The bandwidth scarcity myth

In one of his latest missives from CES, Bob Frankston reminds us of how bandwidth isn't nearly as scarce as some would lead you to believe and that it's just that some people are making up reasons for why most of what's there needs to be dominated by something that's commercially profitable (like video on demand) for the established companies that don't want themselves or their Draconian business models to be disintermediated by the Internet.  Wrote Bob:

The story about video priority is not really about video priority – it’s about purchased priority. The bit is set if one makes arrangements with fATT. They are open in that they will take extra money from anyone who pays enough.

faTT by the way is about increasing the bandwidth of copper and is the primary subject of Bob's post.  It's a way of getting more connectivity to more users without having to lay fiber everywhere.  What are "they" (the telcos) going to do with all that bandwidth once it's there? Take most of it over to deliver their own video on demand (VOD) services instead of letting end users decide how to make best use of that bandwidth? For example, why should the telco decide what Internet video streams you get to see at full fidelity.  Full fidelity is important.  If they take over a majority of the newly discovered bandwidth to deliver their VOD services to you instead of just plain IP connnectivity, watching that video from a Internet source of your choice will be constrained by the remaining bandwidth.  Wouldn't it be better to allocate your bandwidth as you see fit?  (imagine if your electric company said 90 percent of the juice coming to your house could only be used for the toaster).

Oh, and DRM doesn't escape Bob's commentary unscathed: 

I had a chance to learn more about Vongo – the next generation of the StarzTicket service I wrote about recently. Aside form lower price and increased selection, Vongo goes more directly and uses Akamai caching rather than going through Real. Apparently Real was a chokepoint which might’ve been the source of the problems that I had viewing the Starz live. Vongo may work much better but I haven’t gotten it to work because of something deep in the DRM bowels of my system that I have yet to resolve. I’ll continue to try to find a solution.