There’s an old saying from my college days that, if overly simplistic, captures something of the challenge starting to face ISPs: “you are part of the solution or part of the problem.”

The growing problem is that business is going to be disrupted both at the high end (gigabit connections) and at the low end (basic access for up to a billion people in the global south that do not presently have access).

To be sure, mobile service providers, who already have managed to supply voice service to billions of people since about 2002, will be positioned to begin supplying Internet access to billions of people as well. 


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But the cost of providing service at the high end and buying service at the low end is becoming a key issue. But in both cases, a looming challenge is reducing the cost of buying, which requires reducing the cost of supplying.

At the high end, the example of 1 Gbps, symmetrical, for $70 a month is going to disrupt all other pricing expectations. If 1 Gbps costs $70 a month, what does that imply for the pricing of 100 Mbps, or 500 Mbps, or 50 Mbps service?

At the low end, the issue is how to affordably and quickly provide basic access to up to a billion new users, at retail prices perhaps representing one percent of household monthly income. That in some cases might be US $2 a month. That’s a challenging number, but in some ways no more challenging that selling 1 Gbps for $70 a month, which implies 100 Mbps, on such a network could sell for $7 a month.

Google’s (News - Alert) “moon shot” testing of balloon based Internet access might be the best example of an attempt at widespread disruption of the traditional costs of providing Internet access at the low end, the other bookend to Google Fiber, the effort to disrupt the market for high-end Internet access.

We normally envision disruption as something that small upstarts attempt, but that isn’t the only pattern. You might argue that Apple (News - Alert) has disrupted several businesses, suggesting that some businesses can be disrupted only by a large entity with lots of scale.

That might suggest that what Google is attempting, at one end with Google Fiber and at the other with balloons, white spaces networks or other techniques, is the sort of disruption only a large company with scale can achieve in the ISP business.