F.C.C. to Promote Choices for High-Speed Broadband

Edward Wyatt, New York Times
Published: September 4, 2014

WASHINGTON — Americans lack real choices among providers of high-speed Internet service, with fewer than one in four homes having access to two or more providers of the broadband speeds that are quickly becoming “table stakes” in modern communications, the chairman of the Federal Communications Commission said on Thursday.

The chairman, Tom Wheeler, said in a speech that the F.C.C. planned to promote more choices and protect competition, because a lack of adequate consumer choice inhibits innovation, investment and economic benefits.

“There is an inverse relationship between competition and the kind of broadband performance that consumers are increasingly demanding,” Mr. Wheeler said. “This is not tolerable.”

While about 80 percent of homes have access to a wired broadband connection that provides service at 25 megabits per second or greater, an overwhelming majority of those have no choice among providers, Mr. Wheeler said, citing statistics from the Commerce Department’s State Broadband Initiative.

Even that overstates the level of competition because “users cannot respond by easily switching providers,” Mr. Wheeler said. “Once consumers choose a broadband provider, they face high switching costs that include early-termination fees and equipment rental fees. And, if those disincentives to competition weren’t enough, the media is full of stories of consumers’ struggles to get I.S.P.s to allow them to drop service.”

Mr. Wheeler said the F.C.C. would protect competition where it existed and encourage greater competition where it could exist.

Those comments could hold significant implications for Comcast, which is trying to gain approval to buy Time Warner Cable. They do not compete in any markets, but eliminating an independent operator could adversely affect future competition.

Mr. Wheeler cited the long-distance market of the 1990s, when consumers could easily switch from one carrier to another, as “what a truly competitive telecommunications marketplace looks like.”