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Companies, Government and Community Fiber Rollouts
hype7 writes "Wired is running an interesting article about a number of communities which are dissatisfied with the present communications infrastructure that they are being offered, and are deciding to do something about it. However, many of the corporates who had previously been offering services to these communities have resisted this, with Pennsylvania going so far as to draft law to prevent competition for the communications providers. What is most interesting is that in the communities where the roll outs have taken place, the incumbent providers have "dropped prices to be more competitive ... while not changing rates in areas where it continues to have a monopoly". What I don't understand is why can't a public utilities company provide a public utility if their rate payers want it? What's wrong with additional competition? And why should legislative bodies protect telecommunications monopolies?"
for granting Congress the power to legislate trade between the States. That little crack has widened to an enormous breach, to the point where these days, in America, the Soviet Russia jokes troll you. As the Oracle said in the Matrix "What do all men with power want? More power." As long as State and Federal legislatures exist, they will continue to pass laws. They're never "done". So of course they'll step up and slap down communities for doing this, its legally their perogative, and this is what they DO, they make laws. Not to mention the fact that they're probably all in the pockets of the telecom companies (Valenti, anyone?)
I want to delete my account but Slashdot doesn't allow it.
Corporations don't care about the consumer. They never have, and they likely never will. Corporations care about the consumer's money. As long as they can provide the bare minimum required to keep the money flowing into their coffers, that's all they'll do.
Pessimistic, yes. But show me a wildly successful corporation that lavishes it's customers with their every desire. Yeah. Right.
"What's wrong with additional competition? And why should legislative bodies protect telecommunications monopolies?" Because additional competition means less profit for the existing monopolies. Because telecommunication monopolies protect legislative bodies when it comes to election funds. It may sound like paranoi, but it's also the real world.
Whenever our normally capitalist system grants somebody a monopoly, it's usally because two of that kind of business would lead to mutual destruction, and we need that business to exist because it makes other businesses possible.
Netflix would not be able to operate if not for the United States Postal Service, for example. The same goes for most magazine subscriptions. Sure, FedEx, UPS and Airborne Express all compete with the USPS express and priority line of services, but everybody else is prohibited by law from making a daily stop at every address without a pre-existing relationship.
Cities control the local water and sewage systems as well for obvious reasons. We can't afford these services becoming unavailable for any length of time for any reason.
POTS used to be an essential utility as it was the only commonly deployed realtime communnication tech. Now, it's not so much the only game in town, but it still is the only communication lifeline for some elderly people who don't want a cell phone. Because of this, the local Ma Bell company is not allowed to close up shop, and that's why they're basically granted a monopoly to soak the customers the can soak so that the company can afford to give below-cost service to those who can't.
"And why should legislative bodies protect telecommunications monopolies?"
Campaign donations... It's all about money, if telco's are going to rollout fiber they want to be the only ones to use it. I thought the FCC already ruled on this, and was 'giving' telcos a monopoly nationwide? (Being that if they roll the fiber, they don't 'have' to sell it to competition?)
Regardless, these telcos have deeper pockets and connections then the **AA's do - with the US so far behind in the communications area, I think it has to become painfully obvious there is more at play then just the difficulty and expense of rolling out the glass. IMHO, the telcos are refusing to do it waiting on the government to pay for it AND let them control it. Telcos don't want glass everywhere because once things go digital they don't know how to play anymore. And God knows people are itching to drop telcos like a bad habbit. And after years and years of dog poor service (IE, got a problem? Call support, wait 2 hours on hold - get transferred twice with additional hour of wait time per transfer, then get disconnected. Rinse, repeat. - Then you switch to cable instead of DSL - have a problem - call support - on hold for 10 minutes...)
You don't want 50 seperate startup companies all laying their own custom fiber or coax networks through your city redundantly, when you know that when it all shakes out, at best 3 will survive. Because physical infrastructure is involved, typically communities award a contract to a single player, who will provide said infrastructure - and they tend to keep that contract going because of the infrastructure (there would be financial issues switching to a new provider and possibly having to pay for them to buy the old infrastructure from the previous company).
The government's answer to these competitive problems to date in the electric and telecomm markets is to enforce a really stupid form of competition, and require incumbent telcos and power providers to share their physical network with startups (where "share" means basically resell). So now You can choose Traditional Company A, or one of A's 50 crappy resellers who have no physical infrastructure of their own.
The Right Thing, IMHO, is that municipalities (or states, or whatever) should be putting out bids and taking contracts to build physical cabling infrastructure of various types for the area, and also contracts (perhaps from the same provider, but not neccesarily) to maintain said cabling infrastructure. The cabling infrastructure is then owned by the municipality itself, and it terminates at certain wire-centers where competitive providers can hook in with their own real equipment (much like internet NAPs in some ways - a shared facility where people co-loc edge equipment).
11*43+456^2
Local governments shouldn't be allowed to compete for local telecom services because they have an unfair advantage in the ability to acquire capital. They just tax you! Cities that claim that they can provide services cheaper than a nationwide telecom are playing a shell game with their funding.
They most often have no clue what it really takes to provide services. They are sold on an idea, they implement it, they realize it is going to cost more than they thought, they subsidize the project, you get the service a rock bottom price, and later your taxes go up because the city is running short on cash.
What has this accomplished? You raised taxes for everyone, even those that don't what the service, you put a legitimate company out of business in you area, and as technology progresses you are left behind because no one will want to serve your area after you the way your city treated the last competitor.
You also mention that the local telecom providers lower rates once a community telecom comes in. You have to understand that the incumbent provider has spent millions and millions of dollars to provide service in the area. They are forced to lower prices to levels that are below the cost of providing service just to survive. Local telecoms are regulated; they have to provide service to anyone who wants it. They can't just pack up there bags and leave. So, its either sell service at below cost or be left with a multimillion dollar network that no on is using.
I'm not trying to sell anything here, but maybe some cities could look at what Frankfort Kentucky did as a case study. Cable Modems 128/128 at $14 per month. 256/128 at $18 and 512 at $24. (higher services available) VOIP telephone at something like $13 per month. Plus long distance calling at good rates. Plus they provide they provide electricity, water, cable tv, and security monitoring at good rates. Everything comes on one bill. Perfect? -NO. A monopoly? -pretty much. but a good service at comparatively low rates? absolutley. http://www.fewpb2.com (too lazy to do html. sorry)
Deregulation of trucking and oil began under Carter.
Reagan's deregulation included the Savings and Loan industry. That one only cost the taxpayers $700 Billion.
Tuxter is right. The government shouldn't be rolling out our new communications lines unless they're going to be free (as in roads), maintained by the governmet...
I hate the goddamn monopolies in my area. I have a cable company (Cox) that blocks my school's (UF) football games on channels that I already pay for in order to put them on pay per view. People in nearby cities get all the games for free. I have a phone company that says 'all circuits are full' half the time I pick up my phone to dial out. My utilities company (power and water in one) charged me a $200 fee because I paid my bill late one month. They said they will give me back my $200 when I quit using their service.
Where competition opens up, rates go down. We need less legislation protecting monopolies. If a company cannot survive on its own, then it deserves to die. In the same way it's unnatural to keep a total human vegetable alive on life support for years, it's unnatural to prop a company that our laws treat as a person once it's already proven to be dying.
--- We need more Ron Paul!
I live in Chelan, Washington. Our PUD has put in fiber to Chelan, and many of the other towns and cities in the county. These fiber services deliver ATM-based telephone and data services, and may eventually deliver digital TV.
For my 2Mb/s down 640Kb/s up connection and a telephone line, I pay about $53 per month. The telephone line is not Voice over IP, but is circuit-switched. ATM provides the means to transmit both the voice and data channels down the fiber.
Now, our PUD doesn't offer these services directly. They only run the fiber network. My actual telephone and internet bill come from my provider of these services (Localtel). What the PUD has actually done is open competition by allowing the customer to choose any of a number of service providers using their network. If I don't like Localtel, I can go to NW Telephone, or Panda Computers, or Modern Networking...... The list goes on.
Now, it is actually interesting. Verizon services here suck, to put it mildly. Ok. Their residential services are OK. But they don't offer any reasonable business services. No fractional T1, no PRI.... So if I am implimenting a phone switch for a customer, I am stuck with analog lines. This means I have to deal with echo cancellation and other artifacts of 4 to 2 wire conversion.
Now, if I have my customer go to fiber, some of the service providers *do* offer fractional T1, PRI, etc. services over the fiber. Now everything works great and the phone switch is cheaper, more robust, etc.
Competition is a wonderful thing.
The problem is, from a telecommunications company perspective, that they are used to being monopolies because of the fact that they own the lines. Community-owned fiber networks are a good solution to this problem, but they need to be used to stimulate competition by allowing choice of service providers.....
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