Comment by thrtythreeforty | Hacker News Reader

Comment by thrtythreeforty | Hacker News Reader

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thrtythreeforty

A lot of people agree that the problems that net neutrality regulations try to solve are caused by local, unimpeachable telecom monopolies. The economics of having a bunch of competing infrastructure make no sense. As much as I generally dislike regulation, I welcomed Title II classification because regulations are an effective answer answer to an abusive monopoly.

However, I think another overall approach would be just as effective at achieving pro-consumer ISP behavior. The approach is simply this: via regulation, force local loop unbundling, and take no other action. Suddenly, anyone would be allowed to start an ISP and rent the existing infrastructure. This would reintroduce the free market and allow it to solve the underlying behavior problems. I think that when it came time to vote with their wallet, most people would select a pro-neutrality ISP, regardless of their political alignment. Competition generally works fine in places it's actually present.

Incumbent ISPs would complain and scream, possibly louder than they have against Title II. I don't know what the legal approach would be for forcing unbundling, but I seem to recall it wasn't completely infeasible.

I disagree. Local loop un-bundling does not solve the problem. You are still back to the same situation. A single pipe can only handle so many providers, thus limit local competition to 2 or 3 providers. So either all will collude, or the one with the deeper pockets will under-price the other ones until they go out of business. (sure you can add more "regulation", but this just throwing duct tape on a broken system)

Local infrastructure will always be a winner takes all economic game. So its pointless to play it. (side-note: Elon Musk's Starlink might change the economic game)

The only way for people to "vote with their wallets" on local communication infrastructure, is BEFORE the winner "settles in", not AFTER.

A bid system, allows 100's of companies to compete to set the price for 2-3 years. Rather than 2-3 companies competing to set the price for perpetuity. It also creates an incentive to produce quality service, because they will be competing for another contract in 2 to 3 years (i.e. they have 2-3 years to demonstrate they are a competent provider).

> A single pipe can only handle so many providers

A single pipe can handle only so many customers. I don't see how it limits the number of providers?

There actually are countriess with such rules, and they seem to work well. The difficult part is the need to set some uniform price providers must pay for that "last mile" connection to their customer. I seem to remember something like $8/month in Germany. That's actually low enough, it would allow healthy competition even if you set wholesale price 50% higher than neccessary.

The same mechanism is used for competition among power and natural gas companies.

I guess you are right. You can really put as many "providers" on a pipe as you want. But are they really providers from a competition standpoint, or just the same pipe with a different logo?

The problem is that they can't compete on price (in the downwards direction), and they can't compete on building new infra with latest technology. The minimum price is established by the price the owner of the pipes charges. Which is usually set by the gov't. So the can only compete on value added services (i.e. hey we are not going to sell your data hooray!)

The core competition we want in local infrastructure is faster internet and cheaper prices. I think the dual bid system can accomplish that (i.e. separate bids on building/upgrading infra, and bids on maintenance/support)

As for gas and electricity, I think a similar bid system would work as well.

> side-note: Elon Musk's Starlink might change the economic game

It could also make the situation worse, if everyone changes to starlink and Starlink becomes a national or global monopoly ISP.

Other companies are working on similar services, and in places with neutral wired service, LEO service will be unappealing.

Local loop unbundling still requires regulation forcing the wire to be neutral, so it's really a matter of who neutrality applies to.

> The economics of having a bunch of competing infrastructure make no sense

If this were true... why would the local telecom companies fight so hard to make sure it's illegal to build competing infrastructure?

It's "slightly" easier for a local monopoly to write a check to bribe a politician than to "squeeze out" or "collude" with a "new competition". (it's simply a path of least resistance). But either way the monopoly will win.

I think the flaw in your reasoning is the "genetic" logical fallacy https://yourlogicalfallacyis.com/genetic

Just because someone "bad" doesn't want something, doesn't make that thing automatically "good"

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