This Thursday in its monthly public meeting, the FCC will consider — as it does each year — the state of competition in the wireless marketplace. It is an important assessment and one that merits a cold, hard look — as the new FCC is wont to do — at the underlying facts and data.
Here are some of the key facts about the American wireless marketplace:
Our nation currently is home to the world's lowest per-minute voice prices, largest 3G customer base and most innovative and voluminous applications and device markets. More than nine out of 10 Americans have mobile devices. One in four of us favor them so much that we left our landline telephone service in the last century. Two-thirds of us have a choice of five or more wireless providers and a range of plans from family discounts to pre-paid, no contract options to "all in" voice, data and texting for as little as $50 a month.
By any measure — from the number of facilities-based competitors to the market share of individual companies — U.S. consumers enjoy the most competitive wireless marketplace on earth. Turn on your radio, your TV or open your newspaper and you plainly see compelling evidence of vibrant competition and consumer choice.
A quick glimpse at the frenetic pace of this growth more than proves the point. Verizon and Google have gone public with their ambitions to challenge the AT&T/Apple iPad alliance. HP, Dell and others are also in hot pursuit. Cox is becoming the first U.S. cable company to offer wireless services directly to consumers and businesses. Regional players like Leap Wireless and MetroPCS are thriving. T-Mobile has vowed to deliver the fastest available speeds across its 3G footprint by year's end. Sprint is prepping the launch of its Evo 4G device, the first to run on its much-heralded 4G network. And, the FCC's recent approval of the Harbinger-Skyterra merger promises the emergence of a fifth national wireless player.
With so many choices, Americans can afford to be among the most communicative in the world, spending more than six billion minutes each day on their mobile phones and sending five billion daily text messages.
Importantly, the competition and consumer choice extends well beyond service providers. America is home to more than 240,000 mobile applications and at least seven competing applications stores. At the Apple App Store alone, more than three billion applications have been downloaded since its launch less than two years ago.
The U.S. is the envy of the mobile innovation world for the robust nature of our networks and the diverse array of consumer choices in devices, applications and service options.
While the FCC urges substantial reforms on multiple fronts, it would be judicious for the Commission to point out where the marketplace is working. Audiences from consumers to policymakers to Wall Street are actively speculating as to how broad or restrained the FCC's new regulatory push ultimately will be — and the potential impact for better or for worse from jobs and economic recovery to innovation and investment. Drawing a bright white line by affirming that competition is clearly working in wireless would offer a reassuring distinction amid a potential tangle of new red tape.
If the Commission aims to make good on its promise to advance a competitive, innovative and consumer-powered marketplace, now is the time and this week's mobile competition report is the place to make clear the upper limits of its regulatory ambitions.
This article was originally published on Huffington Post on May 19, 2010.
A new report by economist Coleman Bazelon at The Brattle Group and sponsored by Mobile Future takes an empirical look at the potential impact proposed Network Neutrality regulations could have on jobs in the broadband sector and jobs growth in the U.S. The paper, "The Employment and Economic Impacts of Net Neutrality Regulation: An Empirical Analysis" makes several key findings including:
Revenue growth in the broadband sector could slow by about one-sixth over the next decade;
Broadband sector jobs lost could be expected to total 14,217 in 2011, growing to 342,065 jobs by 2020;
Economy-wide, 65,404 jobs could be put in jeopardy in 2011, with the total economy-wide impact growing to 1,452,943 jobs affected by 2020.
These numbers are particularly troubling to innovators in the mobile space which is expected to experience the most broadband growth over the next decade.
Heading into the mid-term elections, these are divisive times in the nation's capital. But today Washington witnessed a rare moment of comity, as the Federal Communications Commission released its much-anticipated National Broadband Plan. All five commissioners signed a joint statement embracing the broad objectives of the plan.
It will take days, if not weeks, for the various stakeholders to fully digest a blueprint of this ambition and scope. But before the detail-oriented debates ensue -- and the inevitable divisions emerge -- it's worth taking a moment to step back and offer an appreciation of the process that got us to this potentially historic day.
President Obama was elected on the promise of inclusive and connected government. In crafting this plan, the FCC offered a compelling model of how that gets done. The efforts of Chairman Genachowski and his broadband team have been exceptionally open. The three dozen policy workshops on topics ranging from civic engagement to connected health were webcast live and archived online, allowing ample opportunity for citizen engagement. Several dealt exclusively with the potential of mobile broadband, ranging from thoughtful debates on spectrum to discussions of bleeding-edge applications and wireless deployment. Commissioners also reached outside the beltway, holding nine field hearings throughout the country to bring diverse perspectives into the conversation.
As for the product itself, I am heartened that the Commission recognizes the critical role wireless technology can play to spur global competitiveness, innovation and sustainable job creation. Profoundly significant to mobile consumers and innovators alike is the vow to free up 500 megahertz of wireless spectrum. This is essential progress to support the boom in connected devices -- from the iPhone to the Kindle to mobile medical tablets, digital textbooks and future innovations yet to be imagined.
Other regulatory proceedings that may flow out of the plan could be more polarizing. The depth of division and passion on both sides of the net neutrality regulatory debate is well-known. And, the rumors of an attempt to overturn the Supreme Court's landmark Brand X decision, which essentially upheld the privatized nature of U.S. broadband networks, would likely make the net neutrality debate look like a walk in the park.
Likewise, narrower proposals to create new rules -- whether to impose wholesaling requirements or mandate the provision of "free" broadband services -- would affect many aspects of the already intensively competitive and innovative wireless market and could actually undermine the very laudable objectives of the national broadband plan. The FCC must resist these extreme calls and tread carefully to avoid disrupting an American industry that leads the world and is working extremely well today.
Among the cornerstones of the plan is a 'shoot for the moon' goal of connecting 100 million U.S. households to 100 megabits per second broadband service over the next decade. Goals of this ambition require an unshakeable policy foundation that is unequivocally supportive of investment. This means the many rulemakings that likely flow out of this plan must be cohesive in nature -- pulling in the same constructive and unifying direction and staying true to the Chairman's early and firm commitment to fact-based, data-driven decisions.
As we look to the future, I hope the Chairman remains steadfast in his commitment to encouraging a wireless ecosystem that can fundamentally transform our society and our economy. As we begin the long and hard process of translating bold ideas into concrete, attainable and constructive actions, the hard work is yet ahead. It is my hope that we stay true to this open and participatory process and keep in sight the larger goals of advancing deployment, accelerating investment and promoting genuine competition.
History will judge this plan on its effectiveness. If it does so favorably, a nod is due to the process that got us to this day. It's a famous old adage in Washington that you don't want to see the sausage being made. But thanks to the very innovation we unite today to celebrate and advance, a new era of openness and participatory government has arrived.
Jonathan Spalter, chairman of Mobile Future, has been founding CEO of leading technology, media, and research companies, including Public Insight, Snocap, and Atmedica Worldwide. He served as an advisor to and spokesperson for Vice President Al Gore during the Clinton administration. www.mobilefuture.org.
100 megabit per second connections to 100 million homes.
No question that FCC Chairman Julius Genachowski laid out an ambitious goal this week for nationwide, affordable broadband. Leaving the details aside for the moment, the underlying concept is important: As Mobile Futureconsistently has repeated in this blog, all who care about mobility in the US should agree with Chairman Genachowski, about the urgent need to expand wireless capacity so that mobile users continue to have a good quality of service.
As he said only two months ago:
“There may be no greater spur to America's global competitiveness than getting this right. The record contains powerful evidence that the demand on our commercial mobile spectrum is on a course to outstrip the supply.”
Julius’ pledge, though ambitious, is vitally important. But its implementation also will be very expensive.
To effectively walk his talk, the National Broadband Plan he will be submitting shortly to Congress will need to include coherent and practical policies that actually encourage America’s wireless build-out, and enable the considerable private sector investment needed to support it.
The numbers speak for themselves: More than $300 billion invested in wireless during the past 25 years. And according to NY Times tech columnist Randall Stross, even in an urban setting, a typical wi-fi deployment cost in an urban area runs $75,000 to $125,000 per square mile just to install the equipment. The FCC itself as estimated that some $350 billion in new investment will be required to achieve our nation’s broadband goals.
The Chairman has identified a crucial need, and has offered a bold vision for meeting it. Now the pressure’s on for the FCC – and all of us who care about our mobile future -- to work together in creating innovative policies that will help solve that problem rather than exacerbate it.
CNN has an interesting commentary from Larry Rosen, Cal-State psychology professor and author of a new book which explores how Americans of different generations approach new technology.
Rosen cites a recent Neilsen Mobile survey showing that from 2007 to 2009, the number of texts sent by the average teen increased by more than 600 percent. “If you have a teenager (or even a preteen),” he writes, “You must learn how to text, or you two will never ‘connect.’”
More generally, he says, America’s youngest two generations “are defined not by a letter or by their birth year but by their use of technology and media, their need and ability to multitask, their rapid acceptance of anything new and their view of the meaning of technology.” Any way you look at this, it means more texts, more social networking, more streaming videos – increasingly on a mobile network.
The San Francisco Chronicle recently published an op-ed by Mobile Future Chairman Jonathan Spalter outlining the rapid growth of wireless and the need for sound public policy so that innovation and investment will continue.
As wireless connectivity takes on an even more central role in our economy and our society, we must acknowledge that we have come so far, so fast primarily because of the decisions of consumers and the vision of innovators, rather than the interventions of government. There is so much potential still to unleash, if we chart a constructive and balanced path forward.
Today, Mobile Future released a new report assessing the implications of potential network neutrality regulations on wireless consumers and the networks which support them.
The report, "Net Neutrality Regulatory Proposals: Operational and Engineering Implications for Wireless Networks and the Consumers They Serve,” provides an important technical perspective on the impact net neutrality regulatory proposals will have on the wireless services consumers demand and operators provide. Find out more about the release and read the report.
Last Friday ushered in the holiday shopping season, and while
consumers were clamoring for the best bargain, this year they had a new
tool in their artillery - their cell phone.
With an array of smartphone choices from the Palm Pre to the iPhone,
several new Blackberry models, and the Droid - never before have
Americans had so many options at their disposal. That's not to mention
the proliferation of retail m-commerce sites, and applications that can
help you navigate stores, compare prices and even send coupons straight to your mobile phone. For customers, cell phones have become the ultimate aid in savvy shopping.
The Wall Street Journal reported that on Black Friday, "mobile online payments through PayPal surged 650%" and mobile searches grew to 200,000 from around 5,000 in 2008.
This is good news for retailers, but more importantly it signals that
2009 is likely to be seen as a tipping point for the mobile web.
Today, nearly 40 percent of new phone sales are smartphones, a
figure that will surely rise with the current holiday promotions. And a
recent report projects that by 2011 a majority of phones in the U.S.
will be connected smartphones that put PC-like functionalities in the palm of your hand.
"[S]martphone users are no longer just reading e-mail or
scheduling appointments but also surfing the Web, streaming video and
music, downloading games, and snapping pictures. Smartphones are now
seen more by consumers as minicomputers than as cell phones."
This is a giant step forward for U.S. connectivity and greatly
beneficial to American consumers, but it also raises key questions for
federal policymakers.
With the surge in smartphone adoption and mobile web usage, wireless data traffic in North America is expected to double every year between 2008 and 2013.
If this forecast holds true, it means that we are facing what FCC
Chairman Julius Genachowski calls a 'looming spectrum crisis.' The FCC
needs to take action by opening up new wireless spectrum. Thankfully,
Chairman Genachowski recognizes this challenge and is taking steps to
address it.
However, as we witnessed with the last auctions, the path to
spectrum allocation can be a lengthy and bureaucratic process, and
consumers also need more immediate solutions. Wireless network
management helps ensure as seamless a consumer experience as possible,
no matter how busy the wireless networks become. As we seek solutions
to address exponentially increasing mobile usage, we should keep in
mind the constructive policies and engineering practices that made this
growth possible in the first place.
As evidenced this Black Friday, wireless innovation is working for
America. When considering policy changes, the FCC must first do no
harm. Government policies should support mobile's still-nascent
potential and growth, but consumer choices and mobile innovation should
guide wireless' bright future.
The Mercury News in Silicon Valley recently published an op-ed by Mobile Future Chairman Jonathan Spalter. The piece outlines the potential pitfalls from the FCC's recent announcement to extend net neutrality rules to the wireless world.
For the 200 million Americans who increasingly rely on their mobile phones to manage their connected lives, this subtle rule change could have a raft of unforeseen consequences, say many mobile operators and the labor unions who work with them. These could include a slowdown in investment, job cuts and worse.
Mobile Future Chairman Jonathan Spalter just published a Huffington post entry that discusses the wireless catch 22 of extending proposed net neutrality rules to the wireless industry at a time when we are facing a looming spectrum crisis.
With mobile data traffic growing at 100 times the rate of wireless voice traffic, a serious supply-demand imbalance is headed our way - one that can only be relieved by government leadership to make more spectrum available to keep pace with consumer demand. The technological and policy quandary? How to address this profound and pressing national need, while at the same time asserting that we have to potentially make the crisis worse by fixing these fast-evolving networks with what are widely viewed as unworkable engineering mandates.
What's the solution - long-term strategies and data-driven decision-making. Read more about Jonathan's suggestions in the article here.
Mobile Future Chairman Jonathan Spalter just published a Huffington Post entry that discusses the wireless catch 22 of extending proposed net neutrality rules to the wireless industry at a time when we are facing a looming spectrum crisis.
With mobile data traffic growing at 100 times the rate of wireless voice traffic, a serious supply-demand imbalance is headed our way - one that can only be relieved by government leadership to make more spectrum available to keep pace with consumer demand. The technological and policy quandary? How to address this profound and pressing national need, while at the same time asserting that we have to potentially make the crisis worse by fixing these fast-evolving networks with what are widely viewed as unworkable engineering mandates.
What's the solution - long-term strategies and data-driven decision-making. Read more about Jonathan's suggestions in the article here.
Mobile Future Chairman Jonathan Spalter just published a Huffington Post entry that discusses the wireless catch 22 of extending proposed net neutrality rules to the wireless industry at a time when we are facing a looming spectrum crisis.
With mobile data traffic growing at 100 times the rate of wireless voice traffic, a serious supply-demand imbalance is headed our way - one that can only be relieved by government leadership to make more spectrum available to keep pace with consumer demand. The technological and policy quandary? How to address this profound and pressing national need, while at the same time asserting that we have to potentially make the crisis worse by fixing these fast-evolving networks with what are widely viewed as unworkable engineering mandates.
What's the solution - long-term strategies and data-driven decision-making. Read more about Jonathan's suggestions in the article here.
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Tags: AT&T, Competition, FCC, Genachowski, Huffington Post, Net Neutrality, Verizon, Wireless Innovation