> Why do local ISP markets tend towards monopoly, even though it has been illegal since 1992 to grant local cable monopolies? Two words: universal access.
It's true that universal access is what causes networks in major cities to lack competition. But getting rid of it wouldn't solve the problem anywhere else, because there are still millions of people who live in areas that couldn't economically justify more than one ISP. The only way those areas can justify the investment is if the ISP can collect revenue from a majority of the customers (and/or not compete aggressively on price), meaning that a competitor entering the market would cause both ISPs to become unprofitable and so no rational investor will be the second to service that market. Those geographical areas are natural monopolies. There is very little realistic alternative to utility regulations in those markets, short of massive government subsidies to create market conditions that can sustain multiple competitors.
> There is no free lunch. You can have: neutrality, universal access, or a mostly privately-funded telecom infrastructure, but you only get to pick two. If you think universal access is important, and net neutrality is important, you have to be willing to publicly subsidize the construction of telecom infrastructure.
That isn't necessarily true. What it means is that without public investment, the subscription fees for internet service have to be sufficient to justify private investment. It isn't at all clear that they aren't already at that level. The lack of investment in many markets is at least in significant part attributable to the fact that neither competition nor regulation currently provides a large incentive to make infrastructure improvements. But there is no reason that in markets with insufficient competition, regulations could not be made to create that incentive, e.g. allowing ISPs to charge higher rates only if they provide higher speeds and then over time increasing the required speed for a given rate. And ironically the rates required to justify a given level of investment would be lower if we had less competition, because the cost to wire a street is in large part proportional to the number of miles of road rather than the number of subscribers, so Verizon and Comcast having to build parallel networks each with half the total number of subscribers causes each to be significantly less profitable and that much less likely to make future investments. "More competition" is not a panacea.
And more than that, why is public investment in infrastructure a controversial position? We have public roads, what's wrong with public last mile networks?
> But getting rid of it wouldn't solve the problem anywhere else, because there are still millions of people who live in areas that couldn't economically justify more than one ISP.
So city dwellers have to subsidise the country folks?
> So city dwellers have to subsidise the country folks?
No, build out requirements are actually very stupid and we should get rid of them. It's just that getting rid of them doesn't magically create broadband competition in unattractive geographies.
It's true that universal access is what causes networks in major cities to lack competition. But getting rid of it wouldn't solve the problem anywhere else, because there are still millions of people who live in areas that couldn't economically justify more than one ISP. The only way those areas can justify the investment is if the ISP can collect revenue from a majority of the customers (and/or not compete aggressively on price), meaning that a competitor entering the market would cause both ISPs to become unprofitable and so no rational investor will be the second to service that market. Those geographical areas are natural monopolies. There is very little realistic alternative to utility regulations in those markets, short of massive government subsidies to create market conditions that can sustain multiple competitors.
> There is no free lunch. You can have: neutrality, universal access, or a mostly privately-funded telecom infrastructure, but you only get to pick two. If you think universal access is important, and net neutrality is important, you have to be willing to publicly subsidize the construction of telecom infrastructure.
That isn't necessarily true. What it means is that without public investment, the subscription fees for internet service have to be sufficient to justify private investment. It isn't at all clear that they aren't already at that level. The lack of investment in many markets is at least in significant part attributable to the fact that neither competition nor regulation currently provides a large incentive to make infrastructure improvements. But there is no reason that in markets with insufficient competition, regulations could not be made to create that incentive, e.g. allowing ISPs to charge higher rates only if they provide higher speeds and then over time increasing the required speed for a given rate. And ironically the rates required to justify a given level of investment would be lower if we had less competition, because the cost to wire a street is in large part proportional to the number of miles of road rather than the number of subscribers, so Verizon and Comcast having to build parallel networks each with half the total number of subscribers causes each to be significantly less profitable and that much less likely to make future investments. "More competition" is not a panacea.
And more than that, why is public investment in infrastructure a controversial position? We have public roads, what's wrong with public last mile networks?