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FCC Abandons Linesharing, Kills DSL Competition
raygundan writes "According to Reuters, the FCC today decided to greatly curtail the laws that force incumbent phone companies to share their lines with their competition at cost. This does not bode well for companies like Covad Communications who provide DSL using phone lines to bridge their data networks over the "last mile" to customers. The new rules do force line sharing as long as companies are willing to offer voice service, but this essentially states that if you are not already a phone company, you cannot offer DSL. The existing rules will be phased out over three years. There is still some hope, however, that a federal court might strike down the FCC ruling. Oddly, the news agencies seem to be reporting this as a minor change to the rules, rather than an end to all non-ILEC competition in DSL." The FCC's front page has links (luckily PDFs as well as Microsoft Word files) about the decision, including statements from each of the commissioners.
From the article:
The Federal Communications Commission on Thursday voted to exempt new high-speed communications networks from requirements that they be shared with competitors, a move aimed at encouraging investment in bringing fast Internet access to consumers.
Right. Big time investment. Just around the corner. We just need to know it won't all get snapped up by our competition. But we're planning. Yes we are. Big Time Investment. Promise. Even though the economy's in the crapper. Investment. In the future. Of the internet. For Consumers. Investment.
Horseshit!
This is such complete and total doublespeak. Every telecom network in this country was built with public assistence. That's the way to "encourage investment." This is simply a move to allow the established Bells (and neo-bells, like SBC) reap more profit off of existing (publicly subsidised) infrastructure.
Where am I going, and how did I get in this handbasket!
Howard Dean for president
I've been puzzling over something, lately. If AT&T was such a terrible beast that it needed to be broken up into (what, 11?) baby-bells, how is it acceptable that these things are pulling a T2, gathering themselves together so only 3 baby bells exist? Seems the whole anti-competitive issue begins there, not with the FCC yanking the rug out from under non-bell DSL providers.
A feeling of having made the same mistake before: Deja Foobar
DId you read the FCC desicion? I guess not, because on the FIRST PAGE of powell's DISSENT, he disagrees with the ending of line sharing. Next time, RTFA(read the fsck artical)
What you all must realize is that the ILEC's have been given HUGE tax relief on behalf of the federal government in exchange for their responsibility to deploy and upgrade next generation networks. Theoreticly, the last mile option these ILEC's are fighting for are owned by US taxpayers. There has been much relief and many writeoffs done by ILECs for years on this infrastructure, however they have neglected to fullfill their promises in a timely manner.
/early 90's. It wasnt until deregulation in 1996 that we started to see DSL.
You must realize that before deregulation, the telco's were selling us $1,500/month T1's and per-minute ISDN service. DSL technology is old and could have been deployed in the
Wait five years from now after deregulation occurs and we are still paying $50/month for 1.5Mbps ADSL when the rest of the world will have fiber strung to their doorsteps. The Bells have a history of stagnation and emtpy promises, thats why the telco act of 96 was created in the first place.
When it comes to essential public amenities, you cannot allow monopolies to stamp their and say "It's my ball, you can't play with it!"
Modest doubt is called the beacon of the wise. - William Shakespeare
So the phone companies have monopolies on the wires running to your house, and you have no alternative but to use them... Exactly whose fault is it?
* The phone companies who own the wires running to your location?
* The local governments, who regulate how many wires can be put up, and extort plenty of cash from anyone who wishes to emplace new ones?
* The state governments, who already charge heavy tariffs on current communications methods (hey, it's a monopoly, we can milk it as much as we want), and also put more tariffs and more barriers on newcomers to the business?
* The federal government, which severely limits anyone who wants to try a wireless solution?
I don't give a crap (yet :). In Canada, cable modem access is wide-spread, even people like me (in the middle of nowhere) have it. DSL is limited to city centres (I'm, like, at least 10KM away from the nearest access point). The Canadian push to get the entire country onto the Internet most likely means that regulations such as this one will be few and far between.
But seriously, we could spend all day blaming one party or the other for this, or we could discuss the merits and problems of this new decision. Particularly interesting, to me, would be a description of the good things accomplished by the existing regulations. I was under the impression that the whole partial-deregulation quagmire was universally perceived as a disaster. Apparently you don't think it was. Why?
>If I laid out a serious amount of money to
>establish COs and copper to (nearly) every house
>in the United States, I'd be a little pissed at
>the government for making me open it up to
>people who are offering competing services.
If you've paid taxes in the past century, you DID lay out a serious amount of money for that stuff.
-fb Everything not expressly forbidden is now mandatory.
Nope, it's your cable. They built it on public easments with monopoly protection. Keeping others off those lines is about as bogus as keeping others from being able to run their own last mile network, but that seems to be the way it was and is. Now demands have been made that others can use those lines AT COST and offer services that the Bells were unwilling to offer.
I'm hoping that Powel plays this well. As someone else pointed out, he does not agree. This is just the kind of thing that will turn Powel into a houshold word, if he can pull it off.
If he can't, I expect the Bells to start pushing their high priced and highly restrictive service. Woot, I might get to chose between two really lame monoply servers who own the internet.
Screw them. Build your chunk of the wireless mesh today.
Friends don't help friends install M$ junk.
This whole thing could backfire in the long run.
I seriously considered turning off all of my landline services last year. The only thing that stopped me was the announcement that DSL was finally available in my area.
If no competition in the DSL market causes me to turn off my DSL service, I'll likely turn off my landline phone as well, and go strictly cellular.
What we could see happen, with wireless technologies becoming more and more viable, is the elimination of any wired communications to the home.
Eliminate the "last mile" of copper and you eliminate the Baby Bells.
In Canada the local phone company basically has a monopoly over the last mile, and we're known to have some of the best DSL and Cable internet access available in the world.
The problem isn't lack of competition, quite the opposite, more competition means more companies each with redundant staff and bureaucracies. The solution is to actually have the FCC mandate service quality. DSL service sucks down there because the phone companies are free to do whatever the hell they please.
If you had a government regulating body which looked out for the best interest of the consumer and dictated that the Bells must meet these service levels for customers things would be rosey.
But ooooh no, regulation is bad for business. BS! In natural monopolies like this it's the only way to go. You simply TELL the company they must provide quality service, no excuses.
Until this happens we're going to continue to see the weekly story on slashdot of people whining that their DSL is too slow or they can't get service.
Those lines were heavily subsidized by tax money, and the phone companies have priceless right-of-way for their lines. (Try calling your government and asking if you can put up some poles to run an ethernet cable to your ISP)
It's hardly "private property" when public money built it.
And to top it off, it's not "free," either. The CLECs (like Covad) must pay the phone companies the *same* rates they charge to their own DSL divisions. Covad pays SBC the same as SBC's DSL division pays SBC. And on top of that, SBC (or whoever your ILEC is) gets paid for the damn phone line in the first place.
So, they get paid for the line, AND paid AGAIN for the line by Covad, AND tax money, tax breaks, government assistance, and right-of-way to build the lines in the first place, and you think that keeping the lines open for competition isn't fair?
Screw that.
they're refusing to upgrade their networks until they can be assured that they'll be the only ones to profit.
I'm sure their argument is that they won't upgrade because they are afraid if they do they *won't* profit. Me? I don't know who to believe... Sure the phone company is greedy and wants to keep this pie all to itself, but on the other hand their competitors are just as greedy and want a free ride. Government has to step in and set a wholesale price that in the end is arbitrary and probably has a greater corelation to which company funded which campaign than to how much the line costs to install & maintain.
The problem is that the one wire to your house IS a monopoly and there aren't many good ways to get around that. The only way to have real competition is between different networks - phone line, cable TV line (maybe the power line? wireless?) anything else is still a monopoly and you are only arguing about how to regulate it.
There were two major points being decided upon today by the FCC. The one people on Slashdot are crying and moaning about is for DSL only and has been outlined throughout the comments. The second point the CLEC access to lines through UNE-P which is what the Bells really cared about. This decision went the way of the CLECs/state regulators in that the RBOCs must still share their voice network with non-facility based LECs at state mandated prices. Note all of the RBOCs stock prices if you want to see which side won the war, no matter the decision of the DSL battle.
Scott, Keeper of the Crystal Flame
I love it when people who don't understand the history of the present situation try to act like they know something.
:)
Finally the bells can use their *property* without subsidising their competitors.
Property that was paid for via a government protected, anticompetitive monopoly with tariffed rates that kept costs high and federal laws that prevented competition. Line sharing simply recognized the reality of how those lines were paid for and how the law kept others from competing. We payed artificially high prices for decades to finance that property with the stated purpose of developing a public infrastructure...not as an act of "corporate welfare" for the Bell system.
This will be a good thing in the long term 3-5 years.
No better than what happened when the cable companies kept increasing rates and not improving service when THEY didn't have any competition. Think about how bad the cable is now...even WITH the competition from satellite services. With most consumers having only one, perhaps two broadband options left to them you can expect the costs to rise, bandwidth to get metered, and content to be prioritized via PPPoE. Fewer choices is NOT a good thing. Don't believe me? Ask any economist. And note that the non-Bell ISPs *consistently* beat the service ratings of Bell ISPs...see Broadband Reports.
As for comparing us to South Korea...? Do you really think our situation in the U.S. is even remotely similar to that of South Korea???
With previous rules there was no incentive to upgrade their systems because then their competitors would be able to use it too. Now we can have: cable, phone, satelite, wireless, and (perhaps) power line all competing.
With the previous rules the Bells simply followed the strategy of deliberately keeping their equipment primitive and broken to block competition long enough to put them out of business. They knew they were the choke point for the CLECs, and that if they could deny them revenue long enough they could put them out of business. And with most of the CLECs the strategy worked...most of the CLECs went under. Here in California Pacific Bell/SBC had a whole host of tricks to make it difficult for CLECs like Covad to get wire pairs for DSL installs...but remarkably had no problem at all when it came to handing out those same pairs to companies installing home alarms.
This is a good thing even if it is not the socialist position.
Drop the stupid rhetoric. The old, regulated Bell system was clearly more like socialism than what we have now. The US government protected them from competition for the better part of a century to allow them to build up their infrastructure. Ensuring competition by allowing competing providers to use the existing infrastructure just makes sense. Would you require each trucking company to build its own highway to transport your frozen chickens to market?
This regulation of forcing the baby bells to share their networks at cost is killing the large telecom companies. You know, the ones that laid the fiber in the first place, invested all that money, and employ many more people.
These "virtual" phone companies that ride the carriers _at_cost_ have been largely responsible for part of the telecom bust. It's the same model as Enron. Selling things that you don't actually own or maintain. If something goes wrong, you have to pay the carrier $$$ to get it fixed.
A few months ago slashdot was bitching about why cable was clobbering DSL and was taking over broadband, and there would be no more competition. Do you want to know why? The reason is that SBC (in my area of the country) is forced to give up their lines ANY TIME SOMEONE WANTS TO USE THEM, for free (at cost, but that bandwith is lost to SBC).
If you want real broadband competition you cannot cripple the companies doing the investment into the network of DSL.
Cable companies do not have to share their lines. The telecom deregulation act did some good, some bad. (We got worldcom and a bust, but attributing everything to that is not the best idea.)
I get long distance for 5cents a minute, and may soon switch to MCI for unlimited local and long distance calling.
Don't whine about access to a network you never built!
Yes. That would be fine. As would actual deregulation. If phone companies want to be able to cross all those million private property boundries with force of arms behind them, then the government should own those lines. Otherwise... I don't see a problem with taking away their leins on private property, and telling them that they no longer operate a utility. They must pay landowners to cross their property. And they aren't the only ones that can do it.
Either option works for me. Our current situation is crony capitalism, plain and simple.
There are no trails. There are no trees out here.
What's more, it's a government-sponsored monopoly. That means that the Bells have, as a condition of their monopoly, certain restrictions and responsiblities that other industries don't... The Bells can stifle any sort of telecom competition simply because they DO control the wires going into your house.
Is there any reason that you couldn't have more than one line? Sure you wouldn't want dozens or hundreds of different lines but couldn't each town or county grant three or four different companies the right to lay down those wires? Then each company could provide whatever services and compete on a level playing field with none of them holding either it's control over the physical assets or it's influence with the legislature to set a "reasonable price" (which may or may not be "reasonable" and will forever be controversial) over it's competitors.
I suppose you still have the problem of who fixes the mess when a phone pole falls over and pulls down *all* the lines - perhaps they would all have to share the expense of a common maintenance & repair service on an equal basis.
The phone companies (among others) are granted what is known as a "natural monopoly". Basically, the right to string wires (or bury them, etc.). Go the the gov' and ask them for permission to do the same thing... you can't have it. And, because monopolies are (in general) a "bad thing", in that they can extend to other areas (eg. If the phone company where the ONLY company allowed to string cable, the cable companies would be, well, screwed). As long as we are NOT allowed to string the extra cable, and this is imposed by gov' fiat, the companies that HAVE the cable must be forced to "share the wealth".
...choke... another "natural monopoly".
And that's the argument for why "TELCO must share". As to "viable alternatives", what would you propose? The only viable alternative I can see is the TV cable company.
Ratboy.
Just another "Cubible(sic) Joe" 2 17 3061
The only reason the f'ing sale price is below cost is that that is the rate they sell the service to their subsidiary at. If they hadn't been playing shell games with where is the money and just charged the true costs to their other divisions then they wouldn't have been selling below costs. The only intent of the cost structure was a level playing field. Trust me no one who has ever been a customer of SBC is shedding any tears for em.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.