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Re: Competition; was Re: [Membership] ICANN: The Issue of Membership---

I agree that "industry self-regulation" is often a cloak for oligopolies.
But true market competition really works.  (Yes, "true" is an important
qualifier here, and sometimes oversight is needed to keep the competition
fair/vigorous.) So, as I see from your last paragraph, we agree overall!


At 04:20 PM 06/02/99 -0500, Michael Sondow wrote:
>Esther Dyson a écrit:
>> Excuse me. In every market I know where telecom has been privatized and
>> rendered competitive, prices have gone down.  And generally, service has
>> even improved!
>> THe countries I know well are the US, UK, Germany, Czech Republic, Hungary,
>> Russia...... Which ones are *you* referring to?
>Spain, Argentina, Chile, Peru, Colombia, Bolivia. I don't think the US is a
>very good example for descending prices, is it? Long distance rates have
>gone down, but that's due to a change in technology and probably would have
>occurred anyway. Basic line service has risen. And I believe the same is
>true in England. As to the East European countries, I'm surprised to learn
>that capitalism has brought lower rates for former public services like the
>telephone. Certainly the costs of health services and education have risen
>dramatically in those countries that have undergone forced privatization,
>and have even been the cause for experiments in a return to a centralized
>economy, for example in Hungary.
>I'm not arguing for centralized economy here. Far from it. But
>self-regulation of privatized public services doesn't work unless the
>self-regulatory agencies are composed of a large number of consumer
>interests. The US financial services business is a prime example, in which
>self-regulation has brought with it an unprecedented number of arbitrations
>and lawsuits against brokers, who no longer have to face the full effect of
>the SEC laws and can elude responsibility for their actions through
>arbitration schemes run by agencies that they dominate.
>As a matter of fact, industry self-regulation has been demonstrated to be a
>disaster when it hasn't a large component of public input. There are many
>studies to this effect. Price-fixing is only one of the counter-productive
>consequences of uncontrolled privatization and the cartelization that it
>engenders; others include the suppression of new technologies (the
>automobile industry), and practices even endangering the lives of citizens
>(the dangerous materials waste disposal industry).
>There may be a short period of reduced initial costs for domain names if the
>registrars (and registries?) become de-centralized. But if the new ones are
>run strictly as businesses whose bottom line is all that matters to them,
>they'll soon find ways of jacking up the price. I've already heard arguments
>that individuals shouldn't get SLDs, since they can get email and
>webservices without them, and that SLDs should be reserved for businesses
>and organizations. This means "businesses and organizations who can pay well
>for them". The registries, root servers, and even IETF would be delighted
>with this, since it would relieve the pressure on them to upscale
>technology, without diminishing returns. This will destroy all the small ISP
>businesses, of course, but who cares about small ISPs except small ISPs and
>their small customers?
>It's not competition alone that's going to prolong the free development of
>the Internet, but competition together with a truly free market, which
>probably will mean shared registries, and that's something that would have
>to be required by law and maintained through public surveillance.

Esther Dyson			Always make new mistakes!
chairman, EDventure Holdings
interim chairman, Internet Corp. for Assigned Names & Numbers
1 (212) 924-8800
1 (212) 924-0240 fax
104 Fifth Avenue (between 15th and 16th Streets; 20th floor)
New York, NY 10011 USA

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