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How redefining broadband's lowest speed could be anti-competition & undermine universal broadband availability
Submitted by Scott Cleland on Fri, 2008-03-14 18:41
I was surprised and concerned to read in Comm Daily today that the FCC's broadband data collection rulemaking "is expected to swap the FCC minimum speed for broadband -- 200 kbps -- for a tiered approach. The lowest tier would set 768 kbps as the minimum speed, an FCC source said."
- I certainly hope this is not the case, as it could have a ton of negative unintended consequences which I will outline below.
How could changing the baseline minimum definition of what is broadband turn out to be anti-competition and undermine the universal availability of broadband?
- Back door re-regulation? This could have a large and potentially unintended consequence of "redefining" a whole lot of currently unregulated broadband business from the unregulated information services bucket to a regulated telecom service bucket, which would be a back door and non-transparent way to potentially impose net neutrality on a wide swath of lower priced broadband or longer-looped rural broadband -- where it does not apply now.
- It is unclear how and to what extent broadband is synonymous with information service and if that would be changed by this redefinition of broadband.
- Investment uncertainty? Abruptly changing the minimum definition of broadband would be a classic case of "moving the goal posts" or changing the rules mid-game.
- This type of new regulation, changing fundamental baseline policy definitions, could send the signal to investors that the regulatory environment for universal broadband deployment is not stable or certain, which unnecessarily would create investment uncertainty. I don't think is the FCC's intention.
- Undermines President Bush's Broadband Availability Pledge? In the NTIA's January broadband report: "Networked Nation: Broadband in America 2007," the Bush Administration declared that the President's pledge of Universal broadband availability by 2007 had been met.
- It would be surprising, if a Republican-controlled FCC, with the stroke of a pen, redefined the fundamental definition of broadband in such a way as to almost immedately undo or undermine the President's ability to claim success in achieving universal broadband availability in 2007 as pledged in 2004.
- Undermines Adminstration's Policy of Technology Neutrality? The NTIA report is explicit in communicating " The Administration has consistently and strenuously advocated for technology neutrality in order to take the government out of decisions more appropriately left to the marketplace." The unintended, but clear effect of arbitrarily redefining the baseline broadband definition, would be to pick cable modem and DSL stationary technologies over satellite broadband technology or mobile wireless technologies.
- Redefining broadband could also have the unintended effect of putting companies who have technology that averages up to or close to 768 kps at legal risk of false advertising, if they used the word "broadband" in their advertising.
- I don't think it is the intention of the FCC to arbitrarily change which technologies could market themselves as broadband right in the middle of the competitive game.
- Going from being able to market your service as broadband one day and not the next could have an unnecessarily confusing effect, when it is the stated intention of the FCC to not create confusion, but more certainty, in the marketplace.
- Could competition policy ever have a chance to fully succeed? By arbitrarily redefining what is broadband and what is not, the redefinition would have a immediate effect of lessening the official state of broadband competition.
- The redefinition could in many places take a competitive market and immediately redefine it as a monopoly or as a no broadband zone.
- That would seem to run counter to the 1996 Telecom Act purpose to promote competition and the Internet policy statement to keep the free market Internet unfettered by Federal or state regulation.
- It would also be ironic for a Republican-controlled FCC to arbitrarily redefine the competitive scorecard in such a way as to reduce the amount of broadband competition in the marketplace.
- Another potential unintended consequence of arbitrarily mandating a new minimum broadband speed for what is officially and legally considered broadband, is that the FCC could be creating defacto "market definitions," which could have antitrust implications. It could also have the ironic unintended effect of spawning new antitrust suits when the marketplace is trending towards increased competition by almost any appropriate measure.
To an outsider, it is hard to see how the downsides and unintended consequences of changing the baseline definition of broadband would not overwhelm any marginal benefit from moving the competitive broadband goalposts so abruptly and arbitrarily.
- Why is redefining minimum broadband necessary?
- Why not just keep a 200-768kps tier?
- Rather than try and arbitrarily pick a speed that will always be a dynamic and evolving target, why not institute a convention that can adapt with times and remain backward compatible with historical data, where the speed is mentioned before the word broadband, like ~200kps broadband, ~768 kps broadband, ~1.5 mbs broadband, etc.?
- That simple practical solution would be most informative and least disruptive to the marketplace, regulation and consumers.
Bottom line: I don't think the FCC wants to have a consensus, good-government, more-information-is-better-rulemaking, like this broadband data collection rulemaking, have an unintended consequence of undermining broadband competition, investment, universal deployment and competition policy -- all because of a definitional mistake.