Kaltes
Premium
join:2002-12-04
Los Angeles, CA
| reply to Seandhi
Re: If voters vote yes...
BASIC cable (the $10/month version) isnt really all that profitable, and it wouldnt be offered at all unless there were laws forcing the cable companies to offer it.
Remember that any municipal venture will have a substantial bond that it must pay back. Once the bond is paid off expect municipal prices to drop EVEN LOWER than the already-low initial prices.
Incumbents are afraid because they know once word gets out about how great municipal broadband is and how effective it is at ensuring lower prices for a better product, these municipal ventures will spring up all over the place, and heck even prime time news stories might be run showing the disparity between cities with muni and without. |
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Karl Bode
News Guy
join:2000-03-02 | And stop covering the Kobe Bryant trial?  |
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Seandhi
Seeing From a New Level
Premium
join:2003-04-19
Humble, TX
| reply to Kaltes
If the government starts pushing prices too low, and if what you say is true about 10/month not being profitable, how will cable companies compete? Once they are pushed out of the market, then we just have another (worse?) monopoly.
On the other hand, I fail to see how the MUD can drop rates too low if tax payers will not be splitting the bill (as is stated in the article). This would just cause the cable company to be a little more fair to their customers.
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Trusted Computing will destroy the information age! Educate yourself at »www.againsttcpa.com |
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Karl Bode
News Guy
join:2000-03-02
Host:
Road Runner
PC gaming GAMES
PC gaming Tech
| Well for one thing, cable providers profit margins are INSANE. They could afford some pretty hefty price cuts before getting shoved out of any market....they could also spin off sports programming a-la-carte and save a bundle.....
Governments can't afford to push their prices too low, they aren't Walmarts..they're serving small communities at the moment. I think I've seen one instance so far where a muni engaged in questionable behavior, in Grant County, Washington:
»Competitive Conundrum
If the time comes when they are abusing their position and posing serious life or death threats to the incumbents on a broader scale, then perhaps examine leashing them somewhat. What's occuring on the state level here is a bunch of well lobbied politicians falsely assuming you can put equal regulatory restrictions on both incumbents and muni-upstarts and receive competitive parity; which simply isn't accurate.
Something these politicians forget is the fundamental fact that these muni's are being formed because communites are NOT being served and are being over-charged, plain and simple....I think that gets forgotten in the legalese.....the customer is always right, or so someone once said. |
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