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The biggest barrier to competition is infrastructure. Both the cost of, and getting the permitting necessary to build it. If the infrastructure is managed by a

The biggest barrier to competition is infrastructure. Both the cost of, and getting the permitting necessary to build it. If the infrastructure is managed by a public/private entity, then any number of companies could provide service over it.

dsr_ 14y ago
It's called structural separation, and was the reason why we had so many $20/month ISPs back in the days of 28.8k modems. The infrastructure business -- for electricity, water, information networks, and other similar services -- are high-capital cost very long term investments that typically require some degree of government intervention in terms of rights of use. There's no reasonable way to provide independent supply systems if your goal is 100% coverage, and the government must be allowed to dictate things like "this road can be dug up to install pipes" and "this edge must be allowed to hold wire poles" and so forth. If you want an efficient implementation, you have one big infrastructure system that all the suppliers share. The trouble usually comes when an entity gets to both maintain the infrastructure and supply services on it. That's bad. Now they have an incentive to provide better service for their customers and worse to everyone else's. For example, if you allow an ILEC (telco owning local wire systems) to provide DSL service but require them to rent space in their local wiring centers to their competitors, you will discover that the competitors' service requests are answered more slowly, accidentally ignored more often, and generally deprioritized if not actually sabotaged. The best thing a municipality, county, or state government can do to foster a robust network environment is to establish an infrastructure provider and regulate them as the monopoly that they are, forbidding them to provide the services on top of the infrastructure. Then you can get healthy competition in those services.

dsr_ 14y ago

It's called structural separation, and was the reason why we had so many $20/month ISPs back in the days of 28.8k modems. The infrastructure business -- for electricity, water, information networks, and other similar services -- are high-capital cost very long term investments that typically require some degree of government intervention in terms of rights of use. There's no reasonable way to provide independent supply systems if your goal is 100% coverage, and the government must be allowed to dictate things like "this road can be dug up to install pipes" and "this edge must be allowed to hold wire poles" and so forth. If you want an efficient implementation, you have one big infrastructure system that all the suppliers share. The trouble usually comes when an entity gets to both maintain the infrastructure and supply services on it. That's bad. Now they have an incentive to provide better service for their customers and worse to everyone else's. For example, if you allow an ILEC (telco owning local wire systems) to provide DSL service but require them to rent space in their local wiring centers to their competitors, you will discover that the competitors' service requests are answered more slowly, accidentally ignored more often, and generally deprioritized if not actually sabotaged. The best thing a municipality, county, or state government can do to foster a robust network environment is to establish an infrastructure provider and regulate them as the monopoly that they are, forbidding them to provide the services on top of the infrastructure. Then you can get healthy competition in those services.