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Tom Wheeler, the FCC chairman, lamented what he believes is a lack of competition in the broadband Internet industry on Wednesday, while chastising those who aren’t supportive of so-called open-Internet regulations.
“You don’t have a lot of competition, especially at the higher speeds that are increasingly important to the consumer of online video,” Wheeler told attendees of the Internet and Television Expo in Chicago.
“A fully competitive marketplace would bring with it intense and constant pressure to continue to improve — just as it did in the days of cable-DSL competition,” he said. “More competition would be better.”
The commissioner’s speech comes a few months after the FCC declared its intention to basically treat the Internet as a utility, subject to similar “Title II” regulations, impeding a provider’s ability to raise prices on heavy users of broadband such as Netflix. Verizon and AT&T are among those who object to the FCC’s declaration.
“Your principal business is broadband. The service you offer is critically important to all Americans,” Wheeler told attendees. He said that just as competition from cable improved broadcast television, so would Internet access be improved with more competition.
“Your challenge will be to overcome the temptation to use your predominant position in broadband to protect your traditional cable business,” he told the executives. “The Internet will disrupt your existing business model. It does that to everyone.”
Wheeler also explained why the FCC was against the proposed merger of Comcast and Time Warner Cable.
“We recognized that the industry had changed and we saw concrete evidence of the new competition and business models made possible by high-speed Internet access,” he said.
“We recognized that broadband had to be at the center of our analysis and that video was, in essence, an application that flows over networks and that could be supplied both by the owners of facilities and by competitors that use broadband pathways to compete against the owners of those broadband pathways,” he said. “This proposed transaction would not be in the public interest.”
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