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Re: Another Point Of View (Round 2)
On Wed, 4 Dec 1996, Bill Frezza wrote:
> At 8:01 PM -0500 12/3/96, James Love wrote:
> >Oh, one more thing. In game theoretic models, it is the expected
> >prices after entry when are important... not the prices before entry.
> Tell that to all the lunatics that bid $40 a pop for PCS licenses
In a competitive auction like this, I would expect some
high bids. These are bets about technology and services that may or
may not be developed. Who knows now what the licenses are worth.
>. There is
> no question that the consumer is going to be the big winner here as half a
> dozen network providers beat each other's brains out for business. Had we
> taken your approach, say using regulators to force the cellular duopolists
> to reduce their prices to some "fair" level, the results would have been
> entirely different.
Don't act like such a jerk. Instead of putting words
into my mouth, which I don't appreciate (I'm not the simple minded
activist of your limited imagination), you might read the comments
we actually made on the PSC auctions (from the info-policy-notes
archives). We wanted several license per market, so that competition
would solve the problems. The bidders asked for 2, but no more than 3
license per market. We thought the licenses should be broken into the
smallest practical blocks (for more competitors), with mergers between
licenses only allowed if the FCC found that the larger blocks (and hence
fewer competitiors) were needed to provide the service. We also asked
for cross-ownership rules, which would have kept the local LECs, cable
and cellular firms from bidding on licenses, in their current service
area. We sought this in the Teleco bill, to no avail.
The bidders don't want competition. They want to merge licenses. We
want government regulation (antitrust , FCC rules limiting concentration,
etc), so that competition will occur.
Are you so dumb that you think that the LEC market (wires to every
home), and the wireless market pose identical problems for regulators?
The differences seem pretty obvious. jamie
James Love / email@example.com / P.O. Box 19367, Washington, DC 20036
Voice: 202/387-8030; Fax 202/234-5176
Center for Study of Responsive Law
Consumer Project on Technology; http://www.essential.org/cpt
Taxpayer Assets Project; http://www.tap.org