Re: FCC proposes higher speed goals (100/20 Mbps) for USF providers

[Masataka Ohta <mohta () necom830 hpcl titech ac jp>]

Sean Donelan wrote:

> > USF is great for rural, but it has turned medium density and suburban 
> > areas into connectivity wastelands.
>
> Carrier & cable lobbying organizations say that free market competition 
> by multiple providers provide adequate service in those areas.

That's simply untrue, because of natural regional monopoly.

Competitive providers must invest same amount of money to cover
a certain area by their cables but their revenues are proportional
to their local market shares, which means only the provider with
the largest share can survive.

In urban areas where local backbone costs, which are proportional
to market shares, exceeds cabling costs, there may be some
competitions. But, the natural regional monopoly is still
possible.

Still, providers relying on older technologies will be
competitively replaced by other providers using newer
technologies, which is why DSL providers have been
disappearing and cable providers will disappear.

In a long run, only fiber providers will survive.

The problem, then, is that, with PON, there is no local
competition even if fibers are unbundled, because,
providers with smaller share can find smaller number
of subscribers around PON splitters, as, usually,
fiber cost between the splitters and stations are
same, which is why fiber providers prefer PON over SS.

But, such preference is deadly for rural areas where
only one or two homes exist around PON splitters,
in which case, SS is less costly.

                                        Masataka Ohta