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The Broadband Problem: Anatomy of a Market Failure and a Policy Dilemma

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Synopses & Reviews

Publisher Comments:

While the Internet revolution has vastly improved communication among businesses and individuals, pressure has been building for faster and less expensive broadband data services. Such services could not only yield vastly improved and less expensive provision of traditional applications such as voice telephony and Web browsing, but could also enable new applications such as Internet-based television, videoconferencing, and software distribution. However, broadband services and prices have not kept pace either with demand or with progress in information technology. This new book analyzes the markets and policy issues underlying the broadband dilemma. Charles Ferguson asserts that the Telecommunications Act of 1996 and federal policy have failed to provide sufficient levels of new entry, competition, and innovation in the local telecommunications market, which remains dominated by monopoly telephone companies. New entrants and Internet-based firms such as competitive local exchange carriers (CLECs), Internet service providers (ISPs), and enhanced service providers (ESPs) remain disadvantaged relative to the monopoly incumbent local exchange carriers (ILECs). Flawed policy has also allowed ILECs to continue to engage in monopolistic practices, mergers, and anticompetitive conduct. Through a combination of inefficiency and rational monopolistic conduct, the ILECs are thus able to retard the deployment of new technology and services through delaying tactics, regulatory procedures, litigation, and political influence. Competition from the cable television (CATV) industry probably cannot fully address these problems. The CATV industry cannot compete in most business markets. In residentialmarkets CATV's competitive potential is greater, but CATV vendors' incentives to favor their own networks, services, and proprietary content raise major concerns analogous to those raised by the ILECs. The combined result of these market and policy failures is inadequate technological progress, innovation, and productivity growth in advanced Internet services and in telecommunications services generally. This significantly retards U.S. and global economic growth, perhaps by as much as one percent per year. Ferguson believes federal policy must be adjusted to ensure the robust infrastructure necessary for advanced Internet services, electronic commerce, open-systems HDTV, videoconferencing, and improved voice telephony. Ferguson recommends several policy changes, including increased regulatory surveillance of ILEC conduct, antitrust actions against ILECs, limits on conflicts of interest in government and academia, limits on CATV control of proprietary content, and possibly tax measures to stimulate construction of competitive infrastructure systems.

Book News Annotation:

Widely accessible broadband Internet service would enable new applications such as Internet-based television, videoconferencing, and software distribution. But despite its potential for improved efficiency, broadband service lags behind progress made in information technology development. Ferguson (economic studies, Brookings Institution) explains the causes and ramifications of this situation and offers suggestions for improvement, arguing that current telecommunications law and policy have not provided sufficient levels of new entry, competition, and innovation in the local telecom market.
Annotation 2004 Book News, Inc., Portland, OR (booknews.com)

Synopsis:

As the Internet revolution continues to unfold and transform telecommunications, pressure is building for faster, less expensive, and more widely accessible broadband service. Such a development would facilitate improved and less expensive traditional applications such as voice telephony and web browsing. It would also enable new and useful applications such as Internet-based television, videoconferencing, and software distribution. Broadband has great potential to improve efficiency and productivity, even to improve national security in some cases. Broadband service and affordability, however, have consistently lagged well behind demand and progress in information technology, with damaging results. The Internet revolution remains incomplete and threatens to stagnate if the situation continues. In The Broadband Problem, economist and technology entrepreneur Charles H. Ferguson explains the causes and ramifications of this damaging bottleneck, and he offers suggestions on improving the current state of affairs. He asserts that current telecommunications law and policy have not provided sufficient levels of new entry, competition, and innovation in the local telecom market. The continuing dominance of ILECs (incumbent local exchange carriers) in that market impedes the healthy, and much-needed, development of an efficient broadband market. The result of these policy and market failures is inadequate technological progress, innovation, and productivity in advanced Internet services and telecommunication services generally. The broadband problem is holding us back, and thus must be addressed and solved. With this important volume, Charles Ferguson has contributed mightily to that mission.

Product Details

ISBN:
9780815706458
Author:
Ferguson, Charles
Publisher:
Brookings Institution Press
Location:
Washington, D.C.
Subject:
General
Subject:
Telecommunications
Subject:
Economic Policy
Subject:
Economic Conditions
Subject:
Free Enterprise
Subject:
Broadband communication systems
Subject:
Telecommunication policy
Subject:
Industries - Computer Industry
Subject:
Economics - General
Subject:
Business Writing
Edition Description:
Includes bibliographical references and index.
Series Volume:
1170
Publication Date:
20040531
Binding:
TRADE PAPER
Language:
English
Illustrations:
Y
Pages:
236
Dimensions:
9.00x5.68x.68 in. .77 lbs.

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Related Subjects

Business » General
Business » Management
Business » Writing
History and Social Science » Economics » General
History and Social Science » Politics » United States » Foreign Policy
History and Social Science » World History » General
Science and Mathematics » Electricity » General Electronics

The Broadband Problem: Anatomy of a Market Failure and a Policy Dilemma New Trade Paper
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Product details 236 pages Brookings Institution Press - English 9780815706458 Reviews:
"Synopsis" by , As the Internet revolution continues to unfold and transform telecommunications, pressure is building for faster, less expensive, and more widely accessible broadband service. Such a development would facilitate improved and less expensive traditional applications such as voice telephony and web browsing. It would also enable new and useful applications such as Internet-based television, videoconferencing, and software distribution. Broadband has great potential to improve efficiency and productivity, even to improve national security in some cases. Broadband service and affordability, however, have consistently lagged well behind demand and progress in information technology, with damaging results. The Internet revolution remains incomplete and threatens to stagnate if the situation continues. In The Broadband Problem, economist and technology entrepreneur Charles H. Ferguson explains the causes and ramifications of this damaging bottleneck, and he offers suggestions on improving the current state of affairs. He asserts that current telecommunications law and policy have not provided sufficient levels of new entry, competition, and innovation in the local telecom market. The continuing dominance of ILECs (incumbent local exchange carriers) in that market impedes the healthy, and much-needed, development of an efficient broadband market. The result of these policy and market failures is inadequate technological progress, innovation, and productivity in advanced Internet services and telecommunication services generally. The broadband problem is holding us back, and thus must be addressed and solved. With this important volume, Charles Ferguson has contributed mightily to that mission.
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