The Institute for Local Self Reliance has taken a deep dive into broadband providers and competition for their latest report – Profiles of Monopoly: Big Cable & Telecom. On the highest level, this is what they found…
Real Competition Drives Investment : The telecom companies have invested in Fiber-to-the-Home in areas where they face competition, which are generally more urban areas. The advent of Google Fiber in 2011 further increased the competition in urban markets. Efforts to increase investment from the largest firms in more rural areas have largely failed. Though states have varied regulations, the same trend results in every state — investment by the large ISPs is correlated to competition rather than the regulatory environment. This reality does not suggest that competition between a cable monopoly and a telephone monopoly is sufficient for high-quality Internet access, but it clearly helps to ensure connections at the minimum definition of broadband.
Big Cable Companies Dominate: These networks are capable of delivering high-speed broadband to everyone within their service area, a legacy of the local franchising requirements that often required universal service or at least service to all areas with a specified density of housing. More than half of the states have since removed local authority to negotiate such provisions but they bear some responsibility for the far-reaching cable networks.
Big Cable and Telecom Focus on Urban Markets : The big cable and telecom companies fight over urban customers, not rural customers. About 98 percent of the urban population (254 million people) have access to broadband. About 5 million urban residents, however, remain without broadband access. In rural areas, only 69 percent of the population (43.6 million people) have broadband access, leaving 19.3 million rural residents without high-speed Internet access.
The report profiles 6 providers: Comcast, Charter, AT&T, CenturyLink, Frontier, and Verizon. They track how many customer they have, their potential and the customers they have in monopoly areas versus competitive areas. The numbers are startling at times. The number of monopoly customers are a magnitude smaller than the competitive areas.
They give a nod to Blandin’s recent report – Impact of CAFII-funded Networks: Lessons From Two Rural Exchanges Left Underserved, which highlights the fact that (federally subsidized) CAF II networks being deployed are not meeting Minnesota state speed goals. (CAFII only requires 10/1 speeds and with the quickly diminishing quality of the lines, that is what they are building to in many areas.)
The report leaves some advice for communities…
The fact is, the large providers, such as Comcast and AT&T, have not answered the digital divide. Communities must find their own way, whether be working in partnership with local ISPs, cooperatives, or building their own community networks.