October 10, 2013
Once again Holman Jenkins offers terrific insight into the dynamic broadband marketplace, highlighting the true forces driving investment (competition) and the forces holding back progress (outdated regulations). Referring to Google’s much-celebrated fiber investments in key cities Jenkins observes in the Wall Street Journal:
“Google’s real innovation was to tunnel under the regulatory morass that inhibits physical broadband deployment. Why is Google introducing Google Fiber in Kansas City and not its native California? Google’s own Milo Medin has explained repeatedly that regulatory brambles make California ‘prohibitively expensive.’”
Jenkins turns to the FCC’s failure to launch reasonable proposals to allow carriers to shift investment from older technologies carrying increasingly less traffic, to newer technologies carrying an exponentially growing volume of voice, video and data. The need for modernizing our regulations becomes even more critical when one reads a study authored by Dr. Anna-Maria Kovacs, a visiting scholar at Georgetown’s Center for Business and Public Policy. Dr. Kovacs’ analysis estimated that incumbents telcos spent a total of $154 billion on their communications networks, with more than half maintaining fading legacy networks that carry less than 1 percent of all data.
While so much else is crippled by Washington paralysis, broadband deployment should be freed.