What Competition Means

Over on his blog Maximum Entropy, Bret Swanson (who is one of our Broadband Ambassadors) digs in to the FCC’s latest Wireless Competition Report:

Each year the Federal Communications Commission is required to report on competition in the mobile phone market. Following Congress’s mandate to determine the level of industry competition, the FCC, for many years, labeled the industry “effectively competitive.” Then, starting a few years ago, the FCC declined to make such a determination. Yes, there had been some consolidation, it was acknowledged, yet the industry was healthier than ever — more subscribers, more devices, more services, lots of innovation. The failure to achieve the “effectively competitive” label was thus a point of contention.

This year’s “CMRS” — commercial mobile radio services — report again fails to make a designation, one way or the other. Yet whatever the report lacks in official labels, it more than makes up in impressive data.

For example, it shows that as of October 2012, 97.2% of Americans have access to three or more mobile providers, and 92.8% have access to four or more. As for mobile broadband data services, 97.8% have access to two or more providers, and 91.6% have access to three or more.

Swanson goes on to point out that the problem with the FCC not taking a stance on whether the wireless industry is competitive may have more to do with the definition of competitive:

The industry has grown so large, with so many interconnected and dynamic players, it may have outgrown Congress’s request for a specific label.

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