Back in 2013, then FCC boss Julius Genachowski issued a “1 Gbps challenge”: basically a pledge to ensure there was at least one gigabit network operating in all fifty states by 2015. As we noted at the time it was kind of a show pony goal; notorious fence-sitter Genachowski was simply setting a goal he knew the industry would probably meet with or without’s government help, so that government could come in at a later date and insist it played an integral role.
Well, 2015 has come and gone, and while there is at least one gigabit network planned for every state, we narrowly missed Genochowski’s goal by most estimates:
We combed through our archives and other online resources and, by our tally, at least one network operator has announced plans to offer gigabit service in every state. Not all of these networks are actually deployed or supporting service yet. But generally network operators don’t announce specific markets more than a year or two in advance of when they expect to deliver service.
If you live in the city, it’s almost a certainty that your property can get high-speed Internet access from at least one company. But for rural America, it’s a different story, with nearly 4-in-10 people lacking access to fixed-line broadband service.
This is according to FCC Chair Tom Wheeler, who will issue his latest annual Broadband Progress Report later this month. Continue reading
Locally and nationally, consumers are opting not to buy homes if they don’t have access to high-speed Internet.
The Wall Street Journal recently highlighted the topic, and Greater Chattanooga Association of Realtors President Travis Close said that residents in rural areas value high-speed Internet access just as much as people who live in city centers.
But access isn’t always available. There are still unincorporated areas of Hamilton County with limited Internet access. Continue reading
Finally the concept of open-access last mile networks is getting more attention. We could debate the motives behind Comcast’s usage caps, but there is a good chance that they would disappear if there was service-level competition. Even in the wireless market where bandwidth resources are limited, carriers like Sprint still offer an unlimited data package. They do this to compete against Verizon Wireless and AT&T Wireless; it is a product differentiator. The open-access model does work and more cities should implement a variation that works best for their community. The infrastructure could be city, third-party, or carrier consortium owned or a combination of any of those options. In any case the most expensive part of the network will be a shared resource that will be economically justified because its’ usage will be maximized. Offering open access to all service providers on a non-discriminatory price basis will allow multiple service providers to enter a market to offer differentiated and competitive services.
We’ve long made the point that Comcast’s usage caps are just a symptom of the overall lack of competition. The caps, which even Comcast itself has indicated really aren’t financially or technically necessary, are little more than a glorified price hike designed to protect the company’s TV revenues from Internet video. And if customers in Comcast markets had the choice of other ISPs, they’d be able to flee to unlimited offerings. Continue reading
A push by cities across the country to get into the business of the Internet is raising concerns that local governments, with Washington’s blessing, are meddling where they are not needed — and wasting taxpayer dollars in the process.
The push was fueled earlier this year, when President Obama in January introduced a plan for municipal broadband projects which, according to the administration, would encourage “competition and choice” while offering a “level-playing field” for high-speed Internet access. Continue reading
This is a great infographic showing the state of broadband services in the United States, but the text in the article is a little misleading. First of all the reason that about half the rural residents can’t get broadband service is because the FCC changed the definition of broadband service and the incumbent carriers are trying to catch up to meet the new definition. Second allowing municipalities to decide their own broadband fate will not address the problem of reaching customers outside the city limits.
The uninformed and big government types look at municipal broadband as the panacea to all our broadband ills, but there is a reason that 19 states have enacted laws preventing municipal governments from getting into this business. They recognize that about half of these ventures fail and leave taxpayers on the hook to cover the losses, and that bureaucracies are generally not market oriented.
U.S. broadband providers invested $78 billion in network infrastructure in 2014, according to a new analysis of capital expenditures data for wireline, wireless and cable broadband providers. The 2014 investment expenditure was $3 billion, or 4 percent, greater than the $75 billion invested in 2013 and $14 billion, or 22 percent, greater than the $64 billion invested just five years ago in 2009 amidst the financial crisis.Of the 2014 total, the wireline industry invested $28 billion, or 36 percent of the industry aggregate, compared to 43 percent for wireless and 21 percent for cable.
From 1996 through 2014, broadband providers have made $1.4 trillion in capital investments with wireline providers investing more than $720 billion, or 52 percent of this total, compared to 32 percent for wireless and 16 percent for cable. These surging investment levels have taken place during a period of light regulation, which has come to an abrupt end with the Federal Communications Commission’s (FCC) decision(link is external) to impose public utility rules on broadband providers. It is difficult to predict the near-term impact of this decision on investment, but numerous economic analyses(link is external) forecast negative long-term consequences on investment, innovation and other long-term economic benefits that come with broadband investment. Continue reading