House Republicans Don't Want Infrastructure Money Going Toward Broadband Competition

from the do-not-pass-go,-do-not-collect-$200 dept

For years the broadband industry has successfully convinced the U.S. government to remain fixated exclusively on broadband coverage gaps, not the overall lack of broadband competition. That’s in part because they’ve known for decades that substandard maps mean policymakers have never really known which areas lack or need access. That’s helped create an ecosystem where we throw billions upon billions of dollars in tax breaks and subsidies at regional monopolies every year, in exchange for broadband networks that are routinely half-completed.

With a record $42 billion broadband investment on the horizon, the industry is obviously worried that some of that money might go toward (gasp) added competition. As in, not just used to expand access to the estimated 20-40 million Americans without broadband, but funding to help bring new competitors to the estimated 83 million Americans living under a broadband monopoly. That regional monopolization, as we’ve long documented, is why U.S. broadband tends to be expensive, spotty, slow, and with terrible customer service.

Of course you can’t just come out and acknowledge you don’t want money going toward encouraging broadband competition, even though more competition would greatly benefit consumers, small businesses, and countless internet-based economies. So instead the industry’s biggest players (and the politicians and regulators paid to love them) like to complain about “overbuilding,” or the act of creating “duplicative” broadband networks in “already served” areas. This is generally framed in such as a way as to make it sound as if broadband in most parts of the country is already wonderful, and spending any money to expand access in these “already served” areas would be completely wasteful.

That rhetoric and language was quick to pop up in a House Republican letter sent to the two agencies overseeing fund distribution: the NTIA (pdf) and FCC (pdf). In the letters, lawmakers profess they’re just super duper worried about the potential for waste:

“Given the billions of dollars concurrently being awarded for broadband infrastructure deployment by several agencies and the Commission, this Office is on the front line of preventing duplicative and wasteful subsidized overbuilding.As you work to allocate grants pursuant to these laws, we urge you to prioritize funding for unserved communities that lack access to any broadband connection rather than funding duplicative or upgraded service in areas that already have broadband access.

Here’s the thing though: House Republicans are defining “access” as just a single ISP offering speeds of 25 Mbps downstream, 3 Mbps upstream. More often they define it as “any broadband at all, however pathetic.” As such, “access” as theses folks envision it could be a single terrible cable company, a single lazy phone company offering substandard DSL, or a single satellite broadband provider offering capped, expensive, slow, high-latency satellite. That’s, well, a monopoly. Lawmakers are being prodded by giants like AT&T to ensure that nobody does much of anything to challenge said monopoly, but it’s framed in such a way as to make it sound as if lawmakers are doing due diligence regarding fraud and waste.

In reality you can focus on shoring up broadband coverage gaps and expanding competition. In fact, these often operate synergistically. We’ve seen time and time again how local competition forces entrenched broadband providers to expand their footprint, lower prices, or offer significantly faster speeds. So by funding and encouraging competition, you technically are also helping to shore up broadband coverage gaps.

While the government is no stranger to waste, most of the waste in telecom has generally come at the hands of the telecom monopolies whose turf House Republicans are protecting here. Countless billions have been thrown at giants like AT&T, Frontier, and Verizon for networks they routinely only half deploy. In the twenty years I’ve covered the sector I’ve lost track of the billions of state and federal dollars given to giant industry incumbents for network upgrades that simply don’t arrive (often with zero meaningful penalty). Notice how it’s rarely a concern if the company getting the money is, say, AT&T.

Yeah, the broadband component part of the infrastructure bill is going to be a massive challenge, in large part because most of the broadband mapping improvements being adopted won’t arrive in time. Entrenched monopolies of course know this, and are busy injecting themselves in the process on both the state and federal level to ensure as much money as possible goes to them, and not potential competitors. Loyal lawmakers want to help them in this process under the performative cover of just being ultra concerned about government efficiency and waste, when in reality it’s all about defending the busted (but very profitable) status quo.

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Comments on “House Republicans Don't Want Infrastructure Money Going Toward Broadband Competition”

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That One Guy (profile) says:

'Wasteful spending like... giving it to Comcast and co?'

Oh the gross dishonesty of telecom industry stooges claiming that they are just super-super worried about wasting taxpayer dollars on community broadband efforts rather then throwing it at the industries who own them and have a record of taking the money and doing the absolute minimum they think they can get away with and pocketing the rest.

If the concern is really about avoiding ‘wasteful subsidization’ then one side of that equation has shown itself to be vastly more wasteful than the other and as such they should be the last companies getting any of that money.

Pseudonymous Coward says:

It's a multi-way bet...

Another reason why AT&T, Comcast et. al. might want to encourage focus on coverage gaps: it hamstrings any new entrants to the market, in turn making it that much less likely that new entrants will appear in the first place.

One of the reasons coverage gaps exist is because some customers are genuinely more expensive to serve than others. Often, but not exclusively, because of accidents of geography and/or history.

But you can bet your life that currently unserved areas are more expensive to serve than the areas incumbent mono/duopolies have chosen to prioritise.

If subsidies are restricted to unserved areas, then any new entrant looking to get a slice of the subsidy pie will be largely restricted to those more-expensive-to-serve customers.

That restricts the entrant’s scope to turn a profit (even if it is more efficient than the incumbents), making it less of a potential competitive threat.

In a best-case scenario for the incumbents, profitability is restricted so much that it’s not worth anyone else actually bothering to bid for the subsidies. And the incumbents then get to hoover them all up.

anonymouse says:

Re: It's a multi-way bet...

In my area(suburbs just outside a techhub city) internet speeds were capped around 100 mbps being delivered per address even though there was fiber at the curb. I started posting publicly on facebook, nextdoor, reddit, and other places covering my locale asking people if they were happy with their internet service and if they would consider a new service from a new WISP provider in the area. Magically, 3 months later I got a sales call from ATT offering their fiber service. I sprung for 200/200 and 3 months after that was upgraded to 1gig/1gig for no additional charge. I have no idea if one begot the other but in the 10 years that I had lived there the speeds only went from 20 to 100 mbps on cable modems and only on doing some public market research did anything change.

Anonymous Coward says:

well duh

-both sides are paid by lobbyist…why don’t people understand this?
-when politicians can no longer get re-elected/selected, they just go work for whichever company was paying them the most while they were in office
if republicans say the earth is round, then democrats will say that it’s flat
wake me when we have congressional term limit$

Anonymous Coward says:

Re: well duh

Term limits don’t help, and are a significant cause of regulatory capture. When the head of a regulatory agency knows they will be looking for a new job in 5 to 10 years, and are regulating the industry they will likely work in, the agencies do an awful job. Similarly, if congress critters are limited to 5 to 10 years, they will do favours for any industry that promises them a future job.

Anonymous Coward says:

Re: Re: well duh

Similarly, term limits will ensure that none of them persist long enough to develop an area of competence. Working arrangements between members will break down (more than they do already), and institutional knowledge (say, about the perfidy of lobbyists) will be lost.

But sure. Vote term limits, if that’s what you like.

This comment has been deemed insightful by the community.
James Burkhardt (profile) says:

Re: well duh

It is expected that $42 billion in subsidies are going to be doled out in the next year. House republicans are writing these letters because they assume the democratic administration will attempt to push for competitive "overbuilding", community broadband, and require higher baseline speeds for buildouts.

The only reason this letter exists is republicans assume democrats aren’t going to listen to the "lobbyist". please try again.

Anonymous Coward says:

more lies from more lying cunts than ever! talk about the fear of being found out that their existing services are some of the worst in the world and the most expensive, it seems these fuckers will throw whatever shit comments they can dream up as being valid to stop the service getting better, cheaper and more reliable , ie, introducing competition!

Anonymous Coward says:

At this point if you are not a wealthy 1% of the US or a massive corrupt grifter, You would be pretty understandably wanting all republicans dead and out of the way of the nation’s attempt to fix anything.

That we have gotten to this point says a lot about how broken we are as a nation. We gave the democrats with their corrupt corporate kowtowing and the republicans who are now little more than extremists composed mainly of various domestic terrorists each nuttier than the last.

cattress (profile) says:

Re: Re:

Republicans love socialism, love it! But, only for those they deem worthy. Like farmers, couldn’t let them suffer from walking away from the TPP and tariffs on China- they vote red.. Like the rich folks who "worked" for everything they have and can trickle piss down to those lazy poor people. Like those needy coal and fossil fuel industries that everyone is so cruel to. And those predatory lenders, if those poor underbanked folks would just get a good paying job, and learn some self discipline and get some financial literacy and how to save money, they could get prime loans if they still needed one…. Socialism for me, not for thee.

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