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From: 0004133373@mcimail.com (Donald E. Kimberlin)
Newsgroups: comp.dcom.telecom
Subject: Re: New Zealand Sysop Fights Telco on Business Rates
Message-ID: <16464@accuvax.nwu.edu>
Date: 26 Jan 91 15:02:00 GMT
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X-Telecom-Digest: Volume 11, Issue 71, Message 5 of 7


   A recent thread here discusses the practicality of competition arising
in New Zealand, to let market forces work on monopolistic practices
and prices of Telecom NZ.

   One statement too broadly made and accepted without question is to
feel that, "competition is impractical."  This is largely based on a
belief that any competitor would have to build parallel transmission
plant using the same technology or a similarly expensive technology as
the existing company.

   I'd like to posit a few thoughts that counter such a view.

   Here in the US, the FCC undertook to let technology erode the
rather shaky "natural monopoly" enjoyed by local Telcos.  Thus, we
have seen the ownership of cellular radio by non-Telcos.  One maker,
IMM of Philadelphia, has even fielded a cellular system suitable for
use in rural areas to fixed positions.  An even earlier technology
from Farinon in the US and a Canadian firm used lower frequencies in
the 450 Mhz region to serve rural users.  We had a non-directional
microwave technology called Digital Termination Service that was
premature for the marketplace, with so few people applying for it that
the FCC withdrew the frequency allocations.

    In England, the government legislated local competition into
existence, with Cable and Wireless' Mercury Communications developing
means to provide local telephone channels via existing cable
television.

    Most recently, we have seen a US proposition, backed by the FCC,
to let cable TV companies operate nodes of PCN telephones (akin to the
UK "Phonepoints") along their cable routes.

    If the regulators or legislators in NZ will simply let
entrepreneurs loose to try their ideas, New Zealanders might have a
choice within a shorter time than Telecom New Zealand realizes!
That's not to say they would realize what is happening to them very
rapidly.  Here is the US, most local Telcos are at present trying to
ignore the threat, and hoping the public won't find out there really
is no "dial tone monopoly;" that thay've all been living in Oz (and I
don't mean NZ's cousins a thousand miles or so to the west!)