Competitor access to telco fiber would fix “net neutrality” | Hacker News Reader

Competitor access to telco fiber would fix “net neutrality”

freedomofthought.org

55 pointsswohns26 comments

I recall watching a documentary that looked at internet access in various countries. The most interesting was the UK. Their approach is interesting and successful.

Basically, the government forced local loop unbundling, so that the phone companies were required to lease space in their equipment centers to competing ISPs at fair prices and give them access to local loops to offer DSL and other services.

Of course, the phone companies said this would be disastrous. Turns out it was not. A huge number of ISPs jumped in to compete in the DSL market, and the phone companies found they were making more money as landlords leasing out space for equipment than they had been making from running their own ISP business.

On the consumer side of things, there was a big increase in choice, with ISPs jumping in to offer everything from serious power user plans and low latency plans for gamers to cheap plans for people who just use email.

Amusingly, AT&T and Verizon from the US both wrote to British regulators when unbundling was under discussion and provided strong arguments in favor of it. However, when asked if the US should do something similar, they say it is bad for consumers.

Ahh...found the documentary. It was an episode of the PBS series "Need to Know". The journalist who did the segment on broadband also writes for Engadget, and that segment of "Need to Know" and a text version of the story is available at Engadget: http://www.engadget.com/2011/06/28/why-is-european-broadband...

> Basically, the government forced local loop unbundling, so that the phone companies were required to lease space in their equipment centers to competing ISPs at fair prices and give them access to local loops to offer DSL and other services.

Similar idea was implemented in Poland. It mostly means that you can now get the same crappy DSL connection from a number of providers instead of the single (formerly national) telecom. The quality probably did increase a little, and it is fairly affordable but I don't know a single person who's genuinely happy with that sort of Internet access. Most live in suburbs or outright rural areas and have no choice (the other options are flaky mobile, or expensive and high-latency satellite link).

Only real competition leads to improved quality. In large cities where you have properly separate providers -- cable companies, local area networks, mobile providers and the large telcos -- actually competing, you can get a decent TV package, phone with a local number, DVR, 10+MBit (and going as high as 120MBit) connection and maybe even mobile Internet dongle thrown in for ~$40.

Many European cities lack a cable TV infrastructure, preventing the use of faster DOCSIS connections like in the US. On the other hand, digging the densely populated European cities to install extensive optical fibre networks terminating either to buildings or local cabinets (with the remaining loop length being under 300 metres) is an extremely costly affair.

For those cases ADSL over PSTN is the only practical choice for broadband Internet access, but since the incumbent telephone operator (usually an ex-state owned company) owns the entirety of the PST network and related facilities like exchanges (subsided over the decades by the state, directly or indirectly) that puts other providers at a huge disadvantage, being unable to even offer any service.

That's why the LLU scheme was devised. Providers rent the telephone loop, rack-space and in some cases backhaul connectivity at the incumbent's exchange, install their own DSLAMs and provide both telephone and ADSL service. It's the only practical choice for competition in the ISP field. And at least for my country, Greece, it has worked marvelously with prices racing to the bottom and speeds jumping to the maximum of the protocol ever since the LLU scheme started.

Small steps are being made in many cities where fibre-optic networks are slowly being deployed, usually (and in our case) subsided by EU funds and planned to be offered under a scheme similar to LLU but it's a very long time until population (as opposed to geographical) coverage can reach good levels.

> On the other hand, digging the densely populated European cities to install extensive optical fibre networks terminating either to buildings or local cabinets (with the remaining loop length being under 300 metres) is an extremely costly affair.

In Stockholm, the city-owned company Stokab has been doing exactly this for the past 15 years or so. They started out by laying fibre in the inner city and leasing it to businesses. They've been pretty profitable, and reinvesting all their profits into extending their network, moving to less and less profitable areas.

The last year or so they've started connecting every apartment building in the entire city, suburbs and all, and they'll be done in a year or so with that. They hooked up my building last month, for free. And then it's up to us in the coop to pick an ISP and connect each apartment.

They were also smart enough to put in one fibre per apartment, so in some not-too-distant future, it should be possible to upgrade the building LAN to fibre, which means that every apartment gets an unbroken fibre all the way to their connection point. And that in turn enables the same business model as we have with DSL now, i.e. each apartment can freely choose ISP, and different ISP can then compete for the privilege of lighting up my fibre and give me internet.

Digging up suburbs to lay down fibre is extremely costly as you say, but renting that out is extremely profitable.

The common carriage laws are some of the most important laws for the future of this nation.

One possible solution is public maintained networks which operators could use. Every carrier would be a virtual network overlaid on top of the public physical infrastructure.

The problem with this, of course, is that some very large companies have spent quite a bit of money building out these networks and thus simply nationalizing them would be unfair.

I contend that an amicable solution to this problem is a fund to help the top 100 metro areas build ubiquitous public backbones and sell access at an agreed upon (but fair) rate. In reality, there may be very little that any one can do to disrupt big telcos. It is simply a difficult and slow moving market. You'd need something like LightSquared to really have a lasting impact.

Time will tell if they get their spectrum swap; here's hoping.

There's a common fallacious argument in here:

A. The corporations that have the most power in this industry have lobbied for and gotten a consumer-hostile regulatory regime. B. It's the government's fault that the regulations are less than ideal. Therefore the consumer would be best served by getting the government out of it.

This is like saying, "The problem with being stranded in the desert is the lack of water. Therefore water is the problem. Therefore we should remove all the water from the desert."

The article is not arguing that we should remove government regulations. It is arguing that we should re-instate a particular regulation that has been shown to work for very similar systems (and would already apply if not for a specific exception).

The answer needs to be proper regulation. not "de-regulation". the corruption and collusion of the regulatory process needs to be addressed head on. there is an interim step of "de-regulating" but that is to enable proper regulations to be put into place.

This is a good idea except for the part where big telco's have more lobbying power in congress than oil companies and this would never happen

So 'net neutrality' regulations can somehow get around this lobbying power, but fixing the competitive dynamic can't?

Both face the risk of being twisted to the incumbent's advantage, so why not shoot for the more comprehensive solution -- real competition -- rather than solidifying in place a duopoly with slow-moving rulemaking?

Yes, and in my experience, they have no one in direct customer support that has heard of internet basics like DNS (Comcast), let alone how to keep up such essential network services.

Well we know where the money from the overpriced, underpowered ISP bill is going to indeed.

"telcos have more power than oil companies." This is demonstrably false. From opensecrets:

Lobbying money by industry 1998-2012[1]

  Industry                              Total $
  ---------------------------------------------------
  Pharmaceuticals/Health Products       2,505,357,767
  Insurance                             1,774,111,357
  Electric Utilities                    1,663,072,243
  Business Associations                 1,438,954,214
  Computers/Internet                    1,359,204,389
  Oil & Gas                             1,329,100,727
  Education                             1,159,377,327
  Misc Manufacturing & Distributing     1,147,911,037
  Hospitals/Nursing Homes               1,069,574,050
  TV/Movies/Music                       1,022,160,821
  Civil Servants/Public Officials       1,014,054,831
  Securities & Investment               980,371,025
  Real Estate                           975,927,683
  Health Professionals                  941,438,165
  Air Transport                         896,844,603
  Misc Issues                           773,377,869
  Telephone Utilities                   746,207,234
  Automotive                            732,207,809
  Telecom Services & Equipment          701,829,850
  Defense Aerospace                     647,089,847

Lobbying money by industry 2012[2] (Telcos did not even make the list in 2012.

  Industry                              Total $
  -------------------------------------------------
  Pharmaceuticals/Health Products       180,048,744
  Business Associations                 121,893,383
  Insurance                             113,540,783
  Electric Utilities                    108,068,579
  Oil & Gas                             103,734,662
  Computers/Internet                    96,569,868
  TV/Movies/Music                       89,178,807
  Misc Manufacturing & Distributing     79,921,881
  Securities & Investment               74,038,412
  Hospitals/Nursing Homes               68,677,679
  Education                             67,041,930
  Air Transport                         58,666,778
  Health Professionals                  57,991,637
  Real Estate                           55,517,526
  Civil Servants/Public Officials       54,276,821
  Health Services/HMOs                  50,248,170
  Commercial Banks                      44,376,751
  Automotive                            42,835,629
  Chemical & Related Manufacturing      42,435,792
  Defense Aerospace                     42,398,654

Lobbying money by industry 2011[3]

  Industry                              Total $
  -------------------------------------------------
  Pharmaceuticals/Health Products       241,462,770
  Insurance                             159,878,505
  Oil & Gas                             149,169,677
  Electric Utilities                    145,285,040
  Computers/Internet                    126,911,432
  TV/Movies/Music                       122,898,063
  Misc Manufacturing & Distributing     118,668,254
  Education                             106,246,285
  Business Associations                 106,139,640
  Securities & Investment               101,913,226
  Hospitals/Nursing Homes               100,768,231
  Civil Servants/Public Officials       83,236,247
  Health Professionals                  81,006,752
  Air Transport                         80,773,141
  Health Services/HMOs                  74,033,507
  Real Estate                           67,178,304
  Automotive                            61,776,786
  Commercial Banks                      61,376,654
  Defense Aerospace                     59,702,900
  Telecom Services & Equipment          57,736,688

[1] https://www.opensecrets.org/lobby/top.php?showYear=a&ind...

[2] https://www.opensecrets.org/lobby/top.php?showYear=2012&...

[3] https://www.opensecrets.org/lobby/top.php?showYear=2011&...

Your list reports Computers/Internet as a separate category from Telecom Services & Equipment, and Computers/Internet beats out Oil & Gas on the 1998-2012 list. How much of Computers/Internet should be counted as Telecom?

I would like to point out that it is not "my list." I do not want to mislead anyone, the data was compiled by openserets.org (hence the reference links).

With that being said it is fairly easy to check and see what companies were included in the Computers and Internet category. The list for 2012 is quite long so I do not want to paste all the entries. Here are the links for 2012, 2011 and 2010 respectively:

https://www.opensecrets.org/lobby/indusclient.php?id=B12&...

What companies do you think should be included in Telecom? How do they compare to the top 5 in Oil and Gas?

  Royal Dutch Shell $10,860,000
  Exxon Mobil       $9,870,000
  Koch Industries   $7,800,000
  Chevron Corp      $7,080,000
  BP                $6,860,000

Sorry, by "your" I meant "the list you quoted." Thanks for the links to the breakdowns; they succinctly answer my previous question: "very little."

Its not just in congress, but at the state and local level. The political ad-spend on TV and internet marketing is massive. Its a corrupt circle, not just a one-way deal. Thats why its so pernicious, unseemly, and to most unseen.

Sad but true. America loves to fuck its citizens over, online and offline, for money. They broke Ma' Bell up into companies that have become monopolies in their own right. Cable was never actually regulated against monopoly (despite appearances to the contrary) and neither are new new children Bells (ATT and Verizon being high at the top of that list).

Monopoly or duopoly or oligopoly. It's all the same. However, this is not a problem inherent to ISPs and telcos but across the whole American and world-wide economy.

The next time you buy cereal, soda, water, etc. at a supermarket ask how many choices you have as far as actual, separate, competing companies making the product. And if you don't like the choices ... I suppose you can still grow your own. Good luck with that.

Cable was never actually regulated against monopoly (despite appearances to the contrary) and neither are new new children Bells (ATT and Verizon being high at the top of that list).

You've got it backwards. Cable and telephone companies were granted local monopolies all over America, which is why there is a legally enforced duopoly now all over the whole country.

Monopolies only exist when created by regulation.

By the way, to head off a common concern, by example: People who think Microsoft ever had a monopoly are using the word "monopoly" wrong. Consumers were always free to go a different way, or start a competitor (and many did). In fact, MS would probably be weaker today had regulation not forced it to improve its self-defeating business practices.

Except that there is no legally enforced duopoly. By and large the only legal restriction on building a network in the US are related to construction permits & zoning. Cable franchises restricted competition for wireline video delivery but that got tossed a few years back.

If you would like to bury your own wires and use them to deliver Internet, you can. It is just like any other significant construction effort where the costs & paperwork may be daunting to some.

By and large the only legal restriction on building a network in the US are related to construction permits & zoning

I was presuming that when the company agreed to build a local network, it got an agreement from the local authority that nobody else would be granted a permit to do so.

That's still a legally enforced duopoly. Or are you saying, that acutally doesn't happen?

Cable franchises restricted competition for wireline video delivery but that got tossed a few years back.

I am guessing that's because the phone companies also wanted to deliver video over the wire. So this still wouldn't break the duopoly.

When people say Microsoft had a monopoly, they mean a de facto monopoly, rather than a de jure monopoly.

That terminology is conceptually invalid.

A "de facto monopoly" is just "very successful in the market."

There is no need for a separate concept for this, and if there were, it would not be appropriate to overload with the pre-existing term "monopoly" that means something different.

> Monopolies only exist when created by regulation.

Incorrect.

Example?

> Monopolies only exist when created by regulation.

If you take the dictionary definition rather than the legal one, sure. The legal one is the one that's actually relevant for most people's purposes, though.

Soda's an axception in your list of examples, I think. I see lots of different niche sodas (most named after people) when I go anywhere but Wal-mart: Virgil's, Weinhard's, Hansen's, Jones, etc.

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