[IP] more on Getting Universal Service to Work
Begin forwarded message:
From: Dana Blankenhorn <danablankenhorn@xxxxxxxxxxxxxx>
Date: July 21, 2004 1:15:07 PM EDT
To: dave@xxxxxxxxxx
Subject: Re: [IP] Getting Universal Service to Work
Reply-To: Dana Blankenhorn <dana@xxxxxxxxxx>
http://www.corante.com/mooreslore/archives/005176.html
Oram's Razor
Andy Oram has a long story at O'Reilly today detailing the problems with
universal service and public policy.
It's a great historical overview.
But it's missing one key ingredient. And it's a surprising ingredient
for
Andy to miss.
That ingredient is Moore's Law.
Moore's Law applies to fiber, and it applies to data radios as well.
Their
capabilities grow faster-and-faster, faster-and-faster. It's the impact
of
Moore's Law on both these areas that have blown away the financial
assumptions of the telcos, and the assumptions built into the universal
service debate. (Image from Hitachi.)
Oram rightly criticizes conservative critics of the universal service
ideal
as "in no sense constructive" in their spirit. But he never really
looks at
just what has made these criticisms so powerful over the last several
years.
That something is Moore's Law.
When something holds its value as you own it, you can safely buy it over
time. If it fails to hold its value, you have to shorten the payment
period.
Thus 30-year home loans are a good deal for both you and your bank, but
car
loans are pushing it at 5 years.
The problem is that networking capacity, both the cost of moving a bit
over
a long distance and the cost of delivering that bit at "the last mile"
of
the network, is falling in value even faster than the car in your
driveway.
When the radios of today are more than twice as capable of handling
local
traffic as those of two years ago, and the technology of fiber lines
show
similar improvements, you have blown a hole into any long-term financing
scheme.
No one, not a private company, not a municipality, not the federal
government, can justify building telecom capacity today on the basis of
a
30-year note. Not when that capacity is going to be worthless, in real
terms, just three years from now.
Oram's Razor, as I call it, doesn't cut through this question. (Image
from
fnal.gov.)
The critics' policy prescriptions don't approach this problem, either.
But,
in refusing to deal with it, they do come closer to a solution than the
advocates of government.
The real solution, as I've said, is to endorse full competition. Let the
Bells die. Let the cable operators die. Demand that any company wishing
to
use some of their infrastructure be able to get it, at low, low
wholesale
prices. The recipients can invest this money as they see fit, but they
must
be made to take it.
In the end the only worthwhile assets the Bells and cable operators will
have are publicly-controlled -- telephone poles and electromagnetic
spectrum. Everything else is ripening fruit. (Image from CompUSA.) When
it's
ripe treat these assets as right-of-way. The government can promise to
protect it and lease it as many times as the market can bear.
Let it ripen. Let it fall from the tree. But have a new crop coming in
behind it, and new financial models based on Moore's Law, with new
businesses that can provide service to everyone based on real
economics, not
just fictions.
Every policy prescription I see, across the political spectrum, is an
excuse
to subsidize either the government or incumbent duopolies.
Conservatives'
proposals actually violate their own ideological smell test, while
liberal
solutions all smack of corruption.
The only force that can hold up to Oram's Razor is Moore's Law. If it
doesn't give you the closest policy shave you've ever had, send it back
for
a full refund. We think you'll be delighted.
----- Original Message -----
From: "David Farber" <dave@xxxxxxxxxx>
To: "Ip" <ip@xxxxxxxxxxxxxx>
Sent: Wednesday, July 21, 2004 11:59 AM
Subject: [IP] Getting Universal Service to Work
Begin forwarded message:
From: Andy Oram <andyo@xxxxxxxxxxx>
Date: July 21, 2004 11:37:06 AM EDT
To: David Farber <dave@xxxxxxxxxx>
Subject: Getting Universal Service to Work
http://www.oreillynet.com/pub/wlg/5217
Getting Universal Service to Work
The notion of universal service in communications has great staying
power. Although the term "universal service" itself has fallen into
disfavor--I'll explore why in just a minute--the commitment to the
concept remains high, even in our troubled economic and political
times. Just try going to the [85]Thomas legislative information
site
and do a search for bills containing the word "broadband." Most of
these bills are striving for some form of universal service, such
as
high-speed Internet in rural areas.
But a parallel political universe in universal service has also
arisen. A number of researchers in recent years, mostly on the
political right, have critiqued the long-standing ideal of
providing
everybody with communications.
...
----------------------------------------------------------------------
Andy Oram O'Reilly Media email: andyo@xxxxxxxxxxx
Editor 90 Sherman Street voice: 617-499-7479
Cambridge, MA 02140-3233 fax: 617-661-1116
USA http://www.praxagora.com/andyo/
Stories at Web site:
The Bug in the Seven Modules Code the Obscure The Disconnected
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