FCC Seems Unwilling to Confront Monopolies to Create Digital Access

Citizen Wealth Financial Justice

New Orleans  In Congressional hearings vetting the President’s nominee, Tom Wheeler, as the new Chair of the Federal Communications Commission (FCC) there seems to be little hope that we will get the progress needed in creating national standards for higher speed internet connections or a reduction of the digital divide. Wheeler was quoted yesterday stating his philosophy that “competitive markets produce better outcomes than regulated or uncompetitive markets.”  Since in the land of Comcast, AT&T, Verizon, and Times-Warner we have monopoly practices and uncompetitive markets, Wheeler seems clueless about the current communications environment, and he would be the person responsible for regulation.  

            Despite our campaign over the last two years to force the FCC and Comcast to finally live up to the FCC’s requirement in their order approving Comcast’s purchase of NBC/Universal that they provide a plan for less than $10 per month for lower income families, they persist in doing the least they can get away with, rather than acting in the spirit of the order.  The FCC seems either powerless or passive in its unwillingness to enforce its order with any enthusiasm despite our complaints.   Toney Orr, Local 100’s Arkansas director, reported that of the 25 customers we turned into Comcast recently, 20 have now received their “internet essentials” program, but that proves my point:  they are not doing outreach to eligible participants, only waving their hands in the direction of lower income families.  If Local 100 does the work, they are happy to lift a little finger, but lord no do not ask them to create a real program with real penetration in the market to reduce the digital divide. 

            Don’t take my word for it.  Read Professor Susan Crawford’s excellent new book:  Captive Audience:  The Telecom Industry and Monopoly Power in the New Gilded Age.   This one sentence on page 266 says everything anyone might want to know about the effectiveness of the Comcast Internet Essentials offering or the even lamer “voluntary” promises from Cox Cable and Times-Warner to provide lower cost access to low income families:

“Voluntary services from private carriers are costly gifts that do little to move the country forward.”


Earlier in the same paragraph Crawford is even clearer about the whole challenge:

“Moving from a high-speed Internet access model based on overcharging rich, urban residents for bundles of services while letting the state subsidize slow access for poor or rural residents to a model based on the assumption that America requires fast, standard, reliable, and unbundled fiber-optic Internet access at reasonable prices will present many challenges…government intervention is necessary to ensure unfettered competition.”

Crawford makes an excellent, irrefutable case that Comcast, AT&T, and others are simply operating now as monopolies with the sycophantic assistance of the FCC and too many in Congress are allowing them to do it.  In the name of their own profits and business model these companies are retarding America’s economic growth and competitive position around the world.  She states the obvious:  the internet and telecommunications are utilities like water and electricity.  As such they are necessities that need to be regulated in the same way, and that’s not happening now.

Unfortunately every word that came out of Wheeler’s mouth in his nomination hearing indicates that he is a captive of the monopolies and absolutely doesn’t get it!  We have trouble ahead of us.