News Articles

No FCC Call on Wireless Broadband

Agency: Declaring it competitive would oversimplify the picture 1/04/2016 8:00 AM Eastern
TakeAway

An FCC report’s non-finding leaves the agency room to regulate wireless broadband.

WASHINGTON — Borrowing a page from groundhog Punxsutawney Phil, the Federal Communications Commission has taken the temperature of wireless broadband competition and signaled there will be at least another year’s worth of potential regulation.

 

Or at least that was the takeaway of some mobile broadband boosters from the FCC’s pre-holiday release of its 18th annual report to Congress on competition in the wireless industry, which, like other recent reports, comes to no conclusion about whether that industry is competitive.

 

That’s despite the report’s finding that about 92% of Americans can choose between three or more service providers; the FCC pointing out that deployment does not guarantee speed; and that the road miles and landmass covered by wireless broadband were at 34% and 15% of the nation, respectively.

 

A finding that the market is competitive could limit the FCC’s ability to regulate the mobile broadband industry in the interests of wider deployment, or to spur more of the competition the agency won’t say is there.

 

An FCC official pointed out that Congress required only a status report on mobile service, not a decision on whether it was competitive.

 

“Since no decision was mandated, no decision was reached,” the agency source said.

 

“Given the complexity of the various interrelated segments and services within the mobile wireless ecosystem, any single conclusion regarding the effectiveness of competition would be incomplete and possibly misleading in light of the complexities we observe,” the FCC’s Wireless Bureau said in issuing the report.

 

Not surprisingly, that finding, or lack of it, did not sit well with mobile broadband players, but the Wireless Bureau suggested that handicapping competiveness could lead to an overly simplistic conclusion.

 

Mobile Future, whose members include AT&T, Verizon, and Qualcomm, was disappointed. “Once again, the FCC’s competition report has been inspired more by the remembrance of things past, rather than the real-world record,” the group said.

 

The FCC, under Republican chairman Kevin Martin, concluded in 2007 and 2008 that the marketplace was competitive, but since then the reports have been mum on the issue.

 

“Like something out of Marcel Proust, the more things change in our dynamic mobile marketplace, the more the FCC’s analysis stays the same,” Mobile Future said.

 

The FCC has similarly found the wired broadband marketplace in need of more competition, which it has used to regulate that space as well.

 

The wireless report looked at “market concentration, the conduct and rivalry of service providers, and competition in other segments of the mobile wireless ecosystem, including spectrum, backhaul, and handsets/devices, as well as consumer behavior,” but would not make the call about whether those factors indicated the presence or absence of competition.

 

The bureau emphasized the need for more spectrum, including from the broadcast incentive auction, and the need to spread low-band spectrum around to boost competition. In theory, the broadcast spectrum will go to the highest bidders for whatever use they desire, but the Wireless Bureau has said it “will be used for the provision of mobile wireless service, with flexible use service rules.”

 

Senior Republican commissioner Ajit Pai was not happy with the report’s lack of conclusions, suggesting the ends drove the means.

 

“[T]his FCC will never find that there is effective competition in the wireless market, regardless of what the facts show,” he said in a statement. “That’s because doing so would undermine the agency’s goal of expanding its authority to manipulate the wireless market — a goal it can’t accomplish if it deems that market healthy.”

 

The Competitive Carriers Association, which represents rivals of the major wireless carriers, read the report quite differently, saying: “The report affirms an alarming trend of continued consolidation into the hands of the two dominant carriers measured by any metric, including amount of low-band spectrum, wireless revenues or connections, to name a few.”

Want to read more stories like this?
Get our Free Newsletter Here!