Should government compete with private companies to offer services such as internet?

[NorseThing]

Voters in Vail, Louisville and 17 other Colorado cities and counties Tuesday voted to take internet service into their own hands in a move that could lead to providing citizens an alternative to the entrenched cable internet provider. Fort Collins voters, who voted to do so two years ago, passed a measure to finance exploration of a city-owned broadband utility.
According to the Institute for Local Self-Reliance, which has tracked broadband votes for years, the 19 cities and counties join about 100 others in the state that previously opted out of Senate Bill 152. That bill, passed in 2005, restricts local governments from using taxpayer dollars to build their own broadband networks.
“These cities and counties recognize that they cannot count on Comcast and CenturyLink alone to meet local needs, which is why you see overwhelming support even in an off-year election,” Christopher Mitchell, director of the Community Broadband Networks initiative at the Institute for Local Self-Reliance, said in a statement.
Colorado communities’ broadband votes

On Tuesday, voters in 19 cities and counties voted to opt out of SB 152, which restricts local government spending on building a broadband network. Here is the percent by which citizens voted to opt out:

• Eagle County: 85 percent
• Boulder County: 82 percent
• Alamosa: 71 percent
• Avon: 83 percent
• Dillon: 74 percent
• Eagle: 85 percent
• Fort Lupton: 66 percent
• Georgetown: 76 percent
• Greeley: 61 percent
• Gypsum: 85 percent
• Idaho Springs: 70 percent
• Kremmling: 88 percent
• Louisville: 82 percent
• Manitou Springs: 84 percent
• Minturn: 81 percent
• Monte Vista: 61 percent
• Silverthorne: 85 percent
• Snowmass Village: 90 percent
• Vail: 85 percent

Sources: Institute for Local Self-Reliance, Colorado Municipal League
Passage, however, doesn’t mean cities and counties will start offering their own broadband internet service.
In 2005, cable and internet providers campaigned to stop cities from offering internet service. At the time, Steve Davis, an executive at Qwest, which is now CenturyLink, told The Rocky Mountain News, “I think it’s inappropriate for public tax dollars to be invested in competitive businesses. At minimum, taxpayers should have the opportunity (to vote on the matter).”
The law passed, but it gave citizens the right to opt out in order to explore the possibility of building a municipal broadband network.

http://www.denverpost.com/2017/11/08...s-150-million/

So once again we have government wanting to do what others can do. Just people want to pay less and have more service. Government (based upon elected officials) wants to offer what the people want. At least they want to confuse the issue that they can do better than what is already on offer in the private sector. OF course in the end funds are comingled so we do not know the real cost and it will pretty much be more expensive in the end. No matter though. It is what the people want.

So is it proper fo government to compete with private companies and individuals to offer services? If it is proper, un what circumstances should such services be offered? Should there be any provision to privatize such services after the government corporation is up and running?

I think most will know where I stand in general, but I am interested in the views of others here on the TWC! Oh and no poll -- I doubt this is really a simply yes, no, do not know type of an issue. I could be wrong though.

[Sir Adrian]

Why not have the best of both worlds and implement a European model where private companies provide heavily regulated access. By heavily regulated I mean regulated in favor of the customer and against the company's interest of maximizing profit.

[Gaidin]

Cable companies and other providers are doing a job Norse, more interested in maximizing short term profit than in maximizing infrastructure that would maximize long term profit. The people and the local governments are god damned tired of it. Live with the consequences.

[Prodromos]

I dunno, Internet speeds have increased significantly in recent years while prices have decreased. I remember in the old days you'd spent 70 dollars a month for like 20KB/s, while nowadays you can get hundreds of times that speed for cheaper. Sounds good to me. Can people really not afford 20-50 dollars a month for Internet? Stop spending your money on useless things like lottery tickets, Adidas shoes, or food.

Free prosperous population goes to government, gets free Internet and health care, doesn't feel good and changes - TYRANNY. Many such cases!

[hellheaven1987]

Why not have the best of both worlds and implement a European model where private companies provide heavily regulated access. By heavily regulated I mean regulated in favor of the customer and against the company's interest of maximizing profit.

Hence why Europe's economy does not grow much in past two decades.

[Sar1n]

20-50 USD is still too much I think. I'm paying 250 CZK (about 10 EUR or 12 USD) for problem-free line with practical speed in tens of MB/s and relatively direct routing (so when playing online, I get under 50 ms ping to hosts in Europe). Compared to this, the prices in US are insane. I get that it's different there, where low population density outside major centers makes higher infrastructure cost per customer, but the prices, compared to quality, are still insane.

It's similar situation as US healthcare. Too much laissez-faire approach led to creation of large corporations that have enough money to push a newcomer ouf of the business, while getting in a kind of "stand-off", as they understand that going against each other would not be profittable for either.

Anyway. Government's job is to provide to citizens what market economy can't, and if that is the situation with quality internet in US, then it should be their job to take measures to fix it.

[Gaidin]

I dunno, Internet speeds have increased significantly in recent years while prices have decreased. I remember in the old days you'd spent 70 dollars a month for like 20KB/s, while nowadays you can get hundreds of times that speed for cheaper. Sounds good to me. Can people really not afford 20-50 dollars a month for Internet? Stop spending your money on useless things like lottery tickets, Adidas shoes, or food.

Free prosperous population goes to government, gets free Internet and health care, doesn't feel good and changes - TYRANNY. Many such cases!

Ill give you a more detailed post later. But my parents due to the nature of inheritance are stuck in the backwaters of Kentucky and the private companies won't run even basic lines out to them. When they bother doing this maybe I'll take a step in your direction. As of now the only one if it were to ever bother would be state or local government services.

Best analogy would be the USPS. Too bad for you and Norse they can't be constitutionally shut down in favor of private businesses like UPS or FEDEX.

[Gaidin]

I dunno, Internet speeds have increased significantly in recent years while prices have decreased. I remember in the old days you'd spent 70 dollars a month for like 20KB/s, while nowadays you can get hundreds of times that speed for cheaper. Sounds good to me. Can people really not afford 20-50 dollars a month for Internet? Stop spending your money on useless things like lottery tickets, Adidas shoes, or food.

Free prosperous population goes to government, gets free Internet and health care, doesn't feel good and changes - TYRANNY. Many such cases!

http://www.denverpost.com/2017/11/08...s-150-million/

So once again we have government wanting to do what others can do. Just people want to pay less and have more service. Government (based upon elected officials) wants to offer what the people want. At least they want to confuse the issue that they can do better than what is already on offer in the private sector. OF course in the end funds are comingled so we do not know the real cost and it will pretty much be more expensive in the end. No matter though. It is what the people want.

So is it proper fo government to compete with private companies and individuals to offer services? If it is proper, un what circumstances should such services be offered? Should there be any provision to privatize such services after the government corporation is up and running?

I think most will know where I stand in general, but I am interested in the views of others here on the TWC! Oh and no poll -- I doubt this is really a simply yes, no, do not know type of an issue. I could be wrong though.

To add, basically, internet infrastructure is largely unregulated by neither the federal nor state governments, so decisions are left to the service providors. Companies generally don't build alternative routes or redundancies, unless they believe it is worthwhile financially. That is, unless as I have shown, it is worthwhile to them to build at all.

It shows: metropolitan areas have redundancie, smaller cities don't, backwaters have jackall for service in the first place. The more rural the location, the more out of luck you are.

Despite its own warnings of such vulnerabilities, the federal government has taken no steps to require Internet companies to have redundancies or even service even as it has provided billions in subsidies to expand broadband to unserved areas. Why? It can't. Thanks Congress. Law is a thing.
So you know what. I don't want to hear from you two on why the government shouldn't regulate the internet.

[Raubritter]

Cable companies and other providers are doing a job Norse, more interested in maximizing short term profit than in maximizing infrastructure that would maximize long term profit. The people and the local governments are god damned tired of it. Live with the consequences.

You know, some communities do a totaly insane thing by paying for the laying of fiber wire cables to get better internet access instead of waiting for a company to do this investment for their dying 15000 people town. Totaly insane. I mean who would build the roads if government didn't do it.

Why not have the best of both worlds and implement a European model where private companies provide heavily regulated access. By heavily regulated I mean regulated in favor of the customer and against the company's interest of maximizing profit.

There could be a 1000 venezuelas happen every day and people still wouldn't learn a thing.

[antaeus]

My government (Australia) has played a large role in expanding high speed internet in partnership with private sector companies.

It has been completely pants. The idea was to leverage the best aspects of public/private partnerships... good tender processes for infrastructure development... a wide variety of private internet suppliers competing for customers to ensure prices stay low...

Except it ended up with the worst examples of public/private partnerships. Government changed mid rollout and with that priorities, favoured technology partners etc etc. which has led to extreme inefficiency at every level and a completely shite rollout and end product. And because it is centrally managed, there are often no alternate options other than going 4g.

... so my thoughts are, it doesn't matter if government works in competition with private sector, or doesn't involve itself anywhere more than at a regulation level. What matters is whether there is a clear and consistent process that is managed over many years. Elected governments can't guarantee that at either local or national level.

[Sir Adrian]

Hence why Europe's economy does not grow much in past two decades.

I think the massive financial crisis, and the US constantly exporting inflation to europe have had something to do with that. Meanwhile I pay 5 dollars per month for this - that's a random server on the other side of europe

[Love Mountain]

Why not have the best of both worlds and implement a European model where private companies provide heavily regulated access. By heavily regulated I mean regulated in favor of the customer and against the company's interest of maximizing profit.

That's terrible and inefficient. The only regulation that should exist, is the kind of regulation that deliberately hurts the consumer through deception. Maximization of profit should always be the goal as high profits attract innovation.

http://www.denverpost.com/2017/11/08...s-150-million/

So once again we have government wanting to do what others can do. Just people want to pay less and have more service. Government (based upon elected officials) wants to offer what the people want. At least they want to confuse the issue that they can do better than what is already on offer in the private sector. OF course in the end funds are comingled so we do not know the real cost and it will pretty much be more expensive in the end. No matter though. It is what the people want.

So is it proper fo government to compete with private companies and individuals to offer services? If it is proper, un what circumstances should such services be offered? Should there be any provision to privatize such services after the government corporation is up and running?

I think most will know where I stand in general, but I am interested in the views of others here on the TWC! Oh and no poll -- I doubt this is really a simply yes, no, do not know type of an issue. I could be wrong though.

If a market is unable to bring goods to the market efficiently, the Government should step in and offer its own alternative.

[sumskilz]

20-50 USD is still too much I think. I'm paying 250 CZK (about 10 EUR or 12 USD) for problem-free line with practical speed in tens of MB/s and relatively direct routing (so when playing online, I get under 50 ms ping to hosts in Europe). Compared to this, the prices in US are insane. I get that it's different there, where low population density outside major centers makes higher infrastructure cost per customer, but the prices, compared to quality, are still insane.

It's similar situation as US healthcare. Too much laissez-faire approach led to creation of large corporations that have enough money to push a newcomer ouf of the business, while getting in a kind of "stand-off", as they understand that going against each other would not be profittable for either.

Because you're only considering exchange rate and not all the other factors, your assessment isn't accurate. Internet is actually much cheaper in the US compared to your country (relative to our median income).

Average Residential Broadband Costs by Country: U.S. Ranks 13th

[Sir Adrian]

Maximization of profit should always be the goal as high profits attract innovation.

That is never true, and you can see it right now. US internet providers have had the best year ever, each year, for over a decade, yet technologically you lag years behind the Balkans and Eastern Europe -places which have always employed the system you call terrible and inefficient.

[Love Mountain]

That is never true, and you can see it right now.

Really? Never true?

Automobiles, PCs, Medical drugs, smartphones... Hell, Tea even.

US internet providers have had the best year ever, each year, for over a decade, yet technologically you lag years behind the Balkans and Eastern Europe -places which have always employed the system you call terrible and inefficient.

U.S. is the fourth largest country in the world. Fifth is we exclude Alaska. There are considerably more costs to laying a cable network across America instead of Europe. Not to mention that the reason why America doesn't have more ISP providers is because there are very high barriers to entry. I suppose it makes sense to raise these barriers instead of lowering them in the hopes that prices will fall...

[NorseThing]

Existing infrastructure is always a part of the equation. Technology moves forward, but the existing nuts and bolts are still providing service. The problem with the claim that the current moment the government can provide superior service by dumping piles of money into projects is short sighted. That dumping of money then becomes the next layer of nuts and bolts that are inferior to the latest technology. The problem is that the nuts and bolts owned by the government will be protected from future competitors because of the government ownership and that the government also writes the rules and enforces the rules. Examples of other governments doing such projects does not confirm the wisdom of such projects. It just confirms that governments can do such projects. The test is when we find such government projects being allowed to fail or be merged as is done with the private sector projects. Until now I am not at all impressed with government projects for a track record that looks for future innovations to bypass the government projects. I would rather live with the problems of an existing Comcast that must continue to be better that potential competitors or be absorbed than live with city owned projects that will do anything in the future to stifle or simply outlaw better alternatives. A little inconvenience today is acceptable if there is a real possibility of a better tomorrow.

[Gaidin]

Tell that to the people who don't have service.

[NorseThing]

I have relatives with poor service in rural areas. I know that my brother in rural Iowa thinks he is currently better off with a smart phone for internet and a satellite for entertainment than any landline that could ever be offered to his location in the middle of nowhere. The last thing he would want is his local government to start spending his money on service he would never see.

I do not think it wise to lock in a government service that will become the next oppressor to future innovation. The smart phone technology may bypass this bottleneck on speed that is the real reason that local networks are even being contemplated. The debate on these landline service providers may be moot in a decade. I would hate for a government service tied to such technology to then make it inconvenient to progress to other completive technologies.

[Sir Adrian]

Really? Never true?

Automobiles, PCs, Medical drugs, smartphones... Hell, Tea even.

Not true for any of those fields. Competition and heavy state regulation was the one which drove innovation forward - especially for cars and tea and the IT sector.

U.S. is the fourth largest country in the world. Fifth is we exclude Alaska. There are considerably more costs to laying a cable network across America instead of Europe. Not to mention that the reason why America doesn't have more ISP providers is because there are very high barriers to entry. I suppose it makes sense to raise these barriers instead of lowering them in the hopes that prices will fall...

Nice cop-out however the price of laying cable per registered user actually decreases the more users you have. Small town ISPs with less than 15000 registered users could afford to provide full fiber wire access in the heart of the norwegian or romanian mountains but a media giant like Verizon, whose profits number in the tens of billions, each year somehow has trouble providing good internet in flat, almost entirely desert Arizona. Riiiiighhhht.

[Love Mountain]

Not true for any of those fields. Competition and heavy state regulation was the one which drove innovation forward - especially for cars and tea and the IT sector.

Name some regulations that drove the innovation forward in those field. High profits=market entry. That's the entire point of my point. You're not gonna get more competition by reducing the profit the market can extract.

Nice cop-out however the price of laying cable per registered user actually decreases the more users you have. Small town ISPs with less than 15000 registered users could afford to provide full fiber wire access in the heart of the norwegian or romanian mountains but a media giant like Verizon, whose profits number in the tens of billions, each year somehow has trouble providing good internet in flat, almost entirely desert Arizona. Riiiiighhhht.

Which is already the case. The quality of service and price are significantly better in US urban areas than rural areas. Moreover facts are not a cop out. My state of Washington has the population and rough area of Norway and that's just one state with a powerful state government and several large municipalities that constantly bicker. Cable providers have to figure out how to lay cable across all 50 states, across varying terrain and distances, and negotiate with hundreds of different local governments about permits and licenses.

Want an example of how hard it is to enter the market? Look at Google Fiber, an initiative that had a lot of muscle behind it and was rapidly scaled back once the costs started to bring the dream down to Earth. Google Fiber halted the majority of their enthusiastic expansion plans and has been exploring other options, like partnering up with local providers to expand the brand rather than build new infrastructure.

So sure. Go ahead and tell Google Fiber what they can and can't do to consumers. I'm sure that'll encourage them to push more money into expanding a service that everyone seems to wants.

Existing infrastructure is always a part of the equation. Technology moves forward, but the existing nuts and bolts are still providing service. The problem with the claim that the current moment the government can provide superior service by dumping piles of money into projects is short sighted. That dumping of money then becomes the next layer of nuts and bolts that are inferior to the latest technology. The problem is that the nuts and bolts owned by the government will be protected from future competitors because of the government ownership and that the government also writes the rules and enforces the rules. Examples of other governments doing such projects does not confirm the wisdom of such projects. It just confirms that governments can do such projects. The test is when we find such government projects being allowed to fail or be merged as is done with the private sector projects. Until now I am not at all impressed with government projects for a track record that looks for future innovations to bypass the government projects. I would rather live with the problems of an existing Comcast that must continue to be better that potential competitors or be absorbed than live with city owned projects that will do anything in the future to stifle or simply outlaw better alternatives. A little inconvenience today is acceptable if there is a real possibility of a better tomorrow.

Tell me. Have roads become obsolete yet?