Monday, June 05, 2006

Decker on LUS

Bill Decker rendered his editorial judgment on the LUS fiber to the home efforts in the Advertiser this morning:
LUS still can succeed in its plans to offer telecom services here. It probably will. Even if it doesn't, the municipal utility already has changed the competitive situation here in a way that still promises more choices, fewer regulations and lower costs.
He's right about that, (except for the fewer regulations fantasy) and it is a huge movement in the direction of quiet sanity for the online editor of the local paper. Those of us with a long memory will realize how far he's come from his first essay on the topic of LUS' fiber plan which fulminated with strange darkness: “What’s next? A five-year plan? A hall of socialist labor heroes?”

We could get even more specific with our assertions that Lafayette merely planning to take control of its own destiny has benefited the community: there's not been a price hike in Lafayette since the plan was announced; previously the price had been jacked up as much as 3 times a year. Note please, that this advantage isn't limited to the city--the entire parish and beyond is benefiting from the mere threat of competition at the core of the metro region. Cox at least is clearly settling in for a real bout of head-to-head competition. BellSouth, regardless of its current flurry of self-promotion at the legislature as it tries to push through its state-wide franchising bill looks pretty dead in the water in terms of upgrading to the capacity that could challenge Cox, much less LUS.

Lafayette actually providing, rather than merely planning to provide, it's own competitive services should bring even more benefits: actual price reductions rather than a stand-still regime. It should also move Lafayette to the top of the list when new technologies and services are developed--and even to being a testbed location for imaginative new services--would be a smart competitive move on the part of the incumbents. Decker's continuing ideological blind spot also keeps him from mentioning one of the nicest by-products of taking control of our own destiny: restraining taxes. LUS's fees for the services they offer, all of which will be freely chosen by members of the community, will generate non-tax income for the city and hold down the need for new taxes. Initially, while cable services are the lions share of the income, revenues will tend to balance out--income from cable subscribers will come from both Cox and LUS. But in later years as other services grow up that like Cox's current VOIP or internet services do not count toward franchise fees we'll be very glad to have an increasing income while other cities see that portion of their funding drying up. The best is yet to come.

Decker is right to think LUS will be competitive. The gold standard here is bandwidth and LUS will have enough to be able to offer all of the services any of its competitors offer and few more besides. It will be able to offer them at a higher speed and likely with better integration. They won't have to be smarter or unusually aggressive to do this. LUS will simply have plenty to work with; matching and exceeding the competition won't be hard.

I'm very much looking forward to LUS getting into the business. Not only do I expect better packages and better service but I am always pleased to be able to buy from local businesses. I'm happier making groceries at Breaux's Mart than doing so at Target and prefer Guidry's hardware to Home Depot. I think most of us feel thf same. No need to be fanatical about it, but when prices and services are equal are better who wouldn't prefer to leave their money in local hands? It's an old principle of economics that our parents understood better than we: buy local and build the local economy; in the long run we all benefit.

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