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Comment by johngalt | Hacker News Reader

Getting the FCC to make carriers play fair is a slow road to improvement and it's filled with potholes. I'd be more inclined to support regulation changes intended to make starting a new carrier easier.

Mark my words: Any net neutrality bill will benefit the existing carriers, and stifle telecom startups.

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If I am not mistaken, setting up a working telecom startup is quite capital intensive, and has high running costs on top of it, just in terms of handling Marketing and competitive pressures.

How would a new startup survive and scale by any change in rules? The market would still serve the incumbents more than the startups - since their scale would make them stronger bets.

I'm curious to know what type of regulation would help circumvent the high startup cost and create genuine competition.

Edit: I am genuinely interested to know what regulation the original poster had in mind, or any other regulation that would help achieve his stated goal.

So is starting an airline, but deregulation still got us Southwest and Jetblue.

So you are saying LESS regulation is the change in regulation you would like to see?

So what regulations would you remove?

I'm saying that despite the fact that airlines are a textbook example of an industry with high capital requirements for entry, deregulation did not hand the industry over to a cartel of incumbents. In fact, air carriage is regularly shaken up by new entrants and new market forces.

Deregulation is such a blanket term encompassing so many things (especially the things regulated right now) that it by itself can't be judged a cure-all. Imagine deregulating the food industry by disbanding the FDA.

Loss of net neutrality will hurt small players in the web space(imagine a startup competitor to Netflix which can't afford deals with so many ISPs).

I'm not in favor of blanket deregulation. Quite the contrary: I'm a Democrat! Message boards tend to take everyone to extremes. I simply want to make the point that deregulation in and of itself doesn't inevitably lead to megacorporate cartels.

Where is the startup competitor to Netflix that will be hurt? Can you send me a link or something?

Franchise agreements and rights of way prevent new ISPs from entering the market. If you want to deregulate, you could start there. I don't think it would help due to the incumbents' economy of scale, though.

Cable franchises and rights of way are scarce goods that were quickly priced according to the markets. Regulations are, in part, an attempt to limit the value of those goods and reprice those goods. This doesn't sound like a good plan to me; the government is good at a good many things, but price discovery is not one of them.

The next wave of connectivity providers hopefully will not depend on rights of way. If you want to talk about things the government should do to balance out Internet access, let's reevaluate how we're handling the RF spectrum.

Yes! And believe it or not, Southwest is now the largest carrier in the US! What a success story.

Airlines are very different from carriers. The market for air travel is dominated by frequent one-off transactions (with consumers often using multiple airlines for a single trip), and boasts several good ways to compare availability and cost. A new entrant can start off with a few routes, build a good reputation, and grow out from there.

New entrants in the telecom market are considerably disadvantaged by comparison. Consumers in this market make long-term purchasing decisions, often driven by contract pricing,and there remain no good, well known ways of comparing providers. The situation is even worse if you're a new wireless carrier, since coverage is crucial and the market is pointlessly segmented by phone tech.

I'm not saying we couldn't benefit from deregulation in some aspects of this market, but the devil is very much in the details, and simply pointing out that "deregulation" helped improve a market with high capital requirements for entry isn't saying much.

Here is one alternative path. The State of Florida, under the auspices of the North Florida Broadband Authority, is setting up a "middle mile" quasi-government carrier. They will connect to a tier-1 provider (Level3 in this case) and distribute the broadband feed to small rural counties and cities, in an area which is economically disadvantaged (when compared to larger cities in Florida).

While this is capital intensive, they're trying to accomplish something that no private carriers seem to have interest in.

http://www.nfba-fl.org/

I doubt a highly skilled/motivated telecom team would have trouble finding capital in todays market. Millions are being handed out to teams whose infrastructure consists RoR app running on AWS.

I don't have anything specific in mind regulation wise. I have no agenda, merely that net neutrality is trying to cure a symptom not a cause.

>Mark my words: Any net neutrality bill will benefit the existing carriers, and stifle telecom startups.

Why or how?

By creating rules making it harder to create new companies with novel business models for providing Internet service, because those business models might in theory allow an incumbent to unlevel the playing field.

So, is your position that we shouldn't pass any laws or regulations because they may have unintended side-effects on companies that may exist in the future ? That sounds like pretty weak tea to me.

What on earth is wrong with the FCC stating that no company can give precedence to any specific source/destination's traffic over another source/destination's traffic ? All it does is codify the basic principle that the Internet was founded on, and the same principle that allowed it to become what it is today. More importantly, it doesn't involve any changes for any company unless they're already breaking the rule, in which case isn't it a good thing that we make them stop doing so ?

Listen to yourself. Where did you get the idea that I think we shouldn't pass laws or regulations at all? This is a message board political flame war rattling its cage trying to escape. Kill it.

I don't particularly support this regulation (I'm not totally against it, either). Many other things, I do think we should regulate.

What's wrong here is that I think it's too early in the connectivity industry to say that the incumbents we have now are so powerful that we should freeze them into place with regulations. And even if it isn't, it's not the place of an unelected and unaccountable FCC commissioner to pass a law that couldn't get passed through Congress, where the Constitution says new laws should come from.

Every time you say the FCC should be able to make up a new rule, you're in effect saying that the executive branch should be able to make rules there by fiat. I don't recall any us being so psyched about that prospect when Cheney was President.

I did not say that you were against passing laws or regulations at all. I was asking you if you were against passing laws or regulations if they might result in unintended consequences, which is what your position seemed to be, based upon your prior statement.

As for the rest, it's nothing more than a reflection upon the sorry state of affairs in Congress that we cannot get a law passed that re-affirms one of the fundamental principles that established the Internet, especially when it is clear that the major players in regional markets are already trying to prioritize traffic for their own content. My issue with your post was that it seemed to be offering another excuse for inaction, and the problem with our Congress is not that it does too much, but rather that it does too little.

A real democracy isn't about pulling a lever for some guys every few years, then going home and letting them run wild. If citizens want their FCC to pursue certain policies, they have every right to organize against the decisionmaking of the professional politicians. They don't have to remain apathetic non-participants in politics.

People who are effective in politics, participate in it.

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