From: "Robert J. Berger" <rberger@xxxxxxx>
Date: October 14, 2004 6:23:00 PM PDT
To: Dewayne Hendricks <dewayne@xxxxxxxxxxxxx>, Dave Farber
<dave@xxxxxxxxxx>
Subject: Om Malik on: Shrinking consumer broadband choices?
Shrinking consumer broadband choices?
http://www.gigaom.com/2004/10/shrinking_consum.php
FCC's decision to extend monopolistic control over the last mile
has The Consumer Federation of America and Consumers Union all
riled up. They are worried that lack of competition will only
increase prices, limit choices, and result in slower
innovation. “The FCC today took our country one giant step
closer toward solidifying a two-company domination – the local
cable and telephone providers -- over the consumer Internet
market,” said Gene Kimmelman, Senior Policy Director for
Consumers Union. “As both industries tighten their hold on
high-speed Internet (broadband) access, consumers will see their
choices diminish and their bills skyrocket.” “This stranglehold
will stifle innovation as these duopolies discriminate against
unaffiliated applications and services that in the past have
driven the growth of the Internet and the boom in information
technology,” Mark Cooper, Director of Research at the Consumer
Federation of America, said. “As a result, our country will fall
even farther behind Asia and Europe in broadband penetration.”
I agree. FCC is beholden to special interest groups, and has
lost all veneer of fairness. Michael Powell thinks that also-ran
technologies like WiMAX and Broadband over Powerlines will
result in competition, and once again shows that despite his
self professed love for gizmos, he really doesn't have a grasp
on technological realities. I think it is time that consumers
get to elect FCC commissioners, via the local ballet. No
political appointments for this most important body, which is
chartered with coming up with unbiased, fair and realistic
regulations that affect consumer lives in the future. I think
broadband and wireless networks are going to be a key to our
future and global competitiveness, and FCC is selling it down
the pike. Here is a recent FCC reality check:
• In the three and a half years that Michael Powell has
been Chairman of the Commission, the U.S. had fallen
from third to eleventh in broadband adoption.
• As a result, the digital migration that Chairman
Powell has touted has become a migration to a massive
digital divide. One out of every two American households
with incomes above $75,000 have high-speed Internet
connections at home. One-out of every two American
households with incomes below $30,000 does not have any
Internet connection at home at all.
• The cause of the failure of high speed adoption is
clear, Americans are being overcharged by the cozy
duopoly of cable and telephone companies. Cross national
comparisons of price show that Americans pay fifteen to
ten times as much, on a megabit basis, as consumers in
Japan pay. Three years ago the price in America was
three or four times as high.