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silbaco
Premium Member
join:2009-08-03
USA

1 recommendation

silbaco

Premium Member

POTS

How is the price to provide POTS lines dropping? Less and less people subscribe to POTS, making it increasingly expensive to offer on a per customer basis.

JakCrow
join:2001-12-06
Palo Alto, CA

3 recommendations

JakCrow

Member

That's not how a "free market" is supposed to work. Not only does POTS cost little to provide, the lack of demand normally dictates the market lowers prices to stimulate more demand. Except this isn't a real "free market" with true competition, is it?
Skippy25
join:2000-09-13
Hazelwood, MO

Skippy25 to silbaco

Member

to silbaco
Sure, if they replaced all lines every year or 2.

SimbaSeven
I Void Warranties
join:2003-03-24
Billings, MT

SimbaSeven

Member

..or replaced everything with fiber.
ke4pym
Premium Member
join:2004-07-24
Charlotte, NC

ke4pym to JakCrow

Premium Member

to JakCrow
said by JakCrow:

That's not how a "free market" is supposed to work. Not only does POTS cost little to provide, the lack of demand normally dictates the market lowers prices to stimulate more demand. Except this isn't a real "free market" with true competition, is it?

It's a real shame they stopped teaching economics 101 in school.
elefante72
join:2010-12-03
East Amherst, NY

elefante72 to JakCrow

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to JakCrow
Well you may be forgetting that these are regulated government monopoly utilities sponsored by the government, also needing to maintain the network and access to everyone where an "unregulated" company can fire a customer or change rates according to market forces. I jest because there is no unregulated companies anymore...

The smaller the customer base, the more the opex it costs per remaining customer--until it collapses.

It's a dying market, did you expect it to be pretty.

They raise rates on ancillary services because maybe their tariff rates do not reflect the true cost of doing business.
rahvin112
join:2002-05-24
Sandy, UT

rahvin112 to ke4pym

Member

to ke4pym
They've never taught Econ101 in any non collegiate environment. Of course even an Econ101 course rarely covers basics like monpolies and how they distort free markets. If you are going to madate teaching supply/demand you should include a lesson from swift on the danger of trusts.
silbaco
Premium Member
join:2009-08-03
USA

silbaco to JakCrow

Premium Member

to JakCrow
So they are supposed to lower the cost until they operate in the red? Is that how the free market works? POTS is a dying technology. Why? Because damn near everyone has a cellphone and doesn't need POTS. Those who do want a land phone can opt for VoIP and pay a fraction of the cost because VoIP costs a fraction of what POTS costs to offer and is far less regulated.

No amount of price cutting or competition is going to bring back POTS.

SimbaSeven
I Void Warranties
join:2003-03-24
Billings, MT
·StarLink

SimbaSeven

Member

said by silbaco:

POTS is a dying technology. Why? Because damn near everyone has a cellphone and doesn't need POTS. Those who do want a land phone can opt for VoIP and pay a fraction of the cost because VoIP costs a fraction of what POTS costs to offer and is far less regulated.

Some products do not operate correctly on VoIP. If VoIP can handle real-time, extremely low latency high bandwidth communications (we're taking FAX machines and alarm systems), let me know.

JakCrow
join:2001-12-06
Palo Alto, CA

JakCrow to elefante72

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to elefante72
Except this is the telco/cableco industry. They have no problem nickle and diming for everything.
JakCrow

JakCrow to silbaco

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to silbaco
But that's not really the issue, is it? Centurylink blames "competition" for raising rates. Absurdity at its finest.

tshirt
Premium Member
join:2004-07-11
Snohomish, WA

tshirt to ke4pym

Premium Member

to ke4pym
said by ke4pym:

It's a real shame they stopped teaching economics 101 in school.

This is closer to 5th grade math.
There is no free market because the LEC is forced to maintain a plant intended to serve all addresses, on revenues from 40% or less.


JakCrow
join:2001-12-06
Palo Alto, CA

JakCrow

Member

Gotta love it when supposed free market-types don't like it when the free market gets in the way of their argument. Then it's conveniently discarded for more excuses about how tough it is to be a regional bell with almost no regulation at all.
rahvin112
join:2002-05-24
Sandy, UT

rahvin112 to SimbaSeven

Member

to SimbaSeven
If your alarm system isn't communicating by cellular you are doing something wrong. A SIM card adapter can be had for less than $200 and a prepaid SIM can be had for cents per minute. It's not only cheaper it can't be cut.

fg8578
join:2009-04-26
San Antonio, TX

1 recommendation

fg8578 to JakCrow

Member

to JakCrow
said by JakCrow:

That's not how a "free market" is supposed to work. Not only does POTS cost little to provide, the lack of demand normally dictates the market lowers prices to stimulate more demand. Except this isn't a real "free market" with true competition, is it?

Whether or not there is a working "free market" for POTS is debatable.

What is not subject to debate is that wireline providers like CenturyLink have a huge investment in unused POTS lines with fewer and fewer customers to pay for it. That is a result of "carrier of last resort" obligations, which required telcos to lay wire for every home and business whether they actually subscribed to the service or not.

Under monopoly, with subscription rates north of 90%, that was a viable requirement. But now, with subscription rates down to 40% and dropping, mandating a wire to every home and business is no longer economically viable. The wires are still there, they must be maintained, and they result in huge fixed costs to the telco.

But the revenue to pay for all that is shrinking.
fg8578

fg8578 to JakCrow

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to JakCrow
said by JakCrow:

But that's not really the issue, is it? Centurylink blames "competition" for raising rates. Absurdity at its finest.

CenturyLink is not a wireless provider. So, to the extent CTL is losing POTS customers to cellular, they are correct to "blame" it on competition, because fewer customers to cover fixed costs must result in a price hike to the remaining customers.

JakCrow
join:2001-12-06
Palo Alto, CA

JakCrow

Member

What "fixed costs" demand raising the fee to keep your phone number unlisted from .75/mo to $5/mo? Do tell.

fg8578
join:2009-04-26
San Antonio, TX

fg8578

Member

said by JakCrow:

What "fixed costs" demand raising the fee to keep your phone number unlisted from .75/mo to $5/mo? Do tell.

Good question. I have no idea.

former qwest
Premium Member
join:2014-01-04
out there

former qwest to JakCrow

Premium Member

to JakCrow
my increase was from 0.99 to 1.08, this 5.00 must not be system wide, likely regulated by local PUCs?