That is exactly the point though. Since there AREN'T enough competitors, the free market does not work. BEING a competitor means laying cable, getting right-of-ways, getting other permissions from local government, etc. It is not something where several competitors will spring up offering better service and/or better price when one bad actor decides to disallow skype on their network for instance.

When the market fails to provide a fix, the government should step in to keep the public from being at the mercy of greedy monopolies.