Consolidation in the telecom industry

Submitted by acohill on Wed, 10/20/2010 - 08:48

Chris Mitchell has a short but pointed note about the fallacy of the "leave it to the private sector" policies that have received so much attention, mainly because the incumbents have pushed that approach vociferously over the past fifteen years. But Mitchell points out that it has largely failed, with many fewer ISPs than in the late nineties, and overall, fewer telephone and cable companies as the big telecom giants gobble up the smaller ones.

His final point is the most important one: to maintain some balance and to encourage real competition, there needs to be the opportunity to form and run community-owned networks that are "structurally accountable" to the community itself. Telecom and broadband services have become essential economic development infrastructure, and communities need to be able to control their own destiny. I don't subscribe to the notion that the incumbents are bad. I don't subscribe to the idea that they should be regulated out of existence. What I do believe is that community-owned broadband networks ought to be given a fair chance to prosper without the regulatory dead weight of prohibitions, restrictions, and statutory limitations on access to capital. The incumbents have had fifteen years to provide a modern fiber-based infrastructure to American homes and businesses, and they have, by their own admission, declared, "we can't do it." Fine.

Let's take them at their word, and unleash American innovation and enthusiasm to try something different, like open access networks, which have network neutrality baked in when owned and managed by a neutral third party like a community or regional consortium. Open access projects like Utopia have fifteen providers on the network, including three TV providers--that's real network neutrality and real choice, without the need for excessive regulation and complicated rule-making.

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