I believe that you've misunderstood my response to the GP...
Also, your "basic economics" argument is fairly blind in that it relies on economics to solve every problem. If we depended on "basic economics" for all of our progress, the Internet would probably never have been invented in the first place. It was developed by ARPA [wikipedia.org] which, as a military research agency, is not governed or funded by "basic economics" but rather by cold war paranoia.
The GP suggested that allowing multiple carriers to build competing, redundant infrastructure would somehow solve the lack of competition. He implied that the market would magically fix everything. My argument isn't blind to other options. In fact, in another post in this thread I pointed out that a better solution is to have the government own the local infrastructure or at least require that the local utility provides transportation services to anyone who wants to use their pipes.
But if you want to beat the economics drum, consider the South Korean [cnn.com] model wherein the infrastructure is funded by the government and shared by private enterprises that rent the infrastructure and compete on service and performance aspects rather than infrastructure related ones.
Again, you're not arguing against me but the GP to which I responded. I agree. Provide the access as a government service and let private companies compete for the service.
One minor point with your post:
You have a point about companies requiring an incentive to invest, but last time I checked, margins for these enormous cable companies is about 8% -- not a bad ROI at all.
First 8% is not a strong return. I work for a regulated public utility and our maximum rate of return is capped in the 9.5% to 10% range (it varies from year to year). To investors, we are a safe and slow bet - as long as we do things right they aren't going to lose money but even 10% isn't sexy. Second, whatever the return achieved by cable companies, there's no way they are going to get that kind of return in a competitive market. They make their money in monopoly arrangements where most of their customers choose the incumbent provider or no service. My point was that the ROI isn't there for these same companies to build a network where someone else already has one and already has most of the customers.