Originally posted by: cubby1223
Originally posted by: WHAMPOM
Originally posted by: cubby1223
Originally posted by: PC Surgeon
Originally posted by: cubby1223
You've got it mixed up on who is squeezing out the competition.
I wouldn't be so sure. As I stated before, it wouldn't have gotten off the ground had TW not been greedy. Cable companies are notorious for procuring their own 'patch' for cable services. Whats the difference? One is wanted, while the other is forced.
The government's job is to promote competition and stop Time Warner if it is believed they are acting illegally. It is
not the government's job to start up an ISP service.
OH NO! Municipalties providing utilities and services to residents. OH NO! The horror, cubby, the horror!
Why is there this mythical notion that politicians can operate businesses better than businessmen? Take a look at the post office and how much it loses on a yearly basis :Q Recently here in Chicago, the city spent ~$170 million on
consulting fees to determine the best way to go after collecting ~$45 million in unpaid parking tickets... yeah,
they know how to be fiscally responsible :roll:
Assumption: Business operates a leaner operation and is more efficient than their analagous public counterparts (I'm certain you agree with this). Let's say the overhead involved with public operations is x where x is a percentage of the total cost. This will be greater than the profit motive overhead of the private sector.
Assumption: The cost to initiate and maintain this project in nominal terms is identical for both the public and private sectors (you likely believe that this is untrue as I'm sure you believe the public sector employees are more expensive than the private sector employees).
Assumption: Both the public and private sector competitors in this local area have access to money at identical or nearly identical interest rates.
Fact: The public offering in this local government provides equal to or better service at lower rates for the populace.
Fact: The public operation runs on a cost-recovery model. The initial funding came from public bonds as evidenced by Greenlight's FAQ found
here.
Fact: There is nothing particularly noteworthy about Wilson, NC. You can view some information about this town
here. If anything, this town is poorer than most areas.
With these things in mind, we must ask why TW is now trying to get this service shut down. Let's say the cost to operate this network (and repay the bonds/loans) is y1 and y2 for the city and TW respectively. Let's assume the overhead is x1 and x2 for the city and TW respectively. Overhead accounts for inefficiency in the public sector and the profit required by the private sector. Given the above facts and assumptions, and TW's tactic of getting Greenlight shut down instead of offering better service, we know this:
City's cost: TW's cost:
y1 + (y1 * x1) < y2 + (y2 * x2)
This actually has some interesting implications for you. If the cost to run the system (both the private and public sector in this area is drawing from the same labor pool which makes this a somewhat amiable plausibility) is identical, or y1 = y2, then this means that x1 < x2. This means that the inefficiencies of the government is actually preferable to the profit requirements for the private corporation. In other words, this is a case where the people should prefer a degree of public ownership from a purely cost standpoint. It basically means that the government in this case is either much more efficient than you'd like to believe or that TW is reaping such a large profit that it is no longer tenable resulting in a competitor that can do it better. If the government can provide better service at a cheaper price to the public (no tax money is being used), why not let them? The people of this town are benefiting greatly and the people who bought the bonds are making a profit.
Of course, if the overhead is identical (probably much tougher to prove), then it means that y1 < y2, or that the city can actually provide these services at a cheaper cost. So here we are faced with the idea that profit motive has not resulted in the optimal service with the lowest cost. The implication here is that in at least one case, this publicly owned and run program has actually done a better job controlling costs and providing service than a privately held company that should be in the game for maximum profit.
I'm not sure which one it is, but given that we know that the taxpayers of the town aren't paying for this service (unless, of course, they're subscribing) and that this service is better and cheaper than the private counterparts, we must concede that A) the government is doing it cheaper or B) the government is not as inefficient as the corporate entity (if we say profit is inefficient, in that it is money likely taken from the community and distributed elsewhere).
I know there are a lot of government-haters on this board, but this seems like exactly what we would want government to do. It's providing an affordable service with low overhead and the money paid by the subscribers wasted on any inefficiency is still, more than likely, staying within the local economy (which is quite poor). This seems like a model government program, and I'm sure the people of Wilson appreciate the service.