[aclug-L] Re: Monopoly tactics?

[Steven Saner <ssaner@xxxxxxxxxxxxxxx>]

You pretty much have it figured out :-/


On Fri, Apr 28, 2000 at 08:57:02AM -0500, Bates, Rod wrote:
> Whoooooa!
> 
> Clint Brubakken wrote: 
> 
> >If you sign up before April 30, and you agree to sign a one year
> >contract and use SWBI, installation ($200) and isp service is free
> >($10/month) 
> 
> (and others said things to the same effect.)  
> 
> So as I understand it: 
> 
> 1. You need DSL service and ISP service
> 2. It costs somebody to provide ISP service
> 3. There is competition in the ISP business
> 4. SWB is the only game in town for DSL.
> 5. If you take ISP service from SWBI, then SWB will actually
>     charge less for DSL as if you get ISP service from Southwind.
>     (same monthly, no installation) 
> 
> This sounds like a classic monopolistic cross subsidy.  
> Cut your prices below your costs (actually prices cut to zero 
> for SWBI ISP service) in a businessline where you have 
> competition.  Make up your losses from a different line of 
> business where you have none.  Southwind has no comparable
> source of revenue they could use to make up comparable
> losses. Do the regulators know about this?  Have I missed
> something? 
> 
> Rodney Bates 
> 
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