The NBP and ISP competition: this fight's just beginning
By Nate Anderson
For a plan that puts "competition" as its number one goal, the National Broadband Plan is remarkably light on policies that will produce much of it in the wireline space. Talk of competition is everywhere, but all suggestions are remarkably general or terribly banal: "more data collection" and "future policy reviews" are everywhere. Suggestions about how such reviews should turn out is lacking.
But the reviews will still be held, and at some point the consensus-building NBP will devolve into ugly battles of wholesale access, special access (middle-mile connections), and ISP disclosure. The FCC commissioners know it, and they're already gearing up for the fights ahead.
All five commissioners issued statements when the Plan appeared, and everyone took on the issue of competition.
"We should be very concerned about the competitive state of broadband service," warned Mignon Clyburn. "We need to keep our eye on the ball here because evidence in the Plan suggests that by 2012 only 15 percent of households will have the 'luxury' of two providers offering the highest speeds of broadband service (up to 50Mbps). Seventy-five percent of households will have only one provider offering the highest speed. And the remainder of households will not have the highest speeds offered to them at all."
Clyburn made clear she is willing to take bold action, saying that "the Commission must stand ready to act where competition is lacking and be willing to use all available tools to protect consumers and to inject meaningful competition into the marketplace."
The longest-serving commissioner, Michael Copps, went directly after the lack of competition-creating policies in the Plan. "Lack of competition could conceivably require us to take actions going beyond what is generally discussed here," he said.
"I daresay that I don’t need to remind many people here that competition is not, to my mind, the defining hallmark of America’s current telecommunications sector. But it is at the core of our enabling statute. In competition, and elsewhere, should we find that we lack the tools we need to conduct effective public interest oversight of the evolving broadband network, we may have to invoke other available authorities already invested in the Commission—or, should we lack some authority that we need, we may have to request it."
The two Republican commissioners see the implicit threats of more government action here, and both rallied to beat it back. Robert McDowell praised the current deregulatory environment for promoting the robust competition we have today.
"As a direct result of adopting policies that ensured the ’Net would be regulated only with a light touch, the Internet environment is growing and evolving faster than any individual, company or government can measure...." he wrote. "As the Commission and Congress move to consider the ideas offered up by the Office of Broadband Initiative, we should make sure that we first and foremost do no harm."
"Broadband competition is healthy and vibrant," added Meredith Baker. "Under a light-touch targeted regulatory regime in both the Clinton and Bush Administrations, we have gone from a narrowband dial-up world to a multi-platform broadband world by crafting a regulatory framework that promotes facilities-based competition in lieu of prescriptive government requirements."
In other words, the US has moved towards a cable/telco duopoly ("facilities-based competition") and away from line-sharing rules ("prescriptive government requirements").
Let's get ready to rumble
The NBP reminds us that, within a few years, cable will be the only high-speed choice for most Americans unless the telcos start investing in fiber to replace their aging copper networks. Even now, in a well-off Chicago suburb, I have a single ISP choice if I want anything over 6Mbps.
Promoting competition might not require a return to line-sharing mandates—but it certainly requires something. If heavily taxed and highly regulated France can get a complete triple play package of phone, TV, and Internet for €30 a month, these claims about robust US competition look... less than robust.
So the big fights are coming. Baker asks for a "consensus-based broadband policy," but given the ground commissioners are already staking out, that seems difficult if not impossible once the important proceedings begin in earnest. The NBP punted on the toughest questions, perhaps in an effort to give its Plan the consensus that Baker wants, but they will be answered someday.
As for the FCC Chair, Julius Genachowski, he did not take up the line adopted by his Democratic colleagues. In praising the Plan, he noted that it is "idealistic, but not ideological. From my time in the private sector, I have personal appreciation for its focus on the vital role of private investment and competition; and on providing real solutions to real problems."
Genachowski has been good about making the FCC a collegial place once again, seeking common ground whenever possible and operating in a more transparent fashion. But, when the "comprehensive review of wholesale competition rules" begins, that approach may be tested to the breaking point.
By Nate Anderson
For a plan that puts "competition" as its number one goal, the National Broadband Plan is remarkably light on policies that will produce much of it in the wireline space. Talk of competition is everywhere, but all suggestions are remarkably general or terribly banal: "more data collection" and "future policy reviews" are everywhere. Suggestions about how such reviews should turn out is lacking.
But the reviews will still be held, and at some point the consensus-building NBP will devolve into ugly battles of wholesale access, special access (middle-mile connections), and ISP disclosure. The FCC commissioners know it, and they're already gearing up for the fights ahead.
All five commissioners issued statements when the Plan appeared, and everyone took on the issue of competition.
"We should be very concerned about the competitive state of broadband service," warned Mignon Clyburn. "We need to keep our eye on the ball here because evidence in the Plan suggests that by 2012 only 15 percent of households will have the 'luxury' of two providers offering the highest speeds of broadband service (up to 50Mbps). Seventy-five percent of households will have only one provider offering the highest speed. And the remainder of households will not have the highest speeds offered to them at all."
Clyburn made clear she is willing to take bold action, saying that "the Commission must stand ready to act where competition is lacking and be willing to use all available tools to protect consumers and to inject meaningful competition into the marketplace."
The longest-serving commissioner, Michael Copps, went directly after the lack of competition-creating policies in the Plan. "Lack of competition could conceivably require us to take actions going beyond what is generally discussed here," he said.
"I daresay that I don’t need to remind many people here that competition is not, to my mind, the defining hallmark of America’s current telecommunications sector. But it is at the core of our enabling statute. In competition, and elsewhere, should we find that we lack the tools we need to conduct effective public interest oversight of the evolving broadband network, we may have to invoke other available authorities already invested in the Commission—or, should we lack some authority that we need, we may have to request it."
The two Republican commissioners see the implicit threats of more government action here, and both rallied to beat it back. Robert McDowell praised the current deregulatory environment for promoting the robust competition we have today.
"As a direct result of adopting policies that ensured the ’Net would be regulated only with a light touch, the Internet environment is growing and evolving faster than any individual, company or government can measure...." he wrote. "As the Commission and Congress move to consider the ideas offered up by the Office of Broadband Initiative, we should make sure that we first and foremost do no harm."
"Broadband competition is healthy and vibrant," added Meredith Baker. "Under a light-touch targeted regulatory regime in both the Clinton and Bush Administrations, we have gone from a narrowband dial-up world to a multi-platform broadband world by crafting a regulatory framework that promotes facilities-based competition in lieu of prescriptive government requirements."
In other words, the US has moved towards a cable/telco duopoly ("facilities-based competition") and away from line-sharing rules ("prescriptive government requirements").
Let's get ready to rumble
The NBP reminds us that, within a few years, cable will be the only high-speed choice for most Americans unless the telcos start investing in fiber to replace their aging copper networks. Even now, in a well-off Chicago suburb, I have a single ISP choice if I want anything over 6Mbps.
Promoting competition might not require a return to line-sharing mandates—but it certainly requires something. If heavily taxed and highly regulated France can get a complete triple play package of phone, TV, and Internet for €30 a month, these claims about robust US competition look... less than robust.
So the big fights are coming. Baker asks for a "consensus-based broadband policy," but given the ground commissioners are already staking out, that seems difficult if not impossible once the important proceedings begin in earnest. The NBP punted on the toughest questions, perhaps in an effort to give its Plan the consensus that Baker wants, but they will be answered someday.
As for the FCC Chair, Julius Genachowski, he did not take up the line adopted by his Democratic colleagues. In praising the Plan, he noted that it is "idealistic, but not ideological. From my time in the private sector, I have personal appreciation for its focus on the vital role of private investment and competition; and on providing real solutions to real problems."
Genachowski has been good about making the FCC a collegial place once again, seeking common ground whenever possible and operating in a more transparent fashion. But, when the "comprehensive review of wholesale competition rules" begins, that approach may be tested to the breaking point.
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