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Letting The Market Choose Decent Broadband
An Anonymous Coward pointed out this piece on the regulation (and more to the point deregulation) of broadband Internet service. The article takes the viewpoint that solutions possible by relying on "the human spirit of innovation and creativity" are a better antidote than most of the broadband reforms so far proposed by politicians on behalf of lobbying groups. The author takes a stance some people may consider unrealistically optimistic, but makes some good points about the effects of arbitary deregulation.
This piece pretty much ignores the fact that in most states DSL services were already pretty much unregulated which is what allowed the babybells to run roughshod over Covad, Northpoint and Rhythms. There is simply no consumer recourse for being hosed over by the telco on data services once you cross into the realm of the unregulated services. Sticking to T1s and ISDN at least holds things in the realm of tariffed and therefore state regulated services. This has to date been the only reason that these services haven't been totally consumed by the telcos as DSL has been.
The consumer has already spoken in the marketplace only to find their DSL providers driven into bankruptcy at least in part due to predatory practices by the telcos. Predatory monopolies are bad, mkay.
...ISPs stop bundling services that people don't want don't need to offset higher costs.
If I want a webhost, then I can contract for the best webhosting provider. My ISP shouldn't matter. Right now I have four, count them four, webspaces that I am basically being taxed for by my various ISPs, but would never dare use because I have zero faith in their reliability. I'm paying for news servers that have speed-limited connections and don't carry any binaries groups. I'm paying for seven e-mail accounts that i have to throw away if I ever change ISPs, get filled with spam on a regular basis, and are POP3 only.
Why is my $40/50 going towards crap like this? I don't want any of it. I understand that the ISP is a cutthroat business but to me it still constitutes illegal bundling of services.
I want a basic IP dialtone. I think it should be provided as infrastructure by local government. It makes no sense to have four providers of high speed internet service running four lines to every neighborhood when for the same piece the city could run fiber and then lease it to any ISP that wanted to offer service. I am willing to see my taxes go towards that.
As far as webhosting/e-mail/etc I will run those myself. For anything I lack the experience to run, I'll sign up on my own. Everything is a la carte, that is the best way to foster competition and a healthy selection of services in a market where everyone pays based on their actual use of shared resources.
- JoeShmoe
-- I wonder which will go down in history as the bigger failure: the War on Drugs or the War on Filesharing
"The best way to foster this type of innovation is to get the government out and let the free market work its magic."
... the free market and its magic. Now we have an OS that costs more than a new hard drive. I happen to get my dsl here in the states from a baby bell (bellsouth), because they make it 'easy' for you to get it from them, and hard to get it from their competitors. The result - cheap service, horrible support (i refuse to legitimize it by using the word technical, because they are about as technical as my grandmother, who is afraid of email), lots of gratuitous outages, no static ip, and lots of technical errors (I am going to change over, which, again, bs makes overly complex and difficult). My point is that when a single powerful entity that is funded from another source (in this case telephone revenue) where they have a stranglehold on the transportation medium, the free market fails. The service does not get better through competition.
Well look at what happened in the OS market with microsoft
-CrackElf
"Blake is an idealist, Jenna. He cannot afford to think." - Kerr Avon, Star One, Blakes 7
Then Later...
And thats when the strong animals become huge multinational monopolistic corporations...
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And since the DSL marketplace is precisely the sort of marketplace that is manipulated by politicians and hurge multinational monopolistic corporations, what say you now?
The free market is great for the telcos -- they get to violate the law and screw the consumer, paying piddling fines along the way, until all their competition is crushed and we are forced back into their arms. Yup, just the way I like my free market to operate!
My solution? Not sure. How about fines with bite for a start so that when telcos break the law in their thuggish manner they get discouraged from doing it a second time by the fine?
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I'm amazed that /. wastes its front page space pointing to junk like this. It's just some undergraduate practicing his P.R. flak skills by rewriting some tired Bell company propaganda, washed liberally with conservative ideology.
But where's the free market when the Bells (and ohter ILECs) were granted their monopolies, which prevented anybody else, until 1996, from putting in competing facilities at all?
But where's the free market for "innovation" when the "wireless" options cited by the college kid author are, indeed, virtually nonexistent, under a government spectrum policy (remember, the airwaves are REGULATED) that is now aimed at maximizing license auction revenues? That results in high cost-per-bit cellular clones and ever-more-concentrated commercial broadcast groups. Wireless unlicensed options are very limited, by design. Satellite is limited by both spectrum availablity and the speed of light -- "innovation" isn't going to change the value of c.
Where's the free market when an incumbent monopolist is allowed to use their monopoly power (the stuff John D Rockefeller was notorious for) to crush any competition? Where's the free market when the Bell companies use every trick in the book to prevent living up to their legal obligations?
There are, of course, two different views of "free market". One is that the government shouldn't interfere with monopolies. The other is that the government has to limit monopoly power in order to let market forces work. Clearly the undergrad author is in the former camp, the "let's bend over and let the monopolies rule us" camp.
If I have a used car with a blue book value of $2,000, and you want to purchase it, and I refuse to sell it for less than $3,000, have I done something wrong? No; it's my damn property, and you're free to not buy it.
However, if you're a car dealer, and your cars are 50% more expensive than the cars from the dealer across the street, you will soon find yourself out of business. The situation the telcos are in now is that they have legislation saying every car dealer in town has to buy cars from them, at whatever prices they set.
It's a trade off, like everything else. No-one wants their street dug up every week by dozens of different phone, gas, electricity or cable companies, so we give one company a limited monopoly as a "reward" for putting in one set of infrastructure. Yes it's their copper. Yes, they paid to put it in. No, they can't charge whatever they want to use it, because that wasn't part of the deal.
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E_NOSIG
But, in the end, I don't see any other way - regulation won't work. The unionized telco workers with mgmt blessing delay DSL orders for CLECs into oblivion - hell, even if you get DSL FORM the telco it can take weeks and tons of hassles - it shouldn't be this complex. No regulation will change this. Unfortunately, we are unlikely to ever see serious DSL competition - same thing applies to cable modems. The only reason cable modems blew ahead of DSL is the cable companies planned their deployment and save for network bottlenecks which got worked out, they've executed. The telcos are still driving blind.
As much as I hate monopolies (*cough*Micro$oft*cough*), in this case I doubt there are other feasible options. Competing techs (Satellite, wireless, etc) are to immature and cost too much.
Thie ONLY saving grace is cross technology competition. The only thing keeping cable modem prices down is DSL - If DLS disappears, all you cable modem user can rest assured your rates will go up FASTER than your normal cable bill - count on it. But with DSL out there, its a threat.
DSL is to cable modems what satellite is to cable TV - it provides enough competition to keep the cable prices somewhat lower. Without Satellite TV competition, cable prices would be much higher because they are still a monopoly. Its amazing to think that combined, Echostar and DirectTV would be on par with AT&T in terms of the # of customers for 'cable' service. Like #2 nationwide.
So he's right, regulation probably won't work, but if we do give the telcos free reign over DSL, they better not screw it up or we'll all be stuck with RoadRUnner paying whatever AOL wants to charge!
Personally, I love my DSL connection - offered by a Mom & Pop phone company. Prompt service, installs happen quicklyt, upgrades are a phone call away - love it. :)
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Obviously you can't compare to Canada, because they don't have the evil Verizon killing off the competition.
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Make it such that the companies that own the COs and the last mile, and parents/subsideraries thereof, cannot offer the consumer any services and are only there to lease the use of their lines to phone, data, or other potental companies. I'd further extend it to cable lines where that is appropriate.
This would require the bells to split off a company to manage those last miles, and they would never be able to merge it back in the future. But this would also prevent a company like Covad (if they had the cash) to buy the last mile out and reverse the tables in order to screw the telcos. Including the cable lines and any future 'electronic transfer lines' that may come about in the future would also possibly open the door for more competition in the cable industry.
Of course, this isn't an overnight thing, and there must be some initial regulation as such that the cost of the 'extra' company beyond the telcos does not impact the fees that consumers already pay. I'm sure the baby bells would whine as well, since that last mile is their current money maker. But this would force a level playing field in that anyone wanting to offer consumer services would not have to worry about ownership of the last mile.
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