Path: utzoo!telecom-request Date: Mon, 29 Apr 91 17:30 PDT From: John Higdon Newsgroups: comp.dcom.telecom Subject: Re: Decreasing Costs of Transmission Reply-To: John Higdon Message-ID: Organization: Green Hills and Cows Sender: Telecom@eecs.nwu.edu Approved: Telecom@eecs.nwu.edu X-Submissions-To: telecom@eecs.nwu.edu X-Administrivia-To: telecom-request@eecs.nwu.edu X-Telecom-Digest: Volume 11, Issue 319, Message 5 of 12 Lines: 43 Nuclear Warrior writes: > Wouldn't it be great if one ... was to create a full-service telephone > company, hopefully providing long distance ... and ... local service > ... at the lowest possible prices? It would charge just enough to > hire all the necessary people, provide ample capacity and keep all > of the equipment state-of-the-art. And maybe charge just enough more to guarantee the investors a twelve percent rate of return. Maybe I missed something, but is that not what our LECs as a regulated monopoly are already supposed to be doing? If you have trouble recognizing any of that in your local telephone utility, perhaps it is because the regulated division is just a tiny speck on the spreadsheets of a megaconglomerate holding company who is manipulating the books, the legislators, the regulators, and its customers to maximize the "unregulated" profits of the parent corporation. I give you Pacific Telesis as an example, not because it is particularly slimy (it is), but because it is typical. Here you see a very powerful corporation, who among many other things, happens to own a telephone utility. This monopoly is guaranteed by statute to earn a given percentage on invested capital. It cannot lose. The government will not allow it. But does this satisfy PacTel? Of course not. It wants to have the last of the regulations removed that prevent Pac*Bell from competing with its own customers. It wants it both ways: a guaranteed rate-of-return AND the ability to compete on a playing field tilted in its favor. ("No one but Pac*Bell should be able to provide intraLATA toll service, but Pac*Bell should be able to manufacture and sell terminal equipment.") That is one holding company's idea of fair. I can think of a lot of people who would be quite happy running an exemplary utility -- providing the best service at the lowest possible cost. But looking at the stepsisters Bell, it is not really very likely that they will get the chance. John Higdon | P. O. Box 7648 | +1 408 723 1395 john@zygot.ati.com | San Jose, CA 95150 | M o o !