Re: Another Point Of View (Round 2)

[James Love <love@tap.org>]

  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
  
  
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  James Love / love@tap.org / 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
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