To: Frank A. Coluccio who wrote (4921 ) 1/30/1999 6:54:00 PM From: ahhaha Read Replies (1) | Respond to of 29970
No one comes forward because no one wants a free market solution. What is the free market solution? That can't be known. The market will work it out. How might the market work it out? Well, what is the problem? The problem is that there is only one cable provider, that is, one provider of high speed service. That isn't true unless you imply that DSL won't do. I don't agree with that. Not everyone now or in the next several years wants or needs the potentiality of future cable. DSL for most is adequate. DSL is not earnings positive, but it can become earnings supportive by generating activity which would benefit a DSL provider if they were positioned to receive it. That requires the provider diversify into ancillary businesses. An example might be SBC cuts a deal with AMZN to share revenue on every transaction generated by DSL installation in its local area. SBC has to choose those revenue enhancers which leverage off higher speeds. Maybe AMZN isn't such a good example, but buying from them over the net sure could use speed. DSL could be offered at $30/month, stay within its technological limits without provoking all the exponentially rising costs necessarily incurred when trying to go head to head with cable, and fill a valuable market niche . In this case the market is no longer unimodal. Let's consider cable alone. TCI spent a bundle building the fiber plant. Why is that impossible for someone else? That's always the implied assumption: it can't be done. Yet, whoever does it, can put in high quality fiber instead of HFC, rig the system with state -of-the-art equipment, and specialize their delivery. They can choose what they want to deliver without necessarily having to carry tv and telephony. They could deliver the high added value services and amortize the project in half the time. That is competition. That is a market solution. That's not what is wanted. What is wanted is the eminent domain of socialism. The anti-free market types say, "no one would do that, it's too expensive". The conclusion is reached by computing the cost to wire every house in the world in two weeks' time. A network can be wired little by little. Voila, in 5 years you break even on the entire capital cost by the incremental revenue stream. This requires big banks, big companies with big visions. Guess we don't have that anymore. We have big cry babies who cry for protection from government, from competition, and especially from free markets. Bill Gates is worth almost $200 billion. He could easily peal off $30 billion and wire every house in the Pacific Northwest. It's chump change. We don't have Rockefellers, Carnegies, Morgans, men with vision, rather, we've got chumps who believe they need to save their wealth since they are sufficiently distracted to believe they will live forever, so they need that money especially in the year 9595.