How competitive is the telecom/DSL industry?

FCC looks to gauge competition level between telecom carriers; big guys say it’s all good, little guys, not so much, reported by RCR Wireless, the Federal Communications Commission is taking comments for its Mobile Wireless Competition Report.

For instance, dominant carrier Verizon Communications in a filing with the FCC said, “The United States has the world’s most vigorously competitive and innovative mobile market, as demonstrated across virtually every metric.”

Verizon reps point out that consumer price index specific to wireless has dropped 5.1% in the last year; data usage continues to increase indicative of growing demand; and domestic service providers continue to spend big bucks on network investments.

On the other side of the coin, the Competitive Carriers Association, a consortium of small, rural and independent operators, relayed to the FCC its concern that “the mobile wireless industry is not effectively competitive.”

Source: Quexor Group

CCA President Steven Berry said the telecom industry has seen an “alarming amount of market consolidation by the two largest carriers [Verizon Wireless and AT&T Mobility]. The long term sustainability of a competitive wireless marketplace remains in jeopardy. Consolidation has only increased, exacerbating the disparity between AT&T and Verizon, on one hand, and all other carriers on the other.”

Berry specifically pointed out that AT&T and Verizon’s dominance has allowed the two carriers to acquire more spectrum than competitors effectively “strengthening their position as a duopoly in the marketplace.” He urged regulators and policymakers at the FCC to ensure access to spectrum and reasonable roaming agreements, among other suggestions.

CCA’s position was consistent with that expressed by the Rural Broadband Association, which polled its members to better articulate the perceived state of competition.

From its filing: “Consumers in rural areas see advertisements of national carriers and expect their local providers to offer the same prices, the same handsets and the same nationwide service as the large carriers. Despite some lessening of exclusive agreements between handset manufacturers and the largest providers, small carriers still report having difficulty obtaining the newest handsets and are thus at a severe competitive disadvantage.”

Back to the other side of the debate, AT&T’s filing posits that “as any casual observer can attest, competition has gone into overdrive. Mobile providers are competing fiercely on price, offering a wide variety of new data plans and promotions such as shared data plans, equipment installment plans, and offers aimed at providing incentives for customers to switch carriers.”

The FCC’s Wireless Telecommunications Bureau opened the comment period on May 29 with an end date of June 29. Now, with initial comments filed, stakeholders have until July 14 to file any replies.

Source: RCR Wireless

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