Comment by toss1 | Hacker News Reader

Comment by toss1 | Hacker News Reader

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It is neither a "naked display of political power" nor "forcing them to subsidize others".

The utilities have been granted a monopoly by the govt, and in exchange, are subject to regulations. If anything is a "naked display of political power" it is the granting of a monopoly.

The reason the monopoly is granted, is that it is most efficient as a society to have a single successful power distributor than to have multiple failing ones with redundant infrastructure (power poles, lines, etc.). And, for monopolies, to regulate them to reasonable profits instead of allowing any winner of the failing competitors to establish a rapacious monopoly.

With new developments in rooftop solar and batteries making it economical, it is sensible that these distributed modes be supported, and the system migrated towards distributed power. I've always wondered why this wasn't done sooner as a civil defense measure (as the interstate highway system was built as a defense measure, to transport troops to either coast in 24h). As such, they are only being forced to subsidize their customers' ability to either generate power or live at greater efficiency.

That the last-mile costs are so extreme that utilities must be monopolies is not obvious either. We've built out the last mile in the U.S. many times over for many things, and where we've allowed it (as opposed to preempting it a priori) we've had competition (e.g., cable). Even where we don't have direct competition, we do have indirect competition where consumers can vote with their feet (e.g., power rates vary regionally).

My local utility charges users $5,000 per installed pole for last mile connection. I've priced poles and wire, they are turning a hefty profit for last mile connections.

How many people does it take, and how much equipment? If they're using contractors and have to, say, hire a crane, things can add up pretty fast.

That doesn't mean that they're not necessarily price gouging or making a profit, but often things like poles and wire are a small part of the actual cost of installing infrastructure.

Obvious or not, at the time the monopolies were granted, that was the assessment.

And yes, in dense areas, we may have two cable competitors who've both built out the Last Mile. But it is not everywhere, and there are many areas where there is zero build-out, and the only service you can get is DSL on old copper maintained by the TelCos.

Moreover, the monopoly system for Electrical and TelCos was adopted requiring them to provide service to ALL, both the highly profitable dense urban neighborhoods and the massively unprofitable rural areas with one farm every several miles. See the Rural Electrification Act of 1936.

The fact that it was done this way pushed the US very far ahead in the world, providing both electrical and telephone service almost everywhere.

The fact that the Internet was NOT done this way puts us somewhere out the top 25 in Internet service.

Central planning will create a disaster when completely relied upon, but completely avoiding it will also create a disaster. Some things work as a system and society with a measure of applied foresight.

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