TELECOM Digest OnLine - Sorted: Re: Broadband Competition Must Surely be Working

Re: Broadband Competition Must Surely be Working

John Levine (johnl@iecc.com)
28 Aug 2005 16:44:39 -0000

> So, either the costs of cable are so high that the phoneco should've
> done it to provide for economies of scale, OR, cable laying isn't so
> expensive that others couldn't do it too.

I think you'll find the answer to the first question is that
regulators wouldn't let them do so in North America except in a few
rural areas. The answer to the second is blindingly obvious: there's
already a cable system in place and every customer would have to be
poached, at great expense, from the existing system. That's what a
natural monopoly means.

>> Telephone service over CATV networks wasn't realistically possible
>> until VOIP came along (some would say it still isn't).

> I dare say VOIP and other value-added services were in mind when they
> went to fibre (another rush job).

Fiber gives them lower maintenance and lets them offer cable modems,
HDTV and video on demand. Nobody builds a cable system to offer VoIP,
which despite all the hoopla is still a teensy niche business. They
build it to offer broadband applications.

> The local loop can be set up to carry high speed data and at one
> time could carry pulsed signals (not modulated) for Teletype
> machines.

Widespread ADSL depends on signal processing chips that have only
become available in the last decade or two. When CATV was being
built, the state of the art in phone line data was T1 with very
expensive equipment at each end of a not very long well line.

R's,

John

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