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Tauzin-Dingell Up for Vote Soon

An Anonymous Coward writes: "Just received this letter from my ISP, one of the oldest in existence. A study here lays out the basics on the bill and why it's a bad idea. The bill retracts the telecommunications act of '96 which forces the phone giants to share the nation's phone lines (which are in public trust). Looks like it's time to write those pesky congressmen again." Too late to write. Call. Tauzin-Dingell, up for vote on Wednesday, would eliminate all the requirements on the four remaining Baby Bells to play fair with competing telecom providers. "Sure Covad, you can co-locate your DSL equipment in our switching offices - our deregulated rate is only $10,000/day/piece of equipment." It's instant death for all DSL providers except Verizon, SBC, Qwest and BellSouth.

12 of 338 comments (clear)

  1. News Flash by b.foster · · Score: 3, Insightful
    Third-party DSL providers are already dead. Can you name one who's made a profit for one single quarter? I'll give you a hint: it's not one of these losers:
    • Covad (fucked from the get-go, but they blame Verizon)
    • Northpoint (RIP)
    • "DirecTV DSL" (they are taking *huge* losses, just like the rest of Hughes)
    • Tung Communications (who?)
    DSL service is an economy of scale, and carving it up amongst a dozen competitors in the same small geographical area will ensure that they will all sell at a loss and die. It's simple Economics 101.

    Bill

    1. Re:News Flash by Wintersmute · · Score: 5, Insightful

      Let me weigh in on Economics 101. This fictitious argument that a "dozen competitors in the same small geographical area" will all "sell at a loss and die" may be the case.

      You know what I say? Great! That may be, and then went the industry converges on a few major DSL players, we'll know that natural oligopoly is the status quo for the DSL industry. And every time someone pulls out the antitrust argument, you can say 'we tried that'.

      Or you can simply declare that competition won't work, and dictate that the network owners get to do whatever they damn please. Oh, and because they're earning super-competitive profits, they'll branch out to provide DSL to rural communities where its not profitable to do so.

      Long pause. [Insert "huh?" here.] Not profitable?!? If any mechanism is going to get rural broadband off the drawing board, it will be market pressure, not a oligopoly of telecom companies earning supercompetitive profits on what amounts to a state-granted monopoly.

      The economies-of-scale argument is irrelevant. Because the network already exists, the CLECs plugged into the Bell networks have already made the scale investments. It's there to be taken by anyone, given that they have open access to the essential facilities.

      The real question is whether you want to allow the Bells to have to fight off competition with superior service, or whether you want to assume that competition will ultimate tank, and just do away with that whole "free market" thing. Because we all know that's a crock, right?

      Indie DSL providers may all go belly up, but we owe it to ourselves to figure out whether that's going to happen. Tauzin-Dingell is corporate rent-seeking, plain and simple.

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    2. Re:News Flash by MADCOWbeserk · · Score: 3, Insightful

      Economics 101 is just an intro course, to apply your most basic "survival of the fittest" approach to this grossly oversimplifies this. Telephone service is what is called a "public good" or a good provided using public land to run wires built with a huge government subsidy. The government (FCC) has responsibility to ensure that these companies provide greater benefit than the sum of the public resources they use. This is the social contract between the companies and society. Hence these companies don't operate under the normal competitive model. Rather than maximize profits, telephone companies should (in an idealized world if they abide by the contract) provide the most service they can for the most people. Hence, these companies need to be carefully watched to see that they don't unreasonably profit at society's expense. I don't mean to take sides, but I'm an economics grad student and I hate to see economics misrepresented.

  2. ...and the problem is what exactly? by Enry · · Score: 5, Insightful

    It's not like the Telco act of '96 was of any help. The Telcos don't care and use the loopholes, DSL isn't really available everywhere, no matter what James Earl Jones says, and cable/satellite is just as inexpensive and fast.

    I have friends that worked for CLECs that put equipment in ILEC COs. Sure Verizon would let you in the building, but want to use the bathroom? Sorry, can't do that, you'll have to go somewhere else. Want to come back in? Sorry, security isn't here right now and we can't let you in....

    1. Re:...and the problem is what exactly? by CynicTheHedgehog · · Score: 3, Insightful

      If this passes, I'm out of a job. I work for probably the last major competitive CLEC in the southeast. We have over 60,000 lines in service, and something like 7,500 more added in the month of January; we are cash-positive; and we have a business plan that is working better than we ever hoped. We've spent the last year busting our asses to get our service levels to world class levels, and we lead the industry in many areas. A lot of folks put in a lot of time and effort into making this thing work.

      When 2001 hit, we had layoffs. Now this. It's really sad and frustrating that we have to go through this kind of anxiety every year.

      So yes this is a problem. It's a very big problem. Just maybe not for you.

  3. How? by pirodude · · Score: 5, Insightful

    Ok, this pisses me off. Now that I've turned 18, what's the process for getting in touch with the people who can shoot this down? Where do I find out their info? What should I say?

  4. No it isnt by Edmund+Blackadder · · Score: 3, Insightful


    The scale benefits of providing DSL are not that great. It is nothing like making cars, for example.

    Even a small DSL provider can get the software they need to minimize administrative costs, and if bandwidth is a comodity, as it should be, that is more or less all they need.

    There are some benefits of scale in the equipment but that is not a big deal.

    Smaller ISPs may have benefits of finding a niche market or serving customers better.

    In fact before DSL thousands of smaller providers thrived selling basic dialup, and made profit, despite AOl's economy of scale.

    This is the kind of argument that is being used by corporate america to monopolize all our communication media. It was used for radio and now it is used for small ISPs.

    This argument is utter bullshit.

    But suppose it is true. Then why not let those DSL providers die naturaly? Why allow the telecom companies to lock them out? If someone is lobbying for a lock out that means they are affraid of the competition.

  5. Fairness might not be possible by gbnewby · · Score: 4, Insightful

    Read the bill, or at least the summary at the top. Unfortunately, the Congress might actually have our (the people's) best interests at heart. Also unfortunately, the telcos and cable company operators just aren't interested in EITHER opening to competition OR giving good service.

    What we THOUGHT was that the telecom act of 96 would level the playing field for smaller players. This hasn't happened, for reasons you see in other posts in this thread.

    What we THOUGHT was that technology would rapidly get better, yielding higher bandwidth and a greater ability to get beyond the coupla-kilometers limit. There's been progress, but basically we're still stuck with the same technology as in '96 and before.

    What we THOUGHT was that other players (power companies, wireless companies and funky stuff like blimps flying around over cities) would provoke telcos & cable companies to do better. But apart from satelite Internet (which is too slow for gaming and most other interactive use), there are not viable alternatives for most people.

    Basically, things have moved more slowly than we, the geeks, thought they would, and the cable companies and telcos have been able to have their way: little competition, top price, and little need for good service.

    There's still hope for new technologies and other developments (like municipalities' interest in WLANs) that might give hope to competition for xDSL and cable modem service for "broadband" Internet service. But it doesn't look like there's any hope that any sort of regulation will create real improvements for most users (or wannabe users) for today's "broadband" Internet services.

  6. Use Your Words by Wee · · Score: 4, Insightful
    Our government doesn't seem to give two sh*ts about monopolistic tech corporations.

    Go ahead and say it: Our government doesn't give two goddam squirty shits about anything but spreading the legs of the Lady of Justice for the highest fucking bidder.

    And no, I'm not sorry for the swearing. Let's not be afraid to say what we mean. We have to quit couching our words in trivial obfuscations so we don't offend the perpetually victimized. It won't be long before the rearward penetration reaches our mouths and we are all forced to speak up. But by then it will be too late. Oh well. We're all doomed to whatever fate the AOL/TW's of the world wish for us anyway.

    I was just going to moderate the parent comment up, but decided to speak my peace instead. Sometimes I hate America. Its dim-bulb of a leader doesn't help.

    -B

    --

    Ash and Hickory, straight-grained and true, make excellent bludgeons, dandy for the cudgeling of vegetarians.

  7. Re:all those companies by homer_ca · · Score: 3, Insightful

    That may be true, but sooner or later they'll monopolize themselves into a full consumer revolt. Some people will just forget about landlines.

    My Verizon bill just went up to $27 for local service with no long distance and no extra features. They just raised the Interstate Subscriber Line Charge from $3.50 to $5. My cellphone bill (ironically also w/ Verizon) is $40 with free long distance, voicemail, call waiting, and more night and weekend minutes than I'll ever use. If I ever stop procrastinating and get the cable modem, these guys are outta here!

  8. Re:No, this is a good thing by Chris+Johnson · · Score: 3, Insightful
    Why shouldn't they charge a huge amount of money for 768Kbps?

    ...sorry, I mean 384Kbps?

    ...sorry, I mean 384Kbps downstream and 128K upstream?

  9. One more breakup. by IGnatius+T+Foobar · · Score: 3, Insightful

    In retrospect, it's fairly obvious that the Bell System was broken up in the wrong place. Local and long distance service have a rather blurry line between them at this point. With colocation facilities available for CLEC's, the thing everyone needs access to is the 'last mile' local loop. And that's exactly where the split needs to be.

    Your local telco should be nothing more than a company that provisions local loops and provides colocation facilities for LEC's. Not ILEC's, not CLEC's, just LEC's. If they provide the local loop, and only the local loop, no one company has an unfair advantage.

    At that point, the various LEC's could be completely deregulated. They can provide local dial tone, long distance, Internet service, digital audio/video, whatever... it doesn't matter, because nobody would have this big monster competitor that they also have to buy a piece of their service from.

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