> It's government that is granting Comcast the monopoly privilege to be the only ISP on the market.
Not always. Comcast may have got in early and laid substantial infrastructure (copper/fibre/HFC) - something that can be substantially cheaper if you leverage "new" (cable reserves and/or piggy-back off the utilities when they are expanding their networks.
New players, however, need a substantial amount of capital to get started. Comcast (or anyone like them) can leverage their position in the market to drive up prices or push smaller players out. By using regulation to effectively turn the infrastructure into a public utility, it allows smaller players to compete.
The argument against this regulation (which is in place in the UK and Australia, amongst other countries) is that the monopoly (BT/Telstra) spent money building out their network and therefore should not be forced to share it.
The argument for this regulation is that often the telco built out this infrastructure in a particularly favorable environment that cannot be replicated today due to the huge costs of installing physical cable. As a further example, Telstra in Australia (previously Telecom) was government owned and therefore had a directive to supply the population with telecommunications. Many parts of their copper network (cable, conduit, pits, exchanges) were built during this phase. When they were privatised (sold by the Government) this was no longer their key directive. Any new player attempting to get into the market-even a small part (i.e. inner Sydney)-had a lot of catching up to do. Huge capital costs, a significant amount of regulatory hurdles and cable reserves to negotiate access to, etc.
This is of course a simplification of the issue, and you could argue that in Telstra's case the government did effectively grant them a monopoly on the market by privatising them. But had they started out as a private company originally, I believe we would have still ended up in a similar place - getting in early when rolling out disruptive infrastructure (as trenching cable tends to be!) projects is a huge advantage in and of itself.
I think you're correct to point out that "in Telstra's case the government did effectively grant them a monopoly" in the first place.
The specifics I'm talking about in the Comcast case is that government is continually granting the monopoly privilege by preventing other companies from creating infrastructure (laying wire), even if a company wishes to do so.
This is precisely what allows Comcast to charge whatever it wants, begging more regulation down the road to force Comcast to charge 'fair' prices ('fair' in the minds of the legislators).
If any competitor was allowed to enter what is an enormous market it would provide continual downward pressure on consumer prices. The monopolistic privilege granted to Comcast leads to higher prices, as consumers can only pay the high price or forego service.
Not always. Comcast may have got in early and laid substantial infrastructure (copper/fibre/HFC) - something that can be substantially cheaper if you leverage "new" (cable reserves and/or piggy-back off the utilities when they are expanding their networks.
New players, however, need a substantial amount of capital to get started. Comcast (or anyone like them) can leverage their position in the market to drive up prices or push smaller players out. By using regulation to effectively turn the infrastructure into a public utility, it allows smaller players to compete.
The argument against this regulation (which is in place in the UK and Australia, amongst other countries) is that the monopoly (BT/Telstra) spent money building out their network and therefore should not be forced to share it.
The argument for this regulation is that often the telco built out this infrastructure in a particularly favorable environment that cannot be replicated today due to the huge costs of installing physical cable. As a further example, Telstra in Australia (previously Telecom) was government owned and therefore had a directive to supply the population with telecommunications. Many parts of their copper network (cable, conduit, pits, exchanges) were built during this phase. When they were privatised (sold by the Government) this was no longer their key directive. Any new player attempting to get into the market-even a small part (i.e. inner Sydney)-had a lot of catching up to do. Huge capital costs, a significant amount of regulatory hurdles and cable reserves to negotiate access to, etc.
This is of course a simplification of the issue, and you could argue that in Telstra's case the government did effectively grant them a monopoly on the market by privatising them. But had they started out as a private company originally, I believe we would have still ended up in a similar place - getting in early when rolling out disruptive infrastructure (as trenching cable tends to be!) projects is a huge advantage in and of itself.