4 ms·

The "dig once" policy is a public subsidy for broadband in the same sense that a national roads network is a subsidy for FedEx or Amazon.com -- it indeed reduce

by zkms 10y ago

The "dig once" policy is a public subsidy for broadband in the same sense that a national roads network is a subsidy for FedEx or Amazon.com -- it indeed reduces the costs that operators need to pay to get into the market but there's a panoply of benefits to the public beyond those of a literal, "paying government money to broadband operators" subsidy.

rayiner 10y ago
Infrastructure, whether broadband or highways, has positive externalities that are hard for infrastructure builders to capture, so the free market under-invests in infrastructure. However, government investment in infrastructure also is distortionary and needs to be considered in every instance. For example, it's great that we can get products delivered overnight from Amazon. However, as you point out, that is effectively a public subsidy of Amazon's business model, and that has negative effects too. Subsidizing public road infrastructure makes shipping products across the country artificially cheaper compared to making and selling them locally. That essentially strips away an advantage local retailers and manufacturers would otherwise have against big, national companies like Amazon.
- zkms 10y ago
  > That essentially strips away an advantage local retailers and manufacturers would otherwise have against big, national companies like Amazon. Indeed -- my hope for "dig once" policies would be that they have an opposite effect on competition; namely, that national-scale incumbents (who can currently afford to throw a million dollars here or there to put in fibre of their own in a new region/market) can get effective competition from local ISPs (who don't have a comparable ability to throw cash around).
  - jon-wood 10y ago
    In the UK we've had laws requiring common access to telecoms infrastructure since at least the early 2000s, and its had exactly that effect. In almost any home you have a choice of a dozen or so providers, ranging from super cheap basic providers who'll give you a few megabits and a stingy data allowance right up to business specialists who can provide multiple redundant lines on different backbones with 4G backup, generally without any sort of installation being required because. We've also got a big cable provider who run their own lines and give pretty competitive pricing because of all the other options.
- comex 10y ago
  In theory Amazon/FedEx pay for their share of road maintenance costs, via gas taxes. In reality, gas taxes apparently only cover about half of such costs (overall) [1], but that still doesn't sound like a huge distortion to me. [1] http://www.frontiergroup.org/reports/fg/do-roads-pay-themselves http://www.frontiergroup.org/reports/fg/do-roads-pay-themsel...
  - spqr0a1 10y ago
    It's even worse than that, gas usage (tax revenue) scales linear with weight at low speed. Road damage scales as the fourth power of axle weight! Large trucks pay nowhere near the cost they impose on our infrastructure.

by zkms 10y ago

rayiner 10y ago

Infrastructure, whether broadband or highways, has positive externalities that are hard for infrastructure builders to capture, so the free market under-invests in infrastructure. However, government investment in infrastructure also is distortionary and needs to be considered in every instance. For example, it's great that we can get products delivered overnight from Amazon. However, as you point out, that is effectively a public subsidy of Amazon's business model, and that has negative effects too. Subsidizing public road infrastructure makes shipping products across the country artificially cheaper compared to making and selling them locally. That essentially strips away an advantage local retailers and manufacturers would otherwise have against big, national companies like Amazon.

zkms 10y ago
> That essentially strips away an advantage local retailers and manufacturers would otherwise have against big, national companies like Amazon. Indeed -- my hope for "dig once" policies would be that they have an opposite effect on competition; namely, that national-scale incumbents (who can currently afford to throw a million dollars here or there to put in fibre of their own in a new region/market) can get effective competition from local ISPs (who don't have a comparable ability to throw cash around).
- jon-wood 10y ago
  In the UK we've had laws requiring common access to telecoms infrastructure since at least the early 2000s, and its had exactly that effect. In almost any home you have a choice of a dozen or so providers, ranging from super cheap basic providers who'll give you a few megabits and a stingy data allowance right up to business specialists who can provide multiple redundant lines on different backbones with 4G backup, generally without any sort of installation being required because. We've also got a big cable provider who run their own lines and give pretty competitive pricing because of all the other options.
comex 10y ago
In theory Amazon/FedEx pay for their share of road maintenance costs, via gas taxes. In reality, gas taxes apparently only cover about half of such costs (overall) [1], but that still doesn't sound like a huge distortion to me. [1] http://www.frontiergroup.org/reports/fg/do-roads-pay-themselves http://www.frontiergroup.org/reports/fg/do-roads-pay-themsel...
- spqr0a1 10y ago
  It's even worse than that, gas usage (tax revenue) scales linear with weight at low speed. Road damage scales as the fourth power of axle weight! Large trucks pay nowhere near the cost they impose on our infrastructure.