With DSL competition killed off, monopolies cash in

by Andy Oram

The Boston Globe reports today
that "AT&T Broadband, Verizon announce hikes of 15% to 25%." Two articles at CNET are more long-lived:
AT&T hikes cable access rates

and

Broadband Net rates continue to climb
.


Both companies admit they are taking advantage of the lack of competition. Why is there so little competition? Leaving aside the complicated cable access issue (which I cover in several articles) the competing carriers were squeezed between 1) high costs for basic lines and equipment and 2) low prices from the incumbent phone companies.


The kicker is that the incumbent phone companies were responsible for both 1 and 2. There are lots of accusations that 1 was artificially high and 2 artificially low, accusations that are almost impossible to investigate because of the complex technical and cost structures at the incumbents.


Now, can Billy Tauzin continue to dare pushing his deregulation bill, and Michael Powell his deregulation of incumbents at the FCC, which would ensure continued monopolies in local phone service and hide behind the smokescreen of increasing competition in long-distance service--an area where we have plenty of competition already?