Lieberman’s broadband plan draws fire
So Senator Joe has a plan does he? Hmmmm. He’s going to give tax credits to companies that build out broadband infrastructure. Well there’s a couple of things wrong with this idea.
First off, and this is truly one of the biggest problems, this won’t promote competition. It ignores the fundamental problem of infrastructure providers being service providers. This involves the problem of Right of Ways (RoW) and the enormous cost of overbuilding current infrastructure. To put it simply, there is only so much space available on a pole and the owners of those poles charge exhoribant rates to put other peoples fiber on it. So you might be asking what does that have to do with infrastructure providers being service providers? Well ask yourself this. If you had exclusive rights to a RoW would you allow someone else on it at a price point that would allow them to compete against you in offering services to your customers? I don’t think so. To further addn insult to injury the courts have recently ruled that telephone companies no longer need to grant access to their copper to competing xDSL providers and thereby further reducing competitive pressures (although it does bring them on a par with cable companies who have not had to share their lines).
This is the main cause of the downfall of the CLECs. The cost for a CLEC to access an ILECs copper and fiber is such that they cannot make a profit. What this bill does is ensure the incumbents will get a lot wealthier doing at taxpayer expense what they should be doing already with their profits. The incumbenmts are using their RoW positions to choke out competition so that they can hold back progress. They are reluctant to build out because it means they have to abandon major investments in outdated infrastructure that they have planned to write down over the next 10 to 15 years. From the point of view of the incumbents shareholders it is not in their best interests to abandon these multi billion dollar investments.
Secondly, his bill is designed to encourage more cable and xDSL “broadband“. The trouble is xDSL and cable aren’t up to the task of delivering broadband for the future. they have what will become severe limitations on Mbps. While cable and xDSL are certainly broadband in comparison to the dialup speeds of the past they will not suffice in the near future. The future is FTTH and nothing else should be accepted or we will find ourselves 10 or 20 years in the future having to spend even more money to fix the mess we have created.
So long as the infrastructure providers control the services that can be offered over that infrastructure we will not make any substantial progress. It is time for a new model. Broadband infrastructure needs to be viewd in a similar contect as roads. You don’t have every transport company building their own highways and charging exccessive fees for other trucking companies to use. What you have is local, state and federal governments building the roads at a cost applied to all taxpayers then allowing everyone open access to those roads. The same scenario applied to telecommunications is the only sane one and the only one that will work going into the future. It is the various levels of government that should build a nationwide fiber optic network connecting to everyone and allowing everyone who has a service to offer access to that fiber for the same price (akin to charging tolls on roads). This seperates the service providers from the infrastructure providers and absolutely ensures the greatest degree of competition.
OK I’ve had my two cents worth now it’s your turn 
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