Wednesday, January 05, 2005


The Battle of Lafayette, Louisiana

The battle for Lafayette's Fiber to the Home network focusses the issues nicely. Public utility authority, Lafayette Utilities System wants to build FTTH to serve every neighborhood of the city. The incumbent cable system (Cox) and the incumbent telco (BellSouth) want to make money, so they'd like to focus on the 20% of the city's customers that will create 80% of the revenue.

The telco/cableco incumbents cry foul. They say that a city's ability to raise tax free municipal bonds gives munis an unfair "anti-competitive" advantage.
"The reason that we oppose LUS doing that is the approach of using taxpayer dollars to go into competition with private industry," says Danny Wilson, regional director for BellSouth. He says that BellSouth's prices are competitive and adds, "We want to compete with anybody. We will compete with anybody." Link
Should a government, especially a government "of, by and for the people," have the right to say what sectors of its community should be served?

Assume the answer is Yes. Then that government must either dictate to telcos and cablecos where it should build, or it must build the network itself. Assuming the answer is Yes, are there any other alternatives? (Honest question, feedback, please!) But if the answer is yes, then the cablecos and telcos cry, "deregulation" in the first case and "anti-competitive" in the second case.

Assume the answer is No. Now we know who's making the decisions, and it ain't the "of, by and for" people. Certain areas are underserved, the poor ones and the ones that it is expensive to serve. So the town incurs penalties like having two classes of schools, wired and unwired, and two kinds of neighborhoods. The circle could well become vicious; for example, which neighborhood do new jobs gravitate towards?

Now there's a pro-LUS blog and an anti-LUS blog (with links to the Progress and Freedom Foundation for the Preservation of ILECs).

You can BET there'll be lots more on this. Stay tuned.

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