Two weeks ago, the Federal Communications Commission released its Fifteenth Report on the assessment of competition in the market for the delivery of video programming.  As both George and I were members of the core team of FCC staffers who wrote the very First Cable Report (and its insightful Appendix H) way back in 1995, I could not help but marvel at the growth and development of the industry over the last eighteen years. Of particular note to me were the FCC’s findings that not only do nearly 131 million (approximately 99%) of American homes have access to three multichannel video programming distributors or “MVPDs” …
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Recently, I spotted an interesting blog by Scott Wallsten at the Technology Policy Institute.  In this blog, Scott discusses the FCC’s recent decision that Verizon violated the open access rules of the 700 MHz C-Block auction by charging its customers an additional $20 per month on its data plans to tether a device.  In response, Verizon paid a fine and now allows tethering on all new data plans.  However, Scott observes that: Verizon effectively abandoned the post-paid market for light users after the FCC decision.  Verizon no longer offers individual plans.  Even consumers with only a single smartphone must purchase a shared data plan.  That’s …
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Next month, a new book entitled Captive Audience:  The Telecom Industry and Monopoly Power in the New Gilded Age (Yale University Press 2012) from Cardozo Law School Professor Susan Crawford will hit the bookshelves.  According to her publisher’s blurb, Professor Crawford’s book will examine how the United States has “created the biggest monopoly since the breakup of Standard Oil a century ago.”  But what is this “monopoly” to which Professor Crawford refers?  While the publisher’s promotional blurb is silent on this question, according to a 2010 paper authored by Professor Crawford in the Yale Law and Policy Review, it appears that she is talking about …
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Last week, Professor Susan Crawford authored an op-ed entitled What’s Good for Verizon and AT&T Is Terrible for American Consumers.  While Professor Crawford’s emotional argument is a bit scattered, her depiction of an industry in transition provides a useful foundation for discussing the future of broadband in the United States. First, Professor Crawford argues that wireless broadband is a “commodity,” and one that consumers are increasingly using as a substitute for traditional “voice” and “texting” services.  This substitution is arguably true and, as such, we should therefore expect to see broadband providers increasingly employing and experimenting with a variety of pricing plans in an effort …
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What is the effect of regulation on investment?  At a high level of abstraction, it is impossible to say.  Rate-of-return regulation, for example, is criticized by economists for possibly encouraging too much investment—a principle known as the Averch-Johnson Effect.  On the other hand, if a firm fears that the regulator will alter the rules in a way that reduces the ability to earn profits on large, long-term capital investments, then the incentive to make such investments is reduced.  Importantly, the issue is not, as some claim, just about “regulatory uncertainty.”  There could be great uncertainty about future rule changes, but if the expectation is that …
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A recent article in the Wall Street Journal caught my attention, and I’m sure the attention of many others.  The article—AT&T May Try Billing App Makers (February 28, 2012)—reported that AT&T and content providers were discussing ways in which the providers of mobile content, like video streaming, could pay for (in whole or part) the cost of the data traffic on behalf of the end user.  According to the article, the interest in a content-payer system is being encouraged by content developers that “could use the feature to drum up new business from customers wary of using data-heavy services like mobile video” in a world …
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While attending the Consumer Electronics Show last week, FCC Chairman Julius Genachowski observed in his speech to the assembled technology glitterati that “… virtually every new product on the CES floor is fueled by broadband Internet—by connectivity and bandwidth, wired and wireless.  If you shut off the Internet, virtually nothing on the CES floor would work.”  Certainly, the rapid innovation in edge devices is a wonderful thing.  But, such innovation may not be traveling alone.   That is, economic theory suggests this rapid increase in the number and sophistication of edge devices may be accompanied by an increase in the intensity of price competition among broadband …
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One of the major stories that came out of CES last week was (in the words of the Wall Street Journal) the “flood” of new Internet content and mobile devices reaching consumers’ living rooms.  In fact, this has been the story coming out of CES for the past few years.  Given such developments, it continues to puzzle me not only that the FCC refuses to announce, at least formally, that it intends to drop its ill-conceived AllVid paradigm, but that it also refuses to announce that it intends to seek to sunset Section 629 of the Communications Act altogether. By way of quick background, Section …
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