Skier
join:2001-08-09
San Antonio, TX
| reply to micl
Re: Too Big for Their Britches
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One thing that bugs me (among many) is that the Bells were so successful in convincing people they they were actually losing money under the UNE-P rules. Under those rules their compensation was cost + reasonable profit... but because they couldn't charge cost + rape & pillage markup they were loosing money???? LOL.
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If you are going to make statements like this at least speak with complete facts and not represent the situation. The cost + reasonable profit approach for UNE-P was based on least cost model that set costs based on a TELRIC model. This approach assumes each incremental line cost is derived by figuring the most efficient facilities, hardware & software available if you were building a new network.
Two problems with calling this "cost" + reasonable profit:
1) Each incremental unit if built using those pieces would not work with the existing infrastructure &
2) It ignores actual costs of the real deployment & the additional maintenance costs of older infrastructure.
If the pricing had been set using real costs to deploy what was being resold & what it really cost to provision it & maintain it, the only problem would be AT&T and others would use an alternative method just like they are doing now.
BTW: Dave Dorman himself pointed out this same issue of as President of Pacific Bell, he forgot that when he became President of AT&T. He also forgot that retail prices are set by a combination of state regulators and various real competitors. If wholesale rates go up it does not mean retail rates go up. For the Bells it means still selling basic services at below cost as mandated by state commissions & selling packages at lower rates to minimise losses to VoIP, Cellular, Cable & facilities based providers. |
