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brokenparser | 11 years ago

This wouldn't happen if those ISPs didn't have local monopolies. Networks should be opened by selling traffic wholesale to other companies so that they can compete for subscribers on those networks. The network owners would have more than enough money for upgrades and if they don't, downlevel ISPs will sue them.

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kasey_junk|11 years ago

I'm not making a claim about the veracity of the counter argument to this, but it is easy to state. If network providers had to sell traffic wholesale to other companies, they would have less incentive to upgrade them as those networks then become pure commodities. Right now the local monopolies can use their networks to sell high margin services (cable) bundled with low margin services (internet traffic). If they had to compete with other companies, namely bargain ISP offerings, the cost of ownership of the network would be non-profitable.

I've heard some argue that this is precisely why DSL has lagged so far behind cable in upgrades.

rlpb|11 years ago

> they would have less incentive to upgrade them as those networks then become pure commodities

Pit DSL against cable, as has happened in the UK. The POTS network is owned by one company (BT) and the cable network by others. Retail customers generally have a choice of connecting to the Internet by either. BT (POTS network owner) are required to sell traffic wholesale to competitor ISPs (who then buy their own transit). This seems to work very well here, and DSL upgrades continue.

jbooth|11 years ago

The article said that their cable business is way less profitable than their internet business. I haven't done any research on the topic, but given that they have to pay content providers for cable, and don't for internet, I'm inclined to believe Cringely -- even though in a normal market it should be a low-margin business, selling undifferentiated bits for $.

opendais|11 years ago

And those people are completely 100% wrong.

DSL got screwed for around 10 years by having more expensive regulatory costs than Cable.

Why yes, if you tax X more than Y, Y is going to have the advantage.

yk|11 years ago

We have essentially such a system in Germany, does not work well. Thing is, that the owner of the network has then to compete with the resellers, but the resellers need to play nice with the owner. The result is a total mess of regulation to force the network owner ( T-Systems) to play nice.

a3n|11 years ago

Back in the dial-up days I had my choice of ISPs. Some people chose on price, I chose on quality/service, and mine wasn't that much more than the cheapos.

I can't recall any issues with the underlying phone company operator of the wires, although that may be because the wires were primarily for phone and they have to work by law (I think).

I miss the days of being able to choose my ISP. Now I have Comcast, with CenturyLink DSL an inferior possible second choice.