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That's sorta true, but it's overly simplified. You're not considering price elasticity.

It would seem that the French are more sensitive to price changes than Americans. That is, as price increases in France, it's hitting a sharper decline in quantity demanded than would be observed in the American market.

I don't know what the actual numbers here are, just that this is micro-economic theory as I understand it.

But in any case, I disbelieve (at least in part) that telephone rates (I don't know about other services) are higher in the USA. I base this on my experience of having just bought two years of domestic service for well under $10/month, and with international calls being cheap to the point of negligible. Moreover, with skype and other services being free, the bottom falls out of any comparison.



Phone communication has been a broken industry for a decade. We have been fully capable of making the whole thing voip using network lines if we had non-crap internet in the first place. If like the topic said, we had fiber to the home, we would have a single internet bill plus some service to provide "rentals" like netflix for shows and movies and that is it. The false split 3 way package deals are already a broken market because they assume you can't get it all under just one of those.

The reason the French rates are so low is because they have competition. I couldn't start an ISP in my area if I wanted to because Verizon owns the phone lines and Comcast owns the cable lines. I would need to lay everything by hand, but even that I would consider not being much of a problem anymore - if you took every "town" of 3k+ in the country you could easily have local ISPs lay fiber channels and fiber to the home for everyone in each community and pay it off with $60 a month service considering the per foot cost of fiber cable is lower than the going rate of coaxial was back in the 70s when cable tv took off.

It is purely a fixed game. You can't introduce competition to the system so you can't make a prediction on the reactionary effects of American consumers because that isn't happening in the first place.

On the topic of phone rates, I paid $250 for a 2 year 5000 minutes prepaid tracfone. It is the best cellular rate I could get considering I infrequently call anyone via traditional means and not over some VOIP service.




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