I think what is really represented there is that because they own an existing network that was built with public subsidy and future entrants have no such access to public subsidy to build their own network, ...
Sean's post correctly identified the problem with this assertion, so I won't
And I provided a response to Sean's email, so, I won't repeat it here.
The government should recognize that the existing build has actually been paid for mostly by public subsidy anyway and as such, should require the ILECs to split into two separate divisions.
You mean the existing FIBER build was mostly paid by public subsidy? Do you have a reference for that?
No... I'm talking about "last-mile" ifrastructure, not backbone. I'm much less concerned about the cost of new backbone _IF_ providers can get fair and equal access to public right-of-way. Most places have no fiber "last-mile". Some do. Of those that do, I know that many were installed by cable companies and that there are in many of those places utility taxes that are being collected and passed along to at least partially fund said buildout. I know that Comcast signed a huge sweet-heart deal with the city of San Jose, for example before they started tearing up my neighborhood. They seem to have laid interduct to the curb and co-ax to the home. I haven't seen them bring any fiber anywhere yet, but, I presume that's what the interduct is for at some point. Mostly all they've delivered so far is damage. 4 sepearte loss-of-phone service incidents (they cut F1 (twice), F2 (once) and the cable in my street (once)). I'm not a Comcast subscriber and probably never will be, but, that doesn't prevent the city from taxing me to support this buildout.
One division would be a wholesale only infrastructure delivery company that would maintain the physical infrastructure. As part of this, ownership of the physical infrastructure in place would be transferred to an appropriate local civil body (city, county, district, etc.) and said body should have an initial 5 year contract with the infrastructure portion of the ILEC to provide existing services on a provider- neutral basis (same price to all ILECs, Clecs, etc.).
At the end of that 5 year contract, the maintenance of the infrastructure should be up for bid, and, if the existing ILEC infrastructure portion can't win the bid, they are out of luck.
I don't know how familiar you are with what the government contracting process is like, but the word "unpleasant" comes to mind: it's long, hard, and cumbersome. Your model would substantially increase the amount of government contracting required, so you would need to be able to show a benefit to society of corresponding magnitude.
Huh? I'm talking about doing this once every 5 years so that the infrastructure management company has to face some potential recourse if they do a lousy job. I'm not talking about switching contractors on a monthly basis or anything like that. Actually, I think a once every 5 year contract would be a lot less cumbersome than the number of PUC applications processed today. How familiar are you with THAT process?
Right, but, faced with potential competition, they are notorious for temporarily lowering prices well below sustainable levels in order to eliminate said competition.
Are you alleging that the ILECs/RBOCs are providing services below cost? If so, call a regulator. If not, while the profits may be lower than desired by the ILEC/RBOC, it's certainlly "sustainable"
I'm alleging that the ILECs/RBOCs have lower costs than their competitors because they own an infrastructure that was paid for, at least in large part, by others. Further, they have an incentive to provide better service to themselves than to their competitors and do so.
The '96 telecom act did nothing to take the last mile infrastructure out of the hands of the existing ILEC.
You are correct. However, the '96 telecom act did give lots of other companies the OPPORTUNITY to build their own last mile access. Your proposal actually drives toward a more monopolistic, regulated environment.
Not really. First, the '96 telecom act did nothing to remove Cities' ability to enter into exclusive franchise agreements for public right-of-way. Second, my proposal includes the idea of OPEN ACCESS to public right of way for anyone who wants to build infrastructure and the elimination of such franchise deals. So, my intent, at least, is to give equal access to the existing infrastructure for all comers while simultaneously making putting new infrastructure in public right-of-way more accessible to more providers. That having been said, the reality is that there is no rational cost-model where it makes sense to put parallel separate fiber/copper/whatever into every home/business/etc. The last mile is notoriously the highest cost with the lowest return. As such, it lends itself to natural monopoly regardless of other factors. Recognizing this fact and limiting the monopoly to a carrier independent organization that ends at the MDF on a fair and open basis to all service providers reduces the regulated monopoly portion of the network from the current user<->First intelligent device and reduces it to MPOE<->MDF.
So Verizon should be prohibited from building out FTTH? I assume that your approach of "the Government owns all layer 1" would also include 802.11, GSM, CDMA, and all other network types, right? If not, why not?
No... Verizon should be allowed to do so with the understanding that the people retain an option-to-buy said FTTH for a price set at the time before they begin deployment. I'm not proposing that the government should own all layer 1. I do think that the government should have an option to buy on "last-mile" terrestrial layer 1. Why? Because that tends to be the area where parallel infrastructures provide additional cost and not additional benefit to the consumer. Why not in the case of 802.X, GSM, CDMA, etc... Because those forms of infrastructure do not suffer from the same types of last-mile cost models that terrestrial deployments do. Let's face it, the really expensive part of most terrestrial infrastructure deployments is the trenching/moleing(sp?)/pole-stringing of the stuff between the MDF and the MPOE (or equivalent terms for other network).
Now, the ILEC can continue to provide service at the same price, but, they no longer have a cost-basis advantage or the ability to delay, defer, interfere with CLEC installs on the same infrastructure.
Any interference is currently unlawful, and all of the companies regulated under sections 271 and 272 have extensive procedures in place to prevent it. If you've got specific complaints about a specific company, you should be talking to a regulator.
Right... But, there's boundary conditions and if you don't know they push the envelope on those boundary conditions, you aren't paying attention. It takes about two weeks to get through the complaint process. If your issue is resolved before the PUC gets to your complaint, the PUC calls your complaint "moot" and moves on. An example, I switched at one point from Pacific Bell Local Service to MCI. Pacific Bell misplaced the order from MCI for 4 days after the original FOC. The day after I filed my complaint with the PUC, magically they found the order and it was installed. When I switched back from Worldcom to SBC (Worldcom changed their rates and eliminated the part of their service that made them attractive), SBC didn't lose my order. This is just one example. I have accumulated about a dozen or so such occurances over the last decade personally, and, have discussed the specifics of many more with other people who experienced them. If anything, SBC (and I suspect other ILECs) are very good about knowing just how far they can violate the law without consequences. To the average consumer (SBC consistently blamed MCI for SBC losing the order), this just looks like the CLEC can't get their act together. I had enough familiarity with the system to ask the right people and know where things were happening (for example, in one case, MCI faxed me the form and I personally faxed it to the SBC number and retained the confirmation page). SBC was shocked when I showed it to them when they tried to claim MCI must not have faxed it.
So, to summarize - far less than "all" of the ILEC/RBOC infrastructure was "paid for with public funds." (as opposed to user fees), you'd argue for far greater government participation in the marketplace, and the removal of any competition for layer 0/1 services, in favor of competition at layers 2 and higher. Why is that good again?
True... Far less than all of the ILEC/RBOC infrastructure, but, far MORE than half of the "last-mile". No, I don't agree with removal of any competition for layer 0/1, but, I do believe that most forms of terrestrial layer 0/1 "last mile" form natural monopolies because of cost models. As such, I think that managing such natural monopolies to 1. Constrain them to the smallest possible portion of the infrastructure. 2. Ensure fair and equal access to said facilities by competing service providers to the greatest extent possible. Is the best we can currently do. Owen -- If this message was not signed with gpg key 0FE2AA3D, it's probably a forgery.