ReasonedResponse.com

About ReasonedResponse

ReasonedResponse is the policy and opinion blog of Dave McClure. The longtime President and Chief Executive Officer of the U.S. Internet Industry Association (USIIA), Dave is an authority on complex policy, business, and legislative issues that impact the technology and online environment.

A technologist by education, Dave is also an accomplished pilot, judoka, Master Scuba Diver, oenologist and member of the legendary Scottish Clan McLeod.

Everything posted on this blog is my personal opinion and does not necessarily represent the views of the USIIA or its members.

Recommended Blogs

Creating A Broadband Monopoly

Those who demand the regulation of broadband -- open access rules, network neutrality rules, a national broadband plan, rate regulations, expansion of universal service, ad nauseum -- are fond of claiming that what we must fear most is the emergence of a monopoly that controls all of broadband.  One mega, evil networking company that seeks to control what we see, how we see it, who can be on it, and who can't.

They speak of monopolies, and duopolies, and whatever-big-word-we-can-think-of-to-scare-you-opolies, and point their long, sanctimonious fingers at leading network operators as likely villians.

Which is proof that those who will not learn from history are doomed to become progressive liberal telecom pundits.

Just for the record, free markets abhor monopolies.  In a free market, unfettered by government interference, the marketplace will move quickly to quash possible monopolies through innovation, competition and consumer choice.

How, then, do monopolies get created?  By governments, of course.  Only with the direct intervention and deliberate cooperation of the government can monopolies form or continue.  A case in point?  Monopoly cable franchises.

But if we are talking about how broadband might become a monopoly, we have an even better example.  Once upon a time there was a telephone company called AT&T (which, for the record, is not the same company in any way as the current one that carries the AT&T brand name).  AT&T the telephone company did not set out to become the monopoly that had to be broken up in 1982.  It followed a process, set by the United States government and agreed to by the officers of that company in what, in retrospect, turned out to be a deal with the devil.

It began with the patents, and with the confusion and meddling at the Patent Office that gave the lion's share of the telephony patents to a single, pre-selected winner.  Then, around the time of World War I, the telephone system was declared so critical to the security and future of the US that it was nationalized.  Not many years later, the government sought to ensure low rates, and so introduced rate regulation for telephony -- including cross-subsidizations, government supports and other artificial mechanisms.  The final step was to make the telephone company an instrument of social policy by implementing universal service and minimum service mandates.

All of which must sound eerily familiar to those attempting to battle for consumer choice and free markets today.  The Patent Office is an ungodly mess, giving power hither and yon based on shifting definitions and interpretations.  In the wake of 9-11, we have the Internet declared to be essential to US security and the future.  So-called consumer advocates are demanding telephony-style rate regulation.  And Congress is trying to expand the mega-billion universal service program to broadband.

How much of this is supported by the networking companies?  None.  How much do they want to return to the old days of monopoly operations?  Not a bit.

Which again begs the question:  if it is not the networking companies pushing us down the long, slippery slope that could lead to a monopoly, who is it?

I'll take a wild guess that it is the same bunch of academics, policiticians and pundits who are pushing hard to put all the pieces of a monopoly in place -- the net neutrality/open access/rate regulation crowd.  They are not a bit interested in letting consumers in a free marketplace keep us off of that path, and are pushing as hard as they can to create the government co-conspiracy that will enable them to choose which monopoly company will succeed.

Which is why I can't and won't ever support them.

<< How To Fix Municipal Wi-Fi | Main Index | An ACTA Of Bad Faith >>

 

Categories

Legal and Legislative

,

Network Neutrality

,

Random Musings

 

Leave a comment

 

 

Search

Subscribe

Categories

Recent Posts

Archives