andy9 wrote on Feb 28
th, 2007 at 11:23am:
I would be interested to hear how telecoms would have existed in this country if BT had been closed down, asset-stripped, or split up into factions and then taken over by venture capitalists who expect 40% return on their money, then spend more on lawyers than engineering staff, like the railways have done.
Would broadband have been developed in their labs earlier or later, and would the management who could see no business case for it, and were worried about losing pstn revenues to VoIP, have held sway over the engineers for even longer?
It isn't misapplied regulation that affects how balances are struck between amortising long-term capital investments against day-to-day running costs and near-zero actual marginal cost of calls; it's interest rates and accountants.
It's rather a paradox that you seem to suggest keeping BT call charges higher, making it uncompetitive, which is how we got saddled with revenue-sharing from cheaper providers in the first place.
You make a very interesting point, andy9, and one which has crossed my mind before. OK, so 'if' is a big word, but it was privatised by the Tory government which the ethos that competition would bring prices down. I do not like being lied to.
At the time I imagined that the one telegraph pole near me would be joined by other telegraph poles as competitors built their networks. But of course that was never going to happen. Look at BT's main competitor, cable, or Virgin Media as it is now known. IIRC it started off as separate companies. I know round here it was Yorkshire Cable, but inevitably individual companies have been swallowed up and now are one. The thing is that cable was only installed in urban areas where there was going to be plenty of business. Anywhere else and they didn't want to know.
As I said elsewhere, telephone isn't like gas and electric because they have one distribution network with many different providers putting in and taking out the gas/electric. With telephones, the network you connect to
is operated by the telco you are with (unless you're with a LLU provider, but it's still a BT pair of copper wires). So this means that my original vision of competition being brought about by having several different providers' networks running down every street was not far off.
Now look at the mobile infrastructure in this country. It started off privatised and if we take the four public GSM networks, O2, Vodafone, Orange and T-Mobile we see that they have had to build their networks to cover the same areas. So we have areas of the country that aren't covered by some or all networks and we have urban areas where there are, in effect, four times as many base stations as is techincally necessary to provide a mobile telephone service in that location.
I have applied andy9's thinking to this and come to the conclusion that we have a quarter of the coverage we could have and/or we are paying four times as much as we need to because of this waste in equipment. Whilst I accept that this guestimate may be out, I do think that there is something in it and that is wastage of infratsructure when privatisation was supposed to get rid of this.
Also, we now pay through the nose to call someone on another network versus our own. It is also cheaper to call destinations abroad than other networks on some tariffs. People changing numbers is commonplace. With a mobile being mobile it stands to reason that even if someone moves to the other end of the country, they can keep the same number. But the network operators make it cheaper to take out 'new' contracts because statistics of 'new' subscribers are more important than a basic technical requirement that someone should keep the same number. All of this has been brought about by privatisation and the supposed need for competition, but all these years later we still have to put up with it.
Consider other industries like motor industry. Pretty much every manufacturer has a dealership in every town. So there is uniform coverage and choice there. But compare the need to have a separate outlet (dealership) for every car manufacturer and a telephone network which must have 100% coverage. That's cables down every street or radio base stations every how every often.