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Comment by xen2xen1

3 years ago

What other benefits are there to being a "public telecommunication utility"?

The benefit that is obvious to the regulators is that you can charge money for services. So for example, offering telephone services requires being a LEC (local exchange carrier) or CLEC (competitive local exchange carrier). But even telephone services have become considerably unregulated through VoIP. It's just that at some point, the VoIP has to terminate/interface with a (C)LEC offering real dial tone and telephone numbering. You can put in your own Asterisk server [0] and provide VoIP service on your burgeoning optical utilities network, together with other bundled services including television, movies, gaming, metering etc.. All of these offerings can be resold from wholesale services, where all you need is an Internet feed.

Other benefits to being a "public telecommunication utility" include the competitive right to place your own facilities on telephone/power poles or underground in public right-of-way under the Telecommunications Act of 1996. You will need to enter into and pay for a pole attachment agreement. Of course local governments can reserve the right to tariff your facilities, which has its own ugliness.

One potentially valuable thing a utility can do is place empty conduit in public right of way that can be used/resold in the future at a (considerable) gain. For example, before highways, roadways, airports and other infrastructure is built, it is orders of magnitude cheaper just to plow conduit under bare ground before the improvements are placed.

[0] https://www.asterisk.org/

  • > Other benefits to being a "public telecommunication utility" include the competitive right to place your own facilities on telephone/power poles or underground in public right-of-way under the Telecommunications Act of 1996. You will need to enter into and pay for a pole attachment agreement. Of course local governments can reserve the right to tariff your facilities, which has its own ugliness.

    Note that in many parts of the country, the telcos/cablecos themselves own the poles. Google had a ton of trouble with AT&T in my state thanks to this. They lost to AT&T in court and gave up.

  • > the competitive right to place your own facilities on telephone/power poles or underground in public right-of-way under the Telecommunications Act of 1996

    This is not true. The FCC doesn't regulate the first pole attachment by a given attacher to poles owned by a given owner. The pole owners are basically free to use all sorts of lame reasons for refusing your first pole attachment request.

    The FCC only gets involved when a company already has some (even just one) attachments and is getting rejected or stonewalled on making more attachments.

    If you think about it, this is typical captured regulator behavior. The phone companies already have attachments to the electric utility's poles wherever they operate. So this lets the phone companies call in the FCC on any pole dispute. But it provides zero assistance to any new market entrants who want to compete with the existing phone company.

    It also makes the decision to allow the first attachment a much harder decision for the pole owner, with the result being that the electrical utilities are incentivized to exclude new telecoms from competing with the phone company. But of course these new telecoms aren't trying to provide electrical services, so it doesn't look anticompetitive to a superficial analysis.