North American Network Operators Group

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RE: What do we mean when we say "competition?" (was: Re: [Latest draft of Internet regulation bill])

  • From: David Schwartz
  • Date: Wed Nov 16 07:25:08 2005

> In any case, the bottom line is that whether through subsidy, "deal",
> or other mechanism, the "last-mile" infrastructure tends to end up being
> a monopoly or duopoly for most terrestrial forms of infrastructure.
> As such, I think we should accept that monopoly and limit the monopoly
> zone to that area (MPOE<->B-Box or MPEO<->MDF) and prevent an unfair
> advantage by separating the management of that section of infrastructure
> from the service providers offering services which use said
> infrastructure.

	This is the same "create a free market through extensive regulation" that
has created the disaster we have now. Any last mile technology whose cost of
deployment can only be justified by the value of a monopoly on its
deployment just won't be deployed in this model. That's not a free market.

	This separation model may turn out to be a very good one or a very bad one.
But if we choose it and stick with it, what will happen in 50 or 100 years
when it's either broken or irrelevent? Remember, we got to where we are now
by choosing models that made sense in the voice telco time and make no sense
at all now.

	Had we done this twenty years ago, the last mile would be dialup and
billions of public dollars would have been spent to create and maintain an
irrelevent technology. Meanwhile, the newer technologies wouldn't be

> This, at least on a theoretical level creates a carrier-neutral
> party managing the monopoly portion while maximizing and levelling
> the playing field in all other areas.

	A carrier-netural party may not be technology neutral, business model
neutral, or neutral in many ways that may turn out to be important. As I see
it, you give up on everything that's important from the very first step.
What if a non-carrier neutral last mile turns out to be the scheme most
people really want when it's offered to them?

	Competition in last mile technologies, deployment strategies, contract
terms, and the like are not just important, they're absolutely vital.

	If you try to pick the winners and losers, or worse let local governments
do so, you'll just get another generation of publically financed mediocre
solutions while the truly innovative technologies get shut out by the
monopoly arrangements.