ACA Connects Broadband Competition Report Undermines Common Carriage

Last week, ACA Connects released "Broadband Competition Is Thriving Across America," a report that argues common carriage regulation of broadband providers is inappropriate in light of increasingly competitive broadband market conditions. The report projects future competitive conditions in the broadband market based on existing FCC data, the historic pace of deployment, and provider announcements for increased fiber deployment over the next few years.

ACA projects that by December 2025:

• Over 95% of homes will have access to at least one provider of 100 Mbps/20 Mbps speeds;
• Over 95% of homes will have access to at least one provider of 100 Mbps/20 Mbps and one provider of 25 Mbps/3 Mbps speeds;
• 84% of homes will have access to at least two providers of 100 Mbps/20 Mbps speeds.

At this level of competition, harms from common carriage regulation, including reduced investment, efficiency, and innovation, are likely to outweigh its potential benefits, which could include price reductions and better speeds in uncompetitive areas. This is because the vast majority of the country would have competitive conditions in the broadband market, so common carriage regulation would fail to improve the service quality that results from competition.

Additionally, ACA's report argues that the NTIA's BEAD Program eliminates the need for common carriage regulation. It is likely that the BEAD program, or other federal broadband programs, will subsidize new deployment in areas that have only one broadband provider. Thus, common carriage is not needed because BEAD will fund new entry, correcting any market failures common carriage could address.

ACA's report also argues that small broadband providers should be exempted from common carriage regulations if they are implemented despite the evidence that they will not improve competition. This is because nearly every household has at least one large broadband provider. Thus, in almost every market where a small provider competes against a large provider, the large provider will be subject to common carriage regulations, and the small provider would have to offer prices or speeds that reasonably compete with the service standards imposed on the large provider in order to attract any customers.

Free State Foundation scholars have long argued that common carriage regulation of the broadband market is unwarranted and potentially harmful. The FCC's 2018 Restoring Internet Freedom Order, which repealed common carriage regulation of broadband services, cited our supportive comments over 50 times. And Free State Foundation President Randolph May and Director of Policy Studies Seth Cooper wrote a book dedicated to this subject, "A Reader on Net Neutrality and Restoring Internet Freedom," which can be purchased on Amazon by clicking the hyperlink.