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Comment by snisarenko | Hacker News Reader

The writer forgot to mention the most important barrier - Basic economics.

Last mile infrastructure is always a winner takes all market.

Even if all the barriers to entry are removed, you won't have 20 different providers competing in a single city. Only 1 or 2 providers will survive. This is because operational costs for running your own lines will be constant, but you will always have only a fraction of the customers if you are competing with 20 other providers.

I've commented on this topic in a previous HN thread. But I believe the solution to the problem is a bidding system. Companies bid to build infrastructure. And companies bid to maintain it for short period of time (3 years).

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I think the solution is what the developing countries have done: the national government just install the cables, then rent out the infrastructure to private companies to compete/service.

I think the government involvement should be minimal. They should create a law that requires bidding on local infrastructure, and enforce that the bidding process is fair, and the selection/voting process is fair.

The bidding process is easily rigged. See redlining.

Hey. I looked up redlining, but I am not sure how it relates to bidding.

Could you explain your point in a bit more detail. I am kinda curious.

In telecommunications redlining is used to carve out profitable areas to serve and abandoning others.

It doesn't matter how fair the bidding and/or selection process is, you'll only end up with service in the profitable areas anyways. The bidding winner will most likely in most places be the incumbent, since they have a leg up.

A similar concept is gerrymandering where you manipulate district boundaries to get the desired election results.

> the national government just install the cables, then rent out the infrastructure to private companies to compete/service.

And in fact both of these things can be done the same way: by obtaining some bids and giving the task to the best bidder.

The issue is profitability (similar to the post office problem) -- if your house is in a rural area with low density, it's not worth it for a private industry actor to bid on your linkage. In many parts of the US, the only ways to get mail is through USPS (FedEx & UPS just don't service unprofitable routes). However I think internet access is a human right and a public good no matter where you live or can afford to live (imagine raising children who would never have access to at least broadband-level speed -- how would they function in a 21st century economy?) - and the infrastructure can only be provided equitably if the government steps in and subsidizes away the profitability problem.

That's a good point. The law can have an exception for communities that get less than 5 bids. If that happens the gov't builds the infrastructure.

I don't follow. How do you propose that the gov't build the infrastructure? A: get bids, award the task to highest bidder... :)

Profitability should be automatically part of the bid. It doesn't mean the bidders pay the government, it could be the other way around too.

It would be same as the regular bidding process.

Except that the gov't picks and pays for the contract (construction), instead of the local residents.

For service and maintenance contract the gov't would subsidize the monthly fees (which are expected to bee higher than a high density city)

Several cities in the United States have implemented municipal fiber. There are a few different models [1] but my favorite is "open access", where the city owns the fiber and allows many providers to use it. (See more here [2].)

UTOPIA, a consortium of cities in Utah, operates under an open access model. You pay a $30 fee to the city for the line and then choose from 12 different ISPs [3]. A symmetrical 1Gbps plan is around $50, so $80 total. You can even get a 10Gbps plan for $200. If you're having problems with the ISP you're using, you just go online and change it.

[1] https://muninetworks.org/sites/www.muninetworks.org/files/20... [2] https://muninetworks.org/content/open-access [3] https://www.utopiafiber.com/residential3pricing/

The problem lies in states where they've been successfully lobbied at the state level to block municipal telecom.

Utah is one of those states that has laws that were originally crafted to prevent municipalities from providing the service by big ISP lobbyists. The law prevents municipalities from offering the service directly to consumers (still does), so UTOPIA was born with an open access network via a 'loophole' if you will in the laws.

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