[ NNSquad ] Re: Additional or differentiated services

[Barry Gold <BarryDGold@ca.rr.com>]

Lauren Weinstein wrote:
>   [ On the other hand, the vast majority of persons in the U.S.
>     *are* served by utility-based structures for water, power,
>     natural gas, etc.  Here in L.A. my water and power are provided
>     by a city-owned system.  Expensive?  Yeah.  But on the whole the
>     power at least is still a bit less expensive than the surrounding
>     private utility areas.  Broadband access is now in the necessary
>     functions arena, we need to treat it as such.

I agree with Lauren about LA's city-owned water & power system.  Our 
rates have been _consistently_ lower than any of the surrounding cities 
served by So Cal Edison, and we have fewer outages, fewer "planned" 
blackouts (because of insufficient energy on the grid), and overall 
better service than the investor-owned utilities provide.  (Of course, 
this is partly because DWP was exempted from that idiotic "you must 
divest your generating capacity into separate companies" rule.  But 
then, that's what the investor-owned utilities asked for.  "Be careful 
what you wish for... you just might get it.")

But I disagree that broadband is a necessary function.  The number of 
things we have declared "necessary", which you can survive perfectly 
well without, never ceases to astound me.

Water is a necessity.  Okay, without water you die in a few days -- or 
minutes in some parts of CA.  Power... that seems more like a 
middle-class "necessity", oh goodness, the power's out, how will I ever 
live without TV... lights so I can stay up after dark... etc.  natural 
gas... maybe in the Northeast -- except they mostly use oil & coal, 
which are delivered by... ta da! a private company.  Here in SoCal, if 
you don't have heat, pile on another blanket or two.

But for some reason everybody thinks gas is a "necessity".  Beats me.

Telephone... well, it's nice that everybody can "reach out and touch 
someone".  And yes, sometimes a phone can be a lifesaver, a way to dial 
911 if you're in trouble, or for a friend or family member to check up 
on you once or twice a day and call EMS if you don't answer.

But for most of us most of the time, telephones are _real nice_ to have, 
but by no means a necessity.  And I think broadband network access falls 
in the same category.

No, the real reason(*) for regulating broadband access is simple: it's a 
natural monopoly, like electricity or water.  There's just no economic 
way to have multiple providers stringing their own fiber (or copper) to 
every home in a neighborood.  Also, as a few others have noted, the 
telco/cableco uses a right-of-way provided by the city, so it's only 
proper that the city should regulate it.

And right there we can see two models, both of which work moderately well:

1. The government (city, state, or federal) sets the rates and terms. 
Or, more accurately, the provider offers up a set of rates and "tariffs" 
 (terms), and the utility commission (PUC in CA) decides if they are 
acceptable.  If not, they go back to the drawing board.

This is essentially the model used for the local gas and (where private) 
water/sewage systems.

2. The provider is free to set any rates and terms they want, but they 
have to rent out their lines to competitors at a rate fixed by the 
government.  This is essentially the model we have for telephone service 
(AT&T or Verizon has to let various competitors use their lines for a 
fixed rate) and to a certain extent for power: you pay a regulated rate 
to your local power company(+) for being connected to the grid, plus you 
buy kilowatt-hours from your choice of different suppliers.  WHich is 
utterly nonsensical, but that's the way it works, at least in CA.

(*) assuming there _is_ a good reason, which I think there is.

(+) excepting DWP and other city-owned utilities, which can charge 
whatever they like, but have to answer to the elected representatives = 
city council.