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Comment by axus | Hacker News Reader

Last I checked the telcos made plenty of money in the 90s. Should Verizon be getting a cut of my Claude Pro subscription, since I use FIOS to access it?

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This is what everybody is TRYING to do. They built something and will do everything they can to charge outsized rent on it far past the value it provides to take revenue from anyone downstream.

The fact that telcos couldn't charge rent was a primary reason the Internet was so successful.

Remember $0.10 per text message? You bet in some alternate timeline AT&T charges $0.10 per webpage visit and we're stuck on 100kbps connections because the monopoly doesn't want to innovate.

I haven’t fact checked, but according to Evans big telecom builders didn’t make a lot of money after all the capacity investment. Some actually went bankrupt or got acquired as distressed assets. Big tech was very profitable monetizing that same infrastructure.

Some went bankrupt, with Worldcom being the most famous example...though that was fraud. But even those that remained had large amounts of debt that never ends as there's always CAPEX for upgrades to networks to fund (both fixed and wireless). Now a lot of the debt is also from some of them going on media ownership adventures, but even those that didn't eventually got folded into larger companies (eg Sprint).

Most of the ones that survived did so due to being able to pick up distressed assets and at values that could then be profitably monetized - a move that it would not surprise me to see repeat itself in the LLM space (we'll see).

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