France Demonstrates Benefit Of Broadband Laissez-Faire
from the le-broadband dept
Last year, The FCC effectively shut the door on any hopes that the internet operators might have to share their lines with independent ISPs. Because the telcos own so much of the backbone, the last mile, and the legal right of way -- a full combination, not really possible, or reasonable, for anyone else to emulate -- they essentially have a natural monopoly; opening up the lines, so that companies can build services on top of them, is the only way to ensure a competitive market. So next time you get stuck with some outrageous bill for a triple-play offering you thought was supposed to save you money, you can look to France to see how the market might have developed were we to have a competitive system. In 2000, government regulators decided to break up France Telecom's monopoly. However, instead of the Ma Bell breakup, which just produced several regional monopolies, the government forced the company to open up access to independent data providers -- a trust-busting solution well suited for the internet age. Since then, prices have dropped dramatically for the "triple play" ($36/month from one company), speeds have shot up, and providers have introduced unique products into the marketplace. Importantly, France has young entrepreneurs trying to improve the internet marketplace, something you'd hope to see in such an important and evolving area. It's quite embarrassing that while the FCC is protecting low-quality, expensive monopolies, France, of all countries, has gotten it right in fostering competition, and demonstrating that free markets do benefit the consumer. Now they just have to get their labor situation sorted out.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Reader Comments
Subscribe: RSS
View by: Time | Thread
First Post!
[ link to this | view in chronology ]
[ link to this | view in chronology ]
[ link to this | view in chronology ]
3 cheers for France!
France now looks more American than we do. Well, at least someone is doing it! At least the massive corporations don't completely own the government in THEIR country.
[ link to this | view in chronology ]
...we're too stubborn
[ link to this | view in chronology ]
so true
I am bummed to see my basic cable Internet connection cost $45 here. Add another $45 for 40 channels (half of them in a foreign language and another half of that boring as hell).
In France, my mom has that triple play offer for $36 a month, she gets 8 Mbits/s , unlimited calls on land lines (countrywide), extra-low rates for international, digital tv with more than 60 channels + another 100 a-la-carte channels..
/cry
[ link to this | view in chronology ]
Fantastic
The reality is that these CLECs are only as good as the infrastructure they can free ride on.
DT, FT, Telefonica are all refusing to build new infrastructure until the obligation to allow another to free-ride on top of it is removed.
http://www.nyquistcapital.com/2006/03/27/ich-bin-ein-broadbander/
The fact is broadband penetration in France and Germany is less than the USA, and real deployment of advanced FTTH infrastructure is nil in Europe with the exception of muni fiber in Amsterdam.
The figures you see are from a subset of users that happen to be close to CO's that the CLEC decides to come in and cherry pick the best copper loops and the best customers. The French CLECs get to stack their own deck.
The only solution is to create an environment where multiple providers build competitive access infrastructures. If it happens to be a local government like Amsterdam, fine. But don't fall into the trap that forcing someone to give up their asset to someone else is competition.
[ link to this | view in chronology ]
Re: Fantastic
Yes, there is an issue with new infrastructure development, but there are ways to deal with that.
You could make the same argument about any natural monopoly, such as the highway system.
The reality is that these CLECs are only as good as the infrastructure they can free ride on.
Oh come on. Please explain how it's a "free ride." The CLECs are paying for it -- often much more than the *real* cost to France Telecom.
The fact that telcos are saying they won't build new infrastructure isn't *proof* of a problem. It's proof of them wanting a monopoly and recognzing they may have the power to demand it -- even if the *net* result is much worse.
The only solution is to create an environment where multiple providers build competitive access infrastructures. If it happens to be a local government like Amsterdam, fine. But don't fall into the trap that forcing someone to give up their asset to someone else is competition.
I agree that's *one* solution -- but not necessarily the "only" solution. However, your claim about forcing someone to give up their assets ignores the fact that most of these assets were built by gov't owned or gov't backed monopolies...
[ link to this | view in chronology ]
Re: Re: Fantastic
It's easy to come in after a risk capital investment has been made, success has been acheived, and tell the investor that he needs to sell at cost plus. The infrastructure wouldn't be there in the first place if this was the logical outcome. Who is going to stick their *ss out in the wind if 5 years later they aren't rewarded for the risk?
I agree that's *one* solution -- but not necessarily the "only" solution. However, your claim about forcing someone to give up their assets ignores the fact that most of these assets were built by gov't owned or gov't backed monopolies...
France Telecom was privatized. The government was paid for those assets by shareholders. I believe the shareholders were aware of UNE when they bought in.
Thanks for the healthy debate and the great site.
[ link to this | view in chronology ]
Re: Re: Fantastic
In reality I don't see this actually happening, but perhaps there should be committee-based municipal ownership of a resource constituting a natural monopoly, with a fair and equitable "usage tax" for everyone using it. Let the committee be formed of local service provider representatives and community advocates who decide the best cost based on real expenses.
But I'm probably a bit to Utopian for America at this point.
[ link to this | view in chronology ]
Re: Fantastic
http://www.iprovo.net/ and http://www.utopianet.org/corporate.htm http://www.sfcn.org that my State's municipalities have started. But you know who hates them? Qwest. The local telco, and they do everything in their power to make it illegal for the cities to offer this to their residents.
[ link to this | view in chronology ]
It's not right
[ link to this | view in chronology ]
Divest Application From Network Services
[ link to this | view in chronology ]
write right
Dude, two words: sentence structure. For God's sake.
[ link to this | view in chronology ]
Re: write right
"A critic is someone who comes down from the mountain top after the battle and shoots the wounded." -Honoré Balzac
Not all of us are blessed with the formal education we might like.
Me, for example. I struggle with sentence structure all the time.
Judge a post on it's content and it's characterizations and not the color or structure of it's sentences. Let the market decide if sentence structure makes post
nonsense. Your critical remark seemed like the rude, cold, splash of a nonsequitor. It was off topic, critical, and not constructive at all, since you did never respond to the poster's ideas or points, which we all realize might be better served in a sentence of better structure. But, Dudette, he wasn't that oblique. Stop showing off and memorize that quote. I bet you're not perfect either!!!
[ link to this | view in chronology ]
Re: Re: write right
[ link to this | view in chronology ]
Re: Re: write right
[ link to this | view in chronology ]
Laissez-faire
[ link to this | view in chronology ]
Not an accident...
Copper infrastructure varies in different European countries and from that in the US. Generally, loop lengths are shorter and there are more remote terminals.
Some of us had the following migratory path in mind: enter the market with SDSL/ADSL, then, with colocation at remote terminals, run fiber to the remote using a third-party's metro network to backhaul from the remote, then install our own VDSL (and eventually fiber) from the remote to the end user based on bandwith demands and content service offerings. I still think that would have worked in the US had the FCC taken the 1996 Act seriously.
I worked in the GC's office at the FCC before Covad. What the US needed in terms of enforcement was Eliot Ness. What the US got was Barney Frank.
BTW, the US DOJ considered an alternative break-up plan in 1984. Instead of creating regional monopolies and hoping they would compete in one another's territory, a group of economists proposed a facilities - service distinction. AT&T (old) would be broken into a company that owned the infrastructure (recognizing a potential natural monopoly of FTTX) and a competitive services company that would contract to use facilities just like any other new service entrant. The infrastructure company would thereby have the incentive to respond to end-user demand for bandwidth as expressed through the orders placed with it by competitive service providers. No one will know for sure if it would have worked. I continue to believe it never had a chance because in 1984 no one understood the proposal at DOJ or political level.
[ link to this | view in chronology ]
broadband
thanks to the lobbyists. The time when one will have to pay to be able to use the internet is coming. To think that France has had HDTV with 16/9 wide TV screen for 20 years! Pathetic. Broadband, forget it, you are offered download speeds up to 24mbs in France, you are lucky if you get 1.5mbs here in the US, and, for 1/3 of what you are charged here! Do you really think you are Numero Uno on this Planet?
[ link to this | view in chronology ]
mistake
with two a's
[ link to this | view in chronology ]
Poster who mentioned F****
Need to get over the fact that France was right with respect to WMD ...
[ link to this | view in chronology ]
[ link to this | view in chronology ]
some corrections needed
Perhaps we have 16/9 screen since early '90, but it is not at all HDTV !! I will add that if we have cheap broadband connection, nevertheless we have to pay the phone for connections related problems. And it is very expensive. My sister paid for 6 month without to get triple play. She had to cancel her subscription by her own.
Au revoir et à bientot
[ link to this | view in chronology ]
Used both...some comparisons
Service is restricted to the big metro areas. if you live in the countryside (American/British expats seem to like) you're out of luck.
And there is no HDTV standard here yet. I hear of lots of research and they have HDTV-ready sets but I got nothing on DVB-T thats HDTV, maybe satellite (DVB-S) is different, but the only HD coming this way is BlueRay HD-DVD
[ link to this | view in chronology ]
Sentence structure, &c.
It would be nice, were the US to institute such effects in the United States telecom/internet economy... But how is this an example of laissez-faire? Isn't gov't intervention for the good of the people, despite all its good reasons, ultimately an example of, well, socialism? I'm not calling the French socialists by any means, but if you're going to call it like it is, this sort of intervention is more likely to occur in more socialized systems, not in a laissez-faire system.
[ link to this | view in chronology ]
France...
[ link to this | view in chronology ]
So why aren't we all laissez faire?
[ link to this | view in chronology ]
Where are the people demanding change here in the
[ link to this | view in chronology ]
Where are the people demanding change here in the
[ link to this | view in chronology ]
Amazed
I have a gut feeling of disagreeing with this guy, but logically, I can't bring myself to post an argument, based on the fact that after reading what he wrote I know need to go back to high school and college.
Also, Whateva, there was nothing wrong with that sentence structure.
[ link to this | view in chronology ]
Put yourself in the shoes of a small business owner, with the system in France if you hire someone, you are stuck with him. And people say that American is a 3rd world country?
Excuse me. I think America is a great place. There are problems, issues, and corruption in the government, but the main way to slow that down (with government anywhere, that we will never be completely free of that) is to REDUCE the size of the government and its responsabilities. We require a government to do certain things, but why should we increase the size (like France, where your retirement, healthcare, and lots of other services are provided gratis by the government) and and expect things to get better?
Don't get me wrong - I think France is a wonderful place, rich in culture and history. But the structure of society today is so NOT Laissez-Faire - business is totally regulated by government. It is ILLEGAL for an employer to make an employee work more then 35 hours in a week. Can you imagine running that small business? I can see the classified ad: Worker required, lots of work to do, but you don't have to do it because I can't fire you and can't make you work the hours required to get it done, so come and take my money until I go out of business!
[ link to this | view in chronology ]
France, O France, how I adore thee
[ link to this | view in chronology ]
France, O France, how I adore thee
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Interesting discussion ....
I've worked in France a bit and the network infrastructure is impressive when it's available. Like someone else said, when it is not avaliable, the joining cost is high. France is a socilaist country and benefits should be universal when they are offered.
Regarding the US doing anything similar, we would pay for it many, many times. Lobby groups would ensure that the work was granted to those who gave the best bribes. Probably give the contract to Haliburton. Only certainties are that it would take forever and would be done poorly.
Don't know the best technologies, whether cable, dsl, electric wires, satellites or other wireless methods, but it is interesting to note the alternatives are there. Someone recently said that the AT&T break up was very destructive, but things like TCP/IP would probably not have evolved otherwise. This paragraph meant to say that competition is important and works well.
I think Americans do understand that we are not leading the world in broadband capacity; we are low on the list. Partially because we have the original infrastructure, partially because of the continuous research and new development. I don't mind paying $45/month for RR; I just wish it worked better.. It is a shame that the various players don't agree to play nicely and put the customer first, but when did that ever happen?
[ link to this | view in chronology ]
Something to be proud of (endly!)
2002 : bid opening -> rise to 1meg(dl)
Now we get between 8 and 20 Mbps (dl) and almost 1Mbps(ul) + TV + Phone -> 30€!
Even cable offers can't compete. The main issue is "hotline" service whih you have to pay like $0.40/minute ... with paying wait time and often long minutes waiting ...
Even smaller town get outrageous DSL speed ...
[ link to this | view in chronology ]
France gov is trying to make a shift on Fiber... but the bill is hurting so only Paris gets it for the moment ....
[ link to this | view in chronology ]
France did something better than the USA
[ link to this | view in chronology ]