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The 1998 Gas Industry Executives Forum Mapping the Universe of Natural Gas: Closed, Shrinking or Expanding?

Fortnightly Magazine - May 1 1998

when the attackers start creating business models and marketing techniques completely divorced from the traditional gas industry, then there will be some real innovation. And I think when that happens total spending by consumers will actually go up.

A PIPES COMPANY? If by LDC you mean the regulated entity, I think its role will be to become a very efficient logistical company that provides access to the market and moves the molecules as cheaply and efficiently as possible¼ [making] its money by being efficient. I also think that the gas LDC, as such, is not really going to be an economic entity and eventually it will have to combine with other similar regulated entities such as electric and water distribution entities.

I can see the emergence of companies that say, when it comes to moving stuff that flows (em whether that's gas, electricity, water or bandwidth (em "We will be your provider of integrated logistical services, and we'll bundle it together, if you like, into a logistical service that moves all your content for you," but it won't provide the content. The content will come from someplace else.

The model here is, when you subscribe to different premium or pay cable channels, you don't go to different cable companies. The cable company offers the content to you; you the customer gets to decide what the content will be. If you're going to be in a capacity and logistics business, you might as well do it across scale and scope. In the world of [performance-based ratemaking], the way you make money is to become constantly more efficient.

Lori M. Rodgers is contributing editor to Public Utilities Fortnightly.

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