangements.

The point is that geography really doesn't matter. Wiring up a 10,000 homes in Phoenix, Zurich, Shanghai or Sydney is basically the same (normalized for labor costs). The US is very spread out due to geography. It doesn't matter. The links between towns are a small fraction of the cost and often covered by existing rights-of-way anyway (eg railroads). You compare that to a highly urbanized and concentrated population like Australia where urban density is very similar to many American towns and cities and you're dealing with a very similar cost structure.

Think about it this way: if geography was the issue and not, say, artificial barriers to prevent competition (including from municipal broadband), why would the ISP lobby spend so much moeny to make municipal broadband illegal (as they do in many states)? Or why would they formalize a monopoly into a contract with an "exclusivity" deal (ie franchise agreement)?