Judge Tosses Telco Suit Over City-Owned Network 281
tsa sends along news of the city of Monticello, Minnesota, which was sued by their local telco, Bridgewater Telephone Company, because the city chose to build a fiber optics network of their own. The judge dismissed their complaint of competition by a governmental organization. Quoting: "The judge's ruling is noteworthy for two things: (1) the judge's complete dismissal of Bridgewater Telephone Company's complaint and (2) his obvious anger at the underfunding of Minnesota's state courts. Indeed, the longest footnote in the opinion is an extended jeremiad about how much work judges are under and why it took so long to decide this case."
Costly Waste of Time (Score:5, Insightful)
IANAL, but the second part is a warning to TDS against trying to waste more court time. The judge is saying that he's busy enough and therefore if TDS tries to revisit this, it would be another costly loss.
TDS lost a lot of money going after the city. They also lost a lot of revenue because they are now going to try and compete with the city (lol). And they lost the support of their community, who knows they sued the city for unwarranted tax dollars, and taxpayers love bailouts.
Re:Costly Waste of Time (Score:5, Insightful)
Cry me a river.
They lost money.
Oh well! UPS and FedEx lose money every day competing against the government's postal service, and yet they both seem to be doing quite well. Instead of trying to use government to give Bridgewater Telephone a guaranteed monopoly, maybe they should take a page from UPS/FedEx and learn to compete.
Re:Costly Waste of Time (Score:5, Insightful)
Re:Costly Waste of Time (Score:5, Insightful)
Re:Costly Waste of Time (Score:5, Insightful)
Missing the main point... (Score:4, Insightful)
I'm surprised no one has mentioned this yet...
This gives other community precedence in other lawsuits across the nation.
Once one telco falls, hopefully the other lawsuits will fall also, just like a row of dominos.
Re:Costly Waste of Time (Score:5, Insightful)
What every telco wants... (Score:5, Insightful)
Re:Government could have fought back (Score:4, Insightful)
Which would actually support the plaintiff's assertion that the government is abusing its regulatory powers to secure an unfair competitive advantage.
Re:Costly Waste of Time (Score:5, Insightful)
Re:Costly Waste of Time (Score:5, Insightful)
This was no waste of money.
They didn't "lose" money on the lawsuit. They "made an investment". The whole point of the lawsuit was to give them a head-start in the competition against the city. They just wanted to tie the cities coffers so they could start their fiber roll-out before the city did. They succeeded in this goal, so their "investment" paid off big time for them.
Re:Government could have fought back (Score:5, Insightful)
Probably because there was no reason to deny them the permits they needed. To do so would have been a corrupt, let alone shitty, thing to do.
I don't know about the rest of the world, however, if I were a city entity involved in a lawsuit with a telco company, I'm going to do everything in my power to be seen as treating people (especially those suing me) as fairly as possible. You don't want to get a pissed off judge any ammunition to use in his/her making an example of you. That, and it's just the right thing to do, and I wish more people felt that way.
Re:Costly Waste of Time (Score:2, Insightful)
Must be due to /.'s monopoly on blog comment scoring
Re:Costly Waste of Time (Score:5, Insightful)
"This, of course, assumes that the government can do a better job with its limited knowledge, expertise, and equipment."
Its not hard today to throw a rock and hit an able network/systems admin or three and many good ones who live locally might be willing to take a slight pay cut to avoid the commute into MSP or just for the fact a govt job is a much less stressful place than private industry.
"I find it hard to imagine that running fiber around is cheaper, but it must mean that their city buildings are right next door to each other or on the same block."
Cheaper than what? its probably slightly cheaper for them than the teleco's (after all they can way speed up their own permit process). And they seem to be reasonably densely populated (and small) for such a move
Area
- Total 6.2 sq mi (16.1 km)
Population (2000)
- Total 11,414
- Density 1,264.6/sq mi (488.3/km)
Actually its pretty densely populated (and small)
--
"There are few things that I have experienced the government doing better than a competitive private sector."
I generally agree with this but when a government *wants* to do something like this I prefer its a local government and not the state or federal.
Considering... (Score:1, Insightful)
That the judge is making 280,000 a year. we all can call him and say.
WAH big baby.
Re:Costly Waste of Time (Score:2, Insightful)
And what if I don't like either service. Where's the 3rd company? Oh, that's right, companies aren't allowed to lay their own fiber - government restriction. You call this competition?
Re:Government could have fought back (Score:4, Insightful)
How's it working out for you having your government take a "hands off" approach to your banks? (assuming you are an American).
Ted Rogers was on CBC the other day, and made a comment about how when he was sitting on a board of a bank, there was one bank regulator (govt official) for every member of the bank at all the bank meetings. He said he didn't understand the need for the government oversight until now.
My personal belief is that the government (the people, remember) should own ALL the infrastructure and license it to private service providers. I know it isn't perfect, but I feel it is the best. Businesses have one goal, making a profit. Governments have (or should have) one goal, providing a service to the constituents.
That's what I like about Canada. Now if we can only just elect a majourity government so we can get something done instead of just arguing...
Re:Costly Waste of Time (Score:1, Insightful)
Isn't that what the Teclo did with its lawsuit? They used a tactic to delay the City in starting its project, but that is okay. The City responding in kind, to only even the playing field, is somehow supposedly wrong?
Re:Costly Waste of Time (Score:3, Insightful)
Re:Costly Waste of Time (Score:5, Insightful)
If the government got out of the business of providing a poor, unprofitable service, businesses with an interest in profit could take over and make them profitable, more efficient, and more reliable.
More likely private industry would take over the profitable routes dropping all the unprofitable ones, making the service much worse than it already is.
Re:Costly Waste of Time (Score:4, Insightful)
If the demand is high enough
Dude, America has one hell of a lot of rural areas where demand does not meet financial justification. This is exactly why the gov't passed a bill a few years ago to provide something like $200 million in incentives to have telecos service rural areas. The gov't recognized the criticality of decent internet service for US competition in world markets and therefore provided great financial benefits for telecos to run broadband to rural areas. The telecos took the cash and ran. Why is it OK for the telecos to take cash dedicated to a specific cause and screw the taxpayers but it's evil for the government to say "if you don't do it, we will"? There are some cases (and in this case, MANY very compelling cases) where the government is completely justified in offering services to force competition where none exists today and none is likely in the foreseeable future. If this teleco was the only decent game in town, they might wake up and realize that they are not immune from competition.
Re:Missing the main point... (Score:2, Insightful)
A group of people exercising a right to do something they've all agreed on? You aren't really that obtuse are you? Are you going to start bitching that we don't have 5 or 6 power companies per city or something now? Or just keep twisting my words around?
Re:Costly Waste of Time (Score:2, Insightful)
Re:Costly Waste of Time (Score:5, Insightful)
Why would the government arbitrarily cripple a business? Besides the fact that if they did, they would be sued.
COmpanies lay their own fiber all the time. Yes there are government rule regaurding this, but considering they need to rip up roaads, dig through property, and use the underground infrastruture that makes sense.
BTW, the 'Government' needs permission to do this as well.
I mean, really. How do you think the first company got fiber in the first place?
Yes, this is competition. And no one has to guarantee you a service the meets some standard you want...except government agencies.
Re:Costly Waste of Time (Score:4, Insightful)
Yes, and the cost to send mail would go through the roof.
Re:Costly Waste of Time (Score:5, Insightful)
Re:Costly Waste of Time (Score:3, Insightful)
Well, that's the market for you. The government represents the people. The people should be an equal actor in the marketplace, on the same line as a huge ugly telco.
I don't see anything wrong with that. It's called democracy and a free market (long as the telco isn't charged, you know, customs fees).
Or would you rather have a stagnant one-pony market, where the best available Internet connection is something like a 128 kbit/s ISDN that you pay per-minute _and_ per-megabyte charges for? Because that's what you get in a regional monopoly. Competition from the local government is still competition, and oftentimes it works quite well. Of course the telcos will scream red menace, but then again who wouldn't -- no incumbent likes having to do better and bilk their customers less for better service.
Re:Boo fricken hoo (Score:4, Insightful)
I don't know why legalizing prostitution would reduce it, but we've had some positive effects since it was legalized here in Germany. Prostitutes now can get proper health insurance and have legal recourse against pimps (as pimping still is illegal). We didn't legalize prostitution to keep people from going to prostitutes; we legalized prostitution to improve the situation of the prostitutes. As far as I know it helped.
As for legalizing hemp: Yup, I agree there. Legalization would reduce most issues: It wouldn't be as much of an entry drug because you wouldn't buy it from dealers anymore. Hemp consumption wouldn't mean automatically providing money to criminals anymore. Legalization would allow regulation, which would lead to quality controls and thus better quality for the consumers*. Long-term studies would be easier. The situation for addicts would improve as there would be less social and legal danger involved in getting professional help.
Of course it's still a War On Something so we can't expect it to ever end.
* Wow, a sentence where I use the word "consumer" without feeling dirty.
Re:Costly Waste of Time (Score:2, Insightful)
"Why would the government arbitrarily cripple a business?"
Why not ask this guy? http://en.wikipedia.org/wiki/Lysander_Spooner [wikipedia.org] (Well, besides that he's dead, I mean.)
The government arbitrarily cripples all kinds of businesses -- medical marijuana comes to mind. So does prostitution.
Of course, they wouldn't call it "arbitrary" -- always, there's a really good *reason* (from the point of view of the government) why they do the crippling. So perhaps we've arrived at the No True Scotsman impasse :)
Fiber is not the mail, I realize, but there's no way to have a govt-run / subdidized / protectulated* industry without impinging on the freedom of others to engage in a free and fair marketplace, because the ideas of free and fair are suddenly out the window. (Ask an American home schooling parent how he enjoys subsidizing the government schools of this country.)
"Besides the fact that if they did, they would be sued."
You can sue government entities only under certain circumstances, and even then it's a big pain.
timothy
* Correct, that is not a real word.
Re:Troll? I love it (Score:3, Insightful)
You're sticking to principles, but unfortunately for you the principle you've chosen isn't applicable. If your belief in free market competition had any bearing on reality, this thread wouldn't even exist, because every single dwelling on the planet with electricity would be served by 7 ultra-broadband Internet connections that the occupant could choose between on a whim. Manifestly this is not the case, so it's reasonable to question your assumptions.
First, is the market in question free? No, it isn't. Wired versions require access to public right-of-way. Wireless versions require access to public airwaves. Both are heavily regulated because they are shared, public resources that must be tightly controlled at a government level to maintain their accessibility and usability by as large a percentage of the population as possible. Wireless isn't really up to the task technologically, so I'll talk mainly about wired options.
At the moment, the accessibility and usability of public rights-of-way in the US are near enough as to be indistinguishable from 100%. Even the poorest non-citizen is allowed to walk along the roads, if nothing else. The vast majority of the population of the country drives on them, or is driven on them by their parents. The conclusion we may reach is that the current government regulation is working, and working extremely well. The fact that it is also a detriment to the free and easy deployment of new networks is a failure of deployment technology and financial vision rather than any inherent fault.
Second, is there competition in the market? No, there isn't. The various players in the broadband market function, in most regions, as a duopoly at best, and as a monopoly at worst (and in this particular case). Even in regions where there are nominally more than two potential providers, you'll find that their service areas interlace but do not overlap very much. All telecommunications providers in the US have been operating in a careful sort of gentleman's agreement not to intrude on each others markets. Whether these agreements are literal or metaphorical is irrelevant. It is fact that it is vanishingly rare for one of the national carriers to intrude on an established market of another carrier. They stake out their little (or large) territories and don't venture outside of them.
Why is this so? Because of a phrase that has been missing from this entire comment thread: "natural monopoly". Broadband communications is a natural monopoly, in the same manner that water and sewer and electrical service are natural monopolies. It's not quite a natural monopoly in the same way that roads are, since there are serious physical limits as to how many roads can reach my house, but it's very much a natural monopoly akin to the other services. There could easily be six or seven different water companies serving my house, in physical terms. There's plenty of room to lay the pipe required. It doesn't make any sense though. The capital outlay required to lay enormously redundant pipe is absurd, especially because, except for the one I'm subscribing to, it is guaranteed to be unused. The technology currently used to deploy broadband networks is expensive and the method for doing so directly interacts with the justifiably touchy regulatory regime of public rights-of-way mentioned above, making the whole proposition even more difficult and more expensive.
In this case, your vaunted capitalist system is working perfectly - private telecommunications companies are making the most efficient use of their capital expenditures, by NOT competing with one another. They can't. They haven't got the money to do it. The more successful competitors there are in a natural monopoly environment, the larger the waste in under-utilized infrastructure. If there are seven evenly matched competitors with 100% customer overlap, 85% of EACH of their cable plants are totally unused. Given the capital-intensive nature of even potentially providing the service, this scenario will never