Industry Trend Analysis - Counting Wireless As Broadband Requires Right Regulatory Framework - OCT 2017


BMI View: While lowering the speed of broadband services to 10Mbps is an attempt to make the market more competitive than it is, including wirele ss services (as 5G is bound to launch quickly) makes sense. However, it needs the right regulatory framework and , under the current FCC, the move will favour telecoms companies rather than co nsumers.

In a new Notice of Inquiry, the FCC is proposing to include wireless services as broadband. The regulator is also thinking of changing the definition regarding the speed of broadband services, from 25Mbps currently to 10Mbps. While we would be wary of that change, the sole aim of which is to make the US broadband market appear more competitive than it really is, we are more open to giving broadband a technology-agnostic definition, considering the future launch of 5G. However, this would need the right regulatory framework for it to be positive for consumers, requiring a shift from the current FCC thinking (see ' Privacy The First Step In Greater Regulatory Pushback ' , March 30 2017).

Lowering the official speed for broadband services highlights the lack of competition for many consumers for very high-speed services. While at 10Mbps, 90% of households have at least the choice of two different companies for their services, this drops to 24% if the threshold is raised to 25Mbps. 100Mbps fares even worse, with a choice for only 11% of households. Telecoms operators, which have mostly disengaged from copper, have not upgraded most of their footprint with fibre, whereas cable players, which have upgraded to DOCSIS3.0, have a more limited footprint. This means that 25Mbps and 100Mbps, 29% and 53% of households respectively, have no providers offering these speeds, making wireless a viable option in those areas.

Making The Market Seem More Competitive
Number Of Broadband Providers By Speed, 2015
Source: FCC

This article is part of our Americas coverage. To access this article subscribe now or sign up for free trial