Hello; On Nov 16, 2005, at 1:16 AM, Owen DeLong wrote:
--On November 15, 2005 8:14:38 PM -0800 David Schwartz <davids@webmaster.com> wrote:
--On November 15, 2005 6:28:21 AM -0800 David Barak <thegameiam@yahoo.com> wrote:
OK... Let me try this again... True competition requires that it be PRACTICAL for multiple providers to enter the market, including the creation of new providers to seize opportunities being ignored by the existing ones.
The worse the existing provider it is, the more practical it is to compete with them. If they are providing what people want at a reasonable price, there is no need for competition. If they are not, then the it becomes practical for multiple providers to enter the market. If you assume that the cost to develop existing infrastructure is not insanely less than the cost to develop new infrastructure, the isolation from competition comes directly from the investment.
1. The existing infrastructure is usually all that is needed for many of the services in question. Laying parallel copper as a CLEC is not only prohibitively expensive, in most areas, it's actually illegal. Usually, municipalities have granted franchise rights of access to right of way to particular companies on an exclusive basis. That makes it pretty hard for a competitor to enter the market if they can't get wholesale access to the existing copper.
2. The existing copper was actually deployed (at least in most of the united States) using public subsidies. The taxpayers actually paid for the network. The physical infrastructure should be the property of the people. The ownership claim of the telephone companies is almost as baseless as the Verisign clame that they own the data in whois.
For example, if Bill Gates took a few billion dollars out of his pocket and launched 80 satellites to provide wireless Internet access, it would be damn hard to compete with him if he wasn't trying to recover those few billion dollars. But if you spend a few billion, you get a few billion worth. Anyone else can spend the same amount and get the same advantage.
3. Except when you consider that there are only so many orbital slots that can be maintained. (see 1 above as well). If Bill manages to launch N satellites and N leaves N/2 orbital slots available for other uses, then, it's pretty hard to launch another N satellites at any cost.
I do not think that the ITU allocates orbital slots except for geostationary satellites (not even 24 hour inclined orbits, such as are so useful for satellite transmissions to cars). So, if you want to launch a Teledesic or Iridium clone, you can, assuming your credit cards are good for a few billion $. Frequency assignment is, of course, another matter.
If he already has the satellites and is providing the service other people want at a low price, then other competitors will lose. But so what? Consumers win. And competition doesn't exist to benefit the competitors.
<snip>
Owen
Marshall
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