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AT&T Argues That More Competition Is Bad For You & Leads To Higher Prices

from the economics-free-zone dept

Apparently AT&T-land is a place where basic economics doesn't apply. AT&T boss Randall Stephenson, still hurt from the rejection of his attempted merger with T-Mobile, is telling the world that greater competition means higher prices and less efficient markets. That this goes against nearly all understanding of economics seems like an important point that would be worth bringing up to Stephenson, but apparently the reporters present didn't bother. In particular, he claims that AT&T had to increase its data rates by 30% because it doesn't own T-Mobile. That makes no sense, but okay. Then he claims that competition makes things less efficient:
"The more competitors you have, the less efficient the allocation of spectrum will be," he said. "It's got to change. I don't think the market's going to accommodate the number of competitors there are in the landscape."
This is how a monopolist argues: if we controlled everything, why things would be much more efficient. He's seriously arguing that the fact that they have to compete for resources means that they can't get the same level of monopoly rents. Yeah, that's called capitalism, where you actually have to compete in the market. I mean, I'm sure UPS hates that it has to share the roads with Fedex (so inefficient), but it's actually good for the consumers to have real competition. Apparently, though, AT&T has a different point of view.


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  1.  
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    Tech42 (profile), May 7th, 2012 @ 10:27am

    Okay, then, AT&T...

    If competition is bad, then let's just go ahead and shut you down.

    The monopoly can go right back to Bell where it started.

     

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    Jay, May 7th, 2012 @ 10:28am

    obviously

    Surely the reporters didn't question this because they all think that monopoly -- as long as it's government-run or at least government-regulated -- is the most efficient possible system.

    How many times have reporters patiently explained to us that if only all medical care was run by the government, it would be way more efficient because then the government could allocate resources based on need rather than greedy businesses allocating resources to maximize profit, etc.

     

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    non-anonymous coward (profile), May 7th, 2012 @ 10:30am

    Then the obvious solution

    Therefore, the obvious solution is for AT&T to hand over its spectrum to Verizon.

     

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  4.  
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    Anonymous Coward, May 7th, 2012 @ 10:34am

    Why post a single word any obsolete lying dinosaurs say? It's all lies designed to try to get more of your money to feed them.

    Fuck 'em. Let them starve to death.

    Just ignore all the ancient crud (techdirt mostly writes about the whining of ancient dying crud) and forget about them.

    Make this site about the modern age and the future for a change.

     

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  5.  
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    A Guy (profile), May 7th, 2012 @ 10:34am

    Corporate Welfare

    It's so refreshing to see a company come forward and say "I prefer socialism and/or and corporate welfare in America."

    It's so simple though. If their were only one phone company, they could lay all those other people off. Less employment means fewer labor costs.

    Also, without all that pesky competition, they could jack up prices. That's very efficient for AT&T. Their return on investment could shoot through the roof and customers would only have to pay 2x to 3x in additional costs.

     

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    Anonymous Monkey (profile), May 7th, 2012 @ 10:36am

    Look There!!!

    Captain Obvious strikes Again!!

     

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    iambinarymind (profile), May 7th, 2012 @ 10:39am

    Straight up lies...

    One of the reasons I can't watch mainstream news these days is that people like this Randall Stephenson of AT&T can just state bald faced lies and the press laps it up, so long as it falls within the Statist quo.

    For some truth on the matter of competition:
    The Meaning of Competition - by Friedrich von Hayek

    "In actual life the fact that our inadequate knowledge of the available commodities or services is made up for by our experience with the persons or firms supplying them ó that competition is in a large measure competition for reputation or good will ó is one of the most important facts which enables us to solve our daily problems." ~ F.A. Hayek ~

     

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    Jay (profile), May 7th, 2012 @ 10:41am

    Re: obviously

    Let's be clear... The government's job is to regulate in certain markets. This notion that our healthcare system doesn't need government influence is ridiculous.

     

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    Mesonoxian Eve (profile), May 7th, 2012 @ 10:46am

    I hate to agree with AT&T, but he's right to a point.

    Look at competition: most impose data caps. Every single one has identical (or near) pricing tiers. Every single one includes hidden fees and charges for text messages.

    Let's look at cable: same thing.

    Look at entertainment: same thing.

    I'm sure these are all "monopolistic" views, but the fact remains competition no longer exists. These companies thrive on testing the market on what it's willing to tolerate, then price accordingly.

    Yes, back in the day, there was cell competition, but that's all been obliterated when there's only a few left in the market.

    I wouldn't be surprised if these industries sit around and say to themselves, "Yeah, how about we all agree to raise our monthly fees by $10. Everyone on board? Good, Verizon, you start first, followed by T-Mobile. AT&T, you go last, again. Punishment for your old days and old ways."

    There are times I believe a monopoly would serve customers better if only a single entity would be closely monitored for any wrong-doing, like the "only" search engine of the world: Google (which, as you can see, gets everyone upset over a small change to which no one gets... charged. Oh, the irony.)

    At any rate, this guy's obviously making rhetoric, but it sure does get one to think which way would be better for consumers... if competition truly existed.

     

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    Jake (profile), May 7th, 2012 @ 10:51am

    Normally...

    Normally Mike I agree with you, but in this case your analogy is slightly flawed. There is a finite amount of spectrum available, whereas the roads are essentially an unlimited resource. A more apt comparison would be if UPS and FedEx were required to choose which roads to use and then could not use each others roads.

    This slight variation does give some substance to his claims although I feel that the solution that I would propose would be different. Ideally, it would work where one entity would develop the infrastructure and another would provide the actual service. The problem is that the infrastructure provider would have to be the government, highly regulated, or some sort of non-profit organization, but none of those solutions have a high track record for success. The advantage would be that the spectrum would be utilized in the most efficient way, the result for the consumer would depend on how this was implemented.

     

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    anonymous coward, May 7th, 2012 @ 10:54am

    Cry me a river, Randall Stephenson

    I'm sure every time a federally-mandated free 911 call comes across AT&T's spectrum from a long unactivated feature phone, Mr Stephenson weeps for all the wasted air time and lost revenue. There's a special place in whatever kind of hell is waiting for him and his Evil Empire cronies.

     

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    Anonymous Coward, May 7th, 2012 @ 10:56am

    The allocation of spectrum

    I'm not a huge fan of either AT&T or monopolies, but I think you're kind of missing the point Stephenson's making about competition.

    As it stands, all the available RF spectrum is split up into blocks by the FCC. The FCC then "allocates" this spectrum, which is a nice way of saying that they grant monopolies on each of those blocks to various companies. As things currently stand, the spectrum is split into several hundred different, government-mandated and -enforced monopolies.

    Now sure, AT&T would love to become the new Ma Bell. No arguments there. But the way I read the article, they're complaining that having hundreds of artificial monopolies is less efficient than having one or two artificial monopolies. I'd believe that.

     

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    :Lobo Santo (profile), May 7th, 2012 @ 11:01am

    Re: Normally...

    Did you just claim roads where an unlimited resource??

    I think either your understanding of spectrum allocation and/or your understanding of roads is flawed.

    There is, without doubt, a measurable and finite amount of (roads thru-put capability/radio spectrum information capacity/bandwidth). However, this only makes a difference when everybody is trying to use it at the same time. The rest of the time, the (roads thru-put capability/radio spectrum information capacity/bandwidth) may as well be infinite, as the very little use it gets will not clog it or use it up.

     

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    sehlat (profile), May 7th, 2012 @ 11:01am

    He's right, you know.

    More competition IS less efficient ... for him and AT&T.

     

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    Cowardly Anonymous, May 7th, 2012 @ 11:02am

    Re: Normally...

    If you have two companies, each of which have half the band-width, and you change to one company that now services twice the customers, you remove a small portion of overhead that advertises the signal presence of each service. You also gain the ability to handle higher peaks in traffic if the services were afforded the spectrum in a way that did not map well to the number of users in the area.

    The providers all have a significant number of users where they provide service, so the complaint is relatively insubstantial.

     

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    Kaden (profile), May 7th, 2012 @ 11:03am

    Re: Normally...

    Anyone stuck in a traffic jam driving to work this morning is gonna disagree that "roads are essentially an unlimited resource".

     

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    Anonymous Coward, May 7th, 2012 @ 11:06am

    Re: Normally...

    Apparently, I've misunderstood all this time.

    Who knew that "essentially unlimited" meant generally overcrowded, constantly in need of expansion and crumbling in most major metropolitan areas...

    Look Mom, my bank account and retirement fund is essentially unlimited.

    Are you really an idiot or did you just stay at a Holiday Inn Express last night?

     

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  18.  
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    Anonymous Coward, May 7th, 2012 @ 11:06am

    AT&T should join the entertainment industries. they have a self-interest only point of view, where competing with others isn't an option!

     

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    Jake (profile), May 7th, 2012 @ 11:07am

    Re: Re: Normally...

    I apologize, unlimited was a poor choice of words, maybe shared is a better word, no company has sole unlimited use of I-80 in the US. It is shared for better or for worse by all of them.

     

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    DannyB (profile), May 7th, 2012 @ 11:07am

    Re: Normally...

    Spectrum may be finite, but costs of building out and maintaining a network are also finite.

     

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    Rikuo (profile), May 7th, 2012 @ 11:08am

    Re:

    I'm sorry (no I'm not) but with a monopoly, there is NO incentive to do anything for the customer's benefit.
    Yes, the situation is horrible, but at least there is some semblance of customer benefit going on.

     

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    Cowardly Anonymous, May 7th, 2012 @ 11:08am

    Re: The allocation of spectrum

    But the way I read the article, they're complaining that having hundreds of artificial monopolies is less efficient than having one or two artificial monopolies.


    So, we should consolidate all farms into one gigantic farm company so that the thousands of artificial monopolies over land are replaced with a more efficient monopoly?

    The argument does not, in fact, drive toward the solution he is proposing. Rather it suggests that companies should be able to use their portion of the spectrum in trade. Leases, of course, would be the only viable option, but provided the FCC were to commit to a solid allocation schedule, they'd work quite well.

     

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  23.  
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    Jim D, May 7th, 2012 @ 11:09am

    'Competition' doesn't quite have the same meaning in the mobile market.

    In the mobile market, a lot of the 'competition' means the cost of switching is high. Even if you were to do away with 'locked' phones, it doesn't matter -- most phones physically can't work on any of the other networks. Even networks that support the same standards use different parts of the spectrum and the phones can be incompatible. Given that you need to sign a two-year contract to not pay an insane amount for a decent device, it means you can't 'just switch', and thus 'competition' doesn't work in the normal way.

    This is like, back in the day, the AC/DC wars to determine a power standard. Imagine, if you will, your choice of electric providers -- all with different standards. If you want to switch, you need to rewire your house and get new appliances. That's the current situation in the mobile market, and the technology, while still obviously evolving, has matured to the point where it's a 'utility' and needs to be regulated by the government as such. Declare one standard, declare that phones must be multi-frequency so a device can, if not locked, function on any US network. Require providers to unlock devices sold at full price, require providers to unlock devices after contract period ends for 'discounted' devices.

    _Then_ you'll see legitimate competition in the mobile industry in the US, and not the joke it is today.

     

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    Gwiz (profile), May 7th, 2012 @ 11:10am

    Re: Re: Normally...

    Are you really an idiot or did you just stay at a Holiday Inn Express last night?

    Oh man, that is a great line. Gonna have to remember that one.

     

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    AzureSky (profile), May 7th, 2012 @ 11:13am

    does not compute.....error....error....does not compute.....

     

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    Jake (profile), May 7th, 2012 @ 11:14am

    Re: Re: Normally...

    Agreed, all I am saying is that it is true that it would be more efficient to have all the service providers share the available spectrum, rather then have them each control a portion. One build out, more flexibility etc.

     

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    JayTee (profile), May 7th, 2012 @ 11:16am

    It is clear...

    Competition is good for the consumer, but bad for AT&T. I never assumed for one minute that Mr Stephenson actually cares about consumers beyond whether they are paying his company rather than a competitor.

     

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    Anonymous Coward, May 7th, 2012 @ 11:18am

    In other words AT&T is saying we need a 'socialist' big government to force everyone, including AT&T, out of the market, and do the job itself for less.

    Who knew AT&T supported socialism? I was sure their Super PACs only supported pro-free market politicians, not socialists.

     

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  29.  
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    Anonymous Coward, May 7th, 2012 @ 11:18am

    Re: obviously

    "How many times have reporters patiently explained to us that if only all medical care was run by the government, it would be way more efficient because then the government could allocate resources based on need rather than greedy businesses allocating resources to maximize profit, etc."

    Funny, that's what insurance companies are saying now.
    Just substitute "insurance company" for "government" and re-read your sentence!
    That's an improvement over "government control" how exactly...?

     

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    Not an Electronic Rodent (profile), May 7th, 2012 @ 11:20am

    Re: Re: Re: Normally...

    no company has sole unlimited use of I-80 in the US. It is shared for better or for worse by all of them.Yes and no one company has sole use of the 1.8GHz spectrum, it's shared by all of them. In the (imperfect) analogy, the number of transmitters a providor has would be roughly analogous to the size of fleet of a logistics company, the amount of roads to the amount of bandwidth allowed by the government for mobile phone use.

     

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    weneedhelp (profile), May 7th, 2012 @ 11:22am

    Their lies know no bounds.

    "I don't think the market's going to accommodate the number of competitors there are in the landscape."

    What? Like all three of you? Yeah ok AT&T.

     

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    The Infamous Joe (profile), May 7th, 2012 @ 11:22am

    Re:

    You state that he has a point, and then show examples of where the lack of competition is making things worse...

    I'm very confused.

     

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    Anonymous Coward, May 7th, 2012 @ 11:28am

    Re: The allocation of spectrum

    how many slices need to be made before its not considered a monopoly?

     

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    Anonymous Coward, May 7th, 2012 @ 11:32am

    Re: obviously

    Well, a government monopoly would be more efficient than a system where the government pays private enterprises to do the work because governments are not rational market actors in that scenario. That kind of mixing is literally the worst of both worlds.

     

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    Anonymous Coward, May 7th, 2012 @ 11:32am

    Re: Look There!!!

    *cannot resist feeding troll*

    Who's captain obvious?

     

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    Jake (profile), May 7th, 2012 @ 11:35am

    Re: Re: Re: Re: Normally...

    But the spectrum is locked down in a given area. A company may have the sole rights to use the 1.8GHz spectrum in a given area and even if they have excess capacity in that area, no one else is legally allowed to use that bandwidth.

     

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    Anonymous Coward, May 7th, 2012 @ 11:37am

    The more competitors you have, the less efficient the allocation of spectrum will be.


    Actually he's probably right about this. He's not talking about prices, features, or customer options. He's talking specifically about allocation of spectrum.

    With multiple competitors you end up allocating separate spectrum blocks for the "same" functionality, once for each competitor. If you have fewer competitors then you can free up spectrum for other uses since you won't have to allocate the part of the spectrum that would have gone to those competitors.

     

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    jackn2, May 7th, 2012 @ 11:37am

    Re: He's right, you know.

    Yes, but competition drives efficiency.

     

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    Anonymous Coward, May 7th, 2012 @ 11:42am

    Re: obviously

    Have you read Atlas Shrugged, by chance? Because that last line of yours:

    "based on need rather than greedy businesses allocating resources to maximize profit, etc."

    is basically what the entire book argues against.

     

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  40.  
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    Bengie, May 7th, 2012 @ 11:43am

    Re:

    They they should use a technology that allows sharing. CDMA works just fine with multiple companies all using the same frequency at the same time.

     

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  41.  
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    Anonymous Coward, May 7th, 2012 @ 11:47am

    Re:

    Those dinosaurs aren't dead yet, and they can, have, and will try to do a lot of damage in their death throes.

    Ignorance and complacency in the general population is what keeps those anachronisms on life support. So the more educated people become--by sites such as this one--the more we can mitigate the damage those dinosaurs do and the sooner those behemoths can be put out of our misery.

     

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    Anonymous Coward, May 7th, 2012 @ 11:49am

    Re: Re: obviously

    To be fair, if it weren't for certain bad actors in the industries all the government would be required to do is set a minimum standard that they have to meet to operate.

    Minimums required for health and/or safety. Unfortunately what ends up happening is you get someone in charge who only looks at the money. It's far easier to make money by removing competition than it is to actually provide a quality service.

    Quality actually requires you to, you know, work.

     

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  43.  
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    Anonymous Coward, May 7th, 2012 @ 11:49am

    Re:

    So you show how the unfair cable and phone markets are bad because of the lack of competition then you mention how google is awesome and call it a monopoly when search engines is the only truly open market you mention.

     

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    Anonymous Coward, May 7th, 2012 @ 11:53am

    Re: Re: Re: Re: Re: Normally...

    This is a little over my head but I can walk down the street with my verizon phone while my buddies use their ATT, sprint and tmobile phones and they all seem to work at the same time. So how are other companies locked out? I know there are spectrum ranges they can use but are we anywhere near overcrowding those signals?

     

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    ChrisB (profile), May 7th, 2012 @ 11:54am

    Re: obviously

    > if only all medical care was run by the government,
    > it would be way more efficient

    Canada has a government run healthcare system, and no one says it is more efficient than a private system. What is said is a government run system is more accountable, and distributes scarce resources based on need, not on money.

    America's health care problems can be summed up as, An ounce of prevention is worth a pound of cure. America is great at the "pound of cure" side. But an ounce of prevention is cheaper. For example, diabetes is relatively easy to manage or prevent, but unmanaged, consequences like limb amputation, vision loss, or kidney problems are very expensive to treat AND they remove people from the workforce.

    This is why Canada pays less for health care per capita and has better results.

     

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    hegemon13, May 7th, 2012 @ 11:54am

    Re: Re: obviously

    Straw man. No one said insurance company control is good, either.

    Make no mistake, what we call "health insurance" today is not "insurance" by any reasonable definition of the word. It is a pre-paid medical plan that negotiates discounts with health care providers. That's it. True insurance is supposed to insure against catastrophic loss. Think of the old-school, high-deductible major medical plan that the current administration would call an unqualified insurance plan. There is absolutely no reason whatsoever that insurance should be covering office visits, antibiotics, and other basic, day-to-day health care. Those are part of a any sane person's budget, just like electricity and gas. If you want to know why medical costs are so ridiculously high, there's your culprit: most consumers don't pay for anything directly, and therefore competition is not at play.

    So how does that get fixed, when insurance companies have a stranglehold on the market?
    1. Tax health benefits. I know it sounds awful, but if you want to encourage people to select benefit plans that are reasonable and remove control from the insurance companies, that's the way to do it. Besides, only employer pre-paid plans are tax exempt, anyway. So why do employees get special treatment that the self-employed don't?
    2. Expand Health Savings Accounts. Imagine an account that allows anyone to allocate pre-tax dollars for health care. But, unlike FLEX plans, this is not a use-it-or-lose-it plan. All that money is YOUR money, and at retirement, you can use it for anything, tax-free. Before retirement, you can use it for health care, tax-free. But, it's YOUR money that YOU have to spend, meaning that you are much more likely to hunt for the best balance of price and quality instead of being oblivious to it.

    Another nice benefit of HSA is that employers can contribute to it. By combining HSA contributions up to the deductible with a high-deductible major medical and no day-to-day coverage, an employer can offer that same out-of-pocket experience as a much more comprehensive plan, but at a fraction of the premium. Not only that, high-deductible plans are much less susceptible to premium increases from year to year.

    That option would put a lot more control back in the hands of individuals without requiring massive government intervention. Intervention which, in most cases, is less effective, more expensive, and has more unintended consequences that are ever anticipated up front.

     

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  47.  
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    Anonymous Coward, May 7th, 2012 @ 11:55am

    Re: Re: Re: Normally...

    The ability to set the price to whatever the fuck they want and say "what you gonna stop using a wireless phone? HAHAHAHA"

     

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    The Infamous Joe (profile), May 7th, 2012 @ 11:58am

    Re: Re: obviously

     

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    Anonymous Coward, May 7th, 2012 @ 12:00pm

    Derp?

     

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    Jake (profile), May 7th, 2012 @ 12:03pm

    Re: Re: Re: Re: Re: Re: Normally...

    Essentially there is a limited amount of spectrum available. It is divided up between carriers. So say there are two carriers in a given area ( not realistic I know) and they each have half of the available spectrum. If carrier A has 60% of the customers in that area, their customers are making due with less spectrum. This could impact speed, call quality etc, especially during peak times.

    For the last few months(years?) all the major carriers have been warning of a "spectrum crunch" where the available spectrum will no longer easily meet need. They are using this "cruch" to justify many things including, throttling 'unlimited' users, the switch to tiered pricing, and the ATT -T-mobile merger.

     

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    Mesonoxian Eve (profile), May 7th, 2012 @ 12:12pm

    Re: Re:

    Sorry about that. What I was trying to allude to is today's "competition" is effectively a monopoly run by several entities all doing the same thing.

    Back in the day, I was under the impression competition was to make it so customers actually had a choice.

    That's pretty much non-existent anymore.

     

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  52.  
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    Anonymous Coward, May 7th, 2012 @ 12:28pm

    I just want to point out that spectrum is only crowded at today's state of technology/regulation.

    Anyone remember the recent conversion to digital broadcast TV that actually allowed more content to be delivered and freed up spectrum to be sold??? How about 802.11b to 802.11n progression?

    On another note:
    The biggest threat to the shareholders of telecom is the short sightedness of the shareholders of telecom. It would not be inconceivable that in 10-15 years there is just a giant public mesh network running in the ISM bands that is built on everyones own low cost, low power devices. Systems that grow to be distributed and robust will win out.

     

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  53.  
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    Anonymous Coward, May 7th, 2012 @ 12:29pm

    {semi} Real problem... VERY stupid solution.

    The fact is AT&T DOES have limited spectrum to work with. I think the point he was trying to make is that since they couldn't obtain the T-Mobile spectrum, they will now have to raise the rates of their existing customers in order to make ends meet so to speak. Though I am certainly not an AT&T lover, itís not too hard to see this problem and why Mr. Stephenson is lamenting his business woes. These are the kind of woes EVERY business has to some degree or another.

    His problem is real (though a weak thing to be complaining about so adamantly), but his solution is completely ridiculous. He wants more customers, but he doesn't have room in his spectrum for more customers. So he wants to take some spectrum away from someone else so he can get more customers, and thereby more money. And I guess if that did happen it would, indeed, eliminate competition. So, by twisted AT&T logic, competition is the problem! It isn't REALLY competition he's out to get rid of, but rather resources he is looking to control. It is just that those darn competitors control those resources he thinks should be his, so let's eliminate them!

    But you see, he canít just say that. Sympathy for big greedy corporations is at an all-time low (geez, I wonder why), while socialism is very "in" right now. So he had to cover up the greed and package it up in a nice little socialist package. And, of course, the reporters ate it up.

    On a side note... my daughter works at the local pizzeria and today was supposed to be payday. But apparently there is no money in the bank, so no one is getting paid. They are hopefully going to fix the problem by Thursday... hopefully. So I think I'll go down there and give them a suggestion - let's close down all the other restaurants in town! If they were the ONLY restaurant, then everyone would have to eat there and they would have money, right? Payroll issues Ė SOLVED! Thank you, Mr. Stephenson, for this wonderful solution.

     

    reply to this | link to this | view in thread ]

  54.  
    icon
    Benjo (profile), May 7th, 2012 @ 12:31pm

    Re: Re: Re:

    All of this makes a great case for turning data bandwidth and network management in to something like a public utility (look at British Telecomm). This has led to a huge amount of competition between "service providers", who now buy bandwidth wholesale from BT (at a regulated rate) and then sell plans to consumers.

    My point is that data bandwidth is a completely featureless product, like water or electricity. Since these companies (comcast/telcos/whoever) OWN the featureless product, they try to bundle things in to it and make it a non-featureless product, even though that isn't the service that most of us want. If companies had to buy the bandwidth wholesale, they would HAVE to offer what the consumer wants in order to compete.

    I believe you could re-introduce competition to these markets if our anti-trust laws actually worked, and if internet bandwidth was made in to a public utility.

     

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  55.  
    icon
    Ninja (profile), May 7th, 2012 @ 12:34pm

    Re: Then the obvious solution

    I think that if this argument makes the discussion AT&T will suddenly and inexplicably change opinions...

     

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  56.  
    icon
    gorehound (profile), May 7th, 2012 @ 12:35pm

    Re: Okay, then, AT&T...

    ATT You suck and I will never use you.That is what I think of your No Competition.

     

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  57.  
    icon
    John Fenderson (profile), May 7th, 2012 @ 12:37pm

    Re: Re: obviously

    America is great at the "pound of cure" side.


    Only if you are relatively wealthy. If you aren't, you don't get very good care.

    On the whole, the US has among the worst health care systems of the developed work if you measure it by actual outcome.

     

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  58.  
    identicon
    Anonymous Coward, May 7th, 2012 @ 12:38pm

    Re: Re: Re:

    Look up Oligopoly. That's what you are describing.

     

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  59.  
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    Benjo (profile), May 7th, 2012 @ 12:41pm

    Re: 'Competition' doesn't quite have the same meaning in the mobile market.

    "Even if you were to do away with 'locked' phones, it doesn't matter -- most phones physically can't work on any of the other networks. Even networks that support the same standards use different parts of the spectrum and the phones can be incompatible. Given that you need to sign a two-year contract to not pay an insane amount for a decent device, it means you can't 'just switch', and thus 'competition' doesn't work in the normal way."

    Misleading. This is only true if the phones are designed to specifically only work on one network. RF transceivers are not that sensitive. It is true in that the providers ask for these phones to be hardware locked, but in that case you aren't really "doing away" with 'locked' phones.

     

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  60.  
    identicon
    Anonymous Coward, May 7th, 2012 @ 1:01pm

    Uh, economies of scale is a thing. Look it up, that's what they're arguing. It is basic economics. This is why monopolies are not always bad: see utilities.

     

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  61.  
    identicon
    Greg G, May 7th, 2012 @ 1:28pm

    Re: Normally...

    ....Roads are essentially an unlimited resource....

    Remember that next time you're in your vehicle, on a major highway at a standstill because someone else had an accident.

     

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  62.  
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    GMacGuffin (profile), May 7th, 2012 @ 1:35pm

    Re: Re: Re: Re:

    Agreed. I think most all "infrastructure" should be public. Bandwidth is infrastructure.

    At least then the prices would be high due to bureaucratic incompetence, rather than outright malice. Easier to swallow.

     

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  63.  
    identicon
    ANON, May 7th, 2012 @ 1:37pm

    MCI & Sprint

    So just like prices went up after they split AT&T into AT&T, MCI & Sprint? Maybe my memory is wrong but I was paying around 25 cents a minute to call places with the AT&T monopoly and very very quickly that went to 10 cents a minute with competition from MCI & Sprint. Even went down from that later..

    Even if somehow a monopoly manages to charge a "fair price" for their services, it hurts innovation. Why spend all the money to implement a new idea, it's not like a competitor will beat you to the punch.

     

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  64.  
    identicon
    AC Cobra, May 7th, 2012 @ 1:50pm

    This:

    "the technology, while still obviously evolving, has matured to the point where it's a 'utility' and needs to be regulated by the government as such. Declare one standard, declare that phones must be multi-frequency so a device can, if not locked, function on any US network. Require providers to unlock devices sold at full price, require providers to unlock devices after contract period ends for 'discounted' devices."

    I'd like to amplify that. If the FCC was better at doing its job, or was even interested in doing it, they would manage the spectrum better. But the real need is for wireless signal carriage to be treated more as a common carrier situation.

     

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  65.  
    identicon
    anonymous coward, May 7th, 2012 @ 1:54pm

    You say oligopoly, I say...

    In terms of buying spectrum, the market is more like a oligopsony - a few very large players buying multiple small chunks of spectrum in small markets or smaller subsets of larger markets.

    http://en.m.wikipedia.org/wiki/Oligopsony

     

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  66.  
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    harbingerofdoom (profile), May 7th, 2012 @ 1:56pm

    Re:

    came here to say this...sorta.
    yes, he is actually talking about spectrum crunch rather than actual competition with a single market. So, the guy is still an idiot, but he is an idiot for different reasons than this article lays out.

     

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  67.  
    identicon
    cody inskip, May 7th, 2012 @ 2:48pm

    from Canada

    Someone who doesn't understand basic economics or is clearly fighting for a monopolistic business environment, is unfit to serve as a CEO. It's here governments should intervene in the business world, not bailing out banks. Disgusting.

    This has already been occurring in Canada for awhile now.(a few new providers are sprouting up, but they still have no market share) Basically three providers controlled the entire market and all their plans, prices, rates, caps et al were identical. Its really no different nowadays either its just hidden behind subsidiary companies of the same three offering slightly different plans. They rarely compete with each other on price, a clear sign of collusion.

    I live only a few miles from an average Canadian city, ~100k population, and my internet alone is $60/month with a maximum of 30Gb usage. Massive overage charges ($10/Gb) and throttling occur after reaching the cap. A 1Gig phone data plan from Telus (one of the big three) costs $35/month and $15 per Gigabyte over. Everyday Canadians receive rediculas bills for thousands of dollars, myself having been one of them.

    Things are slowly changing for the better here I believe as Wind Mobile is starting to do well and Canadians have been demanding better service for so long. I think Rogers, Bell and Telus will start to get the picture as each day it becomes cheaper to start your own company.

    Unfortunately I have no advice for you guys, just don't let it happen mmmk? :)

    Relevant:
    http://www.cbc.ca/news/canada/british-columbia/story/2012/05/04/bc-premiumtexts.htm l?cmp=rss

     

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  68.  
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    Not an Electronic Rodent (profile), May 7th, 2012 @ 3:31pm

    Re: Re: Re: Re: Re: Normally...

    But the spectrum is locked down in a given area. A company may have the sole rights to use the 1.8GHz spectrum in a given area and even if they have excess capacity in that area, no one else is legally allowed to use that bandwidth.
    If that's the case in the states it's very different from the UK.... air is air and the permission bit for a providor is being allowed to erect a cell tower in the area, which mostly only get blocked by resident protests... most of the major providors cover over 90% of the country to some signal level

     

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  69.  
    identicon
    Anonymous Coward, May 7th, 2012 @ 3:33pm

    Re: Re: Re: obviously

    HSAs are an old idea. The problem is that they don't deal well with new entrants into the system, who haven't saved up much money yet. They also don't work as safety nets for those who experience catastrophic health failures that affect them for the rest of their lives. Those individuals, though rare, could easily outspend such accounts quickly and require government assistance. Then again, before the preexisting condition clauses were outlawed, that happened sometimes anyway.

    I wish we had some sort of non-profit insurance companies, where people pooled resources but which weren't gunning for their 20% cut. We could still negotiate group rates and ensure coverage for rare cases and new entrants, but we could cut premiums.

     

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  70.  
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    Joseph Tilghman (profile), May 7th, 2012 @ 3:37pm

    Bullshit

    Competition raises prices if and only if there is collusion and price fixing. Stop spewing your nonsense ATT. I swear these guys will continually repeat their diatribe over and over until someone believes them. Not gonna happen.

     

    reply to this | link to this | view in thread ]

  71.  
    icon
    A Guy (profile), May 7th, 2012 @ 5:38pm

    Re:

    Wireless companies sell us the use of spectrum.

    Economies of scale only work if they can bring the unit cost of something down by producing more of it. You cannot produce more OTA bandwidth. It's limited by physics. Therefore, economies of scale should not bring the price down, unless there are already major problems in the marketplace.

    A monopoly would only encourage the inefficient use of spectrum by denying market competition.

     

    reply to this | link to this | view in thread ]

  72.  
    icon
    Chargone (profile), May 7th, 2012 @ 6:48pm

    Re: Re: Re: Re: Re:

    also easier to Fix. get someone in the system who Wants it to improve and it will, at least somewhat, due to lack of active opposition (just gotta overcome systematic inertia. difficult, but not as difficult as doing so while being, metaphorically, shot at.)

     

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  73.  
    identicon
    Anonymous Coward, May 7th, 2012 @ 7:23pm

    Re: Re: obviously

    First off the statement an ounce of... is not true in all cases and in many cases actually raises costs of health care not lowers. Canada pays less for health care not because of preventative care but because of price controls and regulation which keep the costs low. But as a result increases wait times for care and somewhat lowers the maximum obtainable quality.

     

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  74.  
    identicon
    Lawrence D'Oliveiro, May 7th, 2012 @ 10:47pm

    Re: ... and somewhat lowers the maximum obtainable quality.

    And yet people in these countries with Government-run healthcare systems tend to be healthier than those in the USA.

     

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  75.  
    identicon
    hegemon13, May 8th, 2012 @ 11:15am

    Re: Re: Re: Re: obviously

    "HSAs are an old idea. The problem is that they don't deal well with new entrants into the system, who haven't saved up much money yet."

    That's why you have employer-subsidized HSA accounts.

    "They also don't work as safety nets for those who experience catastrophic health failures that affect them for the rest of their lives."

    That's why you pair them with a high-deductible major medical plan.

    Hell, did you even read what I wrote, or did you just stop at "HSA"?

     

    reply to this | link to this | view in thread ]

  76.  
    icon
    John Fenderson (profile), May 8th, 2012 @ 12:42pm

    Re: Re: Re: obviously

    But as a result increases wait times for care and somewhat lowers the maximum obtainable quality.


    Perhaps so, but the wait time in the US (or at least in my part of the US) is no better than Canada's, and you get a better end result in Canada.

     

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  77.  
    identicon
    trenchman, May 9th, 2012 @ 12:43am

    Re: Re: Re: obviously

    I would like to point out a few things.

    First, there are several cases of people coming to the US from countries that have a government run "health-care" because they couldn't get procedures in their country that they needed to live. They were considered elective in those countries. I know of several cases in which the people lived in Canada.

    Second, America is not any other country, and humans are not constant. What I mean is any single individual differs from others, meaning that genetics, life style, eating habits, etc. play a part in that persons health not just medical care. So an individuals life is going to affect their health, so the general health of Americans is more because of their life style, genetics, etc. than the health-care system. Also, many Americans put personal choice, see "Freedom", at the top of their priorities, and part of that is being able to live the life you want and dealing with the consequences.

    My point, you cannot look solely on the health-care system as a reason for peoples health. And, if you pay attention at all, you will find that the government has yet to do almost anything right. I would much rather remove the governments influence on health-care and let capitalism and competition fix it, far more than have the government take control and run yet another program into the ground.

     

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  78.  
    identicon
    Anonymous Coward, May 9th, 2012 @ 3:36am

    Re: Re: The allocation of spectrum

    Just the one that gives me a piece of the pie

     

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  79.  
    identicon
    Anonymous Coward, May 17th, 2012 @ 10:38am

    Re: Bullshit

    They don't have to meet in person to fix prices.One company
    raises prices, the others see it and raises theirs accordingly.It's just understood.
    When I decided to get an iphone from AT&T in may of 2009, AT&T did not have a policy that all smart phones must have a data plan.Puchasing an Iphone at that time did require a plan while you were on contract.
    Now that I completed my contract and want to stay on a month to month basis for telephone service only I can only do so if I have a data plan as well.I don't want a data plan so I cannot use my iphone...anywhere!It is a phone and all I want to do is to use it as a phone, with the occasional wifi internet use from home ( to update the apps that I cannot use)mostly it's become an expensive ipod
    All the other carriers followed suit and they all now require a data plan as well.
    Now I have an expensive smart phone sitting around that I can't use Unless I give in to their shakedown scheme.
    In addition (in the US)all phone are either code division or time division spread spectrum...if you have a verizon phone it stays there.The same with Sprint,AT&T and Tmobile
    If you want to change carriers you must get one of their phones.(except for AT&T and T-Mobile)
    THIS IS COMPETITION?

     

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  80.  
    identicon
    Anonymous Coward, May 17th, 2012 @ 10:51am

    Re: Re:

    You mean like they do now?

     

    reply to this | link to this | view in thread ]

  81.  
    identicon
    Anonymous Coward, May 17th, 2012 @ 11:03am

    Re:

    802.11a thru n is has nothing to do with commercial spectrum you speak of.
    It is a license free (unregulated) public spectrum.
    The progression from a to n was delayed because of the ieee dragging their feet in defining the standards.
    Most manufactures went ahead to market without the standards being finalized.

     

    reply to this | link to this | view in thread ]

  82.  
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    Niall (profile), May 25th, 2012 @ 4:39am

    Re: Re: Re: Re: Re: obviously

    That's why most of the Western world has government-subsidised 'insurance'. That covers most stuff. You just buy your own if you want fast treatment, or your own hotel (sorry, hospital) room.

    The US system seems to do it backwards, primarily for the financial benefit of the 'insurance' companies, the pharma/meditech companies, and all-too many doctors.

     

    reply to this | link to this | view in thread ]

  83.  
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    Niall (profile), May 25th, 2012 @ 4:43am

    Re: Re: Re: obviously

    I think that needs a mural of Adam Smith weeping.

     

    reply to this | link to this | view in thread ]

  84.  
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    Niall (profile), May 25th, 2012 @ 4:49am

    Re: Re: Re: Re: obviously

    Yes, but you go to America to BUY procedures. The system is set up so that the wealthy are fine, but those poorer are shafted.

    Healthcare is always open to other financial elements - look at all the Brits who go to Eastern Europe for cheaper dental care. But the baseline should be that prevention is better than cure, and support for most stuff should be available to nearly everyone, as much as possible.

    Also, taking an economic view, government-controlled healthcare allws the buyer (the government) to really force down drug/equipment/service costs. Of course, this is somewhat offset by bureaucratic inefficiency, but overall it seems to help - and it fosters and is fostered by a culture of 'we are here to help', not 'we are here to profit'.

     

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  85.  
    identicon
    Claire Kugelman-Kropp, Aug 3rd, 2012 @ 1:28pm

    Is there any competion for AT&T land line service?

    I like having a land line, but am sick of AT&T controling the market. I could use a cell phone for all my personal business but I like having a permanent phone connection with out having to plug in a cell phone and have it glued to my ear 24/7. I the only one that still has a land line and is it going the way of the dinosaur? I think the other phone companies should offer some alternatives to ATT other than cell phones, and give them even MORE competition!

     

    reply to this | link to this | view in thread ]

  86.  
    identicon
    CKK, Aug 3rd, 2012 @ 1:37pm

    Re: Is there any competion for AT&T land line service?

    The 3rd sentence above is missing a word and should read: Am I the only one that still has a land line and is it going the way of the dinosaur?
    instead of:
    I the only one ...

     

    reply to this | link to this | view in thread ]


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