North American Network Operators Group

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

  • From: Owen DeLong
  • Date: Wed Nov 16 18:57:40 2005

--On November 16, 2005 4:23:20 AM -0800 David Schwartz
<[email protected]> wrote:

>> 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.
The model we have now is a certain amount of facilities from a given center
to each residential unit within that centers "serving area".  For any form
of terrestrial facilities, I don't see many alternatives to that model.  I
don't see how you plan to change that model.  Please explain to me what the
alternative model for deploying last-mile terrestrial facilities is.

As long as we are stuck with that model, I don't see how you will ever get
to a point where parallel facilities are cost effective to deploy, and, I
don't think that's necessary to get them deployed.  The reality is that
a "monopoly on the facilities" isn't required to make them cost effective
to deploy, but, it is unlikely to ever be cost effective to deploy parallel
facilities to create competition.  This is the "natural monopoly" scenario
of which I speak.

If such facilities would never be deployed under said model, then, why do
we have:

	The golden gate bridge
	The bay bridge
	The Carquinez straits bridge
	The new Carquinez straits bridge

	The Interstate Highway system

	Residential Telephone service without party lines


Realistically, for last-mile base infrastructure, there are really only a
few options today.  Co-ax, UTP, and Fiber.  A carrier neutral monopoly
provider of these base facilities in a given serving area (and nothing
says the same monopoly has to run all three) could serve multiple providers
of just about any possible service.

If we come up with a new terrestrial delivery method which has sufficient
promise, I'm betting it won't be that hard to get it deployed.  Fiber,
however, scales pretty far.  A single DWDM pair to the home really is
a pretty large amount of bandwidth.  We'll have many years of warning on
superior technology as it will have to be well and truly deployed in
the backbone prior to any need for it at the edge.

> 	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
> deployed.
Nope... That shows me how much you truly don't understand how little I'm
talking about monopolizing.  The UTP between the MPOE and the MDF can be
used to serve POTS, ISDN, DSL, DS0, T1, and other services.  Since any
service provider could put any equipment they wanted at the ends of any
of those wire pairs, paying the monopoly maintainer only for the lease of
the dry copper pair, we would have seen a much more rapid deployment of
ISDN and DSL because the RBOCs would not have had any power to delay it.
We would have seen multiple providers competing for PSTN service on an
equal footing.  We might have seen providers offering true T1 services
at residential pricing.

>> 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?
What technology... This is literally just the dumbest layer 1 part of the
network.  It's Wire or Fiber.  There aren't really any other options.  I
don't care if we create a monopoly for each of these technologies.  Since
all they can do is lease an unlit/unpowered piece of wire or fiber from
a serving center to a building MPOE, and, nothing else, and they are not
allowed to discriminate about what equipment, technology, service, etc.
the provider is putting on said wire or fiber, in what way are they able
to be not-neutral that you think will matter?

> 	Competition in last mile technologies, deployment strategies, contract
> terms, and the like are not just important, they're absolutely vital.
And how does this eliminate that?  All this does is recognize that it isn't
cost effective to build multiple parallel fiber deployments and multiple
parallel UTP deployments and multiple parallel co-ax deployments to every
house in every neighborhood.  As a result, in the current world, whoever
builds the given topology first gets a monopoly advantage almost no matter
how bad they are for the consumer.

If, OTOH, those minimum facilities are up for use by any provider, all
providers are free to compete in deployment strategy, contract terms with
the end user, and, technologies which utiliize that infrastructure.

If someone wants to build an additional infrastructure, fine... They can
do that, but, they risk having to share after being reimbursed for the

> 	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.
That's not what I'm trying to do.  I'm trying to stop letting the winner
always be the first party to deploy.  Letting the clock pick the winner
isn't any better.  Letting the consumer pick the winner by taking the clock
and the local government mostly out of the equation seems sensible to me.


If it wasn't crypto-signed, it probably didn't come from me.

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