Telecom Collapse?

Jack Bates jbates at
Thu Dec 4 22:16:40 UTC 2008

Lorell Hathcock wrote:
> The classic problem of the ILECs is that they have a government backed
> monopoly on the local loops everywhere and they leverage that monopoly to
> compete with companies that don't have government backing.

Monopoly? Really? I could have sworn someone devised the idea of CLEC.

> 1. Eliminate the FCC Universal Service/Coverage funds and let that farmer
> pay the full rates for connecting his hog barn.  (If we had pursued this
> option years ago, wireless would be much more mature and ubiquitous by now.)

I might accept this if wireless carriers are required to maintain the 
same levels of service an ILEC is supposed to carry. Oh, the reports to 
fill out if you take a substantial outage, and the excuses as to why it 
was unavoidable.

> 2. Have the government meddle with the ILECs... er, ILEC (singular) and
> divide the local loops into a different company that provides a platform for
> selling standardized products and services at wholesale rates to all CLECs.
> This resulting company would not be allowed to sell to end users just
> registered CLECs.

What's wrong with the current method? CLEC moves in, borrows plant from 
ILEC to start service. Over time, CLEC puts their own plant into the 
ground. Both companies take a hit as they now have fewer customers in 
the profit zone to cover the cost of plant, and ILEC loses out more due 
to the hog barns which the CLEC won't dare extend plant to.

> I hate government created monopolies.  It is obvious to the rest of the
> world that the US does not follow our own principles of "democracy".  (More
> correctly it should be termed a "republic").
> With corporate commercial welfare rampant, the free market does not exist.

It's not a monopoly when competition is allowed, yet no one wants to 
compete in a business that won't generate them a profit. Most CLECs 
stick to highly populated areas and won't even bother with the mid sized 
towns. If you own a CLEC, please, feel free to lease some lines from 
AT&T in Ardmore, OK while you put some plant in. I'm sure people there 
would like more choices than wireless, cable, and ILEC.


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