[GRLUG] NOT LINUX - net neutrality

[Michael Mol]

On Fri, Sep 23, 2011 at 3:11 PM, Bob Kline <bob.kline at gmail.com> wrote:
> On Fri, Sep 23, 2011 at 2:55 PM, Michael Mol <mikemol at gmail.com> wrote:
>> On Fri, Sep 23, 2011 at 2:52 PM, Bob Kline <bob.kline at gmail.com> wrote:
>> > Yes, there's all that. But some
>> > kind of regulation is often needed.
>> > AT&T worked well as a regulated
>> > monopoly for something like three
>> > generations - it's what made universal
>> > service come about.
>>
>> Worked well? Why do you think it took so long for network services to get
>> cheap?
>
> Because one had to shift to a new
> business model.  The regulated monopoly
> produced universal service - that was the
> deal, and included a guaranteed rate of
> return.

And all of those guarantees force the maintenance of a status-quo,
defeating innovation, technology improvements and, consequentially,
price reduction. The regulations themselves held the monopoly in
place, and made it more difficult for anyone to compete.

>  In the days of slower moving
> technology, that was a worthy goes - at
> the end, before the divestiture of AT&T
> in 1983, 96% of the US population had
> access to a phone. "Long Lines," the old
> name for long distance, subsidized local
> service to the tune of about $11B in 1981.
> As time went on, there were cheaper
> ways of doing aspects of things - long
> distance for example - but a period of
> cherry picking followed, wherein the
> most profitable parts of AT&T's businesses
> were picked off.  That couldn't work either.
>>
>> > But I take your point more generally.
>> > The government's current war on the
>> > private sector is not doing any of us
>> > much good...
>>
>> And Net Neutrality is about escalating that.
>
> How so?

Because, like all regulation, it increases the costs of doing business.

In this case, it effectively eliminates a network's ability to manage
traffic flows. Curiously, this actually tilts network advantage away
from truly disruptive technologies like VOIP and realtime processes
A/V, and in favor of bulk transfers. And it'd be illegal to provide a
commercial,  general-purpose network for which VOIP actually worked
reliably and efficiently.

>  A side comment, capitalism is
> a flawed system as well.  Unfettered, it can,
> and always has, led to monopolies. Who will
> break them up if the gov't doesn't?

They go bankrupt when something new obviates the need for their
product. Unless they're allowed to buy legislation which structures
regulation to their advantage.

>  Or was
> M$ just another business?

Absolutely. Chances are, if Microsoft had been successful at
monopolizing the desktop market, the mobile market would have exploded
sooner, and the PC as it was would have been a brief fad. (Perhaps it
is anyway, but it would have been briefer.) Something would have
yanked the market out from under them.

>  Standard oil?

Standard Oil was another example of horizontal integration, but, yes,
it was just another business. Standard Oil's market was obviously fuel
oils of various kinds. If those fuels didn't become as cheap as they
had, we wouldn't have had the Age of the Automobile. We'd probably
have used trains instead, and the shapes of cities and other
population centers would be different today, but they'd still exist.
There were (and are) other sources of energy apart from petroleum, and
Standard Oil would have their work cut out for them trying to compete.

> Alas, a missing piece of capitalism is keeping
> competition going, and competition is the
> thing that produces quality and lower prices.

It still comes, but the markets change.

https://secure.wikimedia.org/wikipedia/en/wiki/Disruptive_technology

Video killed the radio star. Cellular phones have killed off landlines
almost entirely. VOIP, if it's *allowed* to take hold in the face of
things like net neutrality, will eventually all but kill off the PSTN.

> Few businesses actually want that if they
> can gouge people instead, as the railroads
> did a century and more ago when they were
> the only real game in town.

And along came roads and planes--powered by Standard Oil.

-- 
:wq

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