Is the US Broadband Segment as Competitive as the FCC Suggests?

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The FCC recently released a Communications Marketplace Report, pointing at a broadband segment in the US that is rife with vibrant carrier competition. In actuality, consumer groups, the third-party data, as well as the report paint a clearly different picture about the segment, one where customers increasingly have access to only a fastest internet provider.

The Chairman of FCC, Ajit Pai, tried to put an optimistic spin on its report, and the Commissioner Brandon Carr’s statement clearly suggested unparalleled competition as well as price decreases across the US broadband market thanks to its policies.

“This is not like any competition we’ve seen before,” Carr said. “After broadband investment fell during the final two years of the last Administration, the key indicators have turned around. Broadband investment is up. Speeds have increased. Infrastructure deployments have accelerated. And prices have declined. All great signs for consumers.”

However, actual consumer groups as well as the Commission’s own data hint at a different reality. For one, all publicly available earnings information and public CEO’s statements contradict the claim of Brandon Carr that investment reduced during the last 2 years of the earlier Commission, something both internet providers and the Ajit Pai Commission have falsely tried to blame on the net neutrality.

The Commission also seems to have buried several of the less-flattering portions of its report below layers of policy details and footnotes. For instance, data that show DSL providers routinely fail to deliver advertised internet speeds mentioned in its set of associated appendices. Few people will read through them.

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Most of them still fail to deliver the base broadband definition (25 megabits per second) to large swaths of their national footprint. That is because despite billions of dollars in subsidies, upgrading aging DSL networks is not profitable enough, fast enough, for the liking of Wall Street. Therefore, many telecommunications companies have shifted their focus to elsewhere, leaving annoyed users in their wake. Some ISPs are securing a prominent position in the broadband market.

Other contradictory information finds a rather inconspicuous place in the FCC report. One of its pages quietly inform people that upgrades to fiber “appear to have slowed recently”, underlining the stalled ambitions of major players in the fiber broadband market.

Consumer groups were not particularly impressed either by the claims of the FCC. However, it insists that broadband is cheaper, quicker, and widely accessible owing to its recent policies, such as the net neutrality repeal.

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