equipment in a vault, pedestal, wireless antenna site, or pole-top device located nearby to the premises. Circuits installed or leased by the provider in turn run from the point of presence to one or more public or private access points for interconnection with the Internet. The so-called second mile connects local access facilities with upstream points of aggregation. In connecting to the Internet, broadband providers either pay for transit service or establish peering agreements with other ISPs to exchange traffic on a settlement-free (barter) basis. Caches, e-mail and content servers, and servers supporting specialized services such as video-on-demand or voice telephony are located at points of presence and/or data centers. Routers located in points of presence and data centers take care of directing data packets on to the next point in the cross-network trip to their eventual destination.
The future of broadband is sometimes described as a shootout among competing technologies that will result in a single technology dominating nationwide. This view, however, is simplistic and unrealistic; there is no single superior technology option. Broadband is going to be characterized by diverse technologies for the foreseeable future. There are a number of reasons for this:
Incremental investment in existing infrastructure. While some firms may have access to large amounts of venture capital, the expectations of investors in existing firms is for short-term payoffs. As a result, the technological approach chosen by an incumbent is likely to make use of existing equipment and plant, and the deployment strategy must be amenable to incremental upgrades. The infrastructures of the various incumbents in the broadband marketplace—telephone local exchange carriers with copper loops, cable television companies with coaxial cable, cellular companies with towers for point-to-point wireless telephony—will continue to make incremental improvements unique to their respective technologies to provide and enhance broadband services.
Continued exploitation of skills. Technologies require distinctive skills and knowledge—those needed, for example, to design, launch, and operate a satellite. Similarly, cable and telephone companies understand the technological challenges associated with their respective systems. Companies that know how to do one or another thing well will attempt to find market opportunities where these skills give them an advantage.
Different demographics and density. The United States (and world) population is very diverse in topography, density, wealth, and demand