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Comment by mseebach | Hacker News Reader

The headline is not just editorializing heavily, it's plain wrong.

[The bill] seeks to ensure that cities, who function in the dual role of regulator and competitor in such markets, don’t abuse their regulatory power to privilege themselves with respect to their competitors. [...] The bills require municipal broadband operators play by the same rules and regulations that apply to commercial operators, to refrain from cross-subsidizing their networks by raiding other kitties, to price at cost or above, and to allow fair access to rights of way.

Say what you want about Time Warner being out there, pushing any bill, but let's at least judge the bill by it's actual content.

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So, you're relying on the editorialized summary of the legislation instead of the actual text to call the article "wrong"?

Municipal broadband operators shouldn't have to "play fair". Broadband access is a natural monopoly, and a municipality offering quality service should not be bound by the same obligations as a profit-making enterprise.

If the city and its residents believe that broadband is worth funding, via any method they choose to do so, that should absolutely be their right regardless of what TWC and their lobbyists think.

Broadband access is a natural monopoly, and a municipality offering quality service should not be bound by the same obligations as a profit-making enterprise.

Neither of these statements make sense.

First, regarding the "natural monopoly", I just can't understand why you'd say that. You've offered no supporting argument. So I'll just point out that, 30 years ago, ATT said exactly the same thing. But we've come a long way from there, virtually all of it good. Why would you want to run your broadband access under the same ideas that gave us the evil old phone monopoly?

I don't understand why you'd think that a government-run service should have special privileges over a corporation. I would say the other way around, because the price of freedom is eternal vigilance, and all that. Plus there's the dismal track record of other governmental efforts. Take sports stadiums, for example. Giving public education huge benefits in that business certainly hasn't delivered better outcomes.

AT&T was right that telephone service is a natural monopoly. There's still only one set of phone lines running into your house. This trend on HN of expecting every argument to be entirely self-supported and encyclopedic-length, defining everything from first principles, is really quite annoying. You don't win an argument by going "HA HA YOU DIDN'T DEFINE A TERM." If you don't know what a natural monopoly is, go look it the fuck up. Utilities such as telephone service and internet access are the textbook definition of a natural monopoly.

Government run services already have tons of special privileges corporations don't. Try not paying your taxes and see what happens. Regardless, it is my opinion (and I'd believe the article writers would agree with me) that infrastructure is something that is inherently in the public interest and therefore best managed by the public (through government.) You don't drive on four separate interstate systems, you don't have eighteen sets of phone lines running into your house, and you don't have 4 sets of power cables either.

>infrastructure is something that is inherently in the public interest and therefore best managed by the public (through government.)

By this idiot "argument", government should go back to the 1950s through 1970s and start nationalizing railroads, power companies, and oil companies again. How did that work out again?

No it should move forward and privitize the roads.

Particularly it should sell them to different car companies and arrange for them to have a monopoly. So the interstate is usable by anyone who pays but the local roads are GM only and the off ramp where you work is owned by Toyota.

I don't know, let's ask California how their energy prices are doing now that they've been radically deregulated. Let's take a train on our efficient, safe, and inexpensive national rail system there to ask them.

Sigh.

The brownouts a couple years back were because the State deregulated only one side of the market, leaving the sellers of electricity in an untenable position. Essentially, they had to compete to sell on the one hand, but were forbidden from competition on the purchasing side. The problem was entirely (and it's not often one can point a finger at one single cause, but here it is) the fault of ham-fisted State regulation.

The federal rail system is not inexpensive, it's heavily subsidized. Don't start with the per-passenger-mile comparison to highways, because it's wrong: the study failed to account for capital cost in the railway, while counting for it against roads. On the topic of rail, the network of rail in the US was subsidized and built using eminent domain -- yet all of those railroads failed or were merged into others. The one exception, the one railroad that stood on its own without federal strongarming others into supporting it, is the only one that managed to survive until the present day.

Yes, because it worked out so well when governments divested themselves of their local transit systems to private businesses: http://en.wikipedia.org/wiki/Great_American_streetcar_scanda...

Apples and oranges.

On the one hand, you are talking about a program to privatize a previously-public program. That has nothing to do with the question of whether public entities should enter markets that are already serviced by corporate entities.

Indeed, if anything, it seems to me that your example argues against government getting into business, because of the danger of it being corrupted or subverted, as in your example.

The tendency to require formal or semi-formal logical proof supporting any claims made correlates heavily with Aspergers.

> First, regarding the "natural monopoly", I just can't understand why you'd say that.

If you don't understand economies of scale or network effects, why are you commenting on this post?

If you don't understand economies of scale or network effects, why are you commenting on this post?

Ahem. Network effects refer to the network, not to the individual provider. As a customer of Verizon, for example, I can participate in the same network that ATT customers use. My ISP is PennTeleData, and I'm fairly confident that this is not the way you're moving your data. Yet we still manage to mutually benefit from network effects.

Economies of scale are a positive effect of larger entities. But this is weighed against by the dinosaur effect, shall we say, that prevents them from changing business methods or products in an agile fashion. Or perhaps you believe that Microsoft should be the only maker of software?

> First, regarding the "natural monopoly", I just can't understand why you'd say that

Why do you think AT&T has basically remerged back together (with the exception of the RBOCs that make up Verizon) after it was broken up?

Carrying the "natural monopoly" point a little further, it's not all upside for the municipal operator: while the commercial operator could walk away from an unprofitable service area, the municipality will have to provide the service even at a loss. (At least as long as taxpayers think it's worthwhile.)

Right, and while it may be unprofitable to build roads to the trailer park, if a city thinks the trailer park deserves connectivity to the rest of the city, the roads will get built. Equal access is a fundamental principle of infrastructure projects -- or at least it should be.

Typically the operating agreement giving the company a monopoly ensures that they provide service to everyone as one of the conditions.

No, I'm relying on the linked article to conclude that the headline linking to that article doesn't accurate reflect the content of the article, in fact it editorializes it. Both are contrary to HN guidelines.

The fact that you agree with the editorializing is irrelevant.

or you could go read the bill at http://www.ncga.state.nc.us/Sessions/2011/Bills/House/PDF/H1...

It basically stops a community from providing broadband as part of the basic city services (like fire, police).

The actual bill is very clearly intended to throw up a prohibitive roadblock in front of any municipal buildout. Cities are forbidden from entering into any sort of public-private partnership to build a network, etc. etc.

Judging the bill by its actual content, a more honest version of the bill would simply be a full ban on municipal networks.

Most of those conditions seem reasonable to me except for the ban on cross-subsidies and sub-cost pricing. If a municipality chooses to pay for a subsidized city broadband network from tax dollars, I don't see why they shouldn't be able to. At least, I don't see a reason that that decision has to be made for every city by the state legislature, instead of leaving it to each local government to decide its own policy on the subject.

More important on the cross-subsidy issue, I doubt the commercial ISPs will be banned from subsidizing the connection service with their business as a content provider. If the existing ISPs were just ISPs, then the ban on cross-subsidies would actually level the playing field, but that's not the case.

Yea, amendments to the bill would be best IMO.

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