From: Stanton McCandlish <mech@eff.org>
Date: Wed, 17 Nov 93 13:31:15 PST
To: habs@panix.com
Subject: Re: Should we oppose the Data Superhighway/NII?
In-Reply-To: <199311171840.AA15151@panix.com>
Message-ID: <199311172130.QAA14722@eff.org>
MIME-Version: 1.0
Content-Type: text/plain


> > I'd say that the 30%+ of US households with computers, and the 10%+ (and
> > VERY rapidly growing) with modems is "a major part" of the market.  Far
> 
> Their are 95 million homes in America.
> Their are 90 million homes with TV
> 65 million homes have Cable.
> Advertisers consider National Broadcast TV to be a major market.
> Even to this day, Cable is not seen in the same light as National
> Broadcast Networks.

This may have something to so with the large number of cable stations that
don't allow advertising, and have not since day one, because people are
willing to pay extra for ad-less tv.  

This also has to do with fact that the most popular shows are on network
broadcast TV, not cable, for a number of reasons.  Advertisers go where
the people are.  Your entire point seems to be that because advertisers
decide that the cable is a lousy market, it does is not "major".  The actual
relationship is quite the opposite.  For many reasons the cable market was
kept from being a "major market" for advertisers, and so advertisers do
not advertise via cable as much as they do via airwaves.  This is all
quite peripheral.

> The fact that 9.5 million homes have modems, or 21+ million homes
> have computers, does not a real mass market make.

? This is a nonsensical statement.  You seem to presume that a
computer-net market must perforce directly compete with a tv-net market,
when there is room for both.  The slothful and apathetic will happily vege
out in front of the new supertube, and fortunately be mostly selected out
of the memepool, while those with a glimmer of imagination and
intelligence are likely to find a use for interactive communications and
information services.  It's certainly the first time I've ever heard
someone say that 21 or even 9 million people is not a mass market.

> Not enough to
> force companies to put in special data services;

Who's talking about doing so?  Companies are *fighting* to put in data
services right now; why should this stop?  The issue is one of access and
expense, not of will it happen or not.

> I am saying, don't regulate data, and thus don't force any carrier to
> offer a special data rate. When 60 - 70 million homes have active 
> use of Data, then you can have congress set some minimum standard.
[...]
> And note, without any regulations in terms of basic services, Cable
> has grown from serving a small town in Penn. to servicing 65 million
> homes in N. America.

What evidence have you that fact that the absence of basic service
regulation was the source of growth in the cable industry, particularly
when other heavily restrictive regulation was affecting it, and preventing
it from being a free market?

> Cable is better suited to offer voice and high
> speed multi-megabit services than are phone companies.

These are not logically comparable categories.  Coax cable, as a conduit,
is certainly better than phone wire.  But why should it be better for
cable companies to offer voice and video services?  I'd think the evidence
points in the other direction.  Cable programming has heretofore been 80
or whatever channels of one-way garbage.  At least telephone communication
is 2 way, relatively private, uncensored, and can be used to reach online
services with many-to-many information exchange.  TCI may say they want to
bring that about via "CableNet" too, but I wouldn't hold my breath if I
were you.

> Clear proof
> that market forces can produce the results we need. (Cable passes over
> 90% of all homes in this country).

No, clear proof that people wanted cable tv. Period.  No more, no less.
Until I see an attempt to bring data (which should not require any new
cabling for a while) to everyone, and see the people from the service
providers being told to beat it and being chased off with brooms by
enraged renters and homeowners, I feel fairly confident that there is a
very worthwhile market for data services, and that at very least it would
be a far more worthwhile experiment that cable ever was.  Seems funny that
you claim that free market theory would yield this 90%, when the cable
"market" is not much of a market at all, but simply a collection of
govt-supported local monopolies.

There are good points, but I still question whether cable (or any other
form of) tv has any business being a "basic service".  Personally I find
tv to be a basic disservice and an utter waste of time (others probably
disagree, but oh well.)  What rationale is there for including it with
POTS as something to be subsidized?  If you firmly believe that govt.
subsidization/regulation will harm a medium, then say so.  But as it
stands I get the feeling that you think it will be good for the provision
of "basic services"; but when challenged you point to the good that
comes from *lack* of regulation.  Which is it?  If the govt. *does* need to
subsidize [useful service X] because it should be a basic service, then
let's see data included.  If subsidization (and the regulation that comes
with it) are lousy and screw up the market, then let's not see *anything*
subsidized (unless we actually want to damage it; might be a good idea for
tv >;)

-- 
Stanton  McCandlish  mech@eff.org  1:109/1103   EFF  Online  Activist & SysOp
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