[11004] in Public-Access_Computer_Systems_Forum
Telecomm Cartel Part I
daemon@ATHENA.MIT.EDU (Public-Access Computer Systems For)
Mon Jan 27 20:38:44 1997
Date: Mon, 27 Jan 1997 19:10:51 -0600 (CST)
From: Public-Access Computer Systems Forum <LIBPACS@UHUPVM1.UH.EDU>
To: Multiple recipients of list PACS-L <PACS-L@UHUPVM1.UH.EDU>
Reply-To: Public-Access Computer Systems Forum <PACS-L@UHUPVM1.UH.EDU>
5 Messages Concerning "Telecomm Cartel"
312 Lines
Followed by Part II
*-----
The following messages were cross-posted to several lists, thus
seven responses and the original arrived at the same time to PACS-L.
All messages will be posted at this point. However, please be
be careful in any further responses to avoid personal attacks
(ie, flaming) and to address your responses to the list. If you
mean to carry on a conversation with another individual, please
do so privately.
Thanks,
Gretchen McCord Hoffmann
Associate PACS-L Moderator
*-----
From: jwarren@well.com (Jim Warren)
[Also by blind cc to others. Repost and recirculate freely. --jim]
Near the end of last year, Congress and the administration enacted the
Telecom Deform (uh, "Reform") Act -- lubricated by several million dollars
of telecomm cartel "donations" in the past decade -- "to encourage
innovation, allow competition and thus reduce costs to communications
services consumers."
Within less than three months, "suddenly" the telecommunications giants --
the RBOCs, Regional Bell Operating Companies, etc. -- have begun a
publicity campaign hyping the delusion that Internet use is exploding so
rapidly that the poor ol' cartel simply can't install enough high-speed
lines to meet the need.
Unless, of course, they can charge per-bit fees for data calls on fixed-fee
residential voice lines, collect per-bit access charges from every Internet
Service Provider, etc. And they're taking their plea of destitution to
their own, private special-interest representatives, appointed in
Washingtoontown, the Federal Communications Commission.
Prior to last Fall's dereg, as bandwidth needs increased, the hub ISP's
simply ordered more and/or higher-speed lines -- and somehow, the telecom
cartel could figure out how to install them. (I mean, installing phone
lines, and high-speed links between telecom central offices is non-trivial,
but it *ain't* that complicated!)
But now -- at least until they can reap more deregulated profits from *all*
telephone users -- the telecom giants have suddenly become fumbling, inept,
non-planning, helpless novices who simply don't know how to do the job
they've been doing for most of a century.
*Until* they can monsterously jack up the fees for all phone users -- but
especially net users -- and, in the process, incidentally kill most current
and potential personal net use.
And now -- gee golly gosh -- *suddenly* we're running into "all circuits
are busy" recordings in our phone calls. (In the last two weeks, while
calling from my Menlo Park central office, to the adjacent Palo Alto
central office -- in the elite north end of Silicon Valley, home of
Hewlett-Packard, Stanford, et al -- I've run into *numerous* such messages.
Amazing how they "just happened" to begin at the same time that the
telecomm cartel began its publicity hype pleading destitution to their
ever-pliant FCC.)
==
In other words, the telecomm cartel *did* learn from the massive success of
the nation's *other* uncontrolled, unprosecuted monopoly cartel -- the oil
cartel.
"Old" folks may recall that, prior to the mid-'70s, oil products in the
U.S. were cheap and plentiful (even though the oil cartel was making
*massive* profits). But -- gee golly gosh -- all of a *sudden*, there was
an oil crisis created by those nasty ol' fererners in the Middle East (it
was all the *foreign* cartel's fault, you see!).
And there were *huge* lines of cars stacked up at the few gasoline pumps
that were open, *especially* in the metropolitan centers of commerce and
industry around the nation -- where the most power is located, capable of
pressuing Washington.
That is, there was an oil "shortage" until any *potential* antitrust
investigators rolled over, and the govt and the nation's desperate citizens
and busineese obediently tolerated the U.S. oil cartel's 2- to 3-fold
increase in gasoline prices (that was immediately followed by mega-profits
that were *obscene* -- even for the oil monopoly).
Then -- amazingly! -- there was again and immediately, plenty of gasoline
... once the cartel was free to collect ~$1.50/gallon instead of their
pawltry 35-75 cents/gallon of the previous year.
And in the process, that one industry unilaterally created the most
expolsive inflation this nation has seen in this century -- with all of its
harm and trauma for *all* other industries, and most-certainly for the
nation's helpless citizens. (Justifiably, the voters blamed the Democrats
-- who *were* in power in both the White House and Congress.)
==
Now, it's time for the nation's other monopoly cartel -- the telecom giants
-- to screw the nation's businesses and citizens using identically the same
tactics.
All they have to do is choke communications channels until citizens and
businesses of the nation -- in desperation -- one again, obediently bend
over and plead for massive fee increases and especially net-use per-kilobit
fees. I mean, it's a proven tactic ... and the skids inside the Beltway
have been greased with amply "donations."
Of course, you could whine to "your" elected "representatives" in Congress
-- who passed the Telecom Deform Act ... or to the best-greased, "slick"
President ... who proudly signed it into law, who also appointed former
telecomm cartel lobbyists, former telecomm cartel lawyers and former
telecomm cartel consultants to the their FCC to represent their interests.
So begin practicing your bending-over techniques, my fellow screwees-to-be
-- because this nation's citizens, long ago, lost the tenacity and backbone
to rebel against "proper authority" and demand that such cartels be
*effectively* prohibited from "having their way with us."
--jim
Jim Warren (jwarren@well.com)
GovAccess list-owner/editor, advocate & columnist (Govt.Technology, MicroTimes)
345 Swett Rd., Woodside CA 94062; voice/415-851-7075; fax-for-the-quaint/<ask>
*-----
From: rishab@dxm.org (Rishab Aiyer Ghosh)
In response to Jim's conspiracy theories, and at the risk of
being called a capitalist running dog (or was it pig?) I would
suggest that we can reasonably expect the "reform" part of the
act to kick in in the not-so long term. Don't forget that the
original purpose of the act was to end RBOC monopolies by
allowing cable companies etc to get in to the local loop. Going
by the experience of Britain, such competition works to keep
the former monopoly on its toes, and prices and services best
for the consumer.
-Rishab
*-----
From: steven cherry <stc@panix.com>
On Sat, 25 Jan 1997, Rishab Aiyer Ghosh wrote:
> In response to Jim's conspiracy theories, and at the risk of
> being called a capitalist running dog (or was it pig?) I would
> suggest that we can reasonably expect the "reform" part of the
> act to kick in in the not-so long term. Don't forget that the
> original purpose of the act was to end RBOC monopolies by
> allowing cable companies etc to get in to the local loop. Going
> by the experience of Britain, such competition works to keep
> the former monopoly on its toes, and prices and services best
> for the consumer.
Sure. Just like the happy results from earlier trust-busting, Big Oil
(those low prices, reliable delivery, as Jim pointed out) and Big Beef
(nothing like a safe and clean food supply)
-steven (hope everyone noticed that Food Lion didn't sue for
libel and didn't despute the truth of the story)
Steven Cherry <stc@vtw.org> <stc@acm.org> <vtw@vtw.org>
Voters Telecommunications Watch <www: http://www.vtw.org/>
--
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
The Internet is not a separate "cyberspace" reality. It is a new
nervous system for the physical world. -- Phil Agre
*-----
From: rishab@dxm.org (Rishab Aiyer Ghosh)
stc@vtw.org wrote:
> Sure. Just like the happy results from earlier trust-busting, Big Oil
> (those low prices, reliable delivery, as Jim pointed out) and Big Beef
> (nothing like a safe and clean food supply)
The reason I used Britain as an example was because I think there
are some differences between the markets in telecom and, say, oil.
So, instead of extrapolating from US experience in other sectors
- oil and beef are commodities, telecom is a service - it may be
worthwhile looking at the experience of competition in _telecom_.
For this you have to see other markets where competition operates -
which means for all practical purposes Britain and New Zealand.
The results there - not least because of strong fair-play rules
enforced by the British regulator, Oftel - _are_ "happy". For that
matter the results of telecom competition in the US have been good,
too, in the area where it has existed for a while international
traffic. Or do you think the fact that the world's lowest international
call rates happen to be in the most competitive market for international
telecom services is just a coincidence?
The fact is that the RBOCs who want to make more money off ISPs
are _not_ facing (significant) competition, yet. In a given city,
therefore, there is no cartel - there is a _monopoly_. The
monopoly sees itself threatened, so it naturally wants to increase
its revenues while it's still alive. Because once there are half
a dozen telcos in your city the RBOC wouldn't want to lose a
competitive edge by charging more.
BTW there are many reasons why usage-based pricing is better than
flat-rate; it can even be cheaper (not if _monopoly_ telcos
get their way, of course). See Hal Varian's work on pricing models
and congestion on the Internet (www.sims.berkeley.edu/~hal)
Apart from anything else, when everyone's paying $20 a month
for Net access, those who spend all day on-line are being subsidised
by those who just check their mail. Similarly with unmetered
phone calls; heavy users are subsidised by light users. This
holds even when running costs (for telcos) are not volume dependent.
Best,
Rishab
First Monday - The Peer-Reviewed Journal on the Internet
http://www.firstmonday.dk/ Munksgaard International Publishers, Copenhagen
International Editor - Rishab Aiyer Ghosh (ghosh@firstmonday.dk)
Mobile +91 11 98110 14574; Fax +91 11 2209608; Tel +91 11 2454717
A4/204 Ekta Apts., 9 Indraprastha Extn, New Delhi 110092 INDIA
*-----
From: jwarren@well.com (Jim Warren)
At 01:37 PM 01/25/97, Rishab Aiyer Ghosh wrote:
>In response to Jim's conspiracy theories, and at the risk of
>being called a capitalist running dog (or was it pig?)
[If I remember my politically-correct '60s Maoist litany, it was something
like, "Running dog lackies of the capitalist war-mongers." But of course,
now, the world's wealthiest capitalists no longer profit from peddling war
tools ... do they? ;-) Oh ... but back to the topic ... after our mutual
digression. :-) ]
>I would
>suggest that we can reasonably expect the "reform" part of the
>act to kick in in the not-so long term. Don't forget that the
>original purpose of the act was to end RBOC monopolies by
>allowing cable companies etc to get in to the local loop.
For starters, I *don't* DARE trust cable companies -- with their appalling
service practices -- to provide something as crucial as phone services
(e.g., phone facilities are in hardened sites, have backup generators,
24-hour emergency staff, etc. Do you know of *any* cable operators who
have that? You want to trust 'em to serve you in a quake, flood, forest
fire, tornado ... or whatever disaster threatens *your* area? *Not*
likely! In fact, far more *interesting* potential comm compitors are the
power and gas industries -- which, unfortunately, also start with 100% of
their markets.)
Nonetheless, I understand and *like* the notion of *real* competition to
control prices and improve alternatives available to consumers. But it
needs to be *real* competition -- not "competition" where (1) there is only
one, or very few *very* cozy, long-cooperating megacorporations "competing"
with each other (as in the "copetitive" oil cartels), and (2) most
especially not when those "competitors" begin the "competition" by having
100% of the market, ALL of the monsterously-costly wired infrastructure and
bay far, the most effective control over their supposed regulators (FCC,
state PUCs, etc.).
Please note that the telecomm cartel just got finished having the FCC
completely trash the possiblity of all of us having free and equal access
to shared wireless digital spectrum (What! Radio spectrum offered for just
*anyone* to use -- with equipment-enforced equal-access algorithms?
*Perish* the thought!) for medium-range free <gasp!> personal and business
communications.
Instead, the ever-obedient FCC casterated the NII-band range by arbitrarily
and capriciously limiting power to choke it to about 1-3 miles ... and not
mandating any equal-access hardware standards at all!
I.e., even though all of us *could* have [at least!] metro region free
wireless comm (data and digitized voice) reaching [at least] 10-50 miles --
the telecomm cartel -- that would have lost control over the local loop as
well as lost control over the cellular market that has been "competitive"
from the outset (i.e., two unregulated providers per service area) -- got
an FCC ruling that limited potential free and convenient (wireless)
communications to little more that the range of the newer walk-around
phones.
Is *that* the capitalist "competition" that you're talking about?!!
>Going
>by the experience of Britain, such competition works to keep
>the former monopoly on its toes, and prices and services best
>for the consumer.
Uh, I didn't realize that the UK now had consumer phone rates that were
comparable to or better than those for U.S. residential users. Do they?
And how many *real* "competitors" are there to Britain's "former" govt-run
phone monopoly? That is, how many -- if any -- have, say, at least 30% of
Britian's total telecomm market? Is there even *one* -- other than the
"former" monopoly?
O' course, part of the reason for my whine about the U.S. comm cartel is
that I'd like to see [real] competition-driven pricing and innovation ...
but *before* I die. Ya see, I'm already 60, and probably have only 10-25
more years -- and I'm *real* cynical about how much *real* competition we
will see in that "short" period.
By "real" competition, I mean a situation where no single company has, say,
more than 30% or 40% of a given large marketplace ... especially not for
more than, say, 5 years or so.
Govt-guided "capitalism" usually *ain't* real competition. It wasn't at
Teapot Dome; it wasn't for the Seven Sisters; it wasn't during the mid-'70s
gas "crisis" -- where very few "competing" companies controlled almost all
of the raw resources ... *and* production ... *and* distribution ... *and*
retail outlets -- and it sure as hell ain't as practiced so far, by the
U.S. telecomm cartel.
--jim-who-wants-his-fair-use-long-distance-wireless-spectrum-NOW :-)
Jim Warren (jwarren@well.com)
GovAccess list-owner/editor, advocate & columnist (Govt.Technology, MicroTimes)
345 Swett Rd., Woodside CA 94062; voice/415-851-7075; fax-for-the-quaint/<ask>
*-----
