North American Network Operators Group

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Re: [funsec] Not so fast, broadband providers tell big users (fwd)

  • From: Daniel Senie
  • Date: Tue Mar 13 14:35:41 2007

At 01:33 PM 3/13/2007, Roland Dobbins wrote:

On Mar 13, 2007, at 10:10 AM, Daniel Senie wrote:

As with the deployment of telephone service a century ago, the
ubiquitious availability of broadband service will require
government involvement in the form of fees on some and subsidies
for others (might be a good use for the funds Massachusetts is
trying to extract from Verizon for property tax on telephone poles,
I suppose). Otherwise, we'll see the broadband providers continue
to cherry pick the communities to service, and leave others in the
digital dustbowl.

Various rural phone companies aside, the majority of this was accomplished in the U.S. via a regulated monopoly, and in many other countries via a government-owned regulated monopoly.

And today we have unregulated monopolies in many communities, and unregulated duopolies in the rest. Are we better off without regulation? That's unclear.

  Do you believe
that's necessary and/or desirable in order to make broadband

A universal service charge could be applied to all bills, with the funds going to subsidize rural areas. Even the electrical utilities have this kind of thing going on... there's an energy conservation charge on my electric bill that is used to pool funds that are used for energy efficiency projects. The solar panels on my roof were partially paid for by a grant from such funds.

There are alternatives to close control of monopolies using mechanisms of this sort. If it's in the best interests of the country to provide universal access, then such a mechanism will likely be the way.

  How do longer-range wireless technologies like WiMAX
potentially impact the equation?

If cell phone companies have not covered an area, what makes you think WiMAX is a magic solution? How well does WiMAX work to cover hilly, forested, rural terrain? Who will pay to put up enough towers to provide coverage? Will municipalities unhappy about the look of towers consider this a reasonable alternative to running services along telephone poles that already exist? If the cell carriers haven't found it economic to provide coverage, why would the WiMAX provider?

It all comes back to economics. If there's an interest in providing universal access, then somehow there will have to be financial incentives for less populated areas to be covered. Verizon, Comcast, ATT and the like have no hearts and thus will not cover rural areas out of the goodness of those non-existent hearts, unless there's a financial incentive to make it worthwhile.