Bandwidth has become the new capital of the information economy,
and the ways it will be produced, traded, and consumed is changing the nature of its provision. In
the past, telecommunications bandwidth was a relatively static
resource. It was centrally planned and controlled by dominant telecommunications operators. Consumers were largely
unaware of performance and indifferent to price. Today, spurred
by the allure of competition, a deepening of capacity has been
the focus. Consumers cannot seem to get enough local capacity -
either DSL or cable modem, and yet industry analysts are
predicting a gross over supply in the backbone.
As the ground of telecommunications is changing, so too
must its ground rules. The first factor of change has been of telecommunications services and the emergence of
competition through the Telecommunications Act of 1996. Though the
Act makes no mention of the word "Internet", the
liberalization was intended to speed the deployment of advance
telecommunications services. The question remains as to the whether it has
achieved this goal. A year ago, the FCC's Second Broadband
Report found that the pace of deployment satisfactory, despite
the fact that 90 percent of local phone service is still
controlled by ILECs.
However, Congress is considering new laws covering the provision of broadband (Tauzin-Dingell and
Cannon-Conyers). Regulation itself is insufficient to insure the flow of
capital investment. In light of the recent retrenchment of
dotcoms, CLECs, and equipment suppliers, Wall Street has
reevaluated its romance with the telecommunications sector. Aggressive competition from cable, satellite, and wireless in
broadband services is beginning to create parallel conduits of
bandwidth for local access. As production and consumption of
bandwidth become more decentralized, fragmented, and
unpredictable, a new market system for capacity will thus emerge. Market institutions have been created to establish prices and
assure fulfillment between conduit providers, and end users.
This transition to a capacity market will therefore be the
next step in competition. This conference will address:
What are the competitive infrastructure
options?
Will bandwidth markets be viable and
sustainable?
Will bandwidth markets change the financial
outlook for telecommunications firms?
I. Evolution of Market Structure & Systems
9:00 a.m. to 10:30 a.m.
Chair: Eli Noam, Columbia Business School
Speakers:
"The Demand for Bandwidth: Access, Content and the Value
of Time" - Paul Rappoport, Temple University, and Lester
Taylor, University of Arizona
"How the Bells Stole America's Digital Future" - Bruce
Kushnick, New Networks Institute
"Regulatory Induced Investment Distortions" - Larry Darby,
Darby Associates
Discussants:
Keith Bernard, Hughes Network Systems
Craig Hall, Nortel Networks
II. Asymmetrical Regulation: The Investor's Dilemma
11:00 a.m. to 12:30 p.m.
Chair: Kenneth Carter, Columbia Business School
Speakers:
"Asymmetrical
Regulation and DSL: The
Demise of the Broadband CLECs" - Jerry Hausman, Massachusetts Institute
of Technology
"Reviving the Revolution that Wasn't" - Ken Zita, Network
Dynamics Associates, Inc.
"Financial Effects of Broadband Regulation" - Tom
Hazlett, American Enterprise Institute and George Bittlingmayer, University of Kansas
Discussants:
Ken Hoexter, Merrill Lynch
John Kasdan, Columbia University Law School
III. Lunch
12:30 p.m. to 2:00 p.m.
Chair: Eli Noam, Columbia Business School
Keynote:
"Regulatory Pratfalls" - Alfred Kahn, Cornell University
IV. Bandwidth Economics
2:00 p.m. to 3:30 p.m.
Chair: Robert Atkinson, Columbia Business School
Speakers:
"Regulation Distortions: Implications for Broadband
Policy" - James Alleman, Columbia Business School
"The 1996 Telecom Act: What Went Wrong and Protecting the Broadband Buildout" - John Thorne, Verizon Communications
"Its the Stupid Economy" - David Molony, Communications Week International
Discussants:
Phil Weiser, Princeton University/University of Colorado
Jonathan Liebenau, London School of Economics V. Implications and Strategy
4:00 p.m. to 5:00 p.m.
Chair: Jonathan Liebenau, London School of Economics
Panelists:
Ken Hoexter, Merrill Lynch
Phil Weiser, Princeton University/University of Colorado
The Broadband Economy: The Emerging Market
System in Bandwidth