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Dana Dana Blankenhorn has been a business journalist for over 25 years and has covered the online world professionally since 1985. He founded the "Interactive Age Daily" for CMP Media, and has written for the Chicago Tribune, Advertising Age, and dozens of other publications over the years.
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Moore’s Law defines the history of technology. It held that the number of circuits etched on a given piece of silicon could double every 18 months as far as its author, Intel co-founder Gordon Moore, could see. Moore’s Law has spawned constant revolutions since then, not just in computing but in communications, in science, in a host of areas. Moore’s Law applies to radios, and to optical fiber, but there are some areas where it doesn’t apply. In this blog we’ll take a daily look at new implications of Moore’s Law in real time, as it rolls forward to create our future.
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April 29, 2004

The Old Switcheroo

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Posted by Dana Blankenhorn

I've looked over coverage of President Bush's broadband plans, and they're "the old switcheroo." (Image from TechCentralStation.)

That is, they sound good on a superficial level, but a look at the fine print shows a different picture.

The headlines are grabbers. There's the goal of universal access, and a call against taxes. Both sound great.

The problem is how we get there. The Bush plan is simply not market-oriented.

A market-oriented plan wouldn't impose hidden taxes on our access endorsing a cable-phone carrier duopoly that was created through protected monopolies.

A market-oriented plan wouldn't fence-off wireless spectrum as property. Bush is planning on continuing the Clinton-era policy of auctioning-off spectrum, rather than treating spectrum for what it is, an ocean where non-interference should be our guide.

I should say here, as a Democrat, that the party's initial criticisms of Bush's plans were, frankly, small-minded and counter-productive. We have seen what happens to Universal Service subsidies -- they go right back into the pockets of the Bells -- and the Kerry criticisms of Bush's plan seem aimed at just making that worse.

At the risk of repeating myself, we can increase broadband take-up dramatically without spending a dime of the government's money. Here's how:

  • Encourage cable and phone wholesaling of their capacity to third parties, at rates that encourage entrepreneurs rather than discourage them. Right now the monopolists are strangling wired competition.
  • Encourage wireless broadband by opening up more unlicensed spectrum. Encourage the FCC toward a more judicial function, mediating disputes over interference, rather than have it regulate all the time.

    The key to broadband is competition, it's entrepreneurship, it's getting the government out of the way. As any good conservative would say, "the government shouldn't pick winners." It won't surprise many that Democrats reach for subsidies and don't get that. It should surprise you that Republicans don't get it either.

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