5 ms·

Of all the government created monopolies, the cable monopolies are some of the worst. If cable companies had to compete to keep business, they'd offer better s

by nirvana 14y ago

Of all the government created monopolies, the cable monopolies are some of the worst. If cable companies had to compete to keep business, they'd offer better service and treat their employees better. Southwest airlines is a good example of a company that has to keep costs low, but does this in part by treating their employees very well. Notice that they charge ever higher and higher fees, in part because the municipalities are on the take here and get a cut of the fees, but also because the demand is inelastic. If you live in Austin and you want cable, they have your business. So, there's no reason to spend the money to have enough technicians to ensure they are able to do a good job and a timely one. A big part of the reason this never improves is that everyone blames Time Warner. TWC is just maximally allocating resources, which is what they should do. Namely, out of areas where they have a monopoly protected by the violence the city of austin will do to any other cable company that tries to compete.... and into areas where they have to compete for customers. But you don't hear this issue at election time. Why do people not hold their city council peeps accountable for imposing this overpriced monopoly on them? My guess is that most don't realize it is a government created monopoly, and the ones who do, many think that there would be no cable if the city hadn't given those rights away as an incentive to install all the cable. (not the case... places where this doesn't happen, still get cable because it isn't that expensive to put in the cable.)

rthomas6 14y ago
What exactly could I personally do to change this situation?
- Produce 14y ago
  It's a democracy - cast your vote. Psyche! Learn to love your monopolist overlords.
- incomethax 14y ago
  You could actively petition your friends and neighbors locally and try to change your local representation. Especially in elections for Alderman, niche issues like cable monopolies can carry weight, especially because voting is based on the issues raised by a vocal minority. In some places being elected to city council is not that difficult and can be managed in addition to a full time job. Anecdotal evidence but - a friend of mine works as a VP of a local consulting firm and also manages to do a great job as an Alderman.
unwiredben 14y ago
Actually, not true in all of Austin. Much of the city is also wired for Grande Communications cable, and so far, I've found them to be much more responsive and with better tools than the TW people I'd used in the past.
aero142 14y ago
I live in Austin and switched from TWC to U-Verse when it was launched. Many customers also have Grande. It wouldn't surprise me to hear that TWC's long dominance was from some government protection arrangement, but I'm not aware of it. Could you offer any specifics as to what gives TWC a monopoly and why it doesn't apply to U-Verse and Grande.
- otterley 14y ago
  The monopoly lies in the fact that municipalities need not provide a franchise to more than one cable operator (such as TWC). In some municipalities you can switch Internet service from, say, cable to telephone-based service (such as U-Verse) but in many others this is not a realistic option.
  - majormajor 14y ago
    The ability to pipe TV over IP is dramatically weakening the natural cable company monopolies. In AT&T phone service territory, as they upgrade their network you can switch to U-Verse for not just internet but also television, with a much improved set-top box experience. I don't agree with the claim that opening up the ability to lay a cable network to everyone would help things -- heck, look how slow the deployment of U-Verse is taking over AT&T's existing infrastructure... having to do that from scratch, laying a whole new network over the city and in everybody's yards, would be a many times larger endeavor -- but technological changes are already making competition much more possible than before since now both of those entrenched networks can be used for TV.
    - wpietri 14y ago
      Do you have the any evidence that cable monopolies have been dramatically weakened? E.g., dropping prices, reduced ability to pressure vendors? I think we might get there one day, but I suspect they're barely noticing it right now.
- lowmagnet 14y ago
  In 1985 FCC rules were adjusted to create CLECs (Competitive Local Exchange Carriers) by forcing the I(ncumbent)LECs to allow competition on their hardware. This never happened in the cable industry because cable isn't considered necessary like phone service is.
guelo 14y ago
You can always count on nirvana to come up with the maximal libertarian argument. What proof is there that this is a government created monopoly? What exactly is the "violence" that Austin would do to competitors? Do libertarians not believe in the concept of natural monopolies?
- kbolino 14y ago
  The monopoly is not entirely created by the government. It would be more accurate to say, "the major cable companies have divided the country amongst themselves and agreed not to step on each other's turf." The FCC and the local governments have various levels of complicity in this arrangement. A municipality would not likely visit any violence upon a competitor, but that's largely because the only way to become a competitor (you can't just start digging holes and dropping cable in them) is through the approval of the municipality. This is where the "government-sponsored monopoly" idea comes into play, because there is often a revolving door between the government agency nominally charged with regulating cable service and the cable company that administers it. Also, no, libertarians in general do not "believe in the concept of natural monopolies". Many libertarians hold that monopolies are short-lived and are prolonged only through the complicity of governments--or other actors which may play the same role in context, like the mafia, or even the corporation itself, should it become a de facto government. Of course, with that last point, you start begging the question...
  - pasbesoin 14y ago
    And where municipalities have not received sufficient -- or any (i.e. high speed) -- service from existing providers and have therefore, finally, attempted to deploy their own local service (an action with much established precendent, e.g. rural electrification cooperatives, water service, etc. -- even telephone exchanges), in many of those cases the incumbent telecommunications providers have lobbied and coerced state governments to outlaw such actions. They don't want to offer service. But they're damned sure not going to let anyone else do so -- not even let the community do so for themselves. I'd hardly call that healthy competition.
- randallsquared 14y ago
rprasad 14y ago
Cable monopolies are not government-created. They are government-backed in limited circumstances. In most of California, for example, there is hefty competition for cable/satellite services and high-speed internet, despite cable television monopolies. >Notice that they charge ever higher and higher fees, in part because the municipalities are on the take here and get a cut of the fees, but also because the demand is inelastic. If you live in Austin and you want cable, they have your business. Notice that every year, content companies demand more and more money to carry their channels. ESPN alone probably accounts for 5% of most cable bills. Maintenance of hundreds or thousands of miles of cable is also very expensive. Upgrading all of that cable infrastructure is even more expensive. >So, there's no reason to spend the money to have enough technicians to ensure they are able to do a good job and a timely one. More money spent on technicians = more money paid by consumers. Yet you complain about higher fees. At some point, you must recognize that there is cost to pay for all of the services you demand. Technicians do not work for free. >But you don't hear this issue at election time. Why do people not hold their city council peeps accountable for imposing this overpriced monopoly on them? My guess is that most don't realize it is a government created monopoly, and the ones who do, many think that there would be no cable if the city hadn't given those rights away as an incentive to install all the cable. (not the case... places where this doesn't happen, still get cable because it isn't that expensive to put in the cable.) Simple solution: don't subscribe to cable. Cable is not a right. It's a choice that is not forced upon you. Alternatively, subscribe to satellite, use the free OTA signals, or learn to live without live TV.
- TheHegemon 14y ago
  > In most of California, for example, there is hefty competition for cable/satellite services and high-speed internet, despite cable television monopolies. Are you kidding me? I currently live in LA and used to live in SD and my choices were either TWC or... DSL. Previously Cox and... that's pretty much it. Which is hilarious considering my parent's choices in San Bernardino are: Fios, Time Warner Cable, and of course DSL.
- joe_the_user 14y ago
  In most of California, for example, there is hefty competition for cable/satellite services and high-speed Internet, despite cable television monopolies. Even if that was true, it would only show limited competition between two government maintained monopolies that happen to imping on each other through historical circumstances (we know that there's no real price competition - what we see is the song-and-dance customer competition characteristic of duopolies). The relative phone and the cable monopolies are maintain through the state granting right-of-ways to a limited number of companies. Your use of "government-backed" in supposed contrast to "government-created" is just verbal slight of hand, a pedantic distinction that does not make a difference (a maneuver that seems sadly popular here). The enterprises (cable and phone for that matter) palpably extract a surplus from their positions in the cat bird seat. (sure, I'm using "monopoly" in the sense of rent-extractor and "duopoly" in the rent of market position. The overall situation should be clear enough).
superuser2 14y ago
How many times are you willing to let a startup tear up your yard? Or are you referring to the proposals that government should force private companies to share the critical infrastructure they created at their own expense? I can't imagine that sitting very well with libertarians or people vehemently opposed to government monopolies. The only way last mile utilities are going to be fair is if government steps in (correctly). To my mind, that means municipally laid and maintained last-mile fiber patched to the commercial provider of my choosing, but I expect that will remain a dream for a few decades, at least.
- njs12345 14y ago
  In the UK, that's essentially exactly what we have: http://www.ofcom.org.uk/static/archive/oftel/publications/broadband/dsl_facts/LLUbackground.htm http://www.ofcom.org.uk/static/archive/oftel/publications/br...
- quanticle 14y ago
  You're not familiar with the concept of easements, are you? Generally, the first meter or two of your property is designated as an easement, for the purposes of running utility lines, telephone lines, and yes, cable lines. So yes, most people have given others the right to tear up their yard. It's just that the city then re-grants the rights to one or two utilities as opposed to having a genuinely competitive bidding process for the city's cable, telephone, or even electricity business.
  - superuser2 14y ago
    >So yes, most people have given others the right to tear up their yard To one cable company, one electrical utility, one telephone company, and to the local government-run water and sewage monopolies. Not to fifty startups. A situation with a "genuinely competitive bid process" is a government-granted monopoly granted based on better criteria, and would certainly benefit consumers. It's still not a free market, which is my point: nobody actually wants a completely free market for last-mile utilities.

by nirvana 14y ago

rthomas6 14y ago

What exactly could I personally do to change this situation?

Produce 14y ago
It's a democracy - cast your vote. Psyche! Learn to love your monopolist overlords.
incomethax 14y ago
You could actively petition your friends and neighbors locally and try to change your local representation. Especially in elections for Alderman, niche issues like cable monopolies can carry weight, especially because voting is based on the issues raised by a vocal minority. In some places being elected to city council is not that difficult and can be managed in addition to a full time job. Anecdotal evidence but - a friend of mine works as a VP of a local consulting firm and also manages to do a great job as an Alderman.

unwiredben 14y ago

Actually, not true in all of Austin. Much of the city is also wired for Grande Communications cable, and so far, I've found them to be much more responsive and with better tools than the TW people I'd used in the past.

aero142 14y ago

I live in Austin and switched from TWC to U-Verse when it was launched. Many customers also have Grande. It wouldn't surprise me to hear that TWC's long dominance was from some government protection arrangement, but I'm not aware of it. Could you offer any specifics as to what gives TWC a monopoly and why it doesn't apply to U-Verse and Grande.

otterley 14y ago
The monopoly lies in the fact that municipalities need not provide a franchise to more than one cable operator (such as TWC). In some municipalities you can switch Internet service from, say, cable to telephone-based service (such as U-Verse) but in many others this is not a realistic option.
- majormajor 14y ago
  The ability to pipe TV over IP is dramatically weakening the natural cable company monopolies. In AT&T phone service territory, as they upgrade their network you can switch to U-Verse for not just internet but also television, with a much improved set-top box experience. I don't agree with the claim that opening up the ability to lay a cable network to everyone would help things -- heck, look how slow the deployment of U-Verse is taking over AT&T's existing infrastructure... having to do that from scratch, laying a whole new network over the city and in everybody's yards, would be a many times larger endeavor -- but technological changes are already making competition much more possible than before since now both of those entrenched networks can be used for TV.
  - wpietri 14y ago
    Do you have the any evidence that cable monopolies have been dramatically weakened? E.g., dropping prices, reduced ability to pressure vendors? I think we might get there one day, but I suspect they're barely noticing it right now.
lowmagnet 14y ago
In 1985 FCC rules were adjusted to create CLECs (Competitive Local Exchange Carriers) by forcing the I(ncumbent)LECs to allow competition on their hardware. This never happened in the cable industry because cable isn't considered necessary like phone service is.

guelo 14y ago

You can always count on nirvana to come up with the maximal libertarian argument. What proof is there that this is a government created monopoly? What exactly is the "violence" that Austin would do to competitors? Do libertarians not believe in the concept of natural monopolies?

kbolino 14y ago
The monopoly is not entirely created by the government. It would be more accurate to say, "the major cable companies have divided the country amongst themselves and agreed not to step on each other's turf." The FCC and the local governments have various levels of complicity in this arrangement. A municipality would not likely visit any violence upon a competitor, but that's largely because the only way to become a competitor (you can't just start digging holes and dropping cable in them) is through the approval of the municipality. This is where the "government-sponsored monopoly" idea comes into play, because there is often a revolving door between the government agency nominally charged with regulating cable service and the cable company that administers it. Also, no, libertarians in general do not "believe in the concept of natural monopolies". Many libertarians hold that monopolies are short-lived and are prolonged only through the complicity of governments--or other actors which may play the same role in context, like the mafia, or even the corporation itself, should it become a de facto government. Of course, with that last point, you start begging the question...
- pasbesoin 14y ago
  And where municipalities have not received sufficient -- or any (i.e. high speed) -- service from existing providers and have therefore, finally, attempted to deploy their own local service (an action with much established precendent, e.g. rural electrification cooperatives, water service, etc. -- even telephone exchanges), in many of those cases the incumbent telecommunications providers have lobbied and coerced state governments to outlaw such actions. They don't want to offer service. But they're damned sure not going to let anyone else do so -- not even let the community do so for themselves. I'd hardly call that healthy competition.
randallsquared 14y ago

rprasad 14y ago

Cable monopolies are not government-created. They are government-backed in limited circumstances. In most of California, for example, there is hefty competition for cable/satellite services and high-speed internet, despite cable television monopolies. >Notice that they charge ever higher and higher fees, in part because the municipalities are on the take here and get a cut of the fees, but also because the demand is inelastic. If you live in Austin and you want cable, they have your business. Notice that every year, content companies demand more and more money to carry their channels. ESPN alone probably accounts for 5% of most cable bills. Maintenance of hundreds or thousands of miles of cable is also very expensive. Upgrading all of that cable infrastructure is even more expensive. >So, there's no reason to spend the money to have enough technicians to ensure they are able to do a good job and a timely one. More money spent on technicians = more money paid by consumers. Yet you complain about higher fees. At some point, you must recognize that there is cost to pay for all of the services you demand. Technicians do not work for free. >But you don't hear this issue at election time. Why do people not hold their city council peeps accountable for imposing this overpriced monopoly on them? My guess is that most don't realize it is a government created monopoly, and the ones who do, many think that there would be no cable if the city hadn't given those rights away as an incentive to install all the cable. (not the case... places where this doesn't happen, still get cable because it isn't that expensive to put in the cable.) Simple solution: don't subscribe to cable. Cable is not a right. It's a choice that is not forced upon you. Alternatively, subscribe to satellite, use the free OTA signals, or learn to live without live TV.

TheHegemon 14y ago
> In most of California, for example, there is hefty competition for cable/satellite services and high-speed internet, despite cable television monopolies. Are you kidding me? I currently live in LA and used to live in SD and my choices were either TWC or... DSL. Previously Cox and... that's pretty much it. Which is hilarious considering my parent's choices in San Bernardino are: Fios, Time Warner Cable, and of course DSL.
joe_the_user 14y ago
In most of California, for example, there is hefty competition for cable/satellite services and high-speed Internet, despite cable television monopolies. Even if that was true, it would only show limited competition between two government maintained monopolies that happen to imping on each other through historical circumstances (we know that there's no real price competition - what we see is the song-and-dance customer competition characteristic of duopolies). The relative phone and the cable monopolies are maintain through the state granting right-of-ways to a limited number of companies. Your use of "government-backed" in supposed contrast to "government-created" is just verbal slight of hand, a pedantic distinction that does not make a difference (a maneuver that seems sadly popular here). The enterprises (cable and phone for that matter) palpably extract a surplus from their positions in the cat bird seat. (sure, I'm using "monopoly" in the sense of rent-extractor and "duopoly" in the rent of market position. The overall situation should be clear enough).

superuser2 14y ago

How many times are you willing to let a startup tear up your yard? Or are you referring to the proposals that government should force private companies to share the critical infrastructure they created at their own expense? I can't imagine that sitting very well with libertarians or people vehemently opposed to government monopolies. The only way last mile utilities are going to be fair is if government steps in (correctly). To my mind, that means municipally laid and maintained last-mile fiber patched to the commercial provider of my choosing, but I expect that will remain a dream for a few decades, at least.

njs12345 14y ago
In the UK, that's essentially exactly what we have: http://www.ofcom.org.uk/static/archive/oftel/publications/broadband/dsl_facts/LLUbackground.htm http://www.ofcom.org.uk/static/archive/oftel/publications/br...
quanticle 14y ago
You're not familiar with the concept of easements, are you? Generally, the first meter or two of your property is designated as an easement, for the purposes of running utility lines, telephone lines, and yes, cable lines. So yes, most people have given others the right to tear up their yard. It's just that the city then re-grants the rights to one or two utilities as opposed to having a genuinely competitive bidding process for the city's cable, telephone, or even electricity business.
- superuser2 14y ago
  >So yes, most people have given others the right to tear up their yard To one cable company, one electrical utility, one telephone company, and to the local government-run water and sewage monopolies. Not to fifty startups. A situation with a "genuinely competitive bid process" is a government-granted monopoly granted based on better criteria, and would certainly benefit consumers. It's still not a free market, which is my point: nobody actually wants a completely free market for last-mile utilities.