I'm addressing some of the links Suresh forwarded to the list.
Bennett:
If we’ve learned anything at all about from the history of
Internet-as-utility, it’s that this strained analogy only applies in
cases where there is no existing infrastructure, and probably ends
best when a publicly-financed project is sold (or at least leased)
to a private company for upgrades and management. We should be
suspicious of projects aimed at providing Wi-Fi mesh because they’re
slow as molasses on a winter’s day.
I don’t see any examples of long-term success in the publicly-owned
and operated networking space. And I also don’t see any examples of
publicly-owned and operated Internet service providers doing any of
the heavy lifting in the maintenance of the Internet protocols, a
never-ending process that’s vital to the continuing growth of the
Internet.
One of the oft-overlooked inconvenient facts about the Internet is that
it was created by the US military to meet various Cold War objectives.
The US government has poured huge amounts of cash into the Internet over
the past 50 years. Much of the early work on protocols and structures
was done at public universities on the military's dime. The Internet
started as a public works project, and public money continues to play a
significant role.
During the first decade I was online (1976-1986), it was widely
understood that the Internet was to be used for military and research
purposes. It was not open to commercial purposes. Advertising was not
permitted, and it was generally understood that we were online as guests
of the military and the universities.
The innovations that made the Internet possible did not originate at
AT&T. AT&T, like any other monopoly, views innovation with extreme
distrust and stifles it whenever possible. Innovation disrupts their
business model, and threatens their control over our communications.
AT&T fought broadband every step of the way, and lapped up a lot of
dollars from the public trough to expand its fiber network to make
broadband possible. The cable companies were late entrants to the
Internet game, once they realized that they had the broadband cable in
place already and just had to figure out the upstream messaging part.
The broadband providers, like the railway robber barons of the 19th
century American West, are political entrepreneurs. Much of the heavy
lifting was done for them at public expense, and now they act like they
built the whole thing by themselves and are perfectly entitled to run
things just the way they like it. They cry foul when the very government
that helped them build the infrastructure with public money wants to
regulate the self-same infrastructure.
Sherman:
Pursuing a public utility model while also desiring competition are
fundamentally contradictory goals. Utilities are designed not to
compete. Do you, or does anyone you know, have a choice of providers
for water, sewage or electricity?
My second question would be: is there anyone in the technology world
who sees public utilities as a model for innovation? A 1.5 megabit
connection (T1) was an unimaginable luxury when I started in tech in
the mid-90′s. It was for well-funded companies only. Today, it is a
low-end consumer connection and costs around 80% less. Has your
sewage service followed a similar trajectory?
A public utility is designed to be “good enough” and little more.
There is no need, and little room, for differentiation or progress.
Your electricity service is essentially unchanged from 20 years ago,
and will look the same 10 years from now. Broadband, on the other
hand, requires constant innovation if we are to move forward — and
it has been delivering it, even if we desire more.
Public utilities exist because there are certain services where the
infrastructure leads to a natural monopoly. Having these services in
private hands created numerous disasters (the history of London's
private water companies is instructive here, as is the history of the
railroads in California). Thus, these services tend to be either
publicly run or heavily regulated. In my experience, publicly run
services tend to be cheaper and better than the privately run
monopolies. Privately run monopolies are always trying to get one-up on
their regulators and the public, while public utilities can get on with
the job at hand.
Innovation is an interesting thing. Warfare (the business of
governments, last time I checked) has been responsible for a great deal
of innovation. Public investment in basic research also tends to foster
a lot of innovation. People playing around with new toys also leads to a
tremendous amount of innovation. Monopoly corporations, on the other
hand, do not tend to innovate. They are sticks-in-the-mud heavily
invested in maintaining the status quo. Moreover, monopoly corporations
often successfully stifle innovation by others.
Public utilities can and do innovate. I can point to wind farms and
smart meters as evidence of this. Better yet, I can take you on a tour
of the City of Santa Cruz' wastewater treatment facility and show you
all the improvements to wastewater treatment that have occurred in your
lifetime. There have been major improvements to roads, ports, and other
transportation infrastructure as well.
Ideally, a public utility (like government itself) is responsible to the
people it serves. If a public utility is not responsive to the public,
that's a problem that needs to be fixed, but it's not inherent in the
very notion of public utilities.
It might be desirable for telephone, cable, and Internet services to be
run as a public utility, just as it might have been desirable for the
U.S. to socialize its railroads way back when. There's no political will
in the U.S. to socialize any industry, so I think that AT&T and Comcast
are safe for the time being. Telephone and cable television service are
already seen as utilities, and the Internet fits right into that model.
Thus broadband innovation in the U.S. will be slowed and stifled to the
extent that AT&T and Comcast can manage to drag their feet.
--hmm
