5G Could Actually Make The 'Digital Divide' Worse

from the ill-communication dept

Since he’s taken office, FCC boss Ajit Pai has repeatedly proclaimed that one of his top priorities is closing the “digital divide,” or making it easier and less expensive for folks to gain access to internet connectivity. Unfortunately, most of his policies have had the exact opposite effect. From rubber stamping competition-eroding mergers to eliminating consumer protections governing broadband, the lion’s share of Pai’s agenda has focused on what telecom giants want — not necessarily what’s actually good for markets, consumers, or the country.

Enter 5G, which is routinely framed by both Pai and the wireless industry as some sort of near-mystical panacea. Do everything wireless carriers demand in terms of 5G subsidies, deregulation, and incentives, we’re told, and America will soon be awash in a new layer of inexpensive broadband connectivity and innovation.

The problem: 5G isn’t magic, and the technology won’t fix the rot that plagues the U.S. broadband sector. It won’t fix the fact we approve mergers that directly contribute to higher prices and weaker markets. It won’t fix the lack of competition in the fiber lines that feed cellular towers, which also contributes to higher rates. It also won’t fix the fact that FCC policy and telecom lobbying positions are virtually indistinguishable. And, contrary to carrier claims, you’re still going to have patchy availability as carriers focus on the most profitable areas despite countless billions in taxpayer subsidization.

5G’s technical accomplishments don’t mean all that much if the underlying structure is rotten, and US telecom is, if you haven’t spent time on the phone talking to telecom customer service lately, very rotten indeed.

And in some instances, 5G may actually make the digital divide worse. The National Digital Inclusion Alliance, for example, is correct to note that the low-income families we profess to love can’t afford new, far more expensive handsets or the even higher rates companies like Verizon intend to charge users to access these networks. Telecom giants (and the current FCC) do yeoman’s work focusing on unhelpful and silly “race” rhetoric, hoping to steer the conversation away from the subject that matters most to low-income families stuck on the wrong side of the digital divide — price:

Dana Floberg, a policy manager with the media and technology equity advocacy group Free Press, agreed, noting there is a narrative being sold to the public that the country is locked in a must-win, high-stakes race to deploy 5G faster than other countries such as China.

“Validity aside, that very notion only frames the issue as a technological challenge ? asking how fast can we build small-cell networks ? rather than an economic challenge. Ignoring the affordability component is likely to create all the same problems that have existed for years with other Internet services.

?5G is potentially an enormous technological innovation,? Floberg said, ?but it?s not that innovative when it comes to the economics of the service. It?s a step forward for technology, but it?s not necessarily a step forward for affordability of competition.”

If you stop and study Ajit Pai’s rhetoric (or any group or individual that mirrors or parrots the thinking of U.S. telecom mono/duopolies), you’ll notice he will go out of his way to avoid acknowledging high US telecom prices. That’s because that conversation leads to another conversation these folks really don’t want to have: the regulatory capture and lack of competition in U.S. broadband that’s causing the problem in the first place. If you don’t acknowledge there’s a problem, you’ll never have incentive or responsibility to fix it. Ingenious!

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Comments on “5G Could Actually Make The 'Digital Divide' Worse”

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13 Comments
Anonymous Coward says:

Can we please drop the "competition-eroding mergers" nonsense already? As people have been pointing out since pretty much the beginning, T-Mobile and Sprint (especially Sprint!) are second-tier carriers which are nowhere near as big as AT&T and Verizon. Sprint knows this full well and has for years; it’s not able to compete with the big boys and it’s been frantically looking for someone to merge with so they won’t end up going under entirely.

If they join with T-Mobile, it’ll create a third first-tier carrier, capable of competing with the other two in a way neither of them is able to do right now, thus increasing competition rather than decreasing it. The only way you can paint this as a "competition-decreasing" merger is by asserting that T-Mobile and Sprint are both on the same level as AT&T and Verizon, which is disingenuous as anything. Come on, you know it’s not true, so stop saying it already.

Anonymous Coward says:

Re: Re: Re: Re:

Yes, it can decease it by preventing future competition…

Lets put it this way… If you join a multiplayer game and have to wait in the lobby before the start of the match, one player leaving the same lobby means you have to wait longer since more spots need to be filled before the match can start.

The problem with the U.S. is that you can change your player customization all you want, but you can’t switch your lobby.

James Burkhardt (profile) says:

Re: Re:

Remind me, what precipitated the ending of long term contracts and the return of uncapped data plans into the mobile market?

Right, second tier carrier T-Mobile not being allowed to merge and choosing to compete to save their long term prospects, ending those things and putting competitive pressure on AT&T and Verizon. The second tier carriers are in the place to make the big disruptive moves to draw off customers from the first tier. A bigger Tmobile would have no reason to introduce newer, disruptive, competitive pricing plans, particularly as they would now have a ton of extra debt from the merger.

This ignores the history of wireless telecom mergers, where any example you can find of 4 carriers merging to three has always resulted in high prices.

The argument is that a bigger Tmobile would be in a better position to bid for more and better spectrum. But there is no technical reason Tmobile and Sprint couldn’t, without being a single company, share spectrum. In theory they could, if they really needed to, redesign their networks to treat each other’s cell towers as one, with fully shared spectrum on new towers.

You might notice an issue: Tmobile and sprint have tried to buy spectrum jointly, but they still couldn’t compete against AT&T and Verizon. Making them one company with less money on hand (Sprint supposedly needs a merger to pay off debts, and the merger saddles Tmobile with a ton of debt) doesn’t change that math. The only value in having T-Mobile be ‘bigger’ is in that spectrum purchasing, and they have to divest spectrum to get this merger done. A partnership would achieve that goal without sacrificing a carrier.

ECA (profile) says:

Just a note.

For all the consumer groups that profess to assist and help..
MOST are not.
They belong to the corps. And help the Corps in other ways. Creating a front, that gives it Some sort of standing(not any in our eyes) The corp can backup anything it says with Facts from Fake little companies.

It would be nice to have a list of agencies/companies/whatever that Actually DO the job and DO something for the consumer.
Even a gov. agency that CAN do the job. or will.

War says:

Re: 5G

5G is driven by greed, information gathering, control/surveillance, and unleashing a new wave of consumerism that we can’t afford (aka Internet of Things) It’s not about empowering people, it will only impoverish the average person, reduce health, and enrich giant corporations. Not only that but the whole internet will become even less secure to hacking……

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