Re: Should we oppose the

To: cypherpunks@toad.com

M >Just so. If you really believe that merely stopping regulation, 
M >*without anything else*, would restore competition to a market that's
M >been dominated by a government-supported monopoly or duopoly, then we 
M >simply must agree to disagree.

You mean to tell me that if the Feds just said -- the Local Loop monopoly 
no longer exists, we'll auction all the frequencies and get out of the 
business of regulating telecoms, no market would spring up.  Right now, 
there are 6 count them 6 possible suppliers for the Local Loop:

1) TPC
2) Cable
3) The Electric Company (yes the Electric Company)
4) Cellular
5) PCS
6) Digital Mobile Radio (you all saw the stories about Nextel?)

There are probably others I haven't heard of.  Looks like tons of 
suppliers to me.

M >Untrue. The cable providers often are putting up obstacles of their 
M >own, as are telco providers. The impossibility of Tim May's X-rated
M >cable channel illustrates this point. The market can't function

It seems to me that many of the alt.sex.whatever subscribers are using the 
PSTN to satisfy their desires.  As long as we have a switched network to 
the home or office, we can switch whatever we like over it.  How can a 
provider stop a porno enterprise network from supplying encrypted signal 
to subscribers.  It won't even be able to tell it's going on.

M >Telling every would-be X-rated cable viewer to build his own cable
M >system is not a solution.

That's just what we do every day on the PSTN or Internet.

DCF

--- WinQwk 2.0b#1165

frissell writes:

> M >Just so. If you really believe that merely stopping regulation, 
> M >*without anything else*, would restore competition to a market that's
> M >been dominated by a government-supported monopoly or duopoly, then we 
> M >simply must agree to disagree.
> 
> You mean to tell me that if the Feds just said -- the Local Loop monopoly 
> no longer exists, we'll auction all the frequencies and get out of the 
> business of regulating telecoms, no market would spring up.  Right now, 
> there are 6 count them 6 possible suppliers for the Local Loop:
 
First, I wasn't talking about the local-loop competition. I was talking about
cable. I don't doubt that in *some* monopoly situations, mere reduction or
elimination of regulation can allow markets to spring up. I just don't
think this is true with regard to telcos and cable.

Secondly, and as I mentioned, there are non-market tactics that a supplier
can use to prevent competition from arising. For example, why should a local
telco decide on its own to be interoperable with, say, the Electric
Company? What market share can a monopoly gain by giving access to
competition? None. It can only *lose* market share.

> 1) TPC
> 2) Cable
> 3) The Electric Company (yes the Electric Company)
> 4) Cellular
> 5) PCS
> 6) Digital Mobile Radio (you all saw the stories about Nextel?)

It's always a mistake to confuse technical feasibility for competition.
What's to prevent the dominant one or two providers (TPC and Cellular,
let's say) from closing out the others by refusing to be interoperable?


--Mike

Mike Godwin says:
> It's always a mistake to confuse technical feasibility for competition.
> What's to prevent the dominant one or two providers (TPC and Cellular,
> let's say) from closing out the others by refusing to be interoperable?

Why did virtually all the railroads in the northern U.S. use the same
rail gauge BEFORE regulation of the railroads?

Why do most of the commercial internet providers (except for the
government subsidized ANS) agree to exchange packets with each other
freely?

Why do open standards do better in the market than closed standards?

The answer is "its in their interest to cooperate, thats why."

There was actually a really nice article in Forbes recently on game
theory and competition vs. cooperation...

Perry

Perry writes:

> Why did virtually all the railroads in the northern U.S. use the same
> rail gauge BEFORE regulation of the railroads?
 
Partly because there was no pre-existing railroad monopoly that was
blocking them from the market.

Of course, railroad interoperability is trivial, and can't easily be
altered to block entry. But it should be noted that "using the same rail
gauge" is only part of interoperability. I leave it to you to guess what
the other part is, and how a railroad monopoly can prevent entry of new
competition.

> Why do most of the commercial internet providers (except for the
> government subsidized ANS) agree to exchange packets with each other
> freely?
> 
> Why do open standards do better in the market than closed standards?
> 
> The answer is "its in their interest to cooperate, thats why."
 
Please explain, specifically, how it's in a local telco's interest to
cooperate with an upstart Electric Company telco provider.

> There was actually a really nice article in Forbes recently on game
> theory and competition vs. cooperation...

That's nice. But don't assume I'm not knowledgeable on these subjects.  


--Mike

Since the discussion is endless, I'm going to take my latest arguments
to private mail with Mike.

Perry