How is the Texas franchise different other franchises? How is it not in
its heart of hearts a monopoly?
Re the situation in the place where you live, I don't know how they've
worked it out, but even an agreement that allows you to select either
RCN or Comcast is still a duopoly and duopoly is considered just as
economically damaging as monopoly.
DSL is an inferior solution as most people in this list will attest.
It's almost degrading to be driven to DSL. FTTH sizzles, but it costs a
lot and it's only available on a limited basis. Oh, sorry, that's how
monopolies profit maximize: they restrict supply so that the market
clearing price is well above marginal cost. Some speculate that Verizon
is only rolling out to the more affluent communities, i.e, communities
that will pay and not cause account maintenance issues. Skimming the
cream. Going to where the market clearing price will involve the least cost.
It sounds that where your moving in a few months will reprise the same
duopoly scenario that you have where you now live, although this time
the it will be Comcast and Service Electric in bed with each other. I
know that the Verizon offering sizzles, but it's a lot to pay just to
get close to what the South Koreans have. And I don't know whether at
the different price points that cable and Verizon FIOS are real
competitors. Then there are the other quasi-monopoly features of
Verizon's business practices.
Your theory of the MSO is that the city strikes a devil's bargain with
some private company and provides all sorts of goodies to entice the
private company to exercise monopoly control over its business. In some
cases, there's really no choice but to have one company run the cables,
or one company run the phone lines, or one company handle electric
transmission, etc. Again, I don't see why the city just doesn't grant
itself the franchise. And, again, I don't see that duopoly is a good
substitute for monopoly franchise, it's the same thing in practice.
Jim Henry wrote:
Robert,
Govt. video franchises are not always monopolies. That depends on the
municipality or govt. entity granting it. In the case of the Texas
state-wide franchise it is not. In the community where I live, two cable
companies, RCN and Comcast, have franchises so I have my choice. For
broadband I have even more choices if I opt to go for DSL or FTTH. Where I
am moving in about 6 months, about 40 miles from here, again, I will have my
choice of Comcast,Service Electric, or Verizon for video, broadband and
voice, plus numerous DSL resellers if I want it. I know in the past in some
communities municipalities would offer monopolies because they could extort
more out of the MSO but I do not think that is legal anymore, at least not
in PA.
Jim
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