FCCs RFC for the Definition of Broadband

Frank Bulk frnkblk at iname.com
Fri Aug 28 22:05:44 CDT 2009


Jc:

Remember, some rural and high-cost areas can't support multiple wireline
providers.  May not even a wireless and wireline provider (though satellite
is a given).

So yes, pricing in these near-monopoly areas might be higher than in an area
with real competition, but does that pricing mean the provider is earning an
exorbitant rate of return?  In the worst case, the price go as high, but no
higher, than what would sustain a competitor to enter the market.  Other
than price regulation, I'm not sure what can be done to get around this
potential problem.

The areas that are unserved/underserved are the ones that have been least
attractive to provide broadband, otherwise someone would have done it.  The
requirement to provide open access to competitors has obviously been a
disincentive for the ILECs to apply.  

Frank

-----Original Message-----
From: JC Dill [mailto:jcdill.lists at gmail.com] 
Sent: Thursday, August 27, 2009 11:51 PM
To: NANOG list
Subject: Re: FCCs RFC for the Definition of Broadband

Leo Bicknell wrote:
> What Telecom companies have done is confused infrastructure and
> equipment.  It would be stupid to plan on making a profit on your
> GSR over 30 years, after 10 it will be functionally obsolete.  When
> it comes to equipment the idea of 1-3 year ROI's makes sense.
> However, when it comes to fiber or copper in the ground or on a
> pole it has a 20, 30, 40, or even 50 year life span.  To require
> those assets to have a 1-3 year ROI is absurd.

What happens if we have improvements in data transmission systems such 
that whatever we put in now is obsolete in 15 years?

What happens if we put in billions of dollars of fiber, only to have 
fiber (and copper) obsolete as we roll out faster and faster wireless 
solutions?

IMHO the biggest obstacle to defining broadband is figuring out how to 
describe how it is used in a way that prevents an ILEC from installing 
it so that only the ILEC can use it.  If the customer doesn't have at 
least 3 broadband choices, there's no real choice, and pricing will be 
artificially high and service options will be stagnant and few.  Look at 
what happened to long distance rates and telephone services once Ma Bell 
was broken up and businesses started competing for customers.  I 
remember when we paid more than $35 a month for long distance fees alone 
(and about that much more for our basic service, including phone 
"rental") when I was a teenager in the 1970s.  Without competition, with 
inflation, that same long distance bill would easily be over $100/month 
today.  Yest today, more than 30 years later you can get a cell phone 
with unlimited minutes, unlimited domestic long distance, for $35/month 
(e.g Metro PCS).

Let's not make this mistake again and let the ILECs use TARP funds to 
build "broadband" to the curb/home that only they get to use to provide 
internet services to the customers.

jc







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