Mueller describes the historical spread of telephone service in the United States to argue that universal telephone service was never a stated goal until the Telecommunications Act of 1996. From there, he further asserts that an unregulated marketplace, without any subsidies or mandates for service, is the best means of providing telephone service to the largest number of people.
Mueller’s assertion is weakened by his examples. He describes rural Aspen as being subsidized by urban Newark. Yet most rural areas are not resorts for the rich, and most urban areas contain dynamic economies and include affluent suburbs. Aspen and Newark are anomalies that do not support his arguments.
He describes studies that show that the cost of local telephone service is not a discriminator in deciding whether to subscribe to service at all. Instead, he argues, the initial deposits and installation fees have a greater impact on the decision than local service charges do, as if the cost of initial access to local telephone service were not part of the cost of local service in the minds of consumers.
While Mueller shoots himself in the foot with weak arguments and poor examples, his overall thesis may indeed be correct, in that an unregulated telecommunications industry might bring universal telephone service. However, the example of emerging nations indicates this will not occur through the conventional wired system, but through cell phones and other wireless systems, which receive only scant mention in Mueller’s paper. In other parts of the world, initiating cell phone access is cheaper and far quicker (days versus months) than initiating wired telephone access. Here in the United States, as pay phone charges lead local prices upward and wireless competition leads cell phone prices down, wireless service may soon bring universal service.