Calling this a "free-market" idea is simply not correct. Innovation and efficiency are delivered primarily by competition, in which the best, most efficient providers rise to the top. But in this case, we're looking at a monopoly. Thus government regulation will still be needed to control costs and stimulate innovation. 

Is a government-regulated private monopoly better than a simple publicly-owned monopoly? Perhaps. I can certainly see how the loosening of bureaucracy and unnecessary regulation could be beneficial. But let's do away with the nonsense that equates "private" with innovation and efficiency. Those goods are determined by competition, not ownership.