Sunday, July 06, 2008

Vint Cerf: Single purpose phone, cable systems and legacy regulation impede broadband expansion

Some observations from World Wide Web creator Vint Cerf. They show that we're in a transition period between yesterday's single purpose, proprietary analog-based telco and cable systems and an evolving digital Internet Protocol-based platform that can deliver the Web, voice and video. Cerf's observations suggest this transition explains why many broadband black holes persist in the U.S. since the nation's current infrastructure was not designed and built to deliver universally accessible IP-based services. Nor is the current regulatory scheme that treats the Internet as an afterthought -- an optional "information sevice" -- rather than an essential telecommunications service.

Cerf also pays homage to the notion that IP-based infrastructure is a natural monopoly like publicly owned roads and highways that by its nature does not lend itself to market competition:

You don't have multiple roads going to your house for example. Instead, it is a common resource. I said something like "maybe we should treat the Internet more like the road system."

Cerf correctly notes that competition to deliver IP-based services isn't likely to develop among the legacy telco and cable providers since the old regulatory framework isn't designed to foster competition for them. He posits that like the early telephone system, subsidies will be needed to ensure universal access.

If broadband service is essential to the national economy and to citizens, given the present means by which it is implemented, and given that it appears unlikely that the usual competitive pressures will lead to discipline among the competitors, perhaps we need new national rules to assure that the service is openly and equally accessible to any application provider and to all users. Equal does not mean that everyone pays the same amount. In particular, higher capacity might be priced at a higher rate. Provision needs to be made, however, to deal with high cost (to the provider) areas using a new form of Universal Service or some other subsidy.

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