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Re: Two msgs California Declares Free Market Broken, Recommends Price Controls For Phone Services
From: David Farber <dave () farber net>
Date: Sat, 16 Aug 2008 18:01:01 -0400



Begin forwarded message:

From: Brett Glass <brett () lariat net>
Date: August 16, 2008 2:53:36 PM EDT
To: dave () farber net, "ip" <ip () v2 listbox com>
Subject: Re: [IP] Re: California Declares Free Market Broken, Recommends Price Controls For Phone Services

At 12:23 PM 8/16/2008, Lauren Weinstein wrote:

Deregulation of phone service pricing in California by the CPUC was,
as I recall, specifically predicated on the telcos' promises that
price increases would not get out of hand.

At the time, telephone companies could not have predicted that the
Internet would make it so easy to bypass them, nor that cellular
phones would become so popular and common. I doubt that they
actually "promised" anything; however, it is fairly likely that they
pointed to the economic climate at the time, when dial-up modems
were common and the number of land lines was going UP, not down.
Today, the telcos really do have a serious problem: their overhead
is growing due to increased commodity, energy, and labor costs
but far fewer phone lines are in use. And because -- in their passion
for vertical integration -- they decline to allow competitors to rent
those lines at any reasonable price, they are actually foregoing
potential rents.

Ironically, it appears that California appears all too eager to regulate
at the retail level, but not at the wholesale level -- even though
enabling competitive providers would surely enable aggressive competition
and thereby benefit consumers.

Part of the reason that the ISP access situation in the U.S. is so
limited in a practical sense for most consumers is that we allowed
all manner of deployment and other ISP promises in that sector to be
ignored by those ISPs as well.

Please give examples.

Our ISP has never once failed to make good on a promise to deploy
service.

--Brett Glass




Begin forwarded message:

From: Lauren Weinstein <lauren () vortex com>
Date: August 16, 2008 3:07:36 PM EDT
To: Brett Glass <brett () lariat net>
Cc: dave () farber net, lauren () vortex com
Subject: Re: [IP] Re: California Declares Free Market Broken, Recommends Price Controls For Phone Services


Brett,

You don't know *what* you're talking about.  The specific
deregulation (lifting of price controls heavily lobbied by the
telcos here in California) under discussion dates from around 2006,
not many years ago.  All of the factors involved were very clear to
the telcos at the time they pushed this through.

Dave already mentioned how Verizon broke their broadband promise in
Pennsylvania, there are similar examples of deployment promises from
telcos that went up in smoke scattered all over.  I'm glad to hear
that you've never broken a deployment commitment.  But as I've said
many times, your WISP isn't the problem, and it's also not
representative of the larger ISP industry.

--Lauren--
Lauren Weinstein
lauren () vortex com or lauren () pfir org
Tel: +1 (818) 225-2800
http://www.pfir.org/lauren
Co-Founder, PFIR
  - People For Internet Responsibility - http://www.pfir.org
Co-Founder, NNSquad
  - Network Neutrality Squad - http://www.nnsquad.org
Founder, PRIVACY Forum - http://www.vortex.com
Member, ACM Committee on Computers and Public Policy
Lauren's Blog: http://lauren.vortex.com







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