Totally Ignorant Article By Michael Lind on “Who’s Afraid of the AT&T Merger”

Michael Lind who I thought would know better keeps writing these articles that show he’s totally clueless about modern technology and how it interacts with business and society.

 

His latest blunder is an article in Salon:

Who’s afraid of the AT&T merger?
American antitrust law is a relic of 19th century agrarian populism

I can only suspect that his organization, New America Foundation is just another one who is getting paid by AT&T just like they did other allegedly “left” organizations like GLADD, NAACP, NEA and many others.

Lind gets off spouting things like Anti-Trust  is so 19th century and there is nothing to fear from AT&T / TMobile merger getting more “efficient”. He had a problem getting cell reception at a National Park, so he things “I am tempted to favor any monopoly that allows all phones to work everywhere in the U.S.” That is so not what will be fixed if AT&T gets to consolidate its monopoly. What we’ll get is no more investment in infrastructure. That is the modus operandi of the Southwest Bell DNA in AT&T. How do you think the worst of all the Bells, Southwest Bell, got to roll up most of the Baby Bells back into AT&T? It was by NOT spending on infrastructure, collecting monopoly rents and using that as the war chest to buy up PacBell, Ameritech, Cingular, Bell South, and AT&T.

Have you seen AT&T spending much on DSL in the last few years? They have frozen any new spending that wasn’t already allocated. Verizon has stopped deploying FIOS. When you are an unregulated monopoly with only the illusion of competition from  regional duopoly of Cable TV, you don’t have to spend on infrastructure. Your only cost is advertising and buying off PUCs, state legislatures, Governors, the FCC, Congress, and Presidents.

Here’s what I wrote as a comment to his post:

Totally ignorant about how destructive Telecom Monopoly is

Wow, All I can say is this guy out of touch with reality.

Yes, there are some arenas where there are “natural monopolies” and efficiencies of scale. But they are rarely leveraged for the common good if the monopolist is not tightly regulated or forced to not use their monopoly to control everything touched by their monopoly.

If an entity has control of the an element that really stems from a common substrate, then that entity must be made to operate to the benefit of the community.

In the case of telecom, the monopoly doesn’t come from technology advance, or innovative business technique. It comes from the fact that there is a limited amounts of ways to connect homes and businesses to each other. Particularly in the last mile. AT&T, Verizon, ComCast and Time Warner all inherited their rights of way from when they were regulated monopolies. Those rights were immorally if not illegally transfered from regulated monopolies to unregulated monopolies. They have similarly monopolized the public spectrum but this time thru bribery and regulatory capture.

They have now used those choke-points of last mile to limit innovation (notice how countries with proper regulation and competition have much higher bandwidth at lower costs and bandwidth growth has stagnated and gone up in price in the US since re-monopolization)

And now they are using their stranglehold on transport to control content. The Government jumps in and supports the Telcos and the RIAA/MPAA to use “piracy”, child porn and terrorism as excuses to consolidate further control of communication and spy on citizens.

AT&T should not be allowed to consolidate their control of communications. They and Verizon, ComCast and TimeWarner should be broken up, but this time do it right. Break them up horizontally.

Make the physical plant ether a regulated monopoly or municipal utilities that just do the physical transport. Just like they do roads and water distribution. Then allow a true market of lighting the transport and offering services on top of that. Then we’ll see huge economic, cultural and political innovation, growth and abundance.

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4 comments to Totally Ignorant Article By Michael Lind on “Who’s Afraid of the AT&T Merger”

  • Bob

    Geez, talk about ignorant of technology. Why would I want DSL? You condemn AT&T because they are smart enough to not waste money on an old technology. You must live on a farm in the middle of nowhere and think DSL is the best solution to your dial-up modem.

    I just signed up with Verizon and now have internet access everywhere I go, in my car, at any store, on the beach, in the boat, and I don’t need Uncle Sam dictating who builds the infrastructure. They are doing it to meet the needs of real people in the real world.

    I dread the day I have to live under the Borg mentality of your phylosophy.

  • AT&T does not invest anywhere near what they need to invest in any of their infrastructure. And the amount of dropped calls or inability to make calls in so many places throughout Silicon Valley where I live (not in the farm in the middle of nowhere, so I wonder how bad it is on the farm in the middle of nowhere).

    Wireless, particularly cellular wireless can not deliver anywhere near the amount of bandwidth to any form of dense usage patterns that even DSL can, let alone what Fiber can deliver. One cellular sector can deliver somewhere in the range of 2 – 10Mbps. That is SHARED bandwidth with everyone on that sector. DSL could deliver between 1MBps to 25MBps and more to as many people within a 3 mile radius of a central office or a VRAD. Fiber could deliver GIGABITS of bandwidth to as many people who are connected to it for miles around the distribution point.

    What are you going to do once you view one or two HD video streams on your Verizon cellular service and you exceed your 5Gb usage cap? You going to pay thousands of dollars to use it for the rest of the month? (Thats the bill I got from ATT cellular when I tried to use cellular for my home connection and exceeded the 5Gb monthly usage in 3 days just because my GMAIL IMAP account was configured in such a way that it was pulling email a bit redundantly on a couple of computers in my house).

    Of course now the duopolies of Telco and Cable are instituting monthly Bandwidth Caps of 250Gb but that is what Monopolies do and why we need to divest and/or regulate them. Whereas in wireless there are some significant physical limitations of how much bandwidth can be delivered around a cell tower, the costs and physical limitations of delivering Terabytes of bandwidth per month to everyone is totally artificial once the copper, coax or fiber are in place.

    Its clear that you are the one ignorant about technology.

  • Bob

    I think you’re confusing recitation of technical specs with solving problems. I’m talking about the ability to decide what the right investment for the next decade and beyond will be. Your approach (force of law) doesn’t promote creative solutions to real problems. I’m sure it would bring you satisfaction in your quest for revenge, but I don’t want to live in your world. I just laughed at the thought that you can’t even be sure of the right transport mechanism in your last sentence. That’s a typical shortcoming with the God complex or people that use the coercive force of government for personal ambitions.

    Give me the name and capital investment of the company who is working on the 25MBps wireless, and the timeframe at which it will be available. Explain the strategy to accelerate that time to market by 25% and the extra capital required to pull it off. Address the extra costs for a 50% faster-to-market solution. How much longer will it take if we force the diversion of investment to something else? Who will gain, and who will lose in that trade-off? What moral proposition justifies imposing that choice on the losers? Spell out the dollar-value of the opportunity cost everyone is required to pay for you to have your dream solution. Explain the demographic makeup of the people who chose to go home for broadband vs. the people who want to be free to receive it anywhere anytime. Justify your rational for forcing one over the other based on verifiable data.

    The problem with your theories here is that it requires the whole of society to value only what you value, and requires large sums of capital be only deployed to the investments your narrow mind can comprehend. To put you at ease, I’ll point out I am as narrow minded as you are. We are both plagued with the incapacity to see beyond what we can imagine.

    If other narrow minded folks like us can handle the cognitive dissonance, they might want to expose themselves to some thoughts that stretch the imagination. Tim Hartford offers some ideas on solving problems that go beyond simplistic approach of (watch out!!) the Fascist state.

    Ted Talk: http://www.ted.com/talks/tim_harford.html

    To really stretch one’s abilities and to see a definition of Fascism that applies to this context: http://mises.org/daily/5634

  • The article on fascism was very interesting, so I don’t really understand what you are proposing and what you are objecting about my proposals. AT&T has to be the ultimate incarnation of what you complain of. They use the government to enforce their monopoly. They don’t build what is needed but what will reinforce their control of communications and allow them to maintain monopoly rents. So I don’t see how you can defend the status quo on one hand and then attack any proposal to open up the communications infrastructure that remove monopoly control. Monopoly rents are the worse kind of tax. It forces people to pay for systems that enslave them further.

    And from a logistics point of view you have to build out a fiber optic plant to deploy so much bandwidth to every square mile of coverage area. So a proper use of capital would be to deploy fiber to supply neighborhoods with GBytes of fibered coverage to homes and businesses AND deploy wireless for the nomadic usages. The incremental cost is small if done right AND it can create markets to implement all but the physical plant.

    Note that I have been involved with the design and building out of various Internet infrastructures both wired and wireless from 1993 thru 2007. I’ve watched the telecommunications transformations from total monopoly to open and innovative (which I had worked to accelerate and maintain) to watch it slip back to an even worse oligopoly. If not stopped, there will no longer be an open Internet as the oligopolies of ATT/Verizon/Comcast combine with the RIAA/MPAA to make the US Internet even more controlled than the Chinese Internet. See Hollywood’s New War on Software Freedom and Internet Innovation

    The article on Fascism had a very accurate diagnosis of the situation, but had no discussion on how it could be changed or what a positive environment should be. I believe that one of the big problems of today is that there is almost NO vision for a positive future. There is not even a language to describe how a world based on abundance would work.

    One of the key issues is to come up with institutions that can properly balance public commons with private/market based mechanisms. The proposal that the physical plant of telecommunications should be treated as a public good and as substrate for private / market services is one such attempt for exploring those possibilities. It is clear that the total “private” ownership by the same entity that controls transport and content is a huge failure and must be disrupted if we have any hope for personal freedom let alone innovation.

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