Go Back  DVD Talk Forum > General Discussions > Other Talk > Religion, Politics and World Events
Reload this Page >

How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rigged)

Religion, Politics and World Events They make great dinner conversation, don't you think? plus Political Film

How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rigged)

Old 04-16-13, 03:31 AM
  #1  
Political Exile
Thread Starter
 
grundle's Avatar
 
Join Date: Jun 2005
Posts: 16,303
How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rigged)

Obama thinks it's unfair that auctions go to the highest bidder, so he wants them to be rigged.


http://www.fool.com/investing/genera...d-verizon.aspx

How the Feds Want to Put Heat on AT&T and Verizon

By Evan Niu

April 15, 2013

Putting heat on the big players is simply the name of the regulatory game -- at least if you're the Department of Justice's Antitrust Division. In a filing with the Federal Communications Commission last week, the DOJ makes it clear that it would like to put additional heat on dominant wireless carriers AT&T and Verizon Wireless.

The FCC has a spectrum auction coming up for low-frequency bands. Frequencies under 1 GHz have greater propagation characteristics that allow signals to provide better coverage in rural areas and penetrate buildings more effectively. Because of this, low-frequency bands are an important part of any carrier's spectrum portfolio. Unfortunately for competition, the "two leading carriers have the vast majority of low-frequency spectrum, whereas the two other nationwide carriers have virtually none."

That's why the DOJ is advocating for the FCC to set up rules favoring Sprint and T-Mobile in the upcoming auction, since otherwise their costs to build out networks in rural areas using high-frequency spectrum would be much higher. The FCC's policies could boost competition in the industry "by preventing the leading carriers from foreclosing their rivals from access to low-frequency spectrum."

AT&T and Verizon have much deeper pockets than Sprint and T-Mobile. One of the big drawbacks to the current FCC auction system that's been in place for nearly two decades is that bigger players enjoy structural advantages since the chunks of the airwaves go to the highest bidder. Smaller competitors are put at a distinct monetary disadvantage in this way. The flip side is that the process is much faster than the previous system of allocating through extensive hearings, lotteries, and awards, which could last years while the spectrum sits unused. Raising money for the government doesn't hurt, either.

Ma Bell pointed out that blocking it and Big Red from the auction would translate into less money going to the Treasury (a not-so-subtle reminder of how deep its pockets are).

The DOJ also warns about taking carriers' statements at face value when it comes to their competitive prospects. When AT&T and T-Mobile were trying to make their case to the DOJ and FCC several years ago, both companies argued that the deal was necessary due to spectrum shortages that were limiting their ability to expand their networks. After the deal was blocked, both carriers "have announced plans to deploy LTE more extensively than they had earlier suggested would be possible." They did this primarily by repurposing spectrum previously deployed to older technologies.

The news today that DISH Network is making a $25.5 billion bid for Sprint, rivaling the previous $20.1 billion offer from SoftBank for a 70% stake, promises to further complicate things. DISH has been busy beefing up its own spectrum holdings over the years for an inevitable push into the wireless industry.

Regulators are going to have their hands full.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.
grundle is offline  
Old 04-16-13, 07:57 AM
  #2  
DVD Talk Hero
 
JasonF's Avatar
 
Join Date: Jul 2001
Location: Washington, DC
Posts: 39,476
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Or, to be less alarmist, the current administration believes consumers will be better served by having four viable wireless carriers instead of two, and are looking to privatize public assets (the spectrum) in a way that fosters that competition.
JasonF is offline  
Old 04-16-13, 08:15 AM
  #3  
DVD Talk Legend
 
JumpCutz's Avatar
 
Join Date: Aug 2004
Location: south of heaven
Posts: 13,540
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

That no good rigger Obummer!
JumpCutz is offline  
Old 04-18-13, 12:57 PM
  #4  
DVD Talk Platinum Edition
 
Join Date: Jun 2009
Location: NYC-ish
Posts: 3,270
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Ropes Pierre is offline  
Old 04-18-13, 01:14 PM
  #5  
DVD Talk Legend
 
Join Date: Sep 2002
Location: Formerly known as "orangecrush18" - still legal though
Posts: 13,846
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Originally Posted by JasonF View Post
Or, to be less alarmist, the current administration believes consumers will be better served by having four viable wireless carriers instead of two, and are looking to privatize public assets (the spectrum) in a way that fosters that competition.
And good for them. There has been far too much consolidation in the wireless industry in the last decade.
orangecrush is offline  
Old 04-18-13, 01:14 PM
  #6  
DVD Talk Legend
 
Dr Mabuse's Avatar
 
Join Date: Jun 2007
Location: 75 clicks above the Do Lung bridge...
Posts: 18,950
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

At least something is being done to address the monopolies in the wireless arena.

Those scumbag monopolies are raping American consumers, and it should be addressed and regulated to end the massive ripoff.
Dr Mabuse is offline  
Old 04-18-13, 01:26 PM
  #7  
DVD Talk God
 
kvrdave's Avatar
 
Join Date: Aug 1999
Location: Pacific NW
Posts: 86,201
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

If the big boys ever quit selling space on their towers to the "Pay as you go" type plans, etc., the prices would soon double. I expect they haven't to try to keep this type of thing at bay. So instead, they'll just slowly increase those leases so they can slowly increase their own plans.
kvrdave is offline  
Old 04-18-13, 06:08 PM
  #8  
DVD Talk Ultimate Edition
 
BKenn01's Avatar
 
Join Date: Jun 2005
Location: Big Blue Nation!
Posts: 4,497
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Originally Posted by JasonF View Post
Or, to be less alarmist, the current administration believes consumers will be better served by having four viable wireless carriers instead of two, and are looking to privatize public assets (the spectrum) in a way that fosters that competition.
As usual Crony Capitalism is the mechanism of correction. Which likely means we get fucked. But everyone can keep thinking they are looking out for our best interest if it makes you feel better.
BKenn01 is offline  
Old 04-18-13, 07:35 PM
  #9  
DVD Talk Legend
 
Dr Mabuse's Avatar
 
Join Date: Jun 2007
Location: 75 clicks above the Do Lung bridge...
Posts: 18,950
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Originally Posted by kvrdave View Post
If the big boys ever quit selling space on their towers to the "Pay as you go" type plans, etc., the prices would soon double. I expect they haven't to try to keep this type of thing at bay. So instead, they'll just slowly increase those leases so they can slowly increase their own plans.
They are forced to do that by regulations they wrote for themselves back in the '90s. That was the con of 'fair competition' for the press and politicians. Most people are unaware that corporations write the laws and regulations they decry as 'stifling us' and the like in the press.

How could these companies have pulled off these monopolies with all the 'government regulations' they wrote and suffer under?



I agree nothing substantive will occur. They own the government.

Hence, a comparable cell service plan that costs around $130-140 a year in country in Europe, is over $750 in the good ol Plutocratic States of America.
Dr Mabuse is offline  
Old 04-18-13, 08:07 PM
  #10  
DVD Talk Platinum Edition
 
Join Date: Jun 2002
Posts: 3,578
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

I'm genuinely asking because I don't know much about this. But to what extent does our geographic size in relation to your average Euro country impact pricing in the US? Does this not translate to substantially increased infrastructure costs, especially since Americans are widely disbursed and they still service a lot of desolate areas?
Nausicaa is offline  
Old 04-18-13, 08:14 PM
  #11  
Moderator
 
Groucho's Avatar
 
Join Date: Mar 2000
Location: Salt Lake City, Utah
Posts: 70,829
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Naming a specific politician as the subject header when posting an article that doesn't even mention his or her name should be an automatic one month suspension.
Groucho is offline  
Old 04-18-13, 08:31 PM
  #12  
DVD Talk Legend
 
Dr Mabuse's Avatar
 
Join Date: Jun 2007
Location: 75 clicks above the Do Lung bridge...
Posts: 18,950
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

Geographic size isn't significant, it's a tower by tower thing. Our population and sheer number of subscribers makes recouping capital expenditure considerably easier.

I'm not going to get in-depth on this, you can research it if you care to know, but costs for services have been falling for years for these monopolies, while they continued to raise prices. 3G was more expensive for them to provide than 4G LTE, and by a good margin, yet they raise prices dramatically on the less expensive service. This is how they outperform even their own optimistic expectations, as their subscriber base was in decline.

The quality and features of services in the US has consistently lagged behind the rest of the world, and were considerably more expensive.

It's a huge ripoff on American consumers.
Dr Mabuse is offline  
Old 04-18-13, 08:53 PM
  #13  
DVD Talk Platinum Edition
 
Join Date: Jun 2002
Posts: 3,578
Re: How the Feds Want to Put Heat on AT&T and Verizon (Obama wants auctions to be rig

I've just heard people use the argument before. It sounded like bullshit to me.
Nausicaa is offline  

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Thread Tools
Search this Thread

Archive Advertising Cookie Policy Privacy Statement Terms of Service

Copyright 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.