Broadband competition is essential to better service and lower costs in rural areas

Brookings recently took a look at broadband in rural areas – postulating that competition is a key component to quality broadband in rural areas…

It can be tempting to accept the view that, in an environment of scarce government resources and competing interests, merely ensuring broadband access from a single provider is enough – especially as an improvement on a status quo with little or no access at all. History tells a cautionary tale, though. In 1913, the U.S. Department of Justice settled an antitrust lawsuit against AT&T by essentially accepting AT&T’s monopoly in exchange for the build-out of the nation’s telephone system. AT&T worked hard to uphold its end of the bargain, but it was decades before competitive markets were free to serve consumers, stimulate innovation, and avoid unnecessary regulation.

In other words, as a nation, we should embrace both expanded broadband deployment and expanded broadband competition. Without competition, the pressure from consumers for better and cheaper broadband will naturally ease, and rural America could fall even further behind.

They note that for the very first time, the Federal Communications Commission concluded in 2015 that the disparity between urban and rural access to broadband provided the basis for direct agency action.

the recent FCC study found that 58 percent of rural Census blocks did not have a “fixed” broadband service provider offering broadband speeds at speeds of 25 megabits per second download/3 Mbps upload or better as of December 31, 2015. 25/3 is scarcely the fastest residential broadband – the same study shows 15.1 percent of fixed broadband connections had downstream speeds of at least 100 Mbps – but it does represent the speeds most recently established by the FCC as the broadband benchmark.

And show the breakdown of competition in rural and urban areas…

And they tell a few stories of what happens when competition happens…

For example, when the FCC looked at the use of municipal broadband (in an order that has since been reversed by an appellate court on legal grounds), it set out evidence showing that the presence of an additional broadband provider pushes down the prices and increases the quality of both new and incumbent providers. In other words, such competition is “win-win.” It benefits those consumers who switch and even those that do not but who gain from faster download speeds resulting from the incumbent’s response to competitive pressures.

This entry was posted in Rural by Ann Treacy. Bookmark the permalink.

About Ann Treacy

I have a Master’s Degree in Library and Information Science. I have been interested or involved in providing access to information through the Internet since 1994, when I worked for Minnesota’s first Internet service provider. I am pleased to be a part of the Blandin on Broadband Team. I also work with MN Coalition on Government Information, Minnesota Rural Partners, and the American Society for Information Science and Technology.

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