View Full Version : Broadband is arse - rant
Jesus tap-dancing christ, i just blew through my monthly broadband allowance downloading one game off Steam in 3 hours. This has gone beyond a joke. Sweden is bitchy about not having 100Mbps lines ffs, we're stranded in the dark ages, and god forbid you wanna game online because with a 128kbps upload you are gonna lag/warp everywhere and get kicked. For $40 in Oz i could get 24Mbps and no caps. For $40 here i get lubed and pounded in the butt by my ISP.
Is it telecoms fault? Not really, they're just taking orders from their overseas shareholders (75%) who are well aware of the situation. The govt has had 3 chances to reverse telecoms stranglehold on NZ in the last 10 years, and has been threatened/conned/bribed into not doing so by guess who. They're terrified because telecom =1/3 of the entire NZ stock exchange.
Back to dial-up speeds for the rest of the month. *sigh*
/Rant over
Burnt Toast
28-04-2006, 11:32
Vote with your feet bro, Tell em to shove it.
Bring back bull Rush.
Ahh...
I love rants... often people are pissed off but don't have a clue what they are talking about.
Its not really telecoms fault there are lots of things that come into it.
Firstly - you have no *right* to high speed internet its a luxury. Telecom has no obligation to give it to you (I don't care what the governement policy is, philosophically there is no obligation). In a dream world we would live in a free market with no externalities and the price would drop to the market equilibrium unfortuantly there are externalities which affect this.
a) NZ's isolation. There are only a few large cables serving NZ's bandwith. Bandwith is limited to these cables.
b) Telecom is not an unlimted source of money, they are a business and they must serve their shareholders. If it is profitiable to upgrade they will do so, otherwise they won't - the same as any other business
c) Kiwi share - telecom is forced to supply free local calls to the public under kiwishare obligations by the government, this is subsidised by other services
d) Telecom does not have a monopoly on supply - new technology is coming in such as wireless and mobile internet - hell yeah its expensive, but thats the cost of developing new technologies etc.
Unbundling the local loop might increase broadband speeds/uptake in the short term, but it sends a pretty scary message to infrastructure investors. That is, if we think your too successfull/too big we will nationalise your investmetn for the greater good (Stalin/Mao would love this), which will put off further large scale infrastructure investment.
But lets watch, we will see more government meddling in telecommunications.. and it will bollicks up things even more.
mmm competition/regualtory law & economics = fun
Further reading:
The Itch to Regulate Broadband
by Rob McLeod
first published in the Dominion Post, 20 February 2006
http://www.nzbr.org.nz/documents/articles/articles-2006/060220itch.htm
further to MikeE's statement
'd) Telecom does not have a monopoly on supply - new technology is coming in such as wireless and mobile internet - hell yeah its expensive, but thats the cost of developing new technologies etc.'
Telstra Clear: if you live in an area with the 'cable' to your door you would be enjoying 2Mbs+ down and UP loads, with very consistent speeds. The real kicker is the price:
The same as Telecom. (well cheaper if you take into account install and the like)
S
Pay more, get a better cap.. Im on a 2MB (up & down) connection with 30GB a month cap (which they dont police). Costs me $109 a month. You definately get what you pay for here. As someone thats used "broadband" since it was first available here via IHUG's satellite service, then onto 128k Jetstream I can honestly say people have it better than ever nowadays.
Problem is for some its easier to complain to the government when you want something forced onto others (i.e. unbundling and local loop access) than to negotiate it yourself...
heh MikeE... I used to work for telecom as an NCE, I know the entire wellington tech crew who serve the SCC (southern cross cable).. Believe me, we have the technology for a few more mps yet ;) Read up on the cable, it'll open your eyes a little. It would've been wise to find out what i know before telling me i dont know what i'm talking about.
Your 'futher reading' (by a major shareholder in telecom) was rebutted 2 days later by the CEO of Econet, guess you didnt' read the paper that day. Rob McLoed showed a scary misunderstanding of economics 101 for a major company director i thought.
http://www.ewnz.co.nz/html/Article%20for%20Dom%20Post%20-%20response%20to%20NZBR.pdf
As he says, if regulation were bad for the industry, we should have had one of the most up to date telnet systems on the planet in the last 19 years. the reverse has happened; we are a textbook case (literally) of what not to do when privatising an industry and failing to regulate; our position was much used as an example in the UK's own LLU decision. The 'geographical isolation' card has been played in so many industries i cant count across australasia, and if you'd read telecoms review of its own systems in 2003, (try to find the link for ya) they are committed to copper for the forseeable (10-15) years. There's been some excellent research done at Otago Uni re just how much telecom and your precious 'infrastructure investors' bleed the NZSE for their benefit and shift assets AWAY from new zealand... No-one's calling for nationalisation yet, but you'd better check under your bed eh? Once again, i'll get a source for ya and post it.
As i said first, it's not telecoms fault really. they just do whats best for their shareholders. But as Sun Microsystems, Microsoft and IBM have recently told Dr Cunliffe, it's got to the stage where its actually going to start hurting our economy. Dunno if they'd know anything though. This is all online, through the NBR. Are you afiliated with telecom in any way? Your arguments have that 'marketing department ' ring to them that i keep getting when i call them for a fight.
No - never have worked for Telecom in my life.
But I do know all the regulatory affairs and regulatory lawyers involved (with this and other network industries such as electricity/gas/water/airports etc).
Disclosure: I'm a libertarian and member/supporter of the ACT party :-P
But I do know all the regulatory affairs and regulatory lawyers involved (with this and other network industries such as electricity/gas/water/airports etc).
oh really, what do you do? ... tell me what you think of this, i'm trying to sort fact from fiction of it at the moment
http://www.ewnz.co.nz/html/Letter%20from%20Matt%20Dunning%20to%20Reg%20Hammon d%20090306.pdf
Pay more, get a better cap.. Im on a 2MB (up & down) connection with 30GB a month cap (which they dont police). Costs me $109 a month. You definately get what you pay for here.
And you think this price is normal?
According to OECD research, it's normal for us and mexico. Both of which haven't unbundled or structurally seperated retail/wholesale arm of the incumbant, out of about 30 countries. Shockingly, we're both at the bottom of the table with regard to speed, innovation, contention ratios, prices and data caps.
It can get better bro, because as a high school economics class will attest, having a monopoly incumbant acting as the wholesaler for its own competition while retaing a retail arm is idiocy. This is shortly to be rectified, in line with the rest of the developed world.
And we will end up with a situation like electricity where the network has been unbundled (i.e. creation of transpower) where retailers can't generated energy or invest in lines.. then the electricity commission stops creation of the 400kv lines due to NIMBYs (not in my back yard types) etc...
Pays not to base things on High school economics ;-) besides the only economics I'm interested in are the Austrian and Chicago schools of economics (i.e. the pure ones/neoclassical) not this keynesian crap...
Interesting. Lets stay on subject shall we?
"Pays not to base things on High school economics ;-)" - I'm simply making the point that a child can see what the problem is here. Its an hyperbole.
Evidence of regulation in the OECD favours not only unbundling, but encumbant seperation. Further proof comes from south america, which is not geographically seperated from fuck all, yet remains in the economic rowboat next to us due to startlingly similar REGULATORY factors. Shock!
Can you find an example where an encumbant with both wholesale and retail arms selling to its own competition in ANY industry is a good idea. Please. Further, can you tell me why Jump, Saturn, Bell South, British Telecom (under Clear)and soon Telstra have left or will be leaving the industry in NZ. Because i can. They told us on no uncertain terms before they left. Also see every other country in the developed world bar mexico and slovenia, Sun Microsystems, Microsoft, Nortons, NZT in international and european and regulatory economics (this will embarrass the libertarian in you) and decide for yourself.
I could understand if it were simply the NZ public bitching about speeds. But when the rest of the world says they cant do business with us because of the regulatory environment and third world internet ... even ACT could see there's a problem.
What these other companies want is the government to step in and allow access to the local loop. If they want it thats fine, but they should either a) negotiate and pay for it at an agreed market rate, or b) invest in infrastructure and create their own - not get the governemnt to nationalise it.
You have now completely misunderstood this issue.
a) No-one is nationalising anything, put your commie-gun away. LLU involves the incumbant selling lines AT the current market rate or to the highest bidder. http://www.covec.co.nz/pdf/unbundling.pdf This is clearly laid out in the OECD manifesto on telco regulation, are you even reading these links?
b) Telstra in the last 2 months have announced that given the opportunity to own their investment instead of leasing it, the infrastructure will be rebuilt from the ground up for NG implementation (fibre exchanges.. small and pretty). Clear and Bell South said the same thing, but legal avenues to assert ownership (even with market rate payment!) were blocked, THREE TIMES, by a monopoly. Guess who. We'd not be having this talk if competition was here 7-8 years ago.
Look, with all due respect it's become clear that you are the one who hasn't a clue about this issue. I urge you to read the details on LLU from the states/european perspective, and get up to speed on the arguement, you might be suprised.
Telecom owns the asset, retail competiton cannot strike a deal for access so they wish the government to step in and decide on access/take defacto controll of a privately owned infrastructure asset. Essentially that is nationalising and redistributing the asset. A clear violation of private property rights.
Thes is probably the best explanation I've heard of it so far:
http://libertyscott.blogspot.com/2006/03/local-loop-unbundling-and-subsidies.html
and some more again, is Austrian/Chigago school of economics stuff here:
Antitrust. The neoclassical economic theory of perfect competition defines a competitive market as one in which there are a large number of small firms, all selling a homogeneous good and possessing perfect knowledge. The structure of the market, according to this analysis, determines the competitiveness of a market. But Austrian economists Friedrich A. Hayek and Israel M. Kirzner have rejected this theory of competition. According to Hayek there is no competition in the neoclassical theory of perfect competition. Competition to an Austrian economist is defined simply as rivalrous behavior, and to compete is to attempt to offer a better deal than one's competitors. Competition in the market arises out of one firm distinguishing its products in some way from those of other firms. And because firms in the real world do not have perfect knowledge, they do not know what a successful competitive strategy is until they try it. Competition is, therefore, as Hayek explains, a "discovery procedure." As each firm attempts to do better than all other firms, the knowledge of what consumers actually want in the market is discovered.
If the neoclassical definition of competition is accepted, many people may want antitrust laws to eliminate excessive divergences from an industry structure characterized by a large number of small firms. If the Austrian definition of rivalrous behavior is accepted, then antitrust laws are seen to be beneficial only if market structure affects rivalrous behavior. But the evidence indicates that market structure does not affect the competitiveness of a market. What matters to Austrian economists is whether governments interfere with rivalrous behavior. For example, when government imposes import quotas, domestic firms in an industry are shielded from the rivalrous competitive behavior of potential and actual foreign competitors. Or when the government prohibits entry into an industry, such as in the delivery of first-class mail, the competitive process of discovering new and more efficient ways of offering the service to the consumer is stifled.
According to Austrian economists, antitrust legislation is neither necessary nor desirable. In recent years many mainstream economists working in the area of antitrust have begun to express this view (see Antitrust). This is especially true of economists in the so-called Chicago school of industrial organization, such as Harold Demsetz, Armen Alchian, and George Stigler. Stigler, in his book The Organization of Industry, wrote: "In economic life competition is not a goal: it is a means of organizing economic activity to achieve a goal."
Source:
http://www.econlib.org/library/Enc/Antitrust.html
http://www.econlib.org/library/Enc/AustrianEconomics.html
Interesting guy, but flat out factually wrong, and i'm not even a third of the way into it. Unless, of course, it was written over a year ago, which it wasn't. I see also that you've built your entire argument around this one article.
A few points..
"I accept that Telecom's privatisation was done with the owners (and subsequent owners) agreeing to it being regulated under the Commerce Act in order that Telecom provide cost oriented, fair interconnection with its competitors. This is a bare minimum for telecommunications, so I will take that as read"
Massive international telcos dont pull and run when the govt wont regulate, they've existed n the UK for many years. THEY SHOULDN'T HAVE TO in a competitive environment, but when the environment isn't competitive why be there? Did you think they just threw their toys when they were told they couldn't make a profit by their wholesaler competition?
"...and some of its wholesale business faces enormous competition from the likes of BCL and Vodafone. Nowhere in the world has this been done."
Someone else who isn't reading very far afield. In his own back yard, in fact. BT voluntarily seperated before any government even sat on it, over a year ago. I was sorely tempted not to read any further at this point.
"Talk to Telecom about it - ask why it wont do it, or whether it will do it if you pay. If Telecom wont do it, it may be because it wouldn’t be profitable, in which case why should it be forced to do so?"
I totally agree, Telecom is right to defend themselves. We foolishly didnt sell the local loop first, we foolishly let telecom have their way twice after that (following threats), and the result speaks volumes. We as a people lead by a govt, have been foolish. So much so, that the bad decisions are now threatening our IT economy. Unbundling would be unfair, anti-corporate, and frankly a last resort. Quick, easy, endorsed by the rest of the free thinking world... I'll take it. Because I can see the end result.
"Given the Commerce Act exists and was substantially strengthened by Labour, why have no competitors taken legal action claiming Telecom is acting anti-competitively?"
Now I am seriously not reading any further. Talk to the TNZ massive legal team about what they spend their time doing, jesus christ this has been going on since Clear, like nearly 10 years!! You dont win fighting your wholesaler, i can tell you that. Telecom has gotten very, very good at telling 'retailers' that they can either have these new, fast lines now, OR go to the commerce commission. The last time this happened was just last month, as a blanket offer. Telstra caved, ihug didn't. Does no-one else read?! The comcom spanked telecom publicly, saying they couldnt do that anymore, and ihug is currently doing exactly what your man says isn't happening; taking legal action again. Flat out wrong.
"However, using information disclosure regulations along with the Commerce Act should be enough protection against “anti competitive behaviour”.
Slowly now.... this is exactly what light-handed regulation we are talking about. IDR has failed, because we aren't talking about real competition, and we are talking a third of the economy, sorry to have bothered you, please dont hit me kind of thing. This is the issue in a nutshell, what he just said. This belief in benign corporate self governance is just.. frightening. They dont disclose what they dont have to, and wont, or their shareholders would fire them.
"Why not require state owned entities to onsell excess capacity, before privatising it?"
Oh jesus they do. Look, I cant read anymore of this. And are we talking about an SOE, or future legislation? That horse has bolted.
"Telecom’s owners bought a network, its competitors didn’t and haven’t offered to buy it from Telecom"
Wrong. Local loop offers all over the show.
What is stopping Telstra Clear from building an alternative network? Its owner is many times the size of Telecom."
There's an elephant in the room here, and its being ignored. The cost to New Zealanders in setting up the network, from scratch, was many, many, many times more than (what is now) TNZ paid for it. Expecting another telco to do the same again and call it a good investment in a country with 4 million people is silly. There's a much easier way. I will not see this country turned into a socialist backwater technologically because of some calvinist philosophy.
"Negotiate with Telecom. I mean seriously, not just to buy access but to buy the entire local loop business into a company owned jointly by Telecom and its competitors."
What a good idea! this is called Unbundling the Local Loop. But if they wont sell, what can you do eh? If i was a telco, I'd be taking the easy road to legislation too, NZ will benefit as an offshoot. This is backed up so full of evidence it's barely an issue anywhere else.
"It is too easy to ask the government to give you access to something someone else owns - it is more creative and entrepreneurial to make the owner an offer it can't refuse!"
This line should read 'anti-trust legislation was invented for a reason, we think we've got a case here based on telecom's unique position, it might just work'.
Thats about as far as i got. Bottom line, we could follow humanist jefferson-ite property rights to the brink of collapse and let skilled IT leave the country en masse (as i am), or we could enact law to keep the country competitive, like a business. Just like the christains, leave your religion out of government please.
heh... just reading the rest of his site... its pretty good actually.
I'm not going to get into the specifics of the Com Com determinations, or anything involving Paula, Bruce or Grant due to work and this being a public board.
So I'll refer to the more Macro economic issues that this unbundling arugment is based upon - is that there must be antitrust/competition laws and regulation in order to increase competition.
Anyway my entire argument isn't based on one article, its based around a belief in neoclassical/austrian/chicago school (i.e. libertarian) economics. I.e. that the only place of government is to a) defend private property rights and b) enforce contracts - nothing else.
Now I'm not quite sure what in the above is yours and what is Scotts on his blog as youd idn't use the quote button (I'm assuming the speech marks are scotts origional)..
Slowly now.... this is exactly what light-handed regulation we are talking about.
You should of seen the look on the Ministers face when she responded to my "the era of light handed regulation appears to be at an end" comment in Feb (http://www.beehive.govt.nz/ViewDocument.aspx?DocumentID=25037 the quoted sentance in her speech is referring to what I said)
And light handed regulation is definately coming to an end:
s9 of the commerce act allows "control" of certain organisations, not just price, but quality, quanity etc... (only have to look at the Gas Industry Co for an example of this)
You have the new leniancy rules on cartels
Information gathering abilities of the ComCom
International Cooperation/information sharing with comcom and other antitrust orgs worldwide
Just check out MERW, Kensington Swan, Webb Morris, and other regulatory law firms and check their newsletters (MERW probably has the best)
Or we could refer to Milton Friedman, nobel prize winning economist:
Now we come to Silicon Valley and Microsoft. I am not going to argue about the technical aspects of whether Microsoft is guilty or not under the antitrust laws. My own views about the antitrust laws have changed greatly over time. When I started in this business, as a believer in competition, I was a great supporter of antitrust laws; I thought enforcing them was one of the few desirable things that the government could do to promote more competition. But as I watched what actually happened, I saw that, instead of promoting competition, antitrust laws tended to do exactly the opposite, because they tended, like so many government activities, to be taken over by the people they were supposed to regulate and control. And so over time I have gradually come to the conclusion that antitrust laws do far more harm than good and that we would be better off if we didn’t have them at all, if we could get rid of them. But we do have them.
Under the circumstances, given that we do have antitrust laws, is it really in the self-interest of Silicon Valley to set the government on Microsoft? Your industry, the computer industry, moves so much more rapidly than the legal process, that by the time this suit is over, who knows what the shape of the industry will be. Never mind the fact that the human energy and the money that will be spent in hiring my fellow economists, as well as in other ways, would be much more productively employed in improving your products. It’s a waste! But beyond that, you will rue the day when you called in the government. From now on the computer industry, which has been very fortunate in that it has been relatively free of government intrusion, will experience a continuous increase in government regulation. Antitrust very quickly becomes regulation. Here again is a case that seems to me to illustrate the suicidal impulse of the business community.
http://www.cato.org/pubs/policy_report/v21n2/friedman.html
Just replace microsoft with Telecom and there you have it....
Just out of curiousity... would you be able to disclose any interests you have in LLU?
Just like the christains, leave your religion out of government please.
As for this - not to sure what your on about... I'm not a religious person, if however your refering to my policy beliefs... well its kinda hard to keep those out of my opinion on the place of government ;-)
Oh yeah and please excuse the slight incoherance of the post.. its sunday nite at 11pm.. and its been a long two days...
Sorry for not using quote button, should've really. I'll be brief tonight and we can pick up on this this week sometime.
I am aware of the Austrian school of economic thought, and agree with libertarianism on many factors.
What we seem to be drifting towards here is pitting an ethos against New Zealands position at the moment with regard to LLU. What i have seen in your (and scotts) writings is a good example of what should happen, but no acknowledgement that often problems get solved faster without a focus on one particular ethos, something I can say i admire ACT for. Both of you have failed to provide an alternative way of getting into the top ten OECD countries for broadband uptake by 2010 (a govt plank), but are happy to act the milton friedman, good quote too. Whatever shaky ground it rests on, i believe we stand to gain from this, as the rest of the world has. I am happy to listen to options that haven't already been tried. Can we agree though, that the incumbant will do anything it can to remain thus? Because to me, the last 20 years only makes sense when you consider their legal obligation is to the shareholder, as it should be.
My interests in LLU? Simply that I.T. will be a major part of our isolated economy in 50 years, and we've started seriously flagging now. Thats about it I'm afraid, no shares in anyone, just professional (or at least ex-professional) paranoia.
Personal, corporate or private property rights are important. Except when, to the detriment of the country, after many legal pursuits, nearly 20 years, and backed by a wealth of evidence from everywhere even remotely similar, it can be quantitatively shown that the status quo is failing us. And i believe it is. Obviously, i also believe LLU is an imoprtant part of that failure.
20 years, 10, hell even 6-7 I would have agreed with your position. As an empiricist, with the evidence floating in front of me.. I cant. There we go, I'm an empiricist.
Just a stab at libertarians at the end there :)
This is fun - a nice reasoned discussion on a paintball board, two people who completely disagree on the matter and no childishness .... if only more threads were like this!
good read too.
I'd have to take sides with crash, being an empiricist myself.
The experiences of other countries are the reasons I've been against a number of recentish policy changes in NZ, and the converse applies here. That means I'm for policy change in this instance :p
Not that I know that much about it besides what I've read now, so I'll shut up.
NiGeFiRe
01-05-2006, 16:28
who's got time to read all this????
Anyone who is interested will read it...
As for empiricism... I'm more inclined towards objectivism... even though Ann Rynd hated libertarians (well she accused them of plagurising her ideas really)..
The thing is though... we are starting to confuse philosophy with politics (yes they are similar but not directly comparable)...
No I'm assuming by empiricism (wiki: http://en.wikipedia.org/wiki/Empiricist ) you mean that in lay terms "it worked overseas so it must work over here" with LLU, in which case you need to prove causality - in which case increased competition would not have happened without LLU in a free market... which I don't think you could prove, and that the results would be transferable - again there is no proof, which makes the argument flawed (though you could also say the same thing about the libertarian argument, so it becomes a bit of a crap response I know).. the difference the becomes one of rights, you don't have a "natural right" to high speed broadband, it is merely a luxury. In which case noone elses rights/freedoms should be impinged upon by cooercive force (i.e government intervention) to gain this (through regulation and LLU i.e. removing the freedom of contract and weakening private property rights through enforced redistribution of the local loop)...
Yeah again.. sorry if this is incoherant.. its the ened of the day and I'm tired - but you get the picture...
Burnt Toast
02-05-2006, 16:32
Thanks you two, that was very interesting.
Note to self : Never argue with Crash or MikeE
Nope - never get into an argument you can't win ;-)
Back again!
I had a big reply all sorted, when i realised we're edging toward a false dichotomy here... I know absolutely nothing about your position on the broadband status quo and why it's imperitive that it remain, why regulation would be disasterous for broadband and new zealand, some evidence for this, etc. I believe you're moving toward bringing the issue to rights rather than giving a statement of your assertion opposing mine. my responses give your arguement weight when (as of yet) I haven't actually seen one relating to broadband.
I realise it's a luxury. Whether that luxury helps us economically or it's a luxury that is quite detrimental, the idea that it IS a luxury is irrelevant.
You're right, i did mean lay proof; simply evidence would have been a much better choice of words, apologies. OECD guidelines enacted over nearly 10 years in 23 countries with overwhelming success is very good evidence. In fact we used far less evidence than that to join the UN, ANZUS, Two world wars, declare war on about a dozen countries, privatise SOE's, Sell gas lines and deregulate the pharmaceutical industry, most of which i agree with. So frankly that arguement is either very selective or not there at all.
So! Anyway. Some assertions for the status quo please.
you don't have a "natural right" to high speed broadband, it is merely a luxury. In which case noone elses rights/freedoms should be impinged upon by cooercive force
Sorry MikeE, this is a huge oversimplification, not adressing the issue, and could've come straight off the International Socialist website. And i'm not giving up coffee, meat or cheap clothing any more than i am broadband :)
what the hell do rights have to do with socialism - socialism is a complete lack of individual rights?
The extreme protection of individual rights typically leads to the extreme restriction of individual rights. Think full freedom of speech vs. anti hatespeech law - both claim to protect individual rights and yet are opposites. In that sense, socialism is often thought of as the ultimate protection of rights. Hence why aunty Helen can be a socialist with marxist leanings and yet a big supporter of unions and worker rights.
Anyways that's off topic, just clarifying the point that many people see socialism the other way because "protecting individual rights" is defined by which rights you're trying to protect.
And now, back to your regular programming.
Hate speech legislation doesn't protect any "natural" or in this case "negative" rights.
Hate speech law is unworkable because of its subjective nature, noone can define hate speech because everyones interpretation of it is difference.
Need I start a speil on positive rights (essentially obligations requiring state cooercion) and negative/natural rights (things that cannot be taken away without force) and their differences, and why negative rights are the only ones that should be protected by a state?
And Clark is a socialist (well chardonay socialist really) because of her support of unions and workers "rights". Socialism is the act of taking a shit all over individual rights in favor of collectivism.
http://en.wikipedia.org/wiki/Natural_rights
http://en.wikipedia.org/wiki/Negative_rights
what the hell do rights have to do with socialism - socialism is a complete lack of individual rights?
First, I'm refering to your blanket statements of rights positive and natural without relevance to the topic, and interestingly provoking another false dichotomy.
Second, 'should' brings us back to objectivism, and before we move on under that statement, at least check that i agree. And i dont.
Third, I hope you caught post 27? I posted twice... just checking.
unless I'm misinterpreting what you are saying (and correct me if I'm read wrong)
but rights have everything to do with the topic of LLU... as LLU is an assault on private property rights. The loop is the private property of telecom, and its competition wish to have access without agreed compensation to it by using the government to force LLU.
Any argument involving government interaction with the public can be explained by rights, which is where the relavance of it is.
As for not giving a specific argument against LLU, my argument rests more against diminisihing private property rights and government intervention/competition and antitrust law in general. As essentially regulation of network industries is all the same, nothing makes telecoms/energy etc any more special and in need of regulation than the manufacture of gimp masks and nipple clamps.
Its got to the stage that I'm not even sure what you are trying to say as there doesn't seem to be any consistancy in your posts, in one you say you are agree and then in another it looks the oppisite... I'm getting confused ;-P
does anyone else remember the govt report published in the late 90s about Telecom abusing its (near) monopoly position to the tune of $'00 millions a year. I have had a quick look (dialup is more arse than broad band) and can not find it (the Commerse Commision lists ~2750 publications relating to Telecom).
I was wondering if anyone remembers the figure and how this compares to the costs Telecom is stating for upgrading the network for real broadband services.
Steven
(i know this is vague as hell but I remember the report coming over the radio and little else)
Its got to the stage that I'm not even sure what you are trying to say as there doesn't seem to be any consistancy in your posts, in one you say you are agree and then in another it looks the oppisite... I'm getting confused ;-P
You're kidding, right?
Go back and very carefully read what i agree with and what i dont. I cannot agree, for example, that an rights-oriented objectivist (or christian, or islamic, or ANY other absolutism) morality should enable telecom to dictate the pace of our IT economy, and they are. If NZ as a business economy fails to act FOR our economy, we will all quickly learn how restrictive an absolutist ethical stance is. Replacing our judao-christian value structure with another inflexible absolutist value structure would be a step back into a very small box.
So intead you go for the "ends justify the means" approach?
Daedalus
03-05-2006, 18:23
Not that it really matters anymore ..... they've been given their marching orders this arvo.
http://www.beehive.govt.nz/ViewDocument.aspx?DocumentID=25636
Now it will be how long and slow a process it will be to actually get the loop opened up.
And what kind of deals we will "eventually" get.
Im picking 2 yrs
cheers
Anw what effects will it have on future infrastructure investment.
So intead you go for the "ends justify the means" approach?
Sometimes, MikeE, sometimes. It's all about having that flexibility. As an empiricist with no more evidence of truth than my own fallible experiences, i get to do that on ethical issues.
And yep scruff, it'll be a long road yet.
I can't agree with an ends justifiys the means type approach... because where do you draw the line with it. Do you draw it at telecoms, or do you go and nationalise all the gas like happened in bolivia yesterday? or in order to lower the levels of homless do you go and murder them like Brazil in the 80s? where do you draw that line of the "ends" justifying the means.
Interesting comments on kiwiblog:
http://www.kiwiblog.co.nz/archives/013922.html
Rodney tells it like it is:
http://www.act.org.nz/news-article.aspx?id=27571
Will be interesting to see if it hurts the sharemarket and the sort of impact it has on mom and pop investors...
From R.Hide's website 'telling it like it is'.... comments
"I agree with Steve C. It's for the public good. You cannot expect us to be downloading porn at 56k for the rest of our lives."
"As a free market conservative I agree strongly with the market principles that act and Mr Hide are talking about. However I believe that NZ's poor broadband uptake is a major problem and a hindrance to our economic growth. If we look past ideology I please ask Act and Mr Hide what they would do to make broadband cheaper, better etc. Cheers, Josh."
"And FWIW I disagree with the ACT position on this too. To simply state that the Local Loop translates to a 'private companies assets' is to take a very narrow minded view of the big-picture situation - that true competition is a very important thing in the development of new, better, and more affordable technologies."
Think that says it all really. Chat about infrastructure and investment some other time this week is cool with me
Heh and congrats on reaching 'division 1' by the way
"I agree with Steve C. It's for the public good. You cannot expect us to be downloading porn at 56k for the rest of our lives."
Telecoms Broadband does promote the downloading of porn, I mean think of any other application where slow upload/fast download is used (c.f. fast bothways for gaming).
I would not be suprised if we do not see Telecom slowely breaking off the copper wire on its own accord, basically upgrade a town to fiberoptic then 'sell' the copper to the 'lines company' which is a seperate entity. this way it will head off the Govt intervention (for a while) in the seperation of lines and retail and ulimatly leave the other telecos with the copper wire to maintain
I'd say we are likely to see less investment in infrastructure from telecom now if they can at all avoid it (i.e. bare minimum under the regulations) as it doens't make sense tospend money on an asset your competition can use at either no or below market prices.
Anyway .. I'm gonna sit back and watch the old "law of unintended consequences" have its way with this... I garuntee its going to be full of cock ups.
Anyway .. I'm gonna sit back and watch the old "law of unintended consequences" have its way with this... I garuntee its going to be full of cock ups.
it is post 1984 NZ:
same country, different cock ups
it is post 1984 NZ:
same country, different cock ups
No idea what you're on about there - unless you are calling douglas's reforms cockups? In which case you need to pull your head out of the sand, they were the single best pieces of policy has ever seen.
Well - looks like things have already started going down hill.
$1.1 BILLION dollars have been wiped off telecoms value in less than 24 hours:
http://www.nzherald.co.nz/section/story.cfm?c_id=3&ObjectID=10380243
I hope noone here owns telecom shares..
http://pc.blogspot.com/2006/05/annette-presley-face-of-theft.html
Peter cresswell sums up a fair bit of it.
Yesterday was a dark day for New Zealand... Unbundling is just a happy, politically correct word for one thing - theft.
How'd you like it if someone unbundled access to your car, your house, or your girlfriend... somehow I don't think you'd be too happy about if it your assets were unbundled for this thing we loosely describe as the "public good"
No idea what you're on about there - unless you are calling douglas's reforms cockups? In which case you need to pull your head out of the sand, they were the single best pieces of policy has ever seen.
my comment was more same area (land) as before 1984, different problems ie the inherited bloated/interventionalist state from before 1984 needed to be fixed, leading to a different possing of the question 'what should the state do?' with the problems ('issues' would be equally applicable) arising from the withdraw of the state from sectors of the economy (rather than its entry into, as before 1984)
overall the reforms were good, but in some cases they were less than ideal in the actual implimentation of the policy (arguements about e.g., the relative speed, viability of the resultant entities, ownership formations, will sustain Economics/Public policy/Politics Class forever), e.g. BNZ, Air NZ, Railways, the synthetic petrol plant (to name a few where there has been the need for large state payouts/losses from sale/degredations of infrastructure*) as opposed to the few true SOEs that exist (e.g. Landcorp, Coalcorp (solid energy))
Steven
*is it not odd how many of these existed either in highly porfitable protected environments (legislative manopoly), natural manopolies or got money from the govt and got into problems once they moved lost them?
NZ Herald -
Freeth (TelstraClear) indicated the decision would likely prompt a renewed push into the New Zealand market by his company which is owned by Australia's incumbent telco Telstra.
"In my early discussions with our Australian shareholder this evening they are both very pleased and it's certainly changed the whole environment for investment by them here.
"For the last 18 months or so I've been struggling to convince my shareholder that this is a good market to invest in. [Telstra chief executive] Solomon Trujillo's view has been this is pretty ugly and they are giving us no incentives to continue the investments that Telstra has made. For the first time I'll be able to go back to him and say things have changed and this is looking quite attractive."
Hmmm. Not the crash and burn for investment the nay-sayers thought. Common market sense, i thought really.
Bored now
Hmmm. Not the crash and burn for investment the nay-sayers thought. Common market sense, i thought really.
Not the crash and burn? are you high? Telecoms share price lost 1.1 billion dollars over night!
I'd suggest that there are many investors who would consider that a crash and burn for investment. I wonder what will happen to other NZ investments now that it has been signaled property rights are not secure. I wouldn't be suprised if you see a lot of fund managers exit the NZ marker over this.
The pet dog we used to feed grew too big after we sold it and started hurting the children, and so we have to chop its balls off. About time.
NiGeFiRe
04-05-2006, 18:42
I am sorry Vigil but I think you need to stop smoking your p pipe
You know the two statements aren't related Mike. I am talking about incoming capital investment as were you earlier. Stop trying to confuse the issue.
FYI, 10c was less than the most conservative estimate being put out by the likes of polson higgs and price waterhouse about a month ago. It's panic like yours that causes the loss of market confidence.
Fund Managers exiting the country after OECD best practice that's been followed everywhere else...? where are they going to go, fund-manager island? All of you keep forgetting, this isn't kiwi socialism at work.
All this is a moot point. Without a shread more capital investment, we could start seeing ADSL2+ 24mbps down, 12mbps up, no caps, 50-1 contention ratios, and break the $20 barrier for broadband. Absolutely disasterous for the country.
You're welcome. :)
I'm not trying to confuse the issue at all.
No this isn't socialism - its more like fascism, theres a clear difference - The state granting favors taken from one business to the other.
And you are correct, without a shred of capital investment you could start up something. The reason why - because someone else has paid for that captial investment.
I wonder if you'd feel differently if it was your own asset that the government forced you to share with others against your will - especially those whom you were in competition with.
And its not panic like mine that causes a loss of confidence - its a lack of respect for private property rights that do. Why invest in a country if there is a chance you have to share your assets with competition who are too crap to afford their own.. its just not worth the risk.
And you are correct, without a shred of capital investment you could start up something. The reason why - because someone else has paid for that captial investment.
You've misunderstood. Again.The nuts and bolts of the regulation is that telecom can no longer artificially impose limits on caps, speeds, etc. So get ready for a suprise that telecom's been hoarding and drip feeding a desperate IT economy. THEY'VE ALREADY GOT IT. Dont wonder where it comes from. By the way, more than this was wiped off telecoms shares in 2002 when verizon sold all but one percent. 1.85Bill. Oh shit they're still here!!
I wonder if you'd feel differently if it was your own asset that the government forced you to share with others against your will - especially those whom you were in competition with.
If i'd been a public nuisance for nearly 20 years and actually damaging the economy but were a small business, 5 employees, modest income... i'd have been stepped on years ago. A NIMBY, by your own words. Property rights only matter if you're enormous though, dont they MikeE?
Telecom get to keep their asset mikeE, effectively nullifying any 'theft' squealing. The Govt regulated the rental price to ATTRACT infrastructure investment. And it works; as the NBR stated, this particular surgery was harsh but necessary. How long did you think we could go on letting one company with 95% of the broadband market threaten our economy? While we're on the topic, in true political style you have completely failed to suggest an alternative route out of the swamp. This is the second time i've asked.
I've suggested an alternative route consistantly - but you've obviously avoided it.
1) get rid of kiwishare, so telecom isn't forced to subsidise local calls
2) get rid the of the RMA which prevents the competition from laying down their own cables
3) get rid of the overseas investment commission which makes FDI harder
4) reduce needless redtape/tax/compliance costs which make it harder to invest in a business
I've suggested an alternative route consistantly - but you've obviously avoided it.
1) get rid of kiwishare, so telecom isn't forced to subsidise local calls
2) get rid the of the RMA which prevents the competition from laying down their own cables
3) get rid of the overseas investment commission which makes FDI harder
4) reduce needless redtape/tax/compliance costs which make it harder to invest in a business
1) You've just told me you dont like the govt interfering on behalf of other companies, now you want them to legislate FOR telecom? on a contract telecom volunteered to sign? For local calls they dont 'subsidise' at all, instead we suddenly started paying the highest line rental BY FAR in the OECD? This is a joke, hypocrasy, and a complete reversal of your position. Next!
2) See about 20 posts ago, also add the attractive proposition of 4-5 exchanges on every block, more lines, not to mention holes in the road for decades to come. Considered, discarded, not workable.
3) Agreed, but absolutely negligible effect on broadband issues with an encumbant controlling 95% of broadband. as for number 4. The foreign investment you're trying to attract to broadband here gets done faster with LLU, as shown in 22 other western countries, that i'm getting tired of pointing out. broadband, broadband, broadband. get it?
Also mikeE, you've not mentioned any of these before, consistantly or otherwise, so i've not avoided anything.
1) You've just told me you dont like the govt interfering on behalf of other companies, now you want them to legislate FOR telecom? on a contract telecom volunteered to sign? For local calls they dont 'subsidise' at all, instead we suddenly started paying the highest line rental BY FAR in the OECD? This is a joke, hypocrasy, and a complete reversal of your position. Next!
Umm no its not a joke, nor hypocracy, and you obviously have a vauge understanding of legislation. Its not legislation "for" telecom, its removal of statuatory obligations under the act, which force cross subsidisation between services (i.e. collectivising the cost of local calls across allc ustomsers).
Telecom isn't paying for the cost of these free calls, the expense is just passed onto existing customers, wheras the money used on these could easily be spent elsewhere.
2) See about 20 posts ago, also add the attractive proposition of 4-5 exchanges on every block, more lines, not to mention holes in the road for decades to come. Considered, discarded, not workable.
Counties power managed to do it in Pukekohe when I lived there, and did a great job of it, laying fibre optic cables and starting up Wired Country - which is effective competition in the Area. Definately workable.
3) Agreed, but absolutely negligible effect on broadband issues with an encumbant controlling 95% of broadband. as for number 4. The foreign investment you're trying to attract to broadband here gets done faster with LLU, as shown in 22 other western countries, that i'm getting tired of pointing out. broadband, broadband, broadband. get it?
Not negligible, if its easier to invest without regulatory barriers, people are more likely to invest in infrastructure. Instead its cheaper to lobby the govt to allow access to others infrastructure than to build your own, wheres the incentive there?
Sorry if I haven't mentioned these here before, I was pretty sure I had, but I'm having this discussion in a few other places as well (with some dedicated commies who aren't capable of rational arugments and instead jump into the class stuggle arguments and talk about punishing the fatcats etc.. so occasionally I get mixed up between the two forums).
Anyway - I'm back at work now, so won't have the time for quick responses - please excuse me if its not upto date.
Telecom isn't paying for the cost of these free calls, the expense is just passed onto existing customers, wheras the money used on these could easily be spent elsewhere.
are we discussing the money Telecom gets from passing onto its customers the costs of kiwishare being reallocated by Telecom into other areas (and oddly still collected for a service they wil no longer provide*), or are we talking more holisitcally 'money from consumers that Telecom collects to pay for Kiwishare could be spent in other areas of the economy if Kiwishare is removed, by those people who are net payers of Kiwishare at the moment'?
Steven
*been there done that, they charged my parents for a FREE service going on 3 years after Telecom swore that it still cost money (only found out as I was pricing changing phone companies)
are we discussing the money Telecom gets from passing onto its customers the costs of kiwishare being reallocated by Telecom into other areas (and oddly still collected for a service they wil no longer provide*), or are we talking more holisitcally 'money from consumers that Telecom collects to pay for Kiwishare could be spent in other areas of the economy if Kiwishare is removed, by those people who are net payers of Kiwishare at the moment'?
Both... no service is free, there are overheads regardless. If telecom is providing a service for free then the money for it must come from somewhere (same with price caps), so it must therefore be cross subsidised by other customers or from other departments.
Putting an artificial cap on the cost of local calls (i.e. one of $0) means that for every call made the true cost of that call is passed on to someone else to pay for who is using another service, therefore making that service more expensive. Lets assume that that cost is spread out equally across all products, one of which would be broadband. Thats money that could have been spend on upgrading broadband which is instead subsidising someones local calls.
And as for the lack of competition pre LLU - wired country seemed to do a pretty good job of building their own fibre optic and wireless broadband network in the counties manukau area.
Unbundling takes away the incentives to invest in such infrastructure. I guess they are lucky that they have laid fibre optic cables, as AFIK (I could be wrong here) that LLU will not apply to them nor their investment (though it seems unfair that it only applies to telecom) even though effectively they have the monopoly of supply of cable in that particular area.
I guess you could still take it back to antitrust/competition law and the question of market definition, what is the market:
* Is it supply of copper cable to households
* Is it the supply of cable to households
* Is it the supply of broadband internet connections to households (Wireless, Mobile 3G, ADSL via copper phone lines, Fibre optic Cables etc).
Sure telecom has a monopoly on copper cables, but they don't have a monopoly on broadband supply to individual households.
Anyway - I should be working..
http://stuff.co.nz/stuff/0,2106,3657725a13,00.html
At first reading, that article seems to put to rest the idea that LLU is going to result is less infrastructure investment. Like completely.
Then again, maybe I'm reading it wrong?
Its one article hardly puts the idea to rest, also they talk about investment in wireless infrastructure - which suprise suprise has nothing to do with unbundling of the local copper loop.
My question is why couldn't they do this before LLU? Sounds dodgy to me.
I guess maybe they figured there were too many barriers to entry regarding expansion into other areas (dsl)?
I dunno. In any case, it appears that investors dont seem particularly dissuaded from moving in.
Sorry, been away all weekend.
MikeE, our govt's have had 16+ years to put any of your suggestions into practice, and by putting any of these tools in telecoms hands, their dividends would increase, not the infrastructure spend (see the last 16 years). To ask me to believe it was going to happen your way anytime soon is gonna be hard. As a corporation, telecom had no obligations to the new zealand economy, it's people or our policies. Meanwhile our govt would continue to 'ask nicely', and the economy would continue to suffer. This is rapidly moving to the political end of the conversation, and I feel this is a mile away from where we started. Not where i wanna go with this thread.
I didn't expect the LLU decision to happen so quickly, but it has, and every single technology/infrastructure commentator and perspective for the last 5 years has indicated to me that we will see significant benefits in broadband and therefore our economy, alot of it being because of this legislation. I choose, based on an enormous pile of evidence and my experience at telecom, to believe them. Now that it's actually happened i seemed to have run out of things to say really... just a 'wait and see'.
You have the benefit of being able to say 'could've, should've', sit back and prosthiletize on how much more huge telecom could've have been, our complete dependence on them for copper broadband (ie, the next 10 years) etc. You'll never be proved wrong or have the burden of proof, but even ACT couldnt sit and watch as software, hardware and general IT skills got shipped out of NZ because we simply lacked what we need to compete.
I wouldn't call myself a socialist, and i actually hope the govt doesn't have to be this heavy-handed ever again. But this is a textbook case of placating the screaming baby inside a burning house.
My argument against unbundling has consistantly been one of political/philosophical reasons. You suggest its moving to that end of the conversation - its been there right from the start. I'd suggest the reason you don't want to touch that end of the convo is you would quickly be proven wrong with regards to unbundling and the state meddling in business in general.
Its simple - supporters of unbundling and regulation of industry in general are quite happy to have the government force someone to give them what they want when they can't negotiate it themselves, in my opinion its simply looting, nothing else.
I don't see any difference between unbundling the local loop because "prices are too high" (yet people seem to be prepared to pay for it), the "market is uncompetitive" (yet competitors exist: wired country, saturn or whatever the wellywood one is etc). There is no difference on a philisopical level to getting the government to unbunble local loop access due to these reasons and someone stealing a car "because its too expensive" etc...
No matter what way you paint it, its still theft, cooercion and looting of a privately owned piece of property.
This is the last post I'll make on it - because I just can't be bothered banging my head against a brick wall.
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