SBC Hit with Antitrust Lawsuit

mrtaco01 writes "Four Internet service providers have filed an antitrust suit against SBC Communications, alleging that the Baby Bell unfairly inflated wholesale prices for high-speed Internet access."

Comments

Less Time For Other Suits

[ThatDamnMurphyGuy]

Good. This will mean they should have less time for suing people using frames in websites, erm, I mean "Structured Document Viewer".

Competition

[marekk]

I for one would love to see more 3rd party DSL operators/licensees in my area. A year ago, with SBC the only DSL company in town, the price was $49.95/mo.

Just two months ago, with the addition of the first 3rd party DSL provider, SBC dropped their price to $29.95/mo (which I was able to sign up for).

Granted, this wasn't due solely to the entrance of this 3rd party, but also high competition between Time Warner, the local cable modem supplier. The dramatic decrease in the pricing though just goes to show how good competition is for the consumer.

Re:How is this illegal?

[banzai51]

The problem is that SBC owns the lines going to your house. SBC also sells DSL access. So they open it up to everyone like they are legally supposed to, but then start jacking up the prices so all the other DSL businesses go under. This leaves SBC as the only DSL provider in your area. Prices and restrictions on users go up. Not good for the public that has to pay more money for less service. This type of behavior crowds out good ISPs like Speakeasy.

Re:How is this illegal?

[Anonymous Coward]

This is also known as 'bait and switch'...

What you aren't reading is that SBC conned all these ISPs into jumping on the DSL bandwagon, and signing up thousands of DSL subscribers...

After they did all the leg work, SBC then lowered the price they offer the public. Hence making it too expensive for the ISPs to compete with SBC (since they still are paying the old rate, they actually pay MORE for 'wholesale' DSL access then SBC is selling to the public for)

Part of the problem with DSL is that the OWNER of the copper last mile has all the advantage. Even though you may be buying DSL Internet from any one of a half dozen ISPs, they ALL rely on SBC to get that last mile. Hence, they have a monopoly.

The courts allowed them have this monopoly, on the understanding that access was fairly given to competitors to 'resell' those facilities at a fair price.

Droping your retail price below your wholesale price doesn't seem very fair, and since it was the FCC that mandated this (ie, they made it a law), that is why it is ilegal.

Re:How is this illegal?

[jchawk]

That and keep in mind that Bell was originally granted a monopoly on the phone system and it's building was subsidized by your tax dollars.

Re:How is this illegal?

[Krow10]

Blockquoth the poster:

How is speakeasy a good DSL provider ?

Speakeasy is a good provider because they offer a reasonable terms of service without charging "Business Class" prices. Most ISP's charge more for their business class, not because of the terms of service, but because of the Quality of Service requirements. Speakeasy's QoS for their SysAdmin offering is the same as BellSouth's home user, so they don't charge an arm & a leg for it.

Those people will only sell me SDSL at 119.99$ month where as bellsouth provides ADSL for just 49.99$.

Oddly, I had the same thing in my case. I tried to order from Speakeasy when I moved into my new house, but Verizon couldn't find a loop that would do anything but SDSL. I went with cable for a while. Then I get an offer from Verizon -- three months free ADSL. I order it, and like magic, they find my original loop can do ADSL (yes, maybe there were changes upstream. And maybe they just didn't try when I wasn't ordering from their service provider.) I get good xfer rates. I log my rates over two months and then I order Speakeasy. Since I now have proof that my loop can support ADSL, Verizon has no choice. So, I pay $15/mo more for my service, but I have a sane terms of service.

Just because those people advt run your ownserver doesn't make them good.

Not everyone wants that. I do. I'm willing to pay a little more for that than for standard connectivity, but there's no good reason I should have to pay Business Class prices for it. Speakeasy is the only provider who offers this in my area. When someone offers a service that you want, for a price you are willing to pay, and nobody else offers the same, that does make them good.

-Craig

SBC in Nevada

[Tiresias_Mons]

SBC recently sponsored a bill in the Nevada Congress which made it legal for them to do this within the state. SB 400 (I think is the number) was sponsored by SBC and is an attempt to make it legal for SBC to charge whatever they want when dealing with 3rd party ISPs. I was in the car with a few colleagues Wednesday and one of them got a call from some of his clients who went through a 3rd party DSL service to say that their entire internet connection had been shut down because SBC cut the connection to the ISP.

Its not only monopolistic pricing, they are now, at least in Nevada (and I think I heard that Indiana or Illinois had a similar measure passed) absolved from even offering the lines to 3rd parties. We're trying to start a grassroots counter-attack in the Reno area, but its going to be a long fight for certain.