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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.
Well, looking at the cable industry I can only say that deregulation has simply resulted in higher cable bills. Prior to deregulation I paid $9.95 U.S./month for cable, now I am looking at $51.00/month and the only new channels available to me now are things like shopping channels, multiple MTV channels and other crap I have no interest in. In fact, what they have done is packaged channels I did watch into more expensive premium packages meaning I can no longer get Speedvision or others I am interested in without paying even more.
The technology exists for us to be able to purchase channels ala-carte yet we still have to pick "packages" and only have access via the cable companies or the dish companies. Perhaps Apple could help things out the way they have the music industry?
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Usually, I'm a big free market proponent, but even I can see how media consolidation is a bad thing for the average American consumer.
Right now, we have four major television networks: ABC, NBC, FOX, and CBS. Watch each network's nightly news broadcasts; they're not all that different. And although news organizations like to say that they're unbiased and "just reporting the facts, ma'am", the way in which you present "the facts" gives a strong indication as to your opinion of it.
"Republicans Hand Wealthy Americans Large Tax Break" vs. "American Citizens Will Pay Less in Taxes" gives a pretty good impression of what the writer thinks of the tax breaks.
And on electricity, in a lot of areas! As well as price competition, it gives you some interesting options - like Green Mountain, who offer 'clean' power (depending on the area, usually generated entirely from wind, sometimes with some hydro or similar) for a slightly higher price.
Unfortunately, SBC just got our legislature here in Illinois to let them double our rate, because... it's... err... good for campaign contributions I guess.
I think their reasoning was something about DSL - if they got the rate hike, they could offer DSL to more people?
I'm sick of the BS "I own the network and don't want to play nice with others" argument the Bells push. It's about time to remove the Bells ability to do things like that. What it should be is, for all phone, internet, cable, or other such services, there should be one player that owns the network and make the equipment investment. But they would not be allowed to sell any of it to regular consumers. Instead, they should only be allowed to lease the use of the equipment to anyone that wants it...the Bells, private ISPs, private cable companys, anyone. That way there is no conflict of interest that there is in the current system. All the companies are on equal ground. Consumers have a true choice on who to use. You don't like one company, move on to the next one. It won't matter, because the service is all on the same network, just different content. Interoptibility is flawless. There would finally be true competition to provide the consumer with the best experience.
But unless MAJOR restructuring happens, we'll never see this. The consumer is just the ragdoll being fought over by dogs. Only one dog is a terrier and the other is a rottweiler. Either way, the consumer still has teeth sunk into them.
many counties and cities have laws which will not allow you to lay a fiber into homes if similar thing already exist (even if it is owned by some monopolist). this means they will keep the prices so high that the total of (price*subscriber - cost) is the highest irrespective of what the price should have been if it were open market. Let us say, their internal research says following:
1) at $300 rate, we can get 10000 subscribers
2) at $30 rate, we can get 100,000 subscribers.
3) the cost per subscriber is $10
Now guess, what route they will take? obviously the first one. if competitors were allowed, you would see about $12-$15 rate, but thanks to monopoly; the rate is now $300!!!
Some cities may have some oversight commission which will prevent such high prices, so they may settle slightly lower price. but they can always lie and say their fiber maintanance cost as $200.
this is not my invention; this is exactly what is happening in local phone and cable market. i have exaggerated the figures in the example but overall the strategy is same. look at how the long distance rates have fallen over time (my per minute cost for long distance is 60% lower than decade ago) while local phone rates are going up (i am paying 40% more).
I doubt that.
The "infrastructure" you speak of was built on public property with monopoly protection. It really belongs to everyone. Just giving it to one company gives that encumbent company the ability to rape the public who get to pay the cost of creating uneeded duplicate ifrastructures while suffering the use of ageing equipment. When you live by public protection, you die by it as well. I'd love to see just anyone able to build infrastructure, but I don't think that it's either possible, permitted or required. Alternate networks will be built and we will all pay for them and then the bells will buy the up when they fail because they don't have to co-operate now. Ready for another century of pay per minute rape telco service?
I doubt the telecom act of 1996 was meant to create an industry that relied on cheap prices by the bells and only on reselling.
No it was not. But my fiber that runs from one side of my house to the other and can't hook into the network everyone else is using does me no good. A network only works if the players co-operate. The Bells have promissed us Broadband Stagnation. This is all just more of the same.
Society is really screwed up when this what we have to do to escape such a rape.
Friends don't help friends install M$ junk.
I'll take this one, begging the original poster's pardon.
How does what you say have any basis in fairness or common sense
Whenever I see the phrase "common sense", I mentally reach for a shotgun.
What you say makes "sense", if you selective the proper facts and ignore all others that contradict you. It's not common sense, or economics: it's economic theology.
A private company is not an entity in a pure economic thought experiment.
For one, Verizon is government subsidized. Yes, I said they are welfare recipients. For, every dollar they weepingly spend on infrastructure, they DEDUCT FROM THEIR TAXES. When you or I buy a car to go to work, we don't deduct the finance charges, actual payments, refinancing costs, or debt sale costs that Verizon does. Verizon gets this government handout so that it may... actually, I never did understand why. They are powerful, and they get to do this. Period.
Secondly, if Verizon screws up, they DEDUCT THEIR LOSSES FROM THEIR INCOME TAXES. The "risk" that they take is government insured, because the taxpayers will be further taxed to make up for the money Verizon will not pay if they screw up.
Third, Verizon may or may not be granted tax relief from local governments for installing various doodads. Another taxpayer-paid welfare grant.
Fourth, when you create a network that is essentially granted to you by access and rate giveaways by the Federal government, you can set up an effective monopoly -- not only over physical infrastructure, but over the content that is provided over that network. Powell has many times indicated that political bias is hokey-dokey in a medium, because so many other media exist to balance it. So, an ISP who is also a provider can control the messages going over its network. Not only a physical monopoly, but a political one as well. Somehow this would be a bigger showstopper for Powell if that bias was not hard-right, I think.
Now, this monopoly does not have to exist. But Powell's economic theology insists that it must, because, like most libertarians, ignores all factors that do not bear on the illusion of a clean sheet economic problem, ie, a company provides a service, competition can try to compete, all is good. His ideology ignores back room dealings (mainly because he is a consummate backroom artist, being a lobbiest for the telecom companies in his off time!), nasty business manipulation, predatory pricing, in short, all the nasty, dirty tricks that were rampant in the old Standard Oil trust days that have come again.
And, the standard isn't recouping investment. Businesses are there to take over a market, not make back their money. They have no limits.
Private busineses are there to steal a much as possible. This is balanced by government elected by the people which regulates the rascals.
What has happened is that Bush's people have appointed the industry lobbyists to be the regulators of the industries they represent. The rights of the people to actual competition for services is being ignored: businesses are treated as feudal lords who should bear no oversight.