On Sun, Dec 19, 2010 at 8:48 PM, Richard A Steenbergen <ras@e-gerbil.net> wrote:
Running a wire to everyone's house is a natural monopoly. It just doesn't make sense, financially or technically, to try and manage 50 different companies all trying to install 50 different wires into every house just to have competition at the IP layer. It also wouldn't make
What no one has mentioned thus far is that CLECs really are able to install their own facilities to homes and businesses if they decide that is a good way to invest their finite resources. This is why we see several options for local loops in the "business district" of every sizable city, as well as in many newly-developed areas such as industrial parks. These infrastructure builds are expensive, the CLECs had limited logistical capabilities and could only manage so many projects at once, and obviously, they focused their efforts on the parts of town where return-on-investment was likely to be highest. Businesses often do have several good choices for voice, data, Internet, and so on. Cogent is an example of an essentially Internet-only service having some degree of success at this without even offering voice, or initially even transport, products. The reason we will not see competitive facility builds to residences is they have a very long ROI scale. Everything in the traditional telecommunications world did. Many POTS customers still pay a fee for DTMF or "touch tone dialing", because when their phone company invested in new cards and software to support DTMF signalling, they passed those expenses on to consumers. These upgrades cost on the order of a thousand dollars per phone line, but consumers could get the benefit of DTMF by paying a couple dollars per month. See also: call waiting, caller ID, and so on. I don't know about you, but I was still using an "ATDP" dialing string until cable and DSL became available to me at home (in about 2002) because I did not want to pay the extra fee for touch tone dialing or other features I didn't need on a dedicated modem line. ;) We see examples of more choice available to business consumers than residences, due to economies of scale, every day. A business, apartment community, or neighborhood association can choose from multiple dumpster-tip services for trash collection. Most residents do not have enough trash volume to justify a bulky dumpster, so their only practical choice is whatever curb-side trash collection company has an agreement with their local government. -- Jeff S Wheeler <jsw@inconcepts.biz> Sr Network Operator / Innovative Network Concepts