++1

Andrew Fried
andrew.fr...@gmail.com

On 5/10/14, 2:42 PM, Patrick W. Gilmore wrote:
> Nice discussion about history & motivations. Not completely correct, but it's 
> always fun to argue over history, and over motivations, since both are open 
> to intepretation.
> 
> Personally, I am interested in the future, and specifically in market-driven 
> solutions to our problems. Call me a capitalist if you like, but I believe in 
> a functioning market, we can get a very good approximation of "fair".
> 
> If Company A and Company B have a mutual customer, and that customer needs 
> both companies to perform a task, the market will find a way to make those 
> two companies work together. Either that, or the customer will replace A or 
> B, whichever the customer feels is underperforming, with Company C.
> 
> We have that situation today. Streaming Company wants to send End User of 
> Broadband Company some content. If Streaming Company sucks - not enough 
> titles, lousy customer service, high price, poor performance, etc., etc. - 
> End User is free to select Streaming Company 2. And contrary to popular 
> belief, there are plenty of "Streaming Company 2s" available. Besides NF, 
> there is Hulu, Amazon, iTunes, iPlayer, etc. They might have different 
> models, but they all allow you to access streaming content, so choice is 
> available.
> 
> And here is where we get into the problem. Should End User believe Broadband 
> Company sucks, they frequently cannot choose Broadband Company 2. I know I 
> cannot, my choices are Comcast @ 100 Mbps or Verizon at 1.1 (yes, 
> one-point-one) Mbps. So when Streaming Company sucks, but they suck because 
> Broadband company is doing something I do not like, I cannot "vote with my 
> wallet" and pick Broadband Company 2. I have no choice but to pick Streaming 
> Company 2, even if I think the problem is Broadband Company's fault. (To be 
> clear, I am not a NF subscriber - any more - and so this is not a NF/CC 
> thing, I'm just talking generalities.)
> 
> Put more succinctly, there is no functioning market. therefore there cannot 
> be a market-based solution.
> 
> Personally, I view that as about the most Un-American, Un-Capitalistic thing 
> there is.
> 
> Lots of people have suggested a simple, if very difficult, fix to this 
> problem. Make the underlying physical infrastructure a regulated monopoly, 
> i.e. a Utility. Then allow anyone to run services over that physical 
> infrastructure.
> 
> This is not  pipe dream. The UK does it today. People there pick ISPs based 
> on service, price, features, etc., not on "who paid off my local PUC".
> 
> And before anyone brings up the whole "the UK is more dense than the US", I 
> preemptively call BS. There is more choice, faster speeds, and lower prices 
> in the middle of no-where UK than downtown manhattan. Please just leave that 
> argument where it belongs, in the dung heap.
> 
> Why can we not do something similar in the US? because the companies who own 
> the lines have enough money to pay enough lobbyists to avoid even the 
> promises they do make. (If anyone on this list is un-aware of things like the 
> telcos promising ubiquitous high-speed BB years ago and never delivering, but 
> never giving back their tax breaks or monopoly positions, you should be 
> ashamed of yourselves.)
> 
> But hey, a guy can dream, right?
> 
> In the mean time, let's stop pretending that 'oh, L3 paid CC so they must be 
> best friends'. L3 paid because They Had No Choice, and maybe because they see 
> some long-term strategic benefit (e.g. they can charge others more later).
> 
> This is not a functioning market. This is a few players with Market Power 
> charging Rents, which any first year econ major will explain is a 
> _very_very_very_ bad place for the market to be.
> 

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