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Great intentions - completely wrong way to make it happen. Regulating the broadband internet market will just make people in metropolitan areas subsidize the c

Great intentions - completely wrong way to make it happen. Regulating the broadband internet market will just make people in metropolitan areas subsidize the cost for people in rural areas. If it ended there...sure it wouldn't be fair, but at least it would be a zero sum game (some win, some equally lose). But with regulation that's never the case because: 1. you introduce additional costs for government oversight 2. you discourage new entrants to the market, thereby reducing competition As Milton Friedman said, you can never judge a government program by it's intentions, only the results it gets. Free markets and unbridled competition have a much better track record of driving prices down, making new technologies available to the masses. Cost of flat panel TV's (unregulated) have cut in half every 18 months since they came out. What was once a toy for the rich is now available even to poor people. Cost of health care (regulated, and increasingly a technology product) has steadily increased each year.

ct4ul4u 16y ago
post hoc ergo propter hoc
phn 16y ago
Well, in this case we are beginning to treat broadband as a need for a person, so you can think of it as a market similar to the electricity or water market, where regulation makes perfect sense, and it actually favors competition by preventing "price abuse" from big established companies.
w1ntermute 16y ago
Free markets and unbridled competition have a much better track record of driving prices down, making new technologies available to the masses. In industries with a high barrier to entry, the market naturally tends away from competition. Broadband is one such industry, due to the enormous initial infrastructure costs.
- dantheman 16y ago
  I don't think so, if you look at the united states the broadband industry is heavily regulated.
  - _delirium 16y ago
    That's partly because it's nearly impossible to build a telecommunications network in the private sector, due to the fact that you don't have eminent domain power, can't dig up roads, etc. And if we're going to have the government assisting private businesses, granting them local monopolies, etc., then sure, they should be regulated.
  - w1ntermute 16y ago
    I never said the US broadband industry isn't regulated, I was just correcting an economic misconception of his. It is entirely true that if the broadband industry were left completely unregulated, there would be a few dominant players in the industry, and their dominance would be a result of the high barriers to entry, and not because of their inherent superiority.
- stretchwithme 16y ago
  I disagree. People would join voluntary local cooperative that can better deals with network providers. They can take a loan out to build the last mile and then just pay to connect to a bigger hub and then even have ability to switch. Condo home owner associations get better deals for a lot of things than the individual could. One might think that a city is just one big cooperative, but of course, its not really voluntary at all (except that you decide to live there) and is usually not as transparent or as responsive as a cooperative that forms without any coercion. There's a certain point where increasing size of a group causes more overhead managing the size of the group (otherwise know as "politics and corruption" than it gets you in buying power. Of course, such things can't really happen once a provider convinces a municipality to to make it a regulated monopoly. Once it is a monopoly, it can devote itself perpetually to reducing this regulation instead of improving its service, as incentives to do so are greatly reduced.
- jquery 16y ago
  > In industries with a high barrier to entry, the market naturally tends away from competition. Broadband is one such industry, due to the enormous initial infrastructure costs. Maybe things are different where you live, but the bandwidth / price ratio has increased over 400% in the past 4 years for me where I live. Not a single website was blocked because the greedy corporation didn't want me to see it. Perhaps a few people were able to pay extra to video-conference, watch HDTV on demand, or do remote-surgery because my torrent downloads were throttled imperceptibly, but I think that's probably a good thing.
  - w1ntermute 16y ago
    What is your point? From your post, I'm going to assume you live in the US. If so, you should know that your broadband access is the result of heavy government regulation.
bentlegen 16y ago
I'm curious why you would make that analogy. Differences between the TV and health care markets aside, last time I checked, the US has perhaps both the least-regulated and most expensive health care system in the industrialized world.
- dantheman 16y ago
  I don't think you know how regulated health care is in the US. For instance, for all the talk about insurance companies being for profit, most don't realize that a lot were nonprofit until the government made that illegal.
- yummyfajitas 16y ago
  Health care is a labor intensive good. Labor is more expensive in the US than in most other parts of the world, particularly high skilled labor. A haircut or a yoga lesson also costs more in the US than in most other countries for this same reason. Further, the US healthcare market has more regulations than you think. One example: in most of the world, you buy birth control pills at the store for cheap. In the US, you must first pay a doctor for permission.
  - neilk 16y ago
    Health care is dramatically less expensive in nearby Canada. Moreover, health care costs are increasing in the USA faster than any other country. It is true that some US regulations do drive up costs -- you mentioned one. There are lots of other perverse incentives in the US system, because there are so many powerful players looking out for their own interests -- HMOs, hospital networks, drug manufacturers, politicians. I would hate to see the usual libertarian/socialist debate ensue here on HN. I would like to challenge people who participate in this thread to not react reflexively, but go look up the actual data and understand what you're debating. In the USA, many people who criticize single-payer health care don't have the first clue about it. They believe it's more expensive than the USA, there's more bureaucracy and paperwork, that there's less choice of doctors... all of which are false. False, as in not true. It doesn't matter what Milton Friedman says the world is supposed to be like. Or if you have to have a theoretical foundation before you'll believe data, go check out the foundational paper in health economics, "Uncertainty and the welfare economics of medical care", by Kenneth Arrow. That said, back to the original post, which is about broadband regulation -- again, I urge people to go look at what happens in other countries, or indeed what happened in the USA in earlier times, when economic policies were based on data and the overall good of the country, instead of ideology. I'm not sure if I would have classified broadband as a "right" (it seems to cheapen other rights, IMO). But faced with industries that often create natural monopolies or oligopolies (telecom is the textbook example) regulation with the goal of universal service can have good effects.
_delirium 16y ago
> As Milton Friedman said, you can never judge a government program by it's intentions, only the results it gets. The results, as far as I can tell, are that Scandinavian countries have very good publicly owned infrastructure.
- cema 16y ago
  And they have it before the law comes into effect.
  - _delirium 16y ago
    I'm talking about much more infrastructure than just broadband. They have good public health-care systems, public transportation systems, etc. --- not just good intentions, but good results. What reason is there to believe that they won't do public broadband just as well?
    - jquery 16y ago
      > I'm talking about much more infrastructure than just broadband. They have good public health-care systems, public transportation systems, etc. --- not just good intentions, but good results. What reason is there to believe that they won't do public broadband just as well? Taken as a whole, they are considerably poorer on average than US citizens (especially professionals of the calibre seen on HN). I'm not convinced, based on their self-reported claims of excellence, that their policies, if emulated, would make the USA more prosperous or more pleasant to live for the average person. I think this is doubly true for the intelligent and motivated.
      - Devilboy 16y ago
        I think you over-estimate how well the 'average' person in the USA is living today.
        jquery 16y ago
        I have no illusions about how much 'average' in the USA is, but I also have no illusions about how much 'average' is in Scandinavian counties are, either. Commodity prices are somewhat higher there, which when adjusted against their income actually makes them somewhat poorer than US citizens, kind of like how $50k in New York City won't get you as far as $50k in Seattle.

ct4ul4u 16y ago

post hoc ergo propter hoc

phn 16y ago

Well, in this case we are beginning to treat broadband as a need for a person, so you can think of it as a market similar to the electricity or water market, where regulation makes perfect sense, and it actually favors competition by preventing "price abuse" from big established companies.

w1ntermute 16y ago

Free markets and unbridled competition have a much better track record of driving prices down, making new technologies available to the masses. In industries with a high barrier to entry, the market naturally tends away from competition. Broadband is one such industry, due to the enormous initial infrastructure costs.

dantheman 16y ago
I don't think so, if you look at the united states the broadband industry is heavily regulated.
- _delirium 16y ago
  That's partly because it's nearly impossible to build a telecommunications network in the private sector, due to the fact that you don't have eminent domain power, can't dig up roads, etc. And if we're going to have the government assisting private businesses, granting them local monopolies, etc., then sure, they should be regulated.
- w1ntermute 16y ago
  I never said the US broadband industry isn't regulated, I was just correcting an economic misconception of his. It is entirely true that if the broadband industry were left completely unregulated, there would be a few dominant players in the industry, and their dominance would be a result of the high barriers to entry, and not because of their inherent superiority.
stretchwithme 16y ago
I disagree. People would join voluntary local cooperative that can better deals with network providers. They can take a loan out to build the last mile and then just pay to connect to a bigger hub and then even have ability to switch. Condo home owner associations get better deals for a lot of things than the individual could. One might think that a city is just one big cooperative, but of course, its not really voluntary at all (except that you decide to live there) and is usually not as transparent or as responsive as a cooperative that forms without any coercion. There's a certain point where increasing size of a group causes more overhead managing the size of the group (otherwise know as "politics and corruption" than it gets you in buying power. Of course, such things can't really happen once a provider convinces a municipality to to make it a regulated monopoly. Once it is a monopoly, it can devote itself perpetually to reducing this regulation instead of improving its service, as incentives to do so are greatly reduced.
jquery 16y ago
> In industries with a high barrier to entry, the market naturally tends away from competition. Broadband is one such industry, due to the enormous initial infrastructure costs. Maybe things are different where you live, but the bandwidth / price ratio has increased over 400% in the past 4 years for me where I live. Not a single website was blocked because the greedy corporation didn't want me to see it. Perhaps a few people were able to pay extra to video-conference, watch HDTV on demand, or do remote-surgery because my torrent downloads were throttled imperceptibly, but I think that's probably a good thing.
- w1ntermute 16y ago
  What is your point? From your post, I'm going to assume you live in the US. If so, you should know that your broadband access is the result of heavy government regulation.

bentlegen 16y ago

I'm curious why you would make that analogy. Differences between the TV and health care markets aside, last time I checked, the US has perhaps both the least-regulated and most expensive health care system in the industrialized world.

dantheman 16y ago
I don't think you know how regulated health care is in the US. For instance, for all the talk about insurance companies being for profit, most don't realize that a lot were nonprofit until the government made that illegal.
yummyfajitas 16y ago
Health care is a labor intensive good. Labor is more expensive in the US than in most other parts of the world, particularly high skilled labor. A haircut or a yoga lesson also costs more in the US than in most other countries for this same reason. Further, the US healthcare market has more regulations than you think. One example: in most of the world, you buy birth control pills at the store for cheap. In the US, you must first pay a doctor for permission.
- neilk 16y ago
  Health care is dramatically less expensive in nearby Canada. Moreover, health care costs are increasing in the USA faster than any other country. It is true that some US regulations do drive up costs -- you mentioned one. There are lots of other perverse incentives in the US system, because there are so many powerful players looking out for their own interests -- HMOs, hospital networks, drug manufacturers, politicians. I would hate to see the usual libertarian/socialist debate ensue here on HN. I would like to challenge people who participate in this thread to not react reflexively, but go look up the actual data and understand what you're debating. In the USA, many people who criticize single-payer health care don't have the first clue about it. They believe it's more expensive than the USA, there's more bureaucracy and paperwork, that there's less choice of doctors... all of which are false. False, as in not true. It doesn't matter what Milton Friedman says the world is supposed to be like. Or if you have to have a theoretical foundation before you'll believe data, go check out the foundational paper in health economics, "Uncertainty and the welfare economics of medical care", by Kenneth Arrow. That said, back to the original post, which is about broadband regulation -- again, I urge people to go look at what happens in other countries, or indeed what happened in the USA in earlier times, when economic policies were based on data and the overall good of the country, instead of ideology. I'm not sure if I would have classified broadband as a "right" (it seems to cheapen other rights, IMO). But faced with industries that often create natural monopolies or oligopolies (telecom is the textbook example) regulation with the goal of universal service can have good effects.

_delirium 16y ago

> As Milton Friedman said, you can never judge a government program by it's intentions, only the results it gets. The results, as far as I can tell, are that Scandinavian countries have very good publicly owned infrastructure.

cema 16y ago
And they have it before the law comes into effect.
- _delirium 16y ago
  I'm talking about much more infrastructure than just broadband. They have good public health-care systems, public transportation systems, etc. --- not just good intentions, but good results. What reason is there to believe that they won't do public broadband just as well?
  - jquery 16y ago
    > I'm talking about much more infrastructure than just broadband. They have good public health-care systems, public transportation systems, etc. --- not just good intentions, but good results. What reason is there to believe that they won't do public broadband just as well? Taken as a whole, they are considerably poorer on average than US citizens (especially professionals of the calibre seen on HN). I'm not convinced, based on their self-reported claims of excellence, that their policies, if emulated, would make the USA more prosperous or more pleasant to live for the average person. I think this is doubly true for the intelligent and motivated.
    - Devilboy 16y ago
      I think you over-estimate how well the 'average' person in the USA is living today.
      - jquery 16y ago
        I have no illusions about how much 'average' in the USA is, but I also have no illusions about how much 'average' is in Scandinavian counties are, either. Commodity prices are somewhat higher there, which when adjusted against their income actually makes them somewhat poorer than US citizens, kind of like how $50k in New York City won't get you as far as $50k in Seattle.