[10715] in Commercialization & Privatization of the Internet
Re: clarifying NAP discussions
daemon@ATHENA.MIT.EDU (Karl Denninger)
Sun Mar 6 20:58:33 1994
From: karl@mcs.com (Karl Denninger)
To: ms6b+@andrew.cmu.edu (Marvin Sirbu)
Date: Sun, 6 Mar 1994 15:47:34 -0600 (CST)
Cc: com-priv@psi.com, fidelman@civicnet.org
In-Reply-To: <0hSTvw200iod015aY0@andrew.cmu.edu> from "Marvin Sirbu" at Mar 6, 94 11:04:12 am
> Now we see that the reason you want to change the forum for decision
> making is that you want a particular outcome--namely no settlements.
> First, I think it highly unlikely that an FCC run process would come to
> the conclusion that no settlements is the best policy; they are quite
> use to ordering settlements in the telephone world. However, I also
> believe that no settlements is bad public policy, so I wouldn't be sorry
> to see that outcome.
Why do you believe that "no settlements" is bad public policy?
In particular, the offering of flat rate services to the public IS ONLY
POSSIBLE THROUGH A NO SETTLEMENT POLICY.
There is a REASON that there are NO -- repeat -- ZERO - flat-rate
long-distance calling plans available. That reason is settlements, a
policy which has been promulgated through regulation and has, in fact,
caused the use of the telephone for long-distance voice communications to
be MUCH more expensive than it needs to be.
At the same time, in an UNREGULATED environment (the Internet) there are
HUNDREDS of places where you can buy a flat-rate account and by doing so
talk to people in <other countries> with NO meter ticking!
Now can you explain to me just how this is "bad" public policy? You can
claim that the rural areas don't have flat rate access, and you'd be
correct. But they have the SAME access that a <regulated and settlement-based>
environment would bring them <right now>, that is -- pay per play -- while in
other areas, where there is sufficient density, you have flat-rate services
springing up like crazy!
What you propose to do is the same thing that many in government propose to
do -- that is, "make things equal". What government and others don't
disclose to you when they bring up this banner is that they aren't
proposing to help the disadvantaged at the expense of the advantaged --
rather, they propose to PENALIZE the advantaged while giving NOTHING back
to those who are disadvantaged.
Illinois phone service is a prime example. We lost flat-rate billing
options a few years ago, ostensibly to "help people who couldn't afford
phone service". The net effect was supposed to be to decrease bills.
Guess what happened? The bills of rural customers went down all of about
$0.50 a month. The bills of CITY dwellers, however, went UP massively --
in many cases, by more than 100%! Heavy users saw their bills go up 1000%
-- I was one of those.
Illinois Bell Telephone reported <record profits> for the next three straight
years. All this from something that was "good public policy". I want to
know who got the kickbacks from that deal.
This is the exact same effect you get when you "dumb down" other processes.
That is, you average DOWN rather than averaging UP, and SOMEONE gets fat in
the process -- usually the very people advocating the change.
This is exactly why Ittai of ANS has advocated a settlement policy here
rather than a CIX-style no-settlement policy. His company, after being
built with <government money>, is in the catbird seat to profit from such a
policy - they would end up with nearly ALL the settlement money flowing to
them, which would effectively put smaller firms such as MCSNet and the
hundreds like us out of business. OF COURSE he wants it this way!
IMHO, those who would regulate in a settlement policy are the ones who wish
to make bad public policy, and it is usually for their own reasons of
personal financial gain that they advance such an agenda. They should be
exposed for what they really are -- profiteers out to rape the public.
Keep the government out of it. Private enterprise is doing quite a nice
job in the Internet area, thank you very much.
If you want to make it possible for rural people to get to the net cheaply,
the solution is to <GET RID OF THE SETTLEMENTS IN THE PHONE SYSTEM> -- then
flat-rate long distance WILL become available. The solution here is to
force the cable plant to be made available to any and all comers for the
cost of maintenance; the public has already paid for the cable plant
through monopoly practice, and as such IMHO the telco is not entitled to
recover a red cent of that "investment" -- it was made at ZERO risk.
--
--
Karl Denninger (karl@MCS.COM) | MCSNet - Full Internet Connectivity (shell,
Modem: [+1 312 248-0900] | PPP, SLIP and more) in Chicago and 'burbs.
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