Will wholesale-only muni actually bring the boys to your yard?

Wed Jan 30 21:53:49 UTC 2013

On Jan 30, 2013, at 1:47 PM, William Herrin <bill at herrin.us> wrote:

> On Wed, Jan 30, 2013 at 4:30 PM, Owen DeLong <owen at delong.com> wrote:
>> On Jan 30, 2013, at 6:24 AM, William Herrin <bill at herrin.us> wrote:
>>> As long as they support open peering they can probably operate at
>>> layer 3 without harm. Tough to pitch a muni on spending tax revenue
>>> for something that's not a complete product usable directly by the
>>> taxpayers.
>> 
>> Perhaps, but well worth the effort. There are a wide variety of reasons
>> to want more than one L3 provider to be readily available and avoid
>> limiting consumers to a single choice of ISP policies, capabilities, etc.
> 
> If the municipal provider offers open, settlement-free peering at the
> head end then the customer *does* have a choice of L3 provider. Tunnel
> service over IP has only minor differences from an L2 service in such
> a scenario. Only one difference truthfully: MTU.
> 

No, they have the municipal provider as a single monopoly L3 provider.

While it's true that you can create an L2 service on top of existing
L3 service using a tunnel, that doesn't exempt you from the limitations
and policies of the underlying L3 provider.

> 
>> Also, an L1/L2 fiber plant may be usable for other services beyond just
>> packets.
> 
> True enough but rapidly dropping in importance. The 20th century held
> POTS service with a rare need for a dry copper pair. The 21st holds IP
> packets with a rare need for dark fiber.
> 

We all know these trends run in cycles. Today, the importance of other
services is dropping. However, if we should have learned anything from
the past development in this industry, it's that planning a 30 year plant
around today's realities is virtually guaranteed to be wrong in about 10
years or less.

> Besides, I don't propose that a municipality implement fiber but
> refuse to unbundle it at any reasonable price. That would be Really
> Bad.
> 

However, if they're competing for L3 business, it creates a conflict
of interest. If they're a monopoly L3 provider, it creates different
problems.

Owen