More on Media Consolidation/Deregulation

I'll try to accumulate some links not previously posted. William Safire comments. The Register has an editorial; see also The Guardian for more on the British perspective. Associated Press story. The Washington Post has a good and lengthy (and rare) piece. The phone companies are making a cynical political announcement that they've agreed on a standard for fiber-to-the-home; that doesn't mean they'll ever use the standard, and indeed they've already promised *not* to roll it out anytime soon. Note that the FCC is removing any requirement for the Bells to share their fiber, so if Verizon runs fiber to your house, you'll be able to get Verizon service or none at all.

Comments

So what if Verizon doesn't have to share fiber?

[alen]

They spent the money to run it. I work for a CLEC and we have our own phone switches. If VZ jacks up the prices on their circuits, it will only hurt us for a little while since we flip customers to our own network. I doubt the telecom act of 1996 was meant to create an industry that relied on cheap prices by the bells and only on reselling. If you want to be a player in telecom then you need to invest in some infrastructure.

Re:So what if Verizon doesn't have to share fiber?

[alen]

I'm only an exchange 2000 admin, but any capital expenditure is tax deductible. A few years ago we were trying to convince management to treat us as consultants for the cost benefits to us and the company.

The tax code is designed to foster business growth, not an excuse to socialize everything. Other companies are free to sell stock shares or bonds in order to pay for their own fiber projects just like Verizon does. Verizon owns something like $50 billion in debt to various bond holders. That's how they and a lot of other companies and governments finance capital projects like running fiber. Sell bonds, build, hope you make money on it and then pay for it over a few decades plus interest.

Re:So what if Verizon doesn't have to share fiber?

[kableh]

They've been subsidized by the government for years, and they have right of way on public lands to lay their fiber and copper. I'd say the networks are just as much ours as they are the phone companies. That was the arguement for the open access provisions of the Telecommunications Act.

And yea, if you want to be a player in telecom you have to make that investment, but do you really think that even the Bells have the clout to purchase all the right of way and coordinate with thousands of different buyers to lay the networks by themselves? That was why the government stepped in and helped, and that is why we demand a return on OUR (the taxpayer's) investment, namely, a competative market for the consumer.

Re:So what if Verizon doesn't have to share fiber?

[drgroove]

There is an inherant flaw in the concept that any of the 'Baby Bells' actually built their networks.

Keep in mind that once upon a time, the Federal Government controlled all telephony.

The Fed deregulated their telephone infrastructure, creating a monopoly - AT&T.

Eventually, a Fed antitrust suit via the DOJ broke AT&T into several 'Baby Bell' phone companies; each taking with them the network infrastructure for their specific geographical location.

However, as the original network was built by the Federal Government, the funding for that network could only come from one source - taxpayer dollars.

The networks have obviously been rebuilt several times since then; however, the point remains that the US telephony infrastructure had its genesis throught public funding.

The current system does not work. Why? Because phone companies - which inherited their networks from the breakup of AT&T - are running their business with an inherant conflict of interest. Each Baby Bell has been asked to both provide telephony service, as well as to allow 3rd party companies access to their networks, in order to provide competitive telephony service.

The model needs to be changed.

In order to be completely impartial and competitive, a separate company or companies should be established, which manage only the network infrastructure for the phone system.

Then, any company which wished to 'lease' or 'rent' the network for the purpose of providing telephony service to consummers would be able to do so.

In this way, there would be a two-stage system, with a central governing body which controls the infrastructure, and separate service providers which charge consummers access to that infrastructure. This would eliminate the conflict of interest that is present in the current system, where the owner of the network is also a service provider to consummers, and therefore in direct competition with others who wish to sell telephony service.

The idea that more companies should invest in additional infrastructure does not make sense for local telephone service. This concept, if carried out, could have dire consequences on the environment (ie, imagine a 10-fold increase in the number of telephone polls and wires across a city!). A network already exists in each city in the US - the problem is the way control of the network has been established.

This same concept could theoretically be applied to all communications systems. Cable lines, cell towers, long distance satelites - all of these could have a controlling body, which impartially allows any number of resellers to use their infrastructure to offer services to consummers.

Verizon's Fiber

[Klerck]

...so if Verizon runs fiber to your house, you'll be able to get Verizon service or none at all.

Isn't that how it should be? If Verizon foots the cost of rolling out thouands and thousands of miles of fiber, shouldn't they be the only ones who can use it?

That's a bit different from phone lines which were subsidised through tax money and therefore should be open to all. If Verizon is the one paying for the fiber, then it should be theirs to use alone if they please.

Re:Verizon's Fiber

[Spytap]

Doesn't the problem then become that Verizon can charge whatever they want becaus eno other company can then also lay wiring to said houses? If you have someone right where you want them, would you trust a company whose primary objective is to make profits and become larger to do what's right for their customers or for themselves?

Re:Verizon's Fiber

[Cyberdyne]

Doesn't the problem then become that Verizon can charge whatever they want becaus eno other company can then also lay wiring to said houses?

Why not? With the existing infrastructure - electricity, cable TV, telephone - the government prohibited competition. This, obviously, created a monopoly for each utility; all the regulatory effort of the last decade or two has gone into reversing the damage from that. With fiber, however, who is prohibiting some other company from laying fiber just like Verizon?

If you have someone right where you want them, would you trust a company whose primary objective is to make profits and become larger to do what's right for their customers or for themselves?

The answer is not to let the government (or their favored company) get you right where they want you. Don't let Verizon be given a monopoly in the first place!

If the infrastructure is too expensive for one company to afford, let them group together to build a shared local network - much the same way Internet peering points work: each ISP wanting to hook up has to pay their chunk of the running costs. That way, nobody gets screwed.

HA!

[s4m7]

Does anyone still remember when the FCC was supposed to HELP the consumer, by regulating the communications industry on our behalf?

now, the FCC serves to help monopolies, by regulating the consumer on the industries' behalf. Why is it that mechanisms to prevent consumers getting screwed always wind up being used against us?

Re:Ted Turner in Washington Post

[Zirnike]

I like this. The dude knows how to separate his professional responsibilities from his personal ones. A lot... and I mean A LOT... of politicians could take a hint from him. I can't say that I support his views on a lot of things, but I think I can respect this comment, at least.

Simple.

[RatBastard]

The answer is very simple: our government is for sale.

Re:Less than an hour to make those calls...

[nanojath]

That line of condescending BS from Powell towards the end of the article regarding the fact that he doesn't really see public comment having much anything to do with public policy really burned my bacon, to the extent I felt compelled to address it directly in my comments to the FCC (just submitted).

"Let me also add a comment in direct response to the comments of Mr. Powell to the effect that "You don't govern just by polls and surveys." Public comment is neither a poll nor a survey, it is a vital element of democracy, required by law. And it is apparently critical as the FCC has clearly lost the understanding that their mission is to serve the American public. If the representatives of government choose to treat the voice of its citizens as unimportant, the its citizens will replace these representatives."

Re:Register hypocrisy?

[IamTheRealMike]

Compared to the UK situation, where 2 of the 5 analogue broadcast channels are part of the tax-funded BBC?

It's not exactly a tax. The government has no control over how it's spent for one thing, and changing it is very hard.

Keep this in mind: For years, the UK had just three different TV companies - the largest one state-owned

The BBC is not state owned. I don't know why people think this. The government have no control over it, short of a somewhat mythical (and in the Dyke era almost certainly dead) old-boys network.

Rather, the BBC is controlled by its Director General, and there is a controlling board too. Major changes, like launching new channels, have to get the approval of the media/culture secretary iirc.

So, the state acts as a check/balance. It cannot influence journalistic integrity however.