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It just seems to me quite wasteful that there are so much telco infrastructure is duplicated (redundant): For example digging along the same street more than on

by nroets 8y ago

It just seems to me quite wasteful that there are so much telco infrastructure is duplicated (redundant): For example digging along the same street more than once to lay fiber. Or have cellular towers from different companies next to each other. On my last visit to the US, I used both "Straight Talk" and "Trac Phone". These are virtual telcos that use Verizon/AT&T and T Mobile infrastructure. New customers can choose a SIM card before activating the service. Surely the prices paid by these virtual telcos are set by the regulator. Here is South Africa, the third and fourth mobile operators roam on the first and second mobile networks. AFAIK, the regulator force these roaming agreements apon the operators. (Here I can get 50 GB of prepaid data for only R500 = $38. Much cheaper than the US!) So there are ways to set prices.

rayiner 8y ago
> It just seems to me quite wasteful that there are so much telco infrastructure is duplicated (redundant): For example digging along the same street more than once to lay fiber. Or have cellular towers from different companies next to each other. That was the basis of a lot of early 20th century regulatory thinking. That was thoroughly discredited because it turns out that government price controls are worse than duplicated infrastructure. Governments only have an incentive to keep prices low, which is not the same as the economically efficient price. From the government’s point of view, it’s better to have cheap 3G networks forever than to have prices that lead to investment into 4G and 5G networks. Low prices kill innovation, which is why all the innovation is happening in IPhones and Macs and Surface tablets and not cut-rate Acer and HP products. MVNO pricing is not set by regulators. The FCC’s last major foray into rate regulation, in connection with DSL loop unbundling, ended up killing DSL as a viable competitor to cable because wholesale prices were set so low there was no incentive to upgrade DSL networks.
- nroets 8y ago
  Obviously price per gigabyte isn't the only parameter. Things like latency, uptime and maximum throughput should also be specified. Densities in rural areas are lower, so the reasonable price per gigabyte will be higher. Ideally wholesale prices should be set before the infrastructure is built. Then telcos know what they get themselves into. -- In South Africa, DSL was never unbundled. But it's still in decline due to competition from 4G and fiber. -- IMHO a lot of innovative business models are built on zero rating. Based on what the article says about prices and your thoughts on innovation, zero rating may actually be a good thing.
- qotgalaxy 8y ago
  > That was the basis of a lot of early 20th century regulatory thinking. That was thoroughly discredited because it turns out that government price controls are worse than duplicated infrastructure. I'm sorry, I don't buy it.
  - shard972 8y ago
    Care to offer more of an explanation? Especially when you consider in many western countries many people are experiencing congested lines at peak hours. Duplicated infrastructure in these cases are not only a negative but a positive. So without duplicated infrastructure, we would be experiencing even more congestion so I don't get what your not buying.
  - rayiner 8y ago
    You don’t have to take my word for it. Read up on the history of the Interstate Commerce Commission and the insane things it used to do (regulate rates for air and truck freight). Read how companies like UPS came into existence after those things were deregulated. Read how most of the western world followed suit in the 1980s and 1990s.

by nroets 8y ago

rayiner 8y ago

> It just seems to me quite wasteful that there are so much telco infrastructure is duplicated (redundant): For example digging along the same street more than once to lay fiber. Or have cellular towers from different companies next to each other. That was the basis of a lot of early 20th century regulatory thinking. That was thoroughly discredited because it turns out that government price controls are worse than duplicated infrastructure. Governments only have an incentive to keep prices low, which is not the same as the economically efficient price. From the government’s point of view, it’s better to have cheap 3G networks forever than to have prices that lead to investment into 4G and 5G networks. Low prices kill innovation, which is why all the innovation is happening in IPhones and Macs and Surface tablets and not cut-rate Acer and HP products. MVNO pricing is not set by regulators. The FCC’s last major foray into rate regulation, in connection with DSL loop unbundling, ended up killing DSL as a viable competitor to cable because wholesale prices were set so low there was no incentive to upgrade DSL networks.

nroets 8y ago
Obviously price per gigabyte isn't the only parameter. Things like latency, uptime and maximum throughput should also be specified. Densities in rural areas are lower, so the reasonable price per gigabyte will be higher. Ideally wholesale prices should be set before the infrastructure is built. Then telcos know what they get themselves into. -- In South Africa, DSL was never unbundled. But it's still in decline due to competition from 4G and fiber. -- IMHO a lot of innovative business models are built on zero rating. Based on what the article says about prices and your thoughts on innovation, zero rating may actually be a good thing.
qotgalaxy 8y ago
> That was the basis of a lot of early 20th century regulatory thinking. That was thoroughly discredited because it turns out that government price controls are worse than duplicated infrastructure. I'm sorry, I don't buy it.
- shard972 8y ago
  Care to offer more of an explanation? Especially when you consider in many western countries many people are experiencing congested lines at peak hours. Duplicated infrastructure in these cases are not only a negative but a positive. So without duplicated infrastructure, we would be experiencing even more congestion so I don't get what your not buying.
- rayiner 8y ago
  You don’t have to take my word for it. Read up on the history of the Interstate Commerce Commission and the insane things it used to do (regulate rates for air and truck freight). Read how companies like UPS came into existence after those things were deregulated. Read how most of the western world followed suit in the 1980s and 1990s.