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FCC Kills Build-out Requirements for Telecoms
Frankencelery writes "In a 3-2 vote, the FCC has altered cable franchising laws in the U.S. to the advantage of AT&T and Verizon. 'The FCC order imposes a 90-day limit on local communities' franchising decisions, but, more importantly, does away with build-out requirements. Those requirements generally insist that companies offer service to all the residents in the town, rather than cherry-picking the profitable areas.' Good news for the telecoms, but bad for cities who want a say in the fiber deployments."
You seem to imply that they will lower their prices or something. I don't see why they would. In which case they make larger profits.
"Thanks for all the money you paid to us. We've used it to buy off ISO among other things" -Microsoft
Somebody just got a brand new phantom in their driveway via payouts from Telecoms. The FCC are the ones that required cable companies and sat companies to sign individual franchise agreements with each city that service was offered. Why would they go and allow telecoms to skip that step with their services? At the minimum mandate that they have to roll out their products to everyone. Crazy!
I'm not from around your neck of the woods, and honestly couldn't tell you if the decision was a good or a bad one. Nor do I understand the consequences or background to the situation, even after RTFAs.
The very fact that the decision had to be made leads me to believe there are communities, cities, populaces with many thousands if not millions of people who want a say in how their town is serviced by a telecommunications company. Some kind of kickback, like a swimming pool, or some franchise fees.
To my naive way of thinking, it seems incredible that 5 (3-2) people can veto the decision making process / power of entire cities or possibly even states, throughout the entire country.
It also seems kind of wrong. Power, corruption, ultimate power, you know, that kind of wrong.
I lived in York when the water company got privatised. Never seen such a disaster. It wasn't just a license to print money, it was also a license to be incompetent. Now with telecom, one can argue to which extent it stil is a monopoly. And people wo go living in the middle of nowhere should learn that this comes with a price tag. I can remember stories from Belgium where millionaires built illegal expensive villas in protected woods. Even though the constructions were illegal, the utility companies had to spend fortunes to connect these houses, paid for by suckers who live in appartments. And five years later, when they get kids, they go and complain to local politicians because there is no busstop anywhere near. So now the bus from A to B has to stop 10 times instead of 5, doubling travel time. Living in a city is better for the environment (less transport) and better for the community (public transport, utilities, schools...). It should be rewarded.
10 ?"Hello World" life was simple then
institutional investors such as governments statistically beat out rates of returns compared to individual investors
That's because the government can print money faster than individual investors...
BTW, the government is not a direct investor in companies, i.e. stockholder. And while mutual funds and investment companies might beat out YOUR individual rate of return, they do not beat mine.
You might want to read some Friedman. His economics work a lot better than Keynes'.
The opposite of progress is congress
As seen on slashdot before2 9222, various companies attempt to hinder broadband rollout by governments.
http://yro.slashdot.org/article.pl?sid=05/01/05/0
Will this decision then reduce the resistance against municipalities building their own infrastructure? If my township isn't one of the cherries to be picked by the companies, we can pick it ourselves.
In my area, there's an ISP that's also a CLEC (Competing Local Exchange Carrier - they offer dialtone). They're building out fiber to buildings for Ethernet and telephony services, and would like to get into video (TV) but since they're a small company, they just can't do it if they're going to be required to build-out to the non-profitable areas. It's not just a matter of raising prices for everyone to subsidize the sparsely-populated areas, it's a matter of not having the access to the capital required to do such a build-out in the first place. That, and the "densely populated" areas around here are not big enough to make the subsidization idea feasable even if the build-out could be done.
Here's another perspective - the telco's are only offering DSL in specific areas - sure it's probably primarily for technical reasons - certain radius from the CO for DSL to work, but if they can "cherry pick" for DSL, why not the rest of the services they offer.
On the other hand, arguments about large numbers of rural residents not having phone or electric sevice now if the build-out requirements were never in place are hard to ignore, and high-speed internet is being considered a basic necessity by more and more people as time goes on. Perhaps the FCC doesn't agree about that, or perhaps they figure having wide-spread fiber deployments at all would be a better starting point to eventually get fiber to rural areas than if fiber wasn't in the city/town at all.
I feel for you, but I don't see any way that this could be true. Fifteen years ago I paid Compuserve 6 dollars an hour for 2400bps online access. Ten years ago it was a local dialup ISP getting $29.95 a month for "offpeak" access at 56k. Today it's 29.95 a month for 3Mbps access.
My local phone service today includes all the long distance I can eat, voice mail, more call handling options than I'll ever use, and costs 60 bucks a month. My parents paid a base fee for service, had to buy "message blocks" for local calls, and paid anywhere from 45 cents to a buck and half for long distance minutes.
Ten years ago I got my first cell phone, and paid $1 a minute for the first 20 minutes of usage, then 69 cents after that. Today I pay 10 cents a minute for the first 700 minutes (on two lines even) and something for going over, which we never have. I can make calls anywhere I go, never pay for roaming, and the only time calls drop is when I'm driving.
I don't usually think of TV as "tech" in this context, but ten years ago our cable bill with HBO ran something like $75(?). Today Dish costs us $80, with HBO and a DVR.
We have two kinds of companies offering broadband services, the cable companies, which have to offer service to everybody, and the phone companies, which only have to offer service where it is the most profitable. The most profitable place to offer service will be where it is cheapest to offer service.
The problem is, the phone company is allowed to set their prices based on the cost of providing service to a particular customer. If providing service toa customer is expensive, the phone company doesn't have to do it. The cable company doesn't have that option - it has to provide service to everybody. So the phone company drives down the price in the profitable areas, and the cable company is screwed - if they lower prices to compete, they still have to provide service to the unprofitable customers, and are eventually forced out of business because they arn't making any money. IF they don't lower prices, the phone company will just lower prices JUST ENOUGH to undercut the cable company, not really saving the cable company any money, while the cable company will probably have to raise rates for everyone because, now that they've lost their profitable customers to the phone company undercutting them, need to cover the increased per-customer costs of being saddled with only the expensive customers.
So, everybody loses - the profitable customers end up paying higher rates to the phone company because the cable company can't compete, and the unprofitable customers end up paying higher rates because they're not being subsidized by the profitable ones.
Now, I'm not saying that unprofitable customers should have the same rates as profitable ones - if you choose to live out in the boonies, that's your choice. But if we're not going to force phone companies to build out to everyone, then we shouldn't be forcing cable companies to do so either.
paintball
California's market was never deregulated. That was just utility marketing speak. It was RE-regulated. They changed the old regulations to new different regulations. And the new regulations sucked. The REGULATIONS about how you could charge for power are what allowed Enron to do their dirty tricks.
paintball
I'm asking this honestly, because I want to know: do you have citations for that info about cable companies getting court orders preventing rural consumers from obtaining satellite? I haven't heard about it before, but I don't follow that particular market too closely, either. If what you say is true, I would like to read about the circumstances.
Anecdotally, I can tell you about my situation. I live in a rural area myself, where cable stops about a half a mile from my house. It sucks, but I don't feel that I'm *entitled* to cable internet. Sure, there is only one cable provider in the area, but when we got wireless a few months ago (the antenna is on top of the local grain silos, how's that for rural?) the cable company didn't complain. There is no bad blood on either part. It simply wouldn't be profitable to run cable half a mile for one customer, and we understand that. So, we go to a competitor, and they understand that. I don't see why the law should force them to run their cable out to us if it won't be profitable. It is not paid for by my taxes.
I know it sounds like I'm sacrificing my soul at the altar of profit or whatever, but think about this: if the state forced the cable company to build out to my house, or beyond, the start-up that provides wireless would probably not have come to our area (we were in close contact with the company, trying to get them to come out here). If the state forced build-out, it would have (1) lowered the profits of the cable company, (2) lowered the profits of the wireless company, and (3) probably prevented the wireless company from even coming here and providing internet to others who are quite a bit farther from the cable line than we are. As it is, we and our neighbors get our internet, the cable company doesn't have to worry about unprofitable build-out, and the wireless company is making some good money in a new area. Like I said, this is purely anecdotal, but the theory applies elsewhere: don't force companies to provide a service, let the demand from the consumers make it desirable to provide the service.
This is why I am so interested in reading more about cable companies claiming monopolies. Build-out laws would have hurt my area, but if they really are stopping competitors while still not providing the service themselves, then yes I agree with you, they should be subject to such laws.
Local governments still have the authority to say "NO!" If the local government does not like the telecoms plan, the plan can be killed in entirety. No foul, No gain! Other businesses have the privilege of deciding where to do business and open/close stores. Telecoms deserve the same right! Resources should not be wasted on installations that cannot be profitable, or at least break even!
If this is the case...I demand the Congress IMMEDIATELY repeal the USF. Since the telecoms will no longer be required to service areas where they don't break even or even make a profit...no one needs to pay this boondoggle any longer. Still irritates me that I have been required to pay it...even when I use VOIP with an out of area phone number!!!
Don't worry about the world coming to an end today. It's already tomorrow in Australia. - Charles M. Schulz
If the telcos no longer have to service poorer or more remote or inconvenient areas, does that mean they will no longer receive Federal Universal Service Fund payments?
Does that mean I can keep my FUSF fees?
Of course not. Gah.
Unfortunately, both parties only support federalism and the 10th amendment when it suits their interests.
I read a book written by Peter Lynch and he said an individual investor can kick an institutional investor's ass any day, and when an institutional investor of Lynch's stature says I can kick his institutional ass, I tend to believe him. Just think about it if a stock gets rocked by bad news, I can sell the couple blocks I have pretty quickly, can the instituionals sell thousands as quickly or even sell any without imploding the buy bids?
Apocalypse Cancelled, Sorry, No Ticket Refunds
You're asserting that governments can't "make money". I presume you mean they can't "make capital". But, they can. They make capital all the time. If you meant they can't "make value", under what theory of value are you assuming they can't make value? The labor theory? What theory? Come on? The CCC didn't make labor and thus make value?
Wow, you really are deluded, or you just don't know the terminology. You call yourself an Economist?
I include investors who invest via a representative. Even if they could match an institutional investor's baseline, the fees they charge are exorbitant and skim much of the profit out.
I'm asking this honestly, because I want to know: do you have citations for that info about cable companies getting court orders preventing rural consumers from obtaining satellite?
I remember the cable companies suing to prevent municipal broadband projects a couple of years back. This was back when some cities didn't have broadband or even planned rollouts.
live in a rural area myself, where cable stops about a half a mile from my house. It sucks, but I don't feel that I'm *entitled* to cable internet.
Well, you actually are. You got that entitlement in exchange for the cable company being the only cable company in the area. At least until this latest thing.
"We returned the General to El Salvador, or maybe Guatemala, it's difficult to tell from 10,000 feet"