Lots of coverage about the Tauke / McSlarrow debate last week.
Let's understand exactly what happened here. Briefly, the FCC found that Verizon was violating a critical provision in the Telecommunications Act of 1996 that prohibited phone companies from using their 100-year-old monopoly power to stifle competition in the long run.
How could Verizon do that?
There is a very unique process that is required when a phone
customer decides to switch carriers. It's called porting the customer's number and it happens when the new carrier notifies the incumbent provider that the customer has decided to switch and the customer's number has to be transferred.
Congress understood that that was a vulnerability in the plan to create competition in voice telephony. Incumbents could transfer that information from the technical department to the retention group to induce customers to cancel their order with the new competitive phone company (like us).
Why should you care? After all, isn't that making Verizon more competitive and giving the customer a better deal? Yes, but only in the short term.
But over at the Technology Liberation Front, they had a different point of view.
I disagree with Technology Liberation Front.
This prohibition was written into the Act for a very good reason. It was an essential part of creating competition for the long term. Congress was concerned that an incumbent could offer new deals only to those who are already committed to leave them. Why weren't they playing fair by marketing these same people before they leave?
Eventually, the new, competitive phone company finds that they only actually install a small percentage of their sales. At some point, they find that they can't compete anymore and bingo! The incumbent goes back to the good old days of the Ma Bell monopoly.