At 12/21/2010 05:58 PM, Jeff wrote:
Fred,
You've been advocating splitting the ILECs between their delivery
and service modelsÂ…basically making the delivery (last mile/middle
mile) into common carriers and having the service business stand on
it's own, for as long as I've been reading your posts (close to 10
years). You haven't come out and said that here (that I've seen),
but isn't that what you are getting at? Let the monopoly be the
monopoly (a regulated utility at that point) and make the
service/content providers compete, right?
Yes. I've noted two different break points, either of which would
solve "neutrality". They are not mutually exclusive.
The common carrier model, which used to apply to the Bells in the US,
separates the lower layer (delivery) from upper layer (Internet
service). The LoopCo model (structural or functional separation)
goes even lower, putting the dark fiber or copper in one company
(LoopCo) and letting all carriers (incumbent, competitor) lease it on
the same terms. Either way the loop monopoly is broken.
Regards,
Jeff
ImageStream Sales Manager
800-813-5123 x106
----------
From: wireless-boun...@wispa.org [mailto:wireless-boun...@wispa.org]
On Behalf Of Fred Goldstein
Sent: Tuesday, December 21, 2010 5:41 PM
To: WISPA General List
Subject: Re: [WISPA] Flexible rules promised for wireless
At 12/21/2010 05:14 PM, MDK wrote:
Fred gave his reasons, which if I were to answer to, I'd have to
quote him, but the gist of what he said, was that the NEXT operator
to come along would have to pay MORE to compete than the original.
Yes, to reach the first customer, as well as on a per-customer
basis, which sets the price. If Bell has 100% of the market and you
don't have lines, then you'd have to pull a line to reach your
customer. That's a huge cost compared to their being able to use
existing lines. If you won a 25% market share and they had 75%,
then if your cost per mile were the same as theirs, your cost per
home served would be three times theirs. If you don't know the
impact of that, look at RCN's sad history. Hint: It's in my
book. Five billion dollars lost in four years.
That's about as flawed a premise for technological matters as it is
possible to have. Technology gets CHEAPER as it become more
popular, subsequent competitors pay LESS to provide services than
the first. This is WHY telcos and utilities were given monopoly
status in the first place, so they would be protected from
competition, thereby ensuring healthy and long term profits from
their investment.
No. The telcos did not have monopolies granted by law until
1934! Well, they had it for 17 years from 1876, under Bell's patent
(which turns out to have been fraudulently granted, but
hey...). But when it expired, competition sprang up like weeds in
spring. LOTS of independent telcos were in business in the
1890s. Some were in new turf, some were "CLECs" (in today's
terms). But Bell then bought Pupin's patent on the loading coil and
thus had a monopoly on long-haul (>10 miles or so) calling. So the
indies started failing. Bell (Ted Vail) proposed a regulated
monopoly. In 1912, they were required to interconnect with the
surviving indies, and banned from buying up non-bankrupt
indies. The last CLECs petered out and were gone by 1930 or so.
(Keystone in Philadelphia was the last big one.) When CA34 was
written, the monopoly was made de jure.
Fred used the example of roads, as a comparison. Hardly a valid
one, since wire takes up minimal real space, and roads take up ALL
the space we have for them. Roads are publicly owned, for the most
part (yes, I know, private toll roads exist, but that's really
outside of free market business, just the same), and consume the
only space that exists for them, they live in a 2 dimension
world. The two are NOT comparable, not even slightly.
Of course not, but economically, they might as well be. There is
negligible provision of mass-market competitive loop plant. That's
why WISPs exist; it's the only competitive medium.
What's really at issue here, is that the incumbents were built with
money extracted from the consumer at usurious rates, and profits
were protected and guaranteed by both federal and state law. And,
incumbents have the historical benefit of having had that guaranteed
profit from which to build an infrastructure that competitors would
not have, and would have to start from scratch.
We agree on that.
Ideas of separating the lines from the service are merely responses
to that fact, and in no way fix the issue.
We disagree on that. Unbundling works all over the world. It
started in the US but was reduced here, so it is not as widely
available as it once was. But I do have WISP clients who do
unbundled DSL "in town" while using wireless in the lower-density
countryside. You can still get unbundled copper in most places (not
all) within about 2 miles of a wire center.
--
Fred Goldstein k1io fgoldstein "at" ionary.com
ionary Consulting http://www.ionary.com/
+1 617 795 2701
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Fred Goldstein k1io fgoldstein "at" ionary.com
ionary Consulting http://www.ionary.com/
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