Trump Administration's 'National Broadband Plan' Comically Refuses To Acknowledge A Lack Of Competition

from the ill-communication dept

We've well documented how the telecom sector is a pit of regulatory capture and dysfunction, pretty evident if you've ever tried to switch ISPs, negotiate a lower rate, or contact Comcast customer support. And since these companies have their lobbying teeth stuck deep into regulators and lawmakers (something that teeters toward parody on the state level), the government's "solutions" to the problem tend to wind up being of the decidedly half-assed variety. That's not helped by many folks who still labor under the misconception that you motivate natural monopolies to behave by eliminating already modest regulatory oversight.

So every few years, regardless of the party in charge, the government will put forth a new broadband plan it promises will finally address this cavalcade of dysfunction. And time and time again, these proposals fall well short of actually pushing policies that could actually drive more competition to market, because that's the very last thing the companies holding sway over our lawmakers and regulatory agencies actually want. The result is plans that sound really good upon superficial inspection, but don't come close to fixing the real problem. Again, because the wealthiest providers don't want it fixed.

That was certainly the case with the FCC's 2010 "national broadband plan," a collection of politically-timid policy goals set forth by Obama's first FCC boss, Julius Genachowski. The plan failed to really offer a solution to drive competition to market, downplayed the potential role of open access, public/private partnerships, and community broadband as useful motivators for natural monopolies, and failed to really even mention the competitive logjam at the heart of the problem.

Here we are, nearly a decade later, and America's broadband problem is in many ways getting worse. As America's phone companies give up on residential broadband and deploying fiber, companies like Comcast are securing a bigger monopoly than ever across huge swaths of American broadband markets. And while many look to the miracle of wireless to somehow act as a competitive panacea, we've discussed at length how that's not likely to happen anytime soon for a wide variety of reasons, most of which also have to do with too little competition in both retail and the business data services market.

Enter the Trump administration. Last week, the National Telecommunications and Information Administration (NTIA) released its American Broadband Initiative Milestones Report, the latest update to the administration's inter-agency agenda plan to "stimulate increased private investment in broadband infrastructure" and finally cure what ails the U.S. broadband sector:

Under the leadership of the White House, the Department of Agriculture, and the Department of Commerce, the American Broadband Initiative is based on a fundamental principle: nothing drives innovation more effectively than unleashing the free market economy.

While a lot of work remains to be done, today’s report represents a significant step forward toward delivering the modern broadband infrastructure that all Americans deserve.

Given the FCC's belief that kissing the ass of telecom giants solves everything, the plan is unsurprisingly focused on a "free market" approach to spurring investment. A cornerstone of this belief in telecom circles involves ideologically viewing government as a perpetual nemesis and obstacle, not a democratically-driven ally.

The problem is that sort of stern ideological position ignores the fact that profound market failure is forcing countless local governments to get into the broadband business. Not because they want to, but because the market is dominated by monopolies that have literally purchased regulatory apathy. It also ignores that in many instances, these local-grown ISPs offer far better service than their private counterparts. As such, in telecom, the die-hard Libertarian-leaning free market demonization of government as always harmful is not only wrong, it's counterproductive to the goal of better broadband.

To be clear there are some good things in the plan, even though most of them have been in process for several administrations now, including scattered subsidization of rural broadband connectivity, forcing divergent government agencies to work more closely, doubling down on the use of government land to cite cellular towers, and expediting the permitting process for towers and other infrastructure.

But the plan also doubles down on all of the government's worst impulses. Like relying on broadband mapping data we all know isn't accurate (but the industry doesn't really want fixed for fear of highlighting the sorry state of availability and competition). In fact, the report begins by throwing out data that anybody that has covered (or visited) rural America knows to be patently false:

As of 2016, more than 92% of the U.S. population had access to fixed land-based broadband at speeds of 25 Mbps/3 Mbps. Nonetheless, the remaining 8% represents more than 24 million Americans who lack access to this basic service. Of those households, 80% live in rural communities. This is more people than live in the States of New York or Florida.

So while the report is at least honest that there's a problem, those numbers are being seen through decidedly rose-colored glasses. And the statement also kind of brushes over the fact that most of these users only have the choice of one ISP if they want actual "broadband" defined as 25 Mbps by the FCC. That's a monopoly, but you'll note that the word monopoly is never uttered once for fear up upsetting said monopolies. At faster speeds there is literally no competition whatsoever in American broadband, but the word "competition" is similarly uttered just once in the report's 62 pages.

You can't fix problems you refuse to admit even exist.

The report also perpetuates the government's belief that a one-size-fits all approach to broadband will somehow work when local, niche, community options are proving to be the lifeblood driving connectivity to rural and low-ROI areas. As we saw with the FCC's attack on net neutrality, the ideology driving the report is that you create a better telecom market by getting government out of the way. But while that may work in healthier markets, that doesn't work in telecom. When you eliminate guardrails for giants like Comcast, they simply double down on bad behavior. Especially in a country where antitrust law isn't enforced and consumer protections are being routinely obliterated at direct lobbyist behest.

There's literally nothing in the plan that addresses the sector's two biggest problems. One being the lack of real competition across countless markets. The other being the comical amount of regulatory capture and telecom lobbying influence on both the state and federal level that kills any well-intentioned improvement efforts in the cradle. That includes letting giants like AT&T and Comcast literally write protectionist state laws that ban towns and cities from building their own broadband networks or striking public/private partnerships, even if that's what citizens democratically voted for.

You don't fix American broadband until you fix American corruption and telecom regulatory capture, and based on the last few years at the Ajit Pai FCC, it's pretty god-damned clear we're far from learning this lesson yet. In other words, enjoy your Comcast monopoly for another decade, everybody.

Filed Under: american broadband initiative, broadband, broadband plan, competition, fcc