The CATO Institute reference is laughable.
It is interesting to read their mental masturbation about how multiple cable companies could compete in the same city, each with their copper. While that could technically happen, the diminishing returns of market entry would keep any sane company from entering into the market. Also, since their Utopia would be lacking in ANY government regulation, the larger company would simply purchase the smaller company if it became a threat. Which is EXACTLY what happened.
That paper was written in 1984. Thanks to their argument many places deregulated the cable industry.
Cable prices sky-rocketed. Companies merged. No true competition arrived. Comcast isn't an example of crony-capitalism. Comcast is the result of people like you and the CATO institute blocking government from heavily regulating "natural monopolies".
Why did anyone care in 1984? Because the federal government had just 'regulated' Ma' Bell. They required the company to reduce its sphere of influence and then they required them to allow "virtual competition". Government 'regulation'(in the form of anti-trust rulings) eventually required AT&T to operate as a copper providers, while other companies could operate as service providers. What was the result of all of this government regulation of a natural monopoly? Prices for long-distance calls dropped rapidly. Services were upgraded in many areas that were previously "unprofitable". Technologies that made heavy use of previously existing infrastructure(ADSL) spurred technological advances.
Basically, the best thing for the internet and cable TV would be HEAVY regulation. It might fall under a different name, but it would be regulation because it would be the government imposing its will on the market. If you wanted truly better service you would look to the deregulation of power operators in Texas as a key example. Create 3 specific "tiers": Content providers, network operators, retailers. Require that no company could exist as more than 1. Pay the network operators based on peers and speed. Watch the internet/cable get better rather rapidly.