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Technology Stocks : The *NEW* Frank Coluccio Technology Forum -- Ignore unavailable to you. Want to Upgrade?

To: Frank A. Coluccio who wrote (25777)	3/11/2008 5:52:31 AM
From: axial	Read Replies (3) \| Respond to of 46821

Frank, the recent trialogue has been fascinating - but also frustrating. Certainly, being better informed about the arcana of network economics is helpful, but what I'd really like to know is "How do we get outta the box we're in?" WRT your posted link on Net Neutrality, it seems clear that the problem would largely disappear in the presence of sufficient capacity: I mean excess capacity. Likewise, without capacity constraints, common carriage becomes a manageable problem. We know that the network builder doesn't have to be the network operator; even though we know (as wonk and fred have discussed) there is a cost to build. But new and enlightened policy can be linked to the economics, such that the cost can be recovered in 10 years, 5 years, or 2 years regardless of early utilization. We know that usage will grow into the capacity, because we saw, and we continue to see the phenomenon. If the buildout cost has been recovered, then what's the cost to transmit data? If an OC48 terminates unused in a given area at zero or minimal cost, how long would it take to develop a business plan for its use? How many ISPs would spring up, willing to extend their reach? We know from experience that at virtually every stage, from the First to Last Mile, a business case can be made given the right economic construct. We all know (now) that we won't soon see the reappearance of Andrew Odlyzko's scholarly research on whether Internet usage is growing. And despite the oft-repeated claim that the Internet is broken it can still support a huge increase in throughput. What's more, any future Internet will still use fibre. One of the unspoken assumptions in many discussions (in the global sense, not here) is that the "owner" is the "carrier" and also the "operator" who is responsible for "connection" and "maintenance", when we know that these can all be separate business entities. We know too, that an entire wired/wireless network can be acquired and operated quite successfully, thank you. We know because we've seen it done. There's no special magic - we don't necessarily need design/build by the owner, or the operator. The end-user doesn't care, as long as it all works. There are existing models in other industries where operation, maintenance and transmission are all individually contracted, with appropriate KPIs and SLAs to maintain QoS. The amount of fibre (including dark fibre, later lit) obtained at distress prices in the "downturn" [wink, wink] is little-discussed, and that relates to the fact that we're being hoodwinked by several "in the box" assumptions. Stimuli/incentives can be established for capacity build and connection. [If some incumbent wants to wave the Free Enterprise flag, especially after our experience of highways, railways and airlines, listen for helpless laughter] Moreover, it's not necessary to disenfranchise existing players: they can partake in the incentives too, or not - recognizing that failure to participate consigns them to eventual extinction. The extension of fibre networks applies to eventual establishment of wireless networks, too. In challenging topography, the extent to which wireless networks (anywhere) are accompanied by fibre makes infill and backhaul easier. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The underlying premises for the proposal are: A - Fibre overbuild serves everyone well, largely eliminating common carriage and Net Neutrality issues resulting from capacity constraints. The old linkages between cost and carriage must be broken - constructively. B - Beyond policy change, there must be some macroeconomic adjustments, that will serve the development of true competition and different business models in telecomms. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The discussion has been fascinating and informative: thanks to everyone concerned. But I'd like to see someone make the conceptual leap from the morass of where we are, to where we can go and how we might get there. Jim