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more on Competition sends phone rates up
From: David Farber <dave () farber net>
Date: Wed, 12 Apr 2006 13:39:03 -0400
Begin forwarded message: From: Randall <4whp () insightbb com> Date: April 12, 2006 1:34:53 PM EDT To: dave () farber net Cc: people () addventure com Subject: Re: [IP] Competition sends phone rates up On Wed, 2006-04-12 at 13:29 -0400, David Farber wrote:
Begin forwarded message: From: Allen Firstenberg <people () addventure com> Date: April 12, 2006 9:53:30 AM EDT To: David Farber <dave () farber net> Subject: Competition sends phone rates up Dave,For IP if you wish. Perhaps someone can explain the economics of this.http://www.pressconnects.com/apps/pbcs.dll/article?AID=/20060412/ BUSINESS/604120325/1002 N.Y. regulators approve telephone rate increase About halfway though, we see this gem of a paragraph: "The commissioners and PSC staff members said the companies need the 'flexibility' to raise rates because they're losing customers rapidly to wireless phones, cable companies and other competitors. Verizon has lost 3 million customers in the past five years and Frontier has lost 18 percent of its customers in the last three years, according to the commission." Aren't we always promised that competition should lower prices?
That's in a free market, which is not what we're dealing with here. This is a regulated utility, which by statute is allowed to recover its costs plus a "reasonable" profit from the ratepayers. Fewer ratepayers, with the same fixed costs, means each ratepayer pays more. (CEO salary is surely part of the "fixed costs", which the ever-shrinking number of ratepayers must cover. Betcha he didn't take a pay cut ...) ------------------------------------- You are subscribed as lists-ip () insecure org To manage your subscription, go to http://v2.listbox.com/member/?listname=ip Archives at: http://www.interesting-people.org/archives/interesting-people/
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- more on Competition sends phone rates up David Farber (Apr 12)