From: brad@clarinet.com (Brad Templeton)
Subject: Re: EFF and its growing pains...
Organization: ClariNet Communications Corp.
Date: Tue, 26 Jan 1993 00:20:06 GMT

In article <1993Jan25.181210.7552@netcom.com> strnlght@netcom.com (David Sternlight) writes:
>losses, management, and some facilities. Someone is paying for that, and it
>isn't the stockholders or the government. That leaves you and me, boys and
>girls. Thus we are paying more than we would have if the cross-subsidy were

Is it not possible that advanced technology is paying for it, by making the
service cheaper to deliver, leaving the competitors more money to spend on
marketing?

Even if that's not true you will find that many believe that it is better
to pay more for competitive service than you would pay to a regulated
monopoly.  Not all are swayed, as you are, by the purely utilitarian
argument.  Many feel that having the competitors around has many side
benefits, in terms of the efforts they make to please their customers,
the incentives for research and customer service.  The enforced monopolies
have little incentive for this, and it shows.  "We don't care, we don't have
to, we're the phone company" -- that was more than an SNL comedy sketch.

The phone company often amortized equipment over multiple decades -- a
joke when you look at the pace of digital telecom technology today.

>Similarly, I argue that the (call it what you will) Internet
>backbone/NREN/whatever is a natural monopoly. (For those unfamiliar with the

You'll get much disagreement with this on all counts.  I'll add another
important point.

I think it is not just important, but *vital* that the worldnet not be
owned or controlled by any one entity, particularly the government.  That
net is going to be the combination of our roads, phones, mail, newspapers,
TV and more things we haven't thought of.

The risk of the pushbutton police state (which you create if the network is
under the control of one entity, whether that entity is the government or
is controlled by it) is small, but the danger is so immense that there is
almost no level of acceptable risk here.

Communications isn't like steel.  There isn't a finite amount of it in
the ground.  If we need more, we can build more.  If one provider won't
build it, others will.  It should be within our capacity to provide
gigabit connectivity for everybody in the next century.   The "natural
monopoly" of internetworking is tenuous.  Yes, there are economies of
scale, but they do top out.  And many of us are willing to pay the costs
of such pesky things as marketing.   Particularly those of us who have
dealt with the attitudes of cable companies and monopoly phone companies.

The only real natural monopoly is the cable right of way going down the
street.  I admit you can't just have everybody digging up the road and
stringing wires on the poles.  So regulate that by having the city put
cable conduits in and lease the right to run cables through them.  But
that's about it.

>I know some of the U.S. legislators who broke up AT&T. Most agree that
>it was a mistake, and that total costs to the public are higher than they
>would have been, but it is too late to put it back together

It total costs were the only factor, this might be an argument.
-- 
Brad Templeton, ClariNet Communications Corp. -- Sunnyvale, CA 408/296-0366