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munky99999
Munky

join:2004-04-10
canada

Carrier rage!

We all know that the carriers could have done this from the get go. They didnt because they WANT the insanely priced data plans that people are inevitably going to go over, unless they simply dont use the product.

So you have 2 kinds of customers.

Those who are paying you top dollar for no product in return.
Those who are paying bills which require you to be getting golden parachutes from the federal government; monthly.

Eliminating the later doesnt fix the underlying problem of outrageously price gouged data costs.

Regulating the data costs toward the actual cost plus very comfortable profit margin. This fixes the problem.

EU hasnt done this because they are being lobbied by the carriers so as not to ruin their cash cow.
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tshirt
Premium
join:2004-07-11
Snohomish, WA
kudos:5
Reviews:
·Comcast
said by munky99999:

Regulating the data costs toward the actual cost plus very comfortable profit margin. This fixes the problem.

The questions are
1} Whats the actual cost?
These companies have already paid top dollar (at auction as highest bidder) for the right to use specific frequency for a specific purpose. It's value is very high due to limited availability (FCC is currently considering PAYING other broadcasters (mostly TV) to reclaim those parts of the spectrum, which they can then resell at a much higher price.
(This is the FCC solution to limited spectrum resources, hoping to flood the market, and create NEW windows for competition)

AND
2} What is a reasonable profit for investors? Who took the risk of buying frequency, building a network (towers, back haul, network equipment and business systems) knowing that it could become worth much less, very quickly (with less than adequate return) should the FCC release more frequency ONLY to new competition.)
Comparing OUR market to the EU or anywhere else)rarely is a good analog (Tax and business policy is far different there)
Yet much of the world continues to invest heavily in the US (as US citizens SHOULD be doing) because the profit is possible) remove the profit motive and investors will flock elsewhere (not just telco investors, but across the board) which would kill our economy.
Many reason exist not to over regulate at this time.

chimera

join:2009-06-09
Washington, DC
Actually a recession is the perfect time to regulate. Recessions are when companies who can't do what the market requires are being weeded out and when new companies who can have their best shot at growing since established giants can't afford to destroy them or buy them out. Add in a new layer of regulation and you can ensure that the new growth fits into it naturally instead of trying to wedge a corporate powerhouse into a box after it's already bloated.

munky99999
Munky

join:2004-04-10
canada
reply to tshirt
quote:
1} Whats the actual cost?
That's for the market to put out there. The regulators requests parties to calculate the hardware costs, the applicable licensing costs, and the electrical/EM costs. Realistically all these costs are insanely low.

quote:
These companies have already paid top dollar (at auction as highest bidder) for the right to use specific frequency for a specific purpose. It's value is very high due to limited availability (FCC is currently considering PAYING other broadcasters (mostly TV) to reclaim those parts of the spectrum, which they can then resell at a much higher price.
(This is the FCC solution to limited spectrum resources, hoping to flood the market, and create NEW windows for competition)
Well FCC doesnt run the world. The problem is that maybe that frequency pricing is too high. Maybe we need to break down the license to very small regions. 1 carrier in Canada has control over an entire range of frequencies... but only uses them in the west coast. Or Bell runs the frequencies in the area but doesnt offer to rural areas. Nobody can put up towers there and run those frequencies. So we should break up the frequencies and everything quite a bit.

Regardless. I really doubt this small licensing cost is meaningless.

quote:
AND
2} What is a reasonable profit for investors? Who took the risk of buying frequency, building a network (towers, back haul, network equipment and business systems) knowing that it could become worth much less, very quickly (with less than adequate return) should the FCC release more frequency ONLY to new competition.)
Um the FCC has grilled the oil companies how many times on their profit margins? They only have something like 5-10% profit margin. While banks and pharmaceutical run more like 20% profit at lowest. Average industries being about 5% profit margin.

quote:
Comparing OUR market to the EU or anywhere else)rarely is a good analog
why? Because they havent had governments giving the carriers oligopoly? They have actual competition?

quote:
Yet much of the world continues to invest heavily in the US (as US citizens SHOULD be doing) because the profit is possible) remove the profit motive and investors will flock elsewhere (not just telco investors, but across the board) which would kill our economy.
Many reason exist not to over regulate at this time.
On the contrary. The american's economy has been dead for a decade since the beginning of the 2000 recession to now. The massive wartime spending managed to cover up this fact.

In the long run... because of the lack of frequencies. Free market forces cant work. It is a government mandated oligopoly too which the government must enforce heavy regulations because the free market cannot deliver competition. As long as you continue to allow non-competition backed by government power. Carriers have no obligation to not screw the customer.
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