Folks
I don't write to this list often, but the comments that Vonage and Skype
don't work on most U.S. broadband networks are plain wrong. I spend a lot of
time on the phone and it's all Skype and Vonage. When we asked a class at
Columbia how many use Skype, more than half raised their hands. (Lots of
international students.)
I essentially never have congestion issues in Skype, Vonage, Netflix,
and Hulu on either Verizon DSL or Time Warner Cable. That's certainly not
true for everyone, but what I'm hearing from teh network engineers at half a
dozen of the large networks and it's typical.
I've seen the network data from several large U.S. networks and
congestion is remarkably rare. They've even solved the upstream cable p2p
issues in the last 12 months almost everywhere with interim upgrades.
This is the kind of thing to answer with data, not speculation.
Separately, I like Gilmore's idea of solving things thru competition, which
clearly worked well in France in 2003. It's working in British retail as
well.
But it's a big jump to think it would work in 2011 in North America. The
telcos and cablecos have huge scale economies and hence much lower costs. In
2011, nearly everyone not poor but interested in broadband is connected.
It's far more difficult (and expensive) to persuade someone to switch
providers than to win customers when people are first starting up.
Which implies it would be hard as hell for a new ISP to reach efficient
size in 2011 than in 2003. Wall Street tells me they wouldn't finance it.
Unbundling in the U.S. still remained possible through UNE-L (equivalent to
what most competitors in Europe are using.) No one has developed in the last
nine years big enough to make a difference.
Interestingly, neither has anyone in the major European countries except
for those who already have a huge number of customers for a piece of the
quad play. Specifically, wireless carriers Bouygues in France, Vodafone in
several countries and Carphone Warehouse/TalkTalk in Britain have come in
with some success. So has BSkyB, the British satellite TV company.
But other than those, I can't think of any successful new entrant in any
major country since before 2006. They are all already in the game, with huge
customer bases to draw on and a good reason to lose money on broadband for
years so as to hold on to the customers, as all of these companies have.
So saying "the problems in the U.S. should be solved by competition" is
very attractive and not totally impossible. But it's highly unlikely any
likely form of unbundling - even full structural separation like England and
Australia - will have major impact in the U.S. unless one of four companies
decides to jump in: Sprint, T-Mobile, DirectV (which almost did five years
ago) or Dish. Sprint and Dish couldn't raise the capital and I don't think
the others are likely.
I wish it weren't so, but it's very unlikely that we'll get high speeds
except from telco and cableco in the U.S. in volume enough to make a
difference this decade.
So we need policy that works if we only have two highspeed players rather
than dreams of competition. db
