FCC makes a good call to follow the market and not manage it

by Steve Blum • , ,

I want to catch up on developments at the FCC this week. The big news, of course, is chairman Tom Wheeler’s press release saying he’s going to put broadband under common carrier rules. If it flies – and all indications are it will – it’ll mark a major turning point in the history of the Internet. I say that with all the authority a bachelor’s degree in history (specifically the historical nexus between California and Japan, if you’re curious) bestows upon me.

There’s a lot more to say about title II and net neutrality and all the rest. But I didn’t want the release of the full text of the FCC’s 2015 broadband progress report to slip by without mention.

That’s the document that provides the basis for raising the minimum broadband standard in the U.S. from 4 Mbps down/1 Mbps up to 25 Mbps down/3 Mbps. It meanders through the thought process that led to the decision, but it seems to boil down to the notion that enough people want that service level now, even more people will need it in the near future and service providers are delivering it…

We disagree with commenters that contend that 25 Mbps is too high, excessive, or purely aspirational. Each household is unique: some households may not require a 25 Mbps/3 Mbps connection, but many do. The market itself belies the claims that the benchmark is unrealistic or unnecessarily high. Service of at least 25 Mbps/3 Mbps or higher is already available to 83 percent of Americans. Service providers have thus determined that these speeds are worth investing in. We reject the argument that service that is already deployed to a substantial majority of Americans is merely aspirational and cannot be achieved for all. And Americans are rapidly adopting service of 25 Mbps/3 Mbps. Approximately 29 percent of consumers take that service when offered, and the rate of adoption has quadrupled (from 7 percent to 29 percent) from 2011 to 2013.

Market supply and market demand have pushed the norm to 25/3. That’s all the justification needed.