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No. I believe in the concept of a natural monopoly for most utilities though - Building outside plant is horrendously expensive - it to me makes as much sense

by Aloha 13y ago

No. I believe in the concept of a natural monopoly for most utilities though - Building outside plant is horrendously expensive - it to me makes as much sense to have multiple cable providers as it does multiple sets of power/telephone/water/sewer infrastructure. I'd even like to see a fewer wireless carriers (consider that each for carrier are spending billions of dollars to roll out what amount to essentially identical network infrastructure often even from the same vendors - how on earth does that even begin to make sense? We - the rate payer ends up paying for it in the end thru higher rates - economy of scale is a thing, and it works. Having been in the industry for about 2 years now, looking at the spectrum, I believe that we have enough for two, possibly three really competitive national wireless carriers - as in a complete nation wide footprint. That means 20x20 LTE even in rural areas, plus whatever 2g (CDMA 1x or GSM) tech you need for circuit switch voice, and whatever legacy 3g you need too (EDGE and HSDPA or EV-DO), with the eventual goal of multiple 20x20 or 40x40 carriers once we can replace all the legacy stuff - but consider the current for a moment, that Sprint in Seattle on 1900 mhz only has 20 mhz duplex, and nothing on 800 at all - this is excluding the acres on 2.5, because of the obvious limitations of use with atmospheric issues. That said - the only way natural monopolies do not become abusive natural monopolies is thru intense and careful regulation - mostly by setting a fixed rate of return for the infrastructure, and then building rates from that.

kevinalexbrown 13y ago
I used to install internet for Comcast. I appreciate the natural monopoly line of thought, but I would love to see solutions that worked around it. I'm not an expert municipal telecom policy, so I'm interested in your perspective, but I would propose a finite number of lines that companies bid for. There's definitely benefit from a natural monopoly in cable, but I'm not convinced they outweigh the costs of alternative solutions.
- Aloha 13y ago
  It would be to take something like what the UK did - have an entity that doesnt own the network itself do the retail sales, and lease a portion of the network, or simply build multiple networks, its a much harder thing to do with cable than phones.
thedaveoflife 13y ago
Conventional economics states that in a natural monopoly the state should be the sole provider.
- zackmorris 13y ago
  You just nailed it, I think yours is possibly the most important comment on this page. Roads, bridges, education, prisons, electricity, water, managing public lands/other commons, the postal service, and now communication infrastructure are all things that should be owned by the public. Putting control of communication in the hands of a few large oligopolies is undemocratic. Since the most common objection to this is privacy, I propose that the government provide the infrastructure (fiber, airwaves, satellites, etc) and that the use of that infrastructure have strong privacy guarantees and the protections of the existing unalienable rights in the forth amendment of the constitution: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.” ISPs already have strict privacy guidelines, and if anyone thinks that corporations act to insulate users from government surveillance, they are fooling themselves. The protections must start with government itself and require constant vigilance. With regard to the commons, the profit motive should be limited to government contractors in service to the people, not the other way around.
- astrodust 13y ago
  The public telephone company here, "state owned", was de-regulated decades ago. What was once a state of the art network, the first all-digital telephone system, is now worse than what they're deploying in Eastern Europe. Prices have never been higher for a service that should be cheaper. How do they even charge for long-distance voice calls these days? It's borderline criminal.
masklinn 13y ago
> That said - the only way natural monopolies do not become abusive natural monopolies is thru intense and careful regulation Or by getting the fed' to build and handle the infrastructural side, and lease it to service providers (see: interstate). Then the expansion and improvement can be added to other infrastructural projects e.g. digging for a new interstate or rail line? Put that nice big bundle of dark fiber along will you? It'll serve.
- Aloha 13y ago
  I've seen what government owned telecoms look like. I'll just say no, private is better. Compare historical AT&T/Bell System to any of the government owned telecoms in the Americas.
  - masklinn 13y ago
    > I've seen what government owned telecoms look like. Good thing I'm not advocating government-owned telecoms then. > Compare historical AT&T/Bell System to any of the government owned telecoms in the Americas. I've no idea what you're trying to say here.
einhverfr 13y ago
> That said - the only way natural monopolies do not become abusive natural monopolies is thru intense and careful regulation - mostly by setting a fixed rate of return for the infrastructure, and then building rates from that. Or better yet, having the natural monopoly infrastructure, narrowly defined, run by local government and rented out at standard rates to all private service providers.... You know, have the city run roads, not taxi cabs. The same thing could be done here regarding the internet component. City and local governments could set up last mile infrastructure and rent out access to these lines to ISP's....
- Aloha 13y ago
  I don't like government monopoly owned telecommunications infrastructure - I'd rather see something larger scale and privately owned, regulated monopolies are OK, unregulated ones are not.
  - einhverfr 13y ago
    At what point can you distinguish between a county-run infrastructure and a subscriber-owned coop? I assume the latter would be ok with you?
igravious 13y ago
This is very much in line with my own thinking. Wireless (cellular/radio/tv/...) affords some competition. Wired (power/water/sewage/copper/fiber) affords little last-mile competition it seems like. Unless municipalities made a real effort to make adding wire a simple proposition which does appear to happen in some places (Scandinavia springs to mind for some reason). These are real issues that keep cropping up and it would be nice to do some actual social and economic simulations and historical analysis to see which models benefit whom. The classic blunder in my neck of the woods was the British Rail privatization fiasco. Network Rail owned the tracks which suddenly ceased seeing any innovation and funding (so no high-speed-rail like practically everywhere else on the European continent). Train providers get their own non-overlapping corridors just like cable providers in the USA. Don't know if there is a limit to the train provider's size though. Same happened with water. Please correct me if I am wrong or painting this in too negative a light.
- Aloha 13y ago
  Agreed - and if spectrum were unlimited - there would be no limits to the number of providers in the wireless markets - beyond the obvious - multiple sets of hardware most often at the same cell sites as other providers hardware.
hrktb 13y ago
If think if there is a natural monopoly on a resource used as a lifeline or by more that half of the citizen, the infra should be under the government's oversight and the service privatized and open to competition. Your wireless carrier example would be a single wireless network with as many as wished service providers. This would slow down new technology deployments, but the market might be mature enough to get it's evolution slowed down two or three times without major inconvenience I think (for instance, we'd be stuck with LTE for a while if we go this way now ?)
- Aloha 13y ago
  We're going to be stuck with LTE for at least another 10 years - the big four can't really afford to upgrade the network again sooner than that - LTE for most of the carriers is a forklift upgrade - not just adding some cards and calling it good. Consider that for the carrier that I work for - the equipment was installed originally in the 1996/97 timeframe, and while there has been some upgrades for EV-DO - the equipment and cabinets are largely of that generation.
boobsbr 13y ago
> it to me makes as much sense to have multiple cable providers as it does multiple sets of power/telephone/water/sewer infrastructure. That's how things work here in Brazil, some cities have 2 DSL providers or 2 cable providers. Big capitals may have both, and fiber. Also, there are a bunch o local radio providers. It is way better for the consumer, as all of them suck and at least you can choose the least sucking one. Telecom infrastructure is very different from electricity/gas/water/sewer infrastructure.
- Aloha 13y ago
  I dont think it is - here at least, the costs are huge.
maxsilver 13y ago
> I'd even like to see a fewer wireless carriers (consider that each for carrier are spending billions of dollars to roll out what amount to essentially identical network infrastructure often even from the same vendors) The identical network infrastructure argument only works if you assume it's a big part of the cost. I don't think that's true, only a fraction of your cell phone bill is spent building or maintaining the network. The tiny cost savings we would get by eliminating competition in Wireless aren't worth the huge increases in cost we'd undoubtedly have to pay in extra profit to those same organizations. We only have to look at Cable / DSL to see how that ends. Or look at wireless carrier pricing before T-Mobile woke up and actually started to compete. It's not a coincidence that Sprint, AT&T and Verizon all dropped their prices as soon as T-Mobile woke up. They aren't eating those costs, every non-Sprint carrier can drop prices and still record millions of dollars in profit, even with their existing spectrum footprint, because their primary infrastructure costs are actually very low in comparison to the rates they charge for service. - - - > Having been in the industry for about 2 years now, looking at the spectrum, I believe that we have enough for two, possibly three really competitive national wireless carriers - as in a complete nation wide footprint I don't know where you get that. We have four carriers now, and none of them are hurting for spectrum, except in a handful of specific markets that are interrupted by other players or outside forces. Seattle, for instance, has plenty of spectrum. However, some of it is being hoarded for speculation (Allen/Vulcan Inc sitting on 700a in Seattle and Portland comes to mind, or Dish sitting on nationwide AWS, or Sprint sitting on tons of 2.5ghz). If the unused spectrum becomes used, and the smaller carriers like US Cellular / Leap / Cincinnati Bell merge into T-Mobile / Sprint, everyone has a pretty decent playing field in every market nationwide, and there's plenty of spectrum for 4 nationwide carriers nationwide. - - - > but consider the current for a moment, that Sprint in Seattle on 1900 mhz only has 20 mhz duplex, and nothing on 800 at all - this is excluding the acres on 2.5, because of the obvious limitations of use with atmospheric issues. If your in the industry, you know that Sprint's problems are not spectrum related, they're all execution related. Sprint's got plenty of capacity on spectrum, they are just too cheap to deploy it properly. Seattle is a perfect example of this. There are no "atmosphereic issues" with 2.5. There's no issues with 2.5, period. The only issue is Sprint trying to pretend 2.5ghz is 800mhz, and deploying 2.5 as if it is as low as 800mhz. The spectrum is not at fault, Sprint is. Seattle's a major market, there's no reason downtown Seattle doesn't have Sprint small-cell 2.5 radios on every street intersection in the whole city - it would allow Sprint to offer multiple 20x20 LTE carriers on 2.5ghz to work properly, even indoors, throughout the majority of the city. Sprint phones shouldn't be using data over PCS in the urban area, except in the most strenuous of situations (deep underground). Seattle's density supports this deployment, the tech is easily available, off the shelf equipment. Sprint's just not executing properly. Hopefully, SoftBank forces them to wake up and care about fixing their service.

by Aloha 13y ago

kevinalexbrown 13y ago

I used to install internet for Comcast. I appreciate the natural monopoly line of thought, but I would love to see solutions that worked around it. I'm not an expert municipal telecom policy, so I'm interested in your perspective, but I would propose a finite number of lines that companies bid for. There's definitely benefit from a natural monopoly in cable, but I'm not convinced they outweigh the costs of alternative solutions.

Aloha 13y ago
It would be to take something like what the UK did - have an entity that doesnt own the network itself do the retail sales, and lease a portion of the network, or simply build multiple networks, its a much harder thing to do with cable than phones.

thedaveoflife 13y ago

Conventional economics states that in a natural monopoly the state should be the sole provider.

zackmorris 13y ago
You just nailed it, I think yours is possibly the most important comment on this page. Roads, bridges, education, prisons, electricity, water, managing public lands/other commons, the postal service, and now communication infrastructure are all things that should be owned by the public. Putting control of communication in the hands of a few large oligopolies is undemocratic. Since the most common objection to this is privacy, I propose that the government provide the infrastructure (fiber, airwaves, satellites, etc) and that the use of that infrastructure have strong privacy guarantees and the protections of the existing unalienable rights in the forth amendment of the constitution: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.” ISPs already have strict privacy guidelines, and if anyone thinks that corporations act to insulate users from government surveillance, they are fooling themselves. The protections must start with government itself and require constant vigilance. With regard to the commons, the profit motive should be limited to government contractors in service to the people, not the other way around.
astrodust 13y ago
The public telephone company here, "state owned", was de-regulated decades ago. What was once a state of the art network, the first all-digital telephone system, is now worse than what they're deploying in Eastern Europe. Prices have never been higher for a service that should be cheaper. How do they even charge for long-distance voice calls these days? It's borderline criminal.

masklinn 13y ago

> That said - the only way natural monopolies do not become abusive natural monopolies is thru intense and careful regulation Or by getting the fed' to build and handle the infrastructural side, and lease it to service providers (see: interstate). Then the expansion and improvement can be added to other infrastructural projects e.g. digging for a new interstate or rail line? Put that nice big bundle of dark fiber along will you? It'll serve.

Aloha 13y ago
I've seen what government owned telecoms look like. I'll just say no, private is better. Compare historical AT&T/Bell System to any of the government owned telecoms in the Americas.
- masklinn 13y ago
  > I've seen what government owned telecoms look like. Good thing I'm not advocating government-owned telecoms then. > Compare historical AT&T/Bell System to any of the government owned telecoms in the Americas. I've no idea what you're trying to say here.

einhverfr 13y ago

> That said - the only way natural monopolies do not become abusive natural monopolies is thru intense and careful regulation - mostly by setting a fixed rate of return for the infrastructure, and then building rates from that. Or better yet, having the natural monopoly infrastructure, narrowly defined, run by local government and rented out at standard rates to all private service providers.... You know, have the city run roads, not taxi cabs. The same thing could be done here regarding the internet component. City and local governments could set up last mile infrastructure and rent out access to these lines to ISP's....

Aloha 13y ago
I don't like government monopoly owned telecommunications infrastructure - I'd rather see something larger scale and privately owned, regulated monopolies are OK, unregulated ones are not.
- einhverfr 13y ago
  At what point can you distinguish between a county-run infrastructure and a subscriber-owned coop? I assume the latter would be ok with you?

igravious 13y ago

This is very much in line with my own thinking. Wireless (cellular/radio/tv/...) affords some competition. Wired (power/water/sewage/copper/fiber) affords little last-mile competition it seems like. Unless municipalities made a real effort to make adding wire a simple proposition which does appear to happen in some places (Scandinavia springs to mind for some reason). These are real issues that keep cropping up and it would be nice to do some actual social and economic simulations and historical analysis to see which models benefit whom. The classic blunder in my neck of the woods was the British Rail privatization fiasco. Network Rail owned the tracks which suddenly ceased seeing any innovation and funding (so no high-speed-rail like practically everywhere else on the European continent). Train providers get their own non-overlapping corridors just like cable providers in the USA. Don't know if there is a limit to the train provider's size though. Same happened with water. Please correct me if I am wrong or painting this in too negative a light.

Aloha 13y ago
Agreed - and if spectrum were unlimited - there would be no limits to the number of providers in the wireless markets - beyond the obvious - multiple sets of hardware most often at the same cell sites as other providers hardware.

hrktb 13y ago

If think if there is a natural monopoly on a resource used as a lifeline or by more that half of the citizen, the infra should be under the government's oversight and the service privatized and open to competition. Your wireless carrier example would be a single wireless network with as many as wished service providers. This would slow down new technology deployments, but the market might be mature enough to get it's evolution slowed down two or three times without major inconvenience I think (for instance, we'd be stuck with LTE for a while if we go this way now ?)

Aloha 13y ago
We're going to be stuck with LTE for at least another 10 years - the big four can't really afford to upgrade the network again sooner than that - LTE for most of the carriers is a forklift upgrade - not just adding some cards and calling it good. Consider that for the carrier that I work for - the equipment was installed originally in the 1996/97 timeframe, and while there has been some upgrades for EV-DO - the equipment and cabinets are largely of that generation.

boobsbr 13y ago

> it to me makes as much sense to have multiple cable providers as it does multiple sets of power/telephone/water/sewer infrastructure. That's how things work here in Brazil, some cities have 2 DSL providers or 2 cable providers. Big capitals may have both, and fiber. Also, there are a bunch o local radio providers. It is way better for the consumer, as all of them suck and at least you can choose the least sucking one. Telecom infrastructure is very different from electricity/gas/water/sewer infrastructure.

Aloha 13y ago
I dont think it is - here at least, the costs are huge.

maxsilver 13y ago

> I'd even like to see a fewer wireless carriers (consider that each for carrier are spending billions of dollars to roll out what amount to essentially identical network infrastructure often even from the same vendors) The identical network infrastructure argument only works if you assume it's a big part of the cost. I don't think that's true, only a fraction of your cell phone bill is spent building or maintaining the network. The tiny cost savings we would get by eliminating competition in Wireless aren't worth the huge increases in cost we'd undoubtedly have to pay in extra profit to those same organizations. We only have to look at Cable / DSL to see how that ends. Or look at wireless carrier pricing before T-Mobile woke up and actually started to compete. It's not a coincidence that Sprint, AT&T and Verizon all dropped their prices as soon as T-Mobile woke up. They aren't eating those costs, every non-Sprint carrier can drop prices and still record millions of dollars in profit, even with their existing spectrum footprint, because their primary infrastructure costs are actually very low in comparison to the rates they charge for service. - - - > Having been in the industry for about 2 years now, looking at the spectrum, I believe that we have enough for two, possibly three really competitive national wireless carriers - as in a complete nation wide footprint I don't know where you get that. We have four carriers now, and none of them are hurting for spectrum, except in a handful of specific markets that are interrupted by other players or outside forces. Seattle, for instance, has plenty of spectrum. However, some of it is being hoarded for speculation (Allen/Vulcan Inc sitting on 700a in Seattle and Portland comes to mind, or Dish sitting on nationwide AWS, or Sprint sitting on tons of 2.5ghz). If the unused spectrum becomes used, and the smaller carriers like US Cellular / Leap / Cincinnati Bell merge into T-Mobile / Sprint, everyone has a pretty decent playing field in every market nationwide, and there's plenty of spectrum for 4 nationwide carriers nationwide. - - - > but consider the current for a moment, that Sprint in Seattle on 1900 mhz only has 20 mhz duplex, and nothing on 800 at all - this is excluding the acres on 2.5, because of the obvious limitations of use with atmospheric issues. If your in the industry, you know that Sprint's problems are not spectrum related, they're all execution related. Sprint's got plenty of capacity on spectrum, they are just too cheap to deploy it properly. Seattle is a perfect example of this. There are no "atmosphereic issues" with 2.5. There's no issues with 2.5, period. The only issue is Sprint trying to pretend 2.5ghz is 800mhz, and deploying 2.5 as if it is as low as 800mhz. The spectrum is not at fault, Sprint is. Seattle's a major market, there's no reason downtown Seattle doesn't have Sprint small-cell 2.5 radios on every street intersection in the whole city - it would allow Sprint to offer multiple 20x20 LTE carriers on 2.5ghz to work properly, even indoors, throughout the majority of the city. Sprint phones shouldn't be using data over PCS in the urban area, except in the most strenuous of situations (deep underground). Seattle's density supports this deployment, the tech is easily available, off the shelf equipment. Sprint's just not executing properly. Hopefully, SoftBank forces them to wake up and care about fixing their service.