Slashdot Mirror
Why ADCo?
Ian Peon writes: "Phoenix center recently released a study (pdf or doc) addressing the 'Last Mile problem.' The paper explains why no one has yet been able to crack the cable and phone providers' local monopolies -- and offers a solution: An ADCo (Alternative Distribution Companies) business model.
SF Gate has a good article on this."
BUT, even the SFGate article says"
"The reasons for that, boiled down, revolve around the costs involved in small telecom companies trying to do too many things all at once."
i haven't read the study in depth yet, but looking at the TOC and skimming the section heads, they seem to ignore a POLITICAL reality....
The Telcos ***DON'T WANT*** to solve the LastMileProblem.
The Telcos had, up until the construction of the fiber backbone, ARPANET and courts' decision that made telcos open the backbone up to competitors, a REALLY SWEET business model
strictly "Cost Plus, Plus" and very cozy relationships with their Fed/State regulators, many of whom were telco execs doing the "Public Service" tour of duty...which made the telco business a "name your own rates" kinda business
the more broadband deployed, the less value switched circuits have, and the more value packets acquire
the Telcos would much rather sell analog switched, retail priced voice services (where they created the business model and still control it), than...
...packet based, circuit-less (or virtual circuits, if you prefer) communications, where they cannot charge per packet and have to share their packet revenues with broadband providers...
i'm routing, uh, rooting, for the ADCOs, but, if you will recall, CLEC's were also supposed to solve at least part of the problem, and before them the RBOC's (soon to be "The RBOC or So")were going to wire the "bridge to the future"...
as a engineer geek, it sounds to me like the ADCOs can solve acutally solve the deployment of high speed fiber to the businesses and homes in the local loop (though you'll probably end up with a very limited number of very big ADCOs, economies of scale being very real)....
but, what about a business model that will allow broadband providers to survive w/o the consumer being charged "per packet" (like Docomo) or "per bandwidth" like fractional T?
Switched circuits are wasting assets, telcos and analog voice are doomed businesses,BUT...
..so far, no successful new business model has emerged to replace them
...
Ten quid, she's so easy to blind. And not a word is spoken...
MS and Intel gave us enormous improvements in their products over time in order to sell us upgrades. Telcos and Cable companies, who sell you a subscription service, have substantially less incentive to improve their product. Better to charge you the same for the same old service, and keep what profits they can from the underlying semiconductor/optic cost drops.
I fear that both these players are going to stick with 1 Megabitish services for a long long time. Video that fills my screen still seems a decade away.
If telcos gave you sufficient bandwidth to the last mile, they'd lose their existing revenue model to VoIP/Microsoft.
If cable companies gave you sufficient bandwidth to the last mile, they'd lose their control over video distribution channels to the surf-anywhere web.
I think broadband will be accessible for nearly anyone who wants it, and at cheaper prices than today (i.e. $20/mo, not $50). But I'm not convinced the bandwidth is going to start going up at Moore's law rates of the underlying semiconductor/optic technology improvements. Not even close. The geographic monopolies are too strong, and the benefits of cable/telco collusion are too profitable for them to not keep us on the leash of slow improvements.
--LP