Thursday, February 15, 2007

Forward-Looking Policy Will Remedy Our Broadband Woes

This week's issue of InformationWeek concludes that forward-looking policy and not wholesale deregulation is the way to save America from becoming a broadband backwater.

The report’s author Richard Hoffman writes that nation’s that are able to craft “genuinely forward-looking telecommunications policies that promote universal access as well as enhancing competition, and which can balance short-term market forces against long-term national priorities, will reap the current and future benefits of increased economic productivity.”

The FCC's Rose Tinted Lens


Read InformationWeek's Report

Hoffman takes the FCC to task for rose-tinted reporting on broadband competition. He calls "questionable" figures presented by FCC Chairman Kevin Martin that define a "high-speed" line as one delivering service of at least 200 Kbps in at least one direction, and for defining a ZIP code as "covered" by broadband access when only one broadband line is active in that region.

His critique of FCC data echoes widespread concern (read Isenberg ,Techdirt, Feld, Free Press, CPI, et al) that the FCC's Martin is skewing already discredited data to paint a picture of a flourishing broadband marketplace. The evidence on the ground – in both urban and rural communities across America – suggests a markedly different reality.

Hoffman writes that the U.S. broadband market is hobbled by "surprisingly little competition." Despite the growing number of broadband users here prices are still much higher than in many of the countries that lead the world in broadband use.

He adds:
"Part of the cause for this pricing disparity can be attributed to the fact that competition brings lower prices and greater innovation, and the U.S. broadband market is, in many ways, not highly competitive."
Back of the Pack

As a result, U.S. broadband accessibility, speed and costs have fallen behind other developed country's including Japan, Canada, Iceland, France, Korea and the U.K.

"The U.S. isn't even close to being the leader in widespread broadband availability and usage," Hoffman writes. "In fact, [we] may be dropping further behind the 'first tier' of broadband-rich countries in Northern Europe and Asia."

He cites Korea as a "best example" of a country's rapid development of superior broadband service. The reason, according to Hoffman, is that Korea "has a tradition of constructive and proactive government policy and involvement in building industry and technological capability to be competitive in the international market."

The Telcos' 'Hand On' Policy Approach

Phone companies only seek to maximize profits and spend millions of dollars on lobbyists to create laws that stifle competition, limit access to rural areas and urban poor with no incentives to increase speed and lower costs. According to Hoffman, "this state of affairs stands in marked contrast to the situation in those nations that are truly broadband leaders."

He concludes:
"[America's] intensely 'hands-off' market-driven system in recent years seems to have resulted in a chaotic and inefficient marketplace, and one that doesn't represent the true state of the United States as a technology leader. Laissez-faire isn't a viable stance if the goal is to compete most effectively against other industrialized nations."
InformationWeek's recommendations fall in line with's agenda for Internet Freedom. They also follow the research and recommendations made by charter members Free Press, Consumers Union and Consumer Federation of America.

Our goal is to create universal and neutral access to a world-class broadband network at affordable prices. To get there we need a national broadband policy, not a series of laws designed to prop up the business models of incumbent telephone and cable companies. We want to make the information superhighway a public good, to bring the transformative spirit of free speech and free markets to every community.

The "Internet Freedom Declaration" is a step in the right direction. Hopefully, InformationWeek's 440,000 readers will join us in this fight for better broadband.

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