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

Ted Turner in Washington Post

[jdunlevy]

The Washington Post also has an opinion piece by Ted Turner on the approaching FCC decision on media owner ship (decision on Monday). Among other things, he writes:

I am a major shareholder in the largest of those five corporations, yet -- speaking only for myself, and not for AOL Time Warner -- I oppose these rules. They will stifle debate, inhibit new ideas and shut out smaller businesses trying to compete. If these rules had been in place in 1970, it would have been virtually impossible for me to start Turner Broadcasting or, 10 years later, to launch CNN.

Media stranglehold

[mtcrowe]

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.

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

[u19925]

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).