[Applause]
so in the summer of 2016 my doorbell
rang I went to the door opened it and
there was a salesman he was there to
convince me that I said should switch my
isp my internet service provider I
invited him in because I was curious the
deal he had was that he was gonna cut my
price in half and he was going to double
my speed I asked a few questions and I
signed up three months later I’m walking
through my kitchen and my wife is paying
bills at the computer and I noticed an
invoice from our new internet service
provider I picked it up and I was
surprised that they were charging me
five times the deal that I had signed up
for but they were giving me ten times
the bandwidth if you do a search on the
companies with the worst customer
service in 2017 across all industries
guess which industry has the top three
spots that’s right Internet service
providers and you may think this is an
operational flaw but I don’t think so I
think it has to do with the structure of
the industry itself so what is an
Internet service provider one way to
think about it is that it’s the on-ramp
to the Internet it’s the way that we
access the Internet and something you
need to understand is that if you’re
gonna compete in this business you got
to build your own infrastructure you got
to get a signal or a wire to every one
of your customers
as you translate this photo you might
think that UPS is doing something
illegal but if we ran our shipping
business the way we run our internet
service provider business then FedEx
would build their own highway and UPS
would build their own highway and then
the United States Postal Service would
build their own highway and this makes
absolutely no sense in the physical
world and it no longer makes any sense
in the digital world but this is an
important point an Internet service
provider is a service and it runs on
infrastructure we’re used to thinking
about those as one thing but
infrastructure is one thing and the
service is another thing so what are the
consequences of this model that we have
currently
well one consequence is that there’s not
very much competition because the
barriers to entry are so high and when
there’s no competition
we know the prices are going to be
inflated another consequence is an the
idea of bandwidth scarcity now when the
internet first came out bandwidth was a
scarce commodity or a scarce resource
but today we have fiber optics and data
scientists can push 5 million megabits
per second over fiber optics in a
laboratory environment and a hundred
thousand megabits in a commercial
environment then why is the national
average in the u.s. around 25 megabits
per second it should be affordable to
have a gig to most homes in the United
States we don’t need a gig
we couldn’t use a gig but it should be
affordable so why is the national
average 25 well one reason is that
there’s a lot of old infrastructure in
the ground and companies continue to
milk that infrastructure rather than to
invest in fiber optics another reason is
that these companies want us to believe
that bandwidth is a scarce resource
because if you think it’s a scarce
resource when they charge you to give
you more of it you’ll feel okay about it
another reason the average is at 25 is
something known as the digital divide
and if you looked at a map of the United
States and could see the digital divide
you would see that urban areas are well
connected and rural areas are not one of
the most insidious parts the digital
divide is that school children do all or
some of their homework online and if
you’re a parent the lives on the wrong
side of the digital divide well you
understand the problem structurally the
thing that makes the least sense about
the way this industry works is that the
internet was based on openness that
means it’s open to competition and it’s
open to innovation what about our
on-ramp to the Internet it works exactly
the opposite our ISPs are based on a
closed model close to competition and
close to innovation at least outside
innovation Rory Sutherland
says that he talks about wealth as a
function of the number of rewarding
choices an individual can make and that
technologies that are really valuable
are those that allow us to do things
that we care about that were not
previously possible
eight years ago some colleagues and I
started a company which we called entry
point networks and we wanted to rethink
the entry point to the Internet we had
two images in our mind when we started
the company one going back to FedEx and
UPS notice that there on one road the
other image is the image of an airport
in both of these images pay attention to
the difference between infrastructure
and services the infrastructure is
robust and the services run on top of
the infrastructure in both cases whether
it’s trucking or airline companies they
follow the rules they have open access
or open use of the infrastructure as we
progressed as a company we were
fortunate to meet a group of researchers
here at the University of Utah called
the flux Research Group in the School of
Computing and then we also met a city in
southeastern Idaho a small city by the
name of Ammon as a group we shared the
same vision and that vision was that we
wanted to move control from the isp to
the consumer as we work together Ammon
the leaders in Ammon had three goals
they wanted to get robust infrastructure
to every resident they wanted to make it
voluntary to participate and they wanted
to make the residents owners of the
infrastructure rather than renters as we
worked at the University of Utah we
thought if we had robust infrastructure
then we can create a cloud for services
for four years we work together and then
one year ago in the fall of 2016 our
science experiment went live if you’re a
resident that subscribes to the network
in a man Idaho today you have a gig pipe
to your house and you can change your
internet service provider
in 20 seconds you go into a portal you
find the plan that you want you click
subscribe a network is provisioned and
you’re live if you get dissatisfied you
click unsubscribe the network is torn
down and then you can choose a new plan
[Applause]
if you can change your service provider
in 20 seconds it fundamentally changes
the value you get from that service
provider what about price before Ammon
launched its network the average cost of
an ISP was 75 dollars for a 50 Meghan
the day a man launched its network the
first ISP came on with a 100 Meg
connection priced at $45 within 10
months because of competition that 100
Meg ISP had fallen to $9.99
I mentioned that city leaders in Amman
wanted to make the residents owners and
not renters of the infrastructure how
does that work the residents pay $17 a
month for their infrastructure until
it’s paid off when it’s paid off it’s
theirs it stays with the house they have
em pay $16.50 for maintenance and
operation of the network and then they
go into the cloud and they choose the
plan that they want in this case a 100
by 100 connection for $9.99 that’s less
than forty four dollars for a one gig
pipe and a 100 by 100 connection so
we’re already spending enough money to
have robust fiber optics in most parts
of the country we just need to structure
these systems different so what’s the
significance of Amman and our science
experiment one significance is that
three groups a private company a
research group from a university and a
small city have worked together to solve
important problems then there’s the
significance to Amman itself that we
effectively moved control from the isp
to the consumer we’ve given them more
value for less cost because Amman will
have a fiber network throughout the
whole city everything that the city
cares about and that the residents care
about will be connected to this network
and because it’s open infrastructure
we’re betting that we’re going to be
surprised by the amount of innovation
that happens on telemedicine education
Public Safety Aging in Place and on we
go one other significance is the Amman
provides a model for other cities now at
least a hundred cities have tried some
form of municipal broadband but I
believe Amman is the first to define the
problem differently those other cities
have focused on fast internet and many
of them have just copied the traditional
isp model
a man defined the problem as open
infrastructure creating competition
moving control to the customer the last
significance comes from Kevin Kelly he’s
my favorite philosopher of technology
when he talks about the importance of
communication networks he says that they
have a special place in economic history
because this is a sector of the economy
that’s transforming all of their sectors
our argument is that this sector that’s
transforming all other sectors itself
needs to be transformed so the next time
you get frustrated with customer service
or you don’t like the value that you’re
getting from your isp think of ammon and
remember that if your city will move
control to the customer you could fix
that problem in 20 seconds thank you
you
so in the summer of 2016 my doorbell
rang I went to the door opened it and
there was a salesman he was there to
convince me that I said should switch my
isp my internet service provider I
invited him in because I was curious the
deal he had was that he was gonna cut my
price in half and he was going to double
my speed I asked a few questions and I
signed up three months later I’m walking
through my kitchen and my wife is paying
bills at the computer and I noticed an
invoice from our new internet service
provider I picked it up and I was
surprised that they were charging me
five times the deal that I had signed up
for but they were giving me ten times
the bandwidth if you do a search on the
companies with the worst customer
service in 2017 across all industries
guess which industry has the top three
spots that’s right Internet service
providers and you may think this is an
operational flaw but I don’t think so I
think it has to do with the structure of
the industry itself so what is an
Internet service provider one way to
think about it is that it’s the on-ramp
to the Internet it’s the way that we
access the Internet and something you
need to understand is that if you’re
gonna compete in this business you got
to build your own infrastructure you got
to get a signal or a wire to every one
of your customers
as you translate this photo you might
think that UPS is doing something
illegal but if we ran our shipping
business the way we run our internet
service provider business then FedEx
would build their own highway and UPS
would build their own highway and then
the United States Postal Service would
build their own highway and this makes
absolutely no sense in the physical
world and it no longer makes any sense
in the digital world but this is an
important point an Internet service
provider is a service and it runs on
infrastructure we’re used to thinking
about those as one thing but
infrastructure is one thing and the
service is another thing so what are the
consequences of this model that we have
currently
well one consequence is that there’s not
very much competition because the
barriers to entry are so high and when
there’s no competition
we know the prices are going to be
inflated another consequence is an the
idea of bandwidth scarcity now when the
internet first came out bandwidth was a
scarce commodity or a scarce resource
but today we have fiber optics and data
scientists can push 5 million megabits
per second over fiber optics in a
laboratory environment and a hundred
thousand megabits in a commercial
environment then why is the national
average in the u.s. around 25 megabits
per second it should be affordable to
have a gig to most homes in the United
States we don’t need a gig
we couldn’t use a gig but it should be
affordable so why is the national
average 25 well one reason is that
there’s a lot of old infrastructure in
the ground and companies continue to
milk that infrastructure rather than to
invest in fiber optics another reason is
that these companies want us to believe
that bandwidth is a scarce resource
because if you think it’s a scarce
resource when they charge you to give
you more of it you’ll feel okay about it
another reason the average is at 25 is
something known as the digital divide
and if you looked at a map of the United
States and could see the digital divide
you would see that urban areas are well
connected and rural areas are not one of
the most insidious parts the digital
divide is that school children do all or
some of their homework online and if
you’re a parent the lives on the wrong
side of the digital divide well you
understand the problem structurally the
thing that makes the least sense about
the way this industry works is that the
internet was based on openness that
means it’s open to competition and it’s
open to innovation what about our
on-ramp to the Internet it works exactly
the opposite our ISPs are based on a
closed model close to competition and
close to innovation at least outside
innovation Rory Sutherland
says that he talks about wealth as a
function of the number of rewarding
choices an individual can make and that
technologies that are really valuable
are those that allow us to do things
that we care about that were not
previously possible
eight years ago some colleagues and I
started a company which we called entry
point networks and we wanted to rethink
the entry point to the Internet we had
two images in our mind when we started
the company one going back to FedEx and
UPS notice that there on one road the
other image is the image of an airport
in both of these images pay attention to
the difference between infrastructure
and services the infrastructure is
robust and the services run on top of
the infrastructure in both cases whether
it’s trucking or airline companies they
follow the rules they have open access
or open use of the infrastructure as we
progressed as a company we were
fortunate to meet a group of researchers
here at the University of Utah called
the flux Research Group in the School of
Computing and then we also met a city in
southeastern Idaho a small city by the
name of Ammon as a group we shared the
same vision and that vision was that we
wanted to move control from the isp to
the consumer as we work together Ammon
the leaders in Ammon had three goals
they wanted to get robust infrastructure
to every resident they wanted to make it
voluntary to participate and they wanted
to make the residents owners of the
infrastructure rather than renters as we
worked at the University of Utah we
thought if we had robust infrastructure
then we can create a cloud for services
for four years we work together and then
one year ago in the fall of 2016 our
science experiment went live if you’re a
resident that subscribes to the network
in a man Idaho today you have a gig pipe
to your house and you can change your
internet service provider
in 20 seconds you go into a portal you
find the plan that you want you click
subscribe a network is provisioned and
you’re live if you get dissatisfied you
click unsubscribe the network is torn
down and then you can choose a new plan
[Applause]
if you can change your service provider
in 20 seconds it fundamentally changes
the value you get from that service
provider what about price before Ammon
launched its network the average cost of
an ISP was 75 dollars for a 50 Meghan
the day a man launched its network the
first ISP came on with a 100 Meg
connection priced at $45 within 10
months because of competition that 100
Meg ISP had fallen to $9.99
I mentioned that city leaders in Amman
wanted to make the residents owners and
not renters of the infrastructure how
does that work the residents pay $17 a
month for their infrastructure until
it’s paid off when it’s paid off it’s
theirs it stays with the house they have
em pay $16.50 for maintenance and
operation of the network and then they
go into the cloud and they choose the
plan that they want in this case a 100
by 100 connection for $9.99 that’s less
than forty four dollars for a one gig
pipe and a 100 by 100 connection so
we’re already spending enough money to
have robust fiber optics in most parts
of the country we just need to structure
these systems different so what’s the
significance of Amman and our science
experiment one significance is that
three groups a private company a
research group from a university and a
small city have worked together to solve
important problems then there’s the
significance to Amman itself that we
effectively moved control from the isp
to the consumer we’ve given them more
value for less cost because Amman will
have a fiber network throughout the
whole city everything that the city
cares about and that the residents care
about will be connected to this network
and because it’s open infrastructure
we’re betting that we’re going to be
surprised by the amount of innovation
that happens on telemedicine education
Public Safety Aging in Place and on we
go one other significance is the Amman
provides a model for other cities now at
least a hundred cities have tried some
form of municipal broadband but I
believe Amman is the first to define the
problem differently those other cities
have focused on fast internet and many
of them have just copied the traditional
isp model
a man defined the problem as open
infrastructure creating competition
moving control to the customer the last
significance comes from Kevin Kelly he’s
my favorite philosopher of technology
when he talks about the importance of
communication networks he says that they
have a special place in economic history
because this is a sector of the economy
that’s transforming all of their sectors
our argument is that this sector that’s
transforming all other sectors itself
needs to be transformed so the next time
you get frustrated with customer service
or you don’t like the value that you’re
getting from your isp think of ammon and
remember that if your city will move
control to the customer you could fix
that problem in 20 seconds thank you
you
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