Blog - Page 55

One of history’s great propaganda experts believed that if you repeat a lie often enough it becomes the truth. A lot of politicians follow this advice. The Consumers Union and the Consumer Federation of America endlessly wave the same bloody shirt of higher phone rates. The latest incantation is: “If approved, [the] merger [between AT&T and BellSouth] will lead to higher local, long distance and cell phone prices for consumers across the country.” This is absurd because AT&T and BellSouth do not compete against each other for local or mobile phone services. And any competition between them in long distance is de minimis. The consumer groups see these companies as potential competitors. They have argued unsuccessfully for years that antitrust Read More ›

Well, that didn’t take long. On Tuesday night the Indiana General Assembly passed the nation’s most far-reaching telecom deregulation, which Gov. Daniels has said he will sign. Today, Friday, I see telecom crews surveying rights of way around my neighborhood to lay new optical fiber. Let’s start the clock and see how long until the optical multimegabits reach my house. Ready, go…. -Bret Swanson

A survey conducted by the American Consumer Institute documents significant consumer savings as a result of the statewide franchise legislation enacted in Texas. For example: “The benefits claimed by those who switched were very substantial. According to the survey, customers that claimed benefits from switching to a competitor saved, on average, $22.50 per month on their cable bill, and those switching to any provider saved, on average, $22.27 per month. This suggests that price competition is occurring among the providers. For these customers, the savings represented approximately a 30% decrease in price, which is nearly identical to the FCC’s estimate of 27% lower price per channel in competitive markets (footnote omitted). From this, we can safely assume that the new Read More ›

As a congressman, Ron Wyden once said that competition is too important to be left to the marketplace. Today, Senator Wyden (D-OR) introduced a “net neutrality” bill (S. 2360) which he thinks is needed to prevent the construction of a “priority lane” on the Internet. National Journal’s Technology Daily ($), paraphrased Wyden saying that “it is perfectly acceptable for broadband providers to charge consumers more for faster speeds, but that it is not acceptable to charge businesses for faster Internet delivery.” That’s like saying businesses shouldn’t pay taxes. The Wyden proposal may be intended merely to ensure that the Internet will function like the telephone network, but in reality it is a radical proposal that would actually shift future costs Read More ›

The Indiana General Assembly tonight approved the nation’s most far-reaching, far-sighted telecom legislation, substantially deregulating the industry and radically simplifying the local video franchising process. Growing up here and living here now, I have a special interest in this effort and hope to see crews stringing optical fiber near my house soon. Gov. Mitch Daniels soon will sign THE BEST telecom law in America. Will other states follow? -Bret Swanson

House Energy & Commerce Chairman Joe Barton (R-TX), along with Reps. Chip Pickering (R-MS) and Fred Upton (R-MI) have an alternative plan in mind for cable franchise reform, according to this afternoon’s National Journal’s Technology Daily ($). Like the Dingell plan, the Republican vision includes a national franchise according to which new entrants would pay the customary 5% franchise fee to localities. But the Republican is superior in two critical respects: No build-out requirement. No requirement to negotiate with local franchise authorities as a pre-condition to obtain a national franchise. It may sound counterintuitive, but the absence of a build-out requirement is actually better for consumers because it reduces investment risk. Tens of billions of dollars are necessary to extend Read More ›

A draft franchise reform proposal authored by Ranking Member John Dingell (D-MI) of the House Energy & Commerce Committee, details of which were reported in today’s Communications Daily ($), increases the likelihood that final legislation would: Allow new video entrants to avoid in-kind contributions to cities (currently averaging approx. 3% of gross revenues) on top of the customary 5% (of gross revenues) fee, Would give the new entrants 10 years to provide their service to every household, and Allow the incumbent cable operator to opt in to the streamlined process as soon as the new entrant has a 15% market share. Dingell, who has traditionally defended the cities on franchise issues — and intends to do so again — reportedly Read More ›

Mike Darda asks a very good question of those who complain of Chinese currency “manipulation”: It is telling that the anti-China crowd in Congress has not taken aim at other dollar-linked or dollarized countries with destructive tariff proposals or charges of currency manipulation. Where are the tariff threats or cries of currency manipulation against Ecuador, El Salvador, East Timor, Panama, Lebanon, Hong Kong, Saudi Arabia, Kuwait, or Malaysia, all of which either use the dollar as legal tender, fix their currencies to it, or manage them in a tight band against it? -Bret Swanson

What’s going on? Last week the U.S. Trade Representative Rob Portman unveiled a comprehensive review of U.S.-China trade relations and our policy toward the Middle Kingdom. The report acknowledges the many benefits that flow from trade with China. It also announces new steps to strengthen our ability to monitor and affect China’s compliance with intellectual property laws and WTO rules. So far, so good. The report even stays away from the contentious issue of the supposedly undervalued Chinese currency, the yuan. The word “yuan” is not even mentioned in the long report. I thought this was a real breakthrough in U.S. policy toward China, showing a more nuanced and sophisticated view of the relationship, one that might actually get results Read More ›

Rich Karlgaard at his great Digital Rules blog refers to Robert Cringely’s new column. How can an article make so much and so little sense at the same time? Cringely correctly identifies big bandwidth as a replacement for Quality of Service (QoS). Big bandwidth will indeed render moot most of the “blocking” and “degradation” fears of the content companies. Congress, furthermore, should refrain from imposing new rules in a dynamic realm it knows little about. Yes, yes, yes. He must be lurking here at disco-tech. But then Cringely gets mixed up and implies the bandwidth providers (cablecos and telcos) are the ones asking for special new rules. Exactly wrong. It’s the content companies asking Congress to impose a massive new Read More ›