Last week California’s Public Utilities Commission had an opportunity to undo some of the damage price controls have wreaked on the telecom sector. Instead it clung to a losing strategy that rewards sloth and punishes innovation. The PUC approved a below-cost wholesale rate that SBC can charge competing carriers to lease its network. There are very few sectors where the government has so much control over operations, and this iron-fist management inflicts great damage. Forcing some companies to subsidize others removes incentives to innovate.
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California Tele-Scheming
Posted by: Sonia Arrison October 1, 2004 05:00 AMLast week California’s Public Utilities Commission had an opportunity to undo some of the damage price controls have wreaked on the telecom sector. Instead it clung to a losing strategy that rewards sloth and punishes innovation. The PUC approved a below-cost wholesale rate that SBC can charge competing carriers to lease its network. There are very few sectors where the government has so much control over operations, and this iron-fist management inflicts great damage. Forcing some companies to subsidize others removes incentives to innovate.