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Municipal Net Access: Unfair Competition?

ruvreve writes: "Net Economy has an article about how Los Angles is attempting to provide the ability for end-users to have a choice between multiple ISPs for high-speed bandwidth access, among other things. The article talks about how a city has an unfair advantage to offer such services. Unfair because the government monitors and regulates the cable and phone company but at the same time wants to compete for their customers. If it gets 100Mbit access to my front door it HAS to be good!" This issue's been raised a few times before, but the article raises some points worth thinking about.

18 of 202 comments (clear)

  1. Not cost effective any time soon by Slash+Veteran · · Score: 2, Insightful
    100Mbps won't be showing up at your door any time soon. Price some of the modems -- you are dealing with modems, not simple 100baseT NICs. To bring 100Mbps to your door, it's optical, and the modem will run $15-20k US.

    It will be awhile until that drops to something more reasonable. Maybe PON (passive optical networks) will be the breakthrough. I'm not very familiar with that technology -- anyone?? anyone?? Ferris?

  2. This sort of thing has happened before. by Latent+IT · · Score: 3, Insightful

    For the most obvious example, you can look at the USPS, vs. Fed Ex and UPS. In that area, it's fairly safe to say that the government version hasn't stifled the private sector interests. Fed Ex gets it there faster, and UPS gets it there better, either cheaper, or if it's heavier, or whatever.

    I work for city government, in that other city, on the other side of the country. A city run ISP will be concerned with either value, fair service, or information security, or maybe a combination of the three. This is hardly a bad thing. Cities have a way of wanting to avoid lawsuits, badly.

    That being that, private offerings will be able to compete with higher speed, more features, package deals, etc. Like the USPS, a city ISP would offer a baseline of service, and any private ISP that couldn't at least match it would crash and burn, but they'd probably deserve it.

  3. Oh my god by abe+ferlman · · Score: 4, Insightful

    Do you suppose it's possible to say something so hypocritical, so mindbendingly and offensively pointing to one's own guilt, that the speakers' head actually spins 360 degrees Exorcist-style then reseats itself as if nothing had happened?

    I mean, the telecom behemoths want to complain about unfair competition after the way Excite, Rhythms, etc were treated?

    Good gravy. Since the government created these corporate monsters through deregulation, perhaps the government is the only entity that can compete with them. Note to conspiracy theorists- perhaps this is all a clever ploy to keep the telecom bribes flowing, so the fatcats don't get too comfortable.

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    1. Re:Oh my god by FaithAndReason · · Score: 5, Insightful

      Note that the two detractors cited in the article were representatives of cable companies, not ILECs (it mentions that the NCTA primarily lobbies for cable companies.)

      What's their beef? "'Don't forget that they (the city) make us carry unnecessary community channels, they force us to provide local infrastructure...'" <verysmallviolin>Such a terrible burden, to actually give something to the community!</verysmallviolin>

      The lobbyist goes on to bemoan the fact that "Municipal power boards can offer service at a fraction of the price of a private competitor. Cities use existing rights of way from the power grid to lay their networks, they face a reduced regulatory burden to get the license to operate and they do not have to run at a profit".

      Then he pulls out his trump card: "At the end of the day it boils down to, do we want the government being in this business?"

      Well, I'm about as anti-government as any slashdotter, but it seems to me this is exactly the business we want the government to be in. Unless we want to actually have multiple "pipes" leading to each and every home and office, the responsibility for building and maintaining the lowest level of the network infrastructure should belong to the same sort of institution responsible for maintaining the water, electricity, sewer, etc.

      After all, if they really want to put their money where their mouth is, the telcos and cablecos can just lease the city's infrastructure and gain the advantage of all those cost savings. It remains to be seen whether they spend their money on that, rather than on more lobbyists...

  4. Who owns the roads? by Bonker · · Score: 5, Insightful

    With a few exceptions, the public utility that most americans think least about... Our public road and highway infrastructure, is completely publicly owned. There's just no way to effectively manage an entire system of roads cost-effectively at a profit.

    There exist a few turnpikes, toll-roads, and troll bridges out there... (*rimshot*) but for the most part Americans are used to paying for the right to use the system out of tax dollars.

    Power is going the same way, as can be evidenced by the collapse of the California power grid. How long will the state pay for the power companies to stay solvent until the state becomes the primary power-provider? Phone will go too, IMHO.

    Internet is going to be the next public utility, probably even before the phone system. Already communities all over the country are building 'municipal' internet services. Look for these to become tax-supported in the near future.

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    1. Re:Who owns the roads? by mrobin604 · · Score: 2, Insightful

      Power went haywire in Calif. not because of de-regulation in general, but California's "de-regulation" [reason.com] specifically.

      Which was heavily lobbied for by the private electric companies.

      I live in Los Angeles. My house is served by LADWP, which was not subject to the deregulation. While the rest of the state suffered rolling blackouts, power shortages, and long term contracts for overpriced electricity, we had the same good level of service we've always had, without interruption.

      Private sector solutions to consumer's needs are not always superior to "inefficient" government agencies. It all depends on the agency in question.

      And these guys wanna do internet access now? Bring it on! I'm sure they could do a better job than Verizon and Comcast.

    2. Re:Who owns the roads? by Arandir · · Score: 2, Insightful

      The private electric companies lobbied for "deregulation", because it is in their best interest to be regulated. It seems counterintuitive, but it's a fact of life that corporations like to be regulated. It keeps the small time operators out of the industry.

      This whole use of the term "deregulation" is the epitome of Newspeak. People now distrust deregulation even though nothing was ever deregulated in the power industry in California. For the same reason, people distrust free trade because of NAFTA, which had nothing to do with free trade other than its name.

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    3. Re:Who owns the roads? by ahfoo · · Score: 3, Insightful

      Oh, Silicon Valley was the culprit?
      And here I was thinking that some Texas fuckheads who specialized in manipulating power markets and later went on to have the biggest bankruptcy in history might have something to do with it. But that would be naive.

  5. Re:broadband and business by FatRatBastard · · Score: 5, Insightful

    Why in god's name should they subsidize it? If people don't want it they don't want it.

    Since there's no demand for solid gold toilets should the gov't subsidize it to generate interest?

  6. Three Cheers for LA's Water District by Schlemphfer · · Score: 3, Insightful

    Was really surprised by the slant of this article. Are we supposed to feel sorry for the cable companies? Here's a couple sentences from the article that make it seem like the cable companies are being handed a raw deal.

    Not only must they compete with the city, they must obey regulations from this same entity. A kind of double burden.

    The whole reason that cable is regulated is because it's inherently a monopolistic product, in that multiple cable providers can't cost-effectively run multiple cables to every house in a city. So these companies should be constantly under the gun in every way possible. Otherwise, there would be all kinds of pricing abuse.

    As I see it, one of the primary advantaes of living in a city is that you should be able to get broadband for far less than you can in the country. If you couldn't, something is be terribly wrong. It's nice to see that LA's Dept. of Water & Power is keeping the cable companies scrambling to provide the best possible deal to consumers. That the cable companies are griping is merely a sign than government is doing its job

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  7. Re:broadband and business by numbuscus · · Score: 3, Insightful

    Allowing a company to put in fiber, etc only creates a situation where you have to deal with a for-profit 'natural'-monopoly. Allow the cities and states to own the backbone - as long as they open the line to many (more than 3) firms - and you will have the happy situation whereby consumers get the service - if they want it - and the installation/maintenance pays for itself. This is the same situation that arises in many cities today. Telephone companies pay a service fee (although the feds began to allow monopolies - we know how that turned out).

  8. Re:"This is unfair.....it's just sooooo unfair.... by unitron · · Score: 2, Insightful
    "...what's capitalism coming to when you have to compete..."

    As you seem to have no sig I humbly suggest the above. It's a great line.

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  9. An Example of City-Run Services by boio · · Score: 2, Insightful

    In Ashland, Oregon the city is running a broadband access network (with cable modems) and faster fiber optic connections for those who want to pay up.

    We certainly didn't mind, as it spurred Charter (cable company) to speed up their service deployment so we actually have competition for cable service - what an interesting concept.

    On the other hand, the City of Ashland also owns the water and electric utilities... and has put the "telecommunications" (the internet & tv business) as a part of the electric utility... check out the Ashland Fiber Network, and the City of Ashland.

  10. Re:Adelphia, my cable company, claims crippled by by clone304 · · Score: 2, Insightful


    Well... You could get off your rich asses and pitch in on a T1 or T3 that you then split via wire or wireless to each contributors home. But, apparently you are just going to wait for the man to give you the access that you want..

    Call your local Baby Bell and get yourself wired. Share your connection with your neighbors for a fee. Is capitalism to advanced a concept for you to grasp?

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    blah, somebody needs to pull me over for a PUI, posting under the influence ;)

  11. Sad commentary on how public views government by Infonaut · · Score: 5, Insightful
    What's interesting to me about this debate isn't so much the particulars of it, but what the presence of the debate itself reveals about how we view goverment in this country.

    You can't get much more local than city government. We're not talking about behemoth state governments or the federal government here. And yet here we are debading whether it's unfair for one of the smallest units of government, one of the entities closest to the people who elected it, to offer us services for our taxes.

    The privatization of government services seems to have gone so far that we now seriously consider almost every city government function replaceable by private contractors (security services, health services, and so on), yet for local government to "intrude" into an arena now dominated by huge for-profit entities is somehow taboo.

    Government is often painfully inefficient - I say that because I've worked in government. But it baffles me that when the people from our own neighborhoods whom we elected to help our cities run better actually offer something superior to what private industry can offer, we run screaming that the free markets are being sabotaged.

    Ah, how far we have come.

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  12. backwards priorities by mmusn · · Score: 4, Insightful
    People don't exist to give companies a level, competitive playing field. Rather, companies exist in order to satisfy the needs of people. High speed Internet access companies have failed to do so, and that's why municipal goverments have stepped in.

    In any case, in a democracy, it is up to the people to decide how public rights-of-way and public airwaves are allocated. We have made a decision in many places to have public utilities, and we can do the same thing with Internet access if we think it serves our needs better.

  13. Re:broadband and business by maniac1860 · · Score: 2, Insightful

    Slashdot: having a choice about your operating system is a religous belief, but having a choice about getting broadband? Who needs one, everyone wants broadband right?

  14. Re:broadband and business by FatRatBastard · · Score: 4, Insightful

    Is not only about free trade and freedom of choice.

    But it should be (in my honest opinion).

    Maybe you don't like it, but that's how it works when you have a goverment. That's what it should do.

    Of course folks love the gov't to interfere in situations where its benefitial to them. By your logic its perfectly OK for Disney and Fox to back Hollings new law and the DMCA since its going to benefit their economics.

    The other problem with the gov't running infrastructure is they now have the moral high ground to regulate it above and beyond what they could do by law anyway. For example, you live in gov't funded housing and someone (not yourself) gets cought doing drugs, you get kicked out. How much howling would we hear the first time an administration came into power and ruled that "offensive material" had to be blocked from gov't subsidised internet access? They already do such things to private schools that accept gov't funding.