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  1. Micael's Avatar
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       #21  
    Quote Originally Posted by Toby View Post
    There's a fatal flaw in this. This is probably one of the few valid instances where government intervention is a necessity. The reason is that these providers use public right-of-ways. While the FCC may not be the correct entity to be overseeing this, government is going to be involved in some fashion.
    I think I see your point, and you may be right, but my thinking was that if the gov was actually doing the job they were supposed to do and level the playing field, then if Comcast chose to not offer a certain, or to constrain access based on usage they wish to control, then someone else has an opportunity to provide that access. Let the industry regulate itself, so to speak.
    The Law of Logical Argument: Anything is possible if you don't know what you are talking about.
  2. angiest's Avatar
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    #22  
    Quote Originally Posted by Micael View Post
    I think I see your point, and you may be right, but my thinking was that if the gov was actually doing the job they were supposed to do and level the playing field, then if Comcast chose to not offer a certain, or to constrain access based on usage they wish to control, then someone else has an opportunity to provide that access. Let the industry regulate itself, so to speak.
    The problem is the government is what is giving these companies the monopoly. Theoretically the law allows for competition in the cable market, but ultimately Comcast, or Time Warner, or whoever is given access to a locality by the various governments in that area. Government can't level the playing field except by getting out of the way. Any intervention ultimately leads to artificial barriers to entry (that is, there is certainly a large enough market for multiple cable providers, but the lack of competition comes from the fact that people are barred from entering. This is different from a very small market where it is economically unviable for more than one company to enter.)
  3. Micael's Avatar
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       #23  
    I'm of the view that government should stay the heck out of businesses way, but making sure that one company doesn't monopolize an area *is* one of the main reasons for even having a government, imho.

    Even in smaller areas, there are hungry small business men who'd love to start up an ISP. If one company controls all the wires hubs and routers, it will never happen.

    Reminds me of Ma Bell.
    The Law of Logical Argument: Anything is possible if you don't know what you are talking about.
  4. groovy's Avatar
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    #24  
    Unfortunately, I think Toby is right here. The government is already inextricably involved. That doesn't necessarily mean 'net neutrality' laws are right or beneficial but it does remove one major rationale against them.
  5. angiest's Avatar
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    #25  
    Quote Originally Posted by Micael View Post
    I'm of the view that government should stay the heck out of businesses way, but making sure that one company doesn't monopolize an area *is* one of the main reasons for even having a government, imho.

    Even in smaller areas, there are hungry small business men who'd love to start up an ISP. If one company controls all the wires hubs and routers, it will never happen.

    Reminds me of Ma Bell.
    Except Ma Bell was what? A government created monopoly...

    I subscribe to the view that there are two types of monopolies: coercive and noncoercive. A coercive monopoly is able to fix prices independent of market forces because there are artificial barriers to entry. Those barriers come only from government intervention/regulation. They raise the cost of entry into a market or they outright prevent entry (such as in local utilities). On the opposite end is the noncoercive monopoly. Although they enjoy monopoly powers they cannot control prices. The reason they cannot control prices is because, although the market is too small to support a large number of players there is no barrier to entry, and if they stray too far from the equilibrium price then other players will be able to enter.

    Standard Oil actually started as a noncoercive monopoly. When they acquired their monopoly in the oil industry in the US there was very little production (mostly from PA and a smattering from elsewhere). Their ability to control the market effectively ended with the Spindletop gusher and the rise of the Texas Oil industry, leading to the formation of companies such as Gulf Oil and The Texas Company (Texaco). With the boom in Texas (opening of SE Texas fields, opening of the East Texas Oil Field) opening of large scale production in Oklahoma, California, and other places, Standard Oil's monopoly was already in decline before the US sued them for antitrust violations. While their business practices were certainly unsavoury, the simple fact of the matter is that Standard Oil could only get away with them precisely because the supply of, and demand for, oil and petroleum products was quite small in the late 19th and early 20th centuries. As the supply and demand both grew it became feasible for competitors to enter the market.
  6. angiest's Avatar
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    #26  
    Quote Originally Posted by groovy View Post
    Unfortunately, I think Toby is right here. The government is already inextricably involved. That doesn't necessarily mean 'net neutrality' laws are right or beneficial but it does remove one major rationale against them.
    This is why I am somewhat ambivalent. In a free market, definitely against. But there is no free market.
  7. Micael's Avatar
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       #27  
    Quote Originally Posted by angiest View Post
    Except Ma Bell was what? A government created monopoly...

    I subscribe to the view that there are two types of monopolies: coercive and noncoercive. A coercive monopoly is able to fix prices independent of market forces because there are artificial barriers to entry. Those barriers come only from government intervention/regulation. They raise the cost of entry into a market or they outright prevent entry (such as in local utilities). On the opposite end is the noncoercive monopoly. Although they enjoy monopoly powers they cannot control prices. The reason they cannot control prices is because, although the market is too small to support a large number of players there is no barrier to entry, and if they stray too far from the equilibrium price then other players will be able to enter.

    Standard Oil actually started as a noncoercive monopoly. When they acquired their monopoly in the oil industry in the US there was very little production (mostly from PA and a smattering from elsewhere). Their ability to control the market effectively ended with the Spindletop gusher and the rise of the Texas Oil industry, leading to the formation of companies such as Gulf Oil and The Texas Company (Texaco). With the boom in Texas (opening of SE Texas fields, opening of the East Texas Oil Field) opening of large scale production in Oklahoma, California, and other places, Standard Oil's monopoly was already in decline before the US sued them for antitrust violations. While their business practices were certainly unsavoury, the simple fact of the matter is that Standard Oil could only get away with them precisely because the supply of, and demand for, oil and petroleum products was quite small in the late 19th and early 20th centuries. As the supply and demand both grew it became feasible for competitors to enter the market.
    Nice post. Thanks.... all good info.

    But I don't think the oil companies model and the history of their growth is misapplied. If Standard Oil owned all of the access points and pipelines to all of the oil wells, these other companies would never have gotten a chance.
    The Law of Logical Argument: Anything is possible if you don't know what you are talking about.
  8. #28  
    Quote Originally Posted by Micael View Post
    I think I see your point, and you may be right, but my thinking was that if the gov was actually doing the job they were supposed to do and level the playing field, then if Comcast chose to not offer a certain, or to constrain access based on usage they wish to control, then someone else has an opportunity to provide that access. Let the industry regulate itself, so to speak.
    If every telecommunications carrier had to lay their own lines to get traffic around, what would that look like?
    ‎"Is that suck and salvage the Kevin Costner method?" - Chris Matthews on Hardball, July 6, 2010. Wonder if he's talking about his oil device or his movie career...
  9. angiest's Avatar
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    #29  
    Quote Originally Posted by Micael View Post
    Nice post. Thanks.... all good info.

    But I don't think the oil companies model and the history of their growth is misapplied. If Standard Oil owned all of the access points and pipelines to all of the oil wells, these other companies would never have gotten a chance.
    But you see, Standard Oil did. They owned the wells, the refineries, a fair chunk of railroad. But the market outgrew that and those controls came to naught.
  10. angiest's Avatar
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    #30  
    Quote Originally Posted by Toby View Post
    If every telecommunications carrier had to lay their own lines to get traffic around, what would that look like?
    Hence why I keep coming back to electric deregulation in Texas. The company that owns the lines still has a monopoly, but only on the lines. They do not play in the electric service provider side of the business. It may still not be ideal, but better than it was before when I really had no say in the matter.
  11. Micael's Avatar
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       #31  
    Quote Originally Posted by Toby View Post
    If every telecommunications carrier had to lay their own lines to get traffic around, what would that look like?
    Good point. Probably like my server room!

    I'm not saying I have the answers... just pointing to an issue, as I see it. Maybe there needs to be another layer of ISP.... a middle man so to speak, that could service more than one "Comcast" in an area?
    The Law of Logical Argument: Anything is possible if you don't know what you are talking about.
  12. #32  
    Quote Originally Posted by Micael View Post
    Good point. Probably like my server room!

    I'm not saying I have the answers... just pointing to an issue, as I see it. Maybe there needs to be another layer of ISP.... a middle man so to speak, that could service more than one "Comcast" in an area?
    The only way it would work without some sort of 'Net Neutrality' would be a scenario like angiest mentions, where one provider is granted a monopoly on the infrastructure, but is prohibited from barring entry to other competitors. Similar to the CLEC concept created in 1996.
    ‎"Is that suck and salvage the Kevin Costner method?" - Chris Matthews on Hardball, July 6, 2010. Wonder if he's talking about his oil device or his movie career...
  13. angiest's Avatar
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    #33  
    I will give credit to my above overview of monopoly types to the writings of Nathaniel Branden, which introduced me to the concept and the example of Standard Oil.
  14. angiest's Avatar
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    #34  
    The means of handling infrastructure (wires, pipes, etc) is an extremely difficult one. I don't like the government involvement but I can't come up with a solution that scales well to a large metropolitan area, for instance. The most common answer I have seen from Libertarians seems to be to have neighborhoods, for instance, owning the infrastructure..... but what are you going to connect to? How does that work in a Houston or Dallas, let alone a Los Angeles or New York?

    A slightly different arrangement might be the government owning infrastructure and contracting out the maintenance of it. Texas seems to be experimenting in this with interstate highway maintenance. You will sometimes drive on an interstate in Texas and pass a sign that says "Private maintenance next xx miles" and lists the name of the company and the address. This is not widespread at this time, and in fact I only see it in the Dallas area right now. Another instance where we do something like this is water and sewer delivery in unincorporated parts of the state. The state (maybe through the county government) will create what is called a municipal utility district (MUD) or water disctrict. These subdivisions are very small, typically a few square miles, and their job is to issue bonds to pay for the construction of water and sewer pipes in an area where there is no city government to do this (I live in such an area). They collect property taxes on residents within the district to pay back the bonds and contract out servicing the utility to another company. These are normally done in suburban areas where it is likely expected that there will be a city one day to take over control of the utility, so I am unsure what is supposed to happen to the district in the event it pays off the bonds without being annexed.
  15. Micael's Avatar
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       #35  
    Quote Originally Posted by Toby View Post
    The only way it would work without some sort of 'Net Neutrality' would be a scenario like angiest mentions, where one provider is granted a monopoly on the infrastructure, but is prohibited from barring entry to other competitors. Similar to the CLEC concept created in 1996.
    That sounds like a valid business model.... is anyone pushing it?
    The Law of Logical Argument: Anything is possible if you don't know what you are talking about.
  16. #36  
    British Columbia, west coast of Canada did the thing you are refering to regarding highway maintenance. This includes repairs, snow, ice removal and such.. at the begining it went fine, then the bottom dropped out in a few areas. One companies were not allowed to own, more then a few contracts across the province, well they just changed their names a little and bid on the contracts anyway... two, companies were stretched due to weather, going bankrupt, leaving no snow ice clearing and so on.. levels of repair also vary from one district to another. Money that should be spent on pot hole repair, is funneled away to other things, in theory it should work,, practically, it has its short comings. Some extreme. oh,, and several studies have come out, stating that the taxpayers of BC are now paying far more then they would be if they had stayed with govt owned and operated system. one of the studies was done by an extremely conservative think tank.. so who knows
  17. #37  
    Quote Originally Posted by Micael View Post
    That sounds like a valid business model.... is anyone pushing it?
    the only problem with the model in my mind, is that the new start ups need to grow just like anyone else. put out their own cable routers hubs an what not.. why should they piggy back on someone else?
    the only way i would allow it would be if tax dollars built it in the first place.
  18. angiest's Avatar
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    #38  
    Quote Originally Posted by xForsaken View Post
    British Columbia, west coast of Canada did the thing you are refering to regarding highway maintenance. This includes repairs, snow, ice removal and such.. at the begining it went fine, then the bottom dropped out in a few areas. One companies were not allowed to own, more then a few contracts across the province, well they just changed their names a little and bid on the contracts anyway... two, companies were stretched due to weather, going bankrupt, leaving no snow ice clearing and so on.. levels of repair also vary from one district to another. Money that should be spent on pot hole repair, is funneled away to other things, in theory it should work,, practically, it has its short comings. Some extreme. oh,, and several studies have come out, stating that the taxpayers of BC are now paying far more then they would be if they had stayed with govt owned and operated system. one of the studies was done by an extremely conservative think tank.. so who knows
    I don't know the details of how it works in Texas, just that we seem to be experimenting with it. It is certainly possible that British Columbia implemented it incorrectly. Or whoever signed the contracts got some kickbacks for allowing provisions that were not favourable to the taxpayers.

    The same is certainly true of what we are doing WRT how contracts are structured, and so forth.
  19. angiest's Avatar
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    #39  
    Quote Originally Posted by xForsaken View Post
    the only problem with the model in my mind, is that the new start ups need to grow just like anyone else. put out their own cable routers hubs an what not.. why should they piggy back on someone else?
    the only way i would allow it would be if tax dollars built it in the first place.
    I selected company X to replace electrons I take off the power grid. It could be based on price, name recognition, "green" energy, or whatever. I am their customer, but they are customers of Centerpoint Energy, which is the local (regulated) utility who is in charge of the power lines. They charge certain fees to my REP who then pass those on to me, which is how maintenance of the physical infrastructure is funded, as well as providing the compay's revenue. A startup ISP would still have to build portions of their infrastructure, but act as a customer of whoever owns the cable or phone line, or fiber, or whatever.
  20. groovy's Avatar
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    #40  
    Verizon CEO: Studies be damned, US is tops in broadband

    Finally, if you're a high-bandwidth user of Verizon's smartphone data services, the company will soon hunt you down and throttle you. (The company has long had a maximum transfer limit on monthly data plans.)

    [Verizon CEO Ivan] Seidenberg: But when we now go after the very, very high users, the ones who camp on the network all day long every day doing things that—who knows what they're doing—those are the—

    Murray: It's video, right? I mean, it's video.

    Seidenberg: But those are the people we will throttle and we will find them and we will charge them something else.
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