> On Feb 16, 2022, at 10:13 , Aaron Wendel <aa...@wholesaleinternet.net> wrote:
>
> The reason government incentives exist is because, in a lot of rural America,
> a business case can't be made to connect to Grandma's farm that's 10 miles
> from the nearest splice box. If you believe that broad band is a basic
> service now, like electricity, then getting Grandma her porn is important
> enough to subsidize.
I’m not opposed to subsidizing Grandma’s porn in rural America… I’m opposed to
doing it to the exclusion of getting equivalent service in mezzo-urban and
sub-urban America.
> If I want to run fiber to every home in the 11th larges city with a
> population density of 5,642 people/sq mi, that's an easy case to make from a
> financial perspective. The issues that come into play are local red tape,
> fees, restrictions, etc. Compound that with large providers agreeing not to
> overbuild each other and incentives given by said large providers to
> developers and, sometimes, its just not worth it.
If they’re actually making such agreements, wouldn’t that violate the Sherman
anti-trust act? (Yes, I know that proving it is a whole other matter).
In actual fact, the reality is a bit more sinister… Providers realize that they
can milk the USF cow for many more $/cost than they would get deploying those
same resources to build out mezzo-urban and sub-urban areas, even though the
business case can be made.
As such, USF does, actually, actively detract from those build-outs… So for
years, I’ve been subsidizing Grandma’s porn habit while I can’t get even half
the level of service she does, even though in an actual market economy, it
would make far more sense to build here.
> Here's an example for you. North Kansas City, Missouri has FREE gigabit
> fiber to every home in town. It also has Spectrum (Charter) and AT&T.
> Recently there has been a boom of apartment complexes going up but they don't
> get the free stuff. Why? Because Spectrum and Charter pay the developers to
> keep the free stuff by assuming internal infrastructure costs and/or paying
> the developments and complexes a kickback for every subscriber. Now the FCC
> says you can't do that but they get around it by altering the language in
> their agreements.
Yeah, I’m sure there’s no shortage of shady utility deals around, to preserve
their monopolies as well.
I think a lot of this could get solved if we started limiting or even
prohibiting vertical integration (prohibit players in layers 0-2 from playing
in layers 3-7 and vice versa). Arguing over where that dividing line should be,
exactly (my vote is actually between L1 and L2) is a detail to hash out once we
get general consensus that vertical integration is harmful.
Up to L1, you have “natural monopolies”… It’s often difficult to cost-justify
the infrastructure unless you have more than 50% of homes passed as customers.
Obviously, it’s impossible for more than one provider to achieve that, hence
natural monopoly. Even in the best cases, you end up with natural oligopolies
(a very small number of competitors and a distorted market as a result).
I’m a big fan of having civil society own the base infrastructure operated
either by the local government directly or by awarding an operations contract
to an independent contractor. Make that infrastructure link end-sites to
serving centers which have essentially super-sized meet me rooms and colocation
facilities which are available to all service providers on an equal basis
(nobody gets sweetheart deals, everyone pays the same unit price for what they
get) has the following effects:
+ Lowers the barrier to competition for services
+ Puts the monopoly in position of being a B2B service only which
increases their accountability
(a small number of business customers wield a much
greater power against said monopoly
than a large group of consumers most of whom lack
detailed technical knowledge)
Obviously, the existing entrenched interests are thoroughly opposed to any such
design because it strips them of their power. However, if we can start
executing this model, I think it would have roughly the same effect on the
current monopolies as Lyft,Uber, et. al. have had on the Taxi industry.
While the cab medallion holders hated it, I’m pretty sure virtually everyone
else has been celebrating the results.
Owen
