If Monopoly Means 6 Choices, Bring It On!

by Mike Wendy on May 1, 2013

Progressives like Susan Crawford love to play fast and loose with the term monopoly, especially as it pertains to the provision of broadband service here in America.   As she and others of similar mind see it, America is a nation of Internet service monopolies, dominated by cable companies.

What utter nonsense.

Regardless of how loud they yell their “truth” on all the NPR shows they can appear on, no such monopoly of the broadband market exists.  In fact, most data show exactly the opposite – that is, that we have a fiercely competitive broadband marketplace, which changes (for the better) almost daily.

Heck, even the most aggressively anti-Bell regulator – the DoJ – has admitted that there are at least four “national” broadband providers when they sunk the AT&T / T-Mobile merger a year-and-a-half- ago.  The broadband market has only gotten more competitive since.

And what of the ostensible dominance of the domineering cable companies?  Well, all the action of late is in mobile broadband, not fixed broadband. The latest FCC statistics reveal that “the number of mobile Internet subscriptions grew to 142 million, up 46% from December 2010.” In contrast to this, “the number of fixed-location connections increased by only 4% year-over-year, to 88 million.”  If cable, which is a fixed line, was so “dominant,” why aren’t consumers “choosing” it with the same or greater gusto as mobile broadband?

I could stop there, but I won’t.

Late last year in a little noted filing to the FCC, the U.S. Telecom Association hinted that the idea of the monopoly-provided communications provider – the so-called “dominant” incumbent – has truly become a vestige of the past.  In its view, the 19th Century regulations designed to ensure that dominant players didn’t use their natural advantages to harm the marketplace no longer serve consumers and should be eliminated.

Why?

Because “traditional” phone companies are no longer just “voice” companies anymore.  They’re dead or dying.  Nearly 40% (and growing) of America has cut that cord and has opted instead for mobile broadband or other Internet services to meet their diverse communications needs.  Today, incumbents face such stiff competition from facilities-based and non-facilities-based competitors that regulating incumbents like it was 1934 only punishes their investment, harming consumers by needlessly distorting the marketplace.

Importantly, the upshot of this is that no one is dominant.  No one has control.  The ability to bend a market to one’s liking is virtually impossible. For voice and for Internet services.  Incumbents are just one player among many in each market, offering their services to hungry consumers in the crowded, converged communications marketplace.

It’s easy to see how one could draw this conclusion.  Recent government and industry data show:

  • There are 1,681 U.S. broadband providers;
  • 99% of the U.S. can access at least one wireless broadband provider;
  • 96% of the U.S. has access to at least one wired broadband provider;
  • 88% of the U.S. has access to at least four mobile broadband providers;
  • 87% of the U.S. can choose between at least two wired providers; and
  • To access broadband, Americans can choose between an array of connection technologies, such as DSL, cable-coaxial, fiber, 3G and 4G mobile broadband, broadband over powerline, WISPs, satellite and Wi-Fi offload (not to mention what’s coming down the pike).

Contrary to the stagnation one would think would be evident in monopolistic markets, the U.S. broadband marketplace proliferates.  It continues to bring higher average and peak broadband speeds, new ways to connect to those speeds, more broadband availability to more people, increased service options and offerings, and overall better dollar value to U.S. broadband consumers with each new year.

Further, the broadband ecosystem continues on its explosive upward trajectory, too, with new content, software, applications, services and hardware developments emerging from the industry seemingly on a hourly basis, goaded in no small measure by America’s world-class broadband infrastructure (which, by the way, is even better than that of the progressive’s Big Government paradigm, Sweden).

Remember those good ole, true monopoly days?  I do.  Susan Crawford should, too.  Growing up we had a single “kids” phone lodged on a chest between all of our bedrooms – a state-regulated, yellow princess model.  We went head over heals because it was touchtone instead of rotary dialing…and it had call waiting (oooh, ahhh!).

What luxuries!

Now, I have a smartphone / mobile computer.  So does my wife.  And the kids will get their own soon enough.   If America opens NASA again, we’d probably be able to launch one of their spacecraft with our smartphones (really).

In a “nation of monopolies,” princess phones and call waiting is about as good as it gets.

Contrary to the fallacious assertions of some, in just about any U.S. market, broadband consumers have six different broadband choices from which to pick.  Last I checked, mono (as in monopoly) meant one, not six.  But, if six players is the new definition of monopoly, bring it on!

Consumers win.

{ 1 comment… read it below or add one }

Mark Causey April 18, 2014 at 3:16 pm

My internet bill has gone from $19.95 to $29.95 to $39.95 to $54.95 in 2 years without any improvement in service. . I have Comcast Cable (Southern California), a company that has NO COMPETITION in my area. I don’t know how you define a “monopoly” but according to Webster, a monopoloy is, “exclusive control of a commodity or service in a particular market, or a control that makes possible the manipulation of prices.” If the shoe fits, wear it!

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