Last week, scholars affiliated with AEI’s Center for Internet, Communications, and Technology Policy, submitted comments (0) to the House Energy and Commerce Committee regarding an update of the 1934 Communication Act.
The Committee has been working diligently to solicit public comments through the issuance of white papers. The most recent white paper was released in May 2014 and specifically requested comments on the structure and dynamics of competition in communications markets.
In their response to the Committee’s request, AEI scholars presented empirical evidence of thriving competition in the Internet ecosystem. The level of innovation and investment we have seen this year alone serves as proof that competition is alive and well. Consider that since January 2014:
- Facebook paid $19 billion for WhatsApp, a messaging service that now boasts some 500 million users worldwide and which provides an alternative to traditional telecom text messaging services.
- Amazon launched Fire TV (an even more ambitious upgrade of its Amazon Video service), partnered with HBO GO, and will soon reveal its own mobile device.
- Google announced it will likely build fiber optic broadband access networks in an additional 34 U.S. cities. Google has also said it is launching a new low-earth-orbit satellite constellation, specifically devoted to broadband access.
- AT&T said it will extend its fiber optic broadband networks in 100 U.S. cities. AT&T also announced plans to acquire DirecTV, which would create a combination that could provide even more robust competition in the video distribution market.
- Verizon is replacing all copper wire telephone service in New York City with advanced fiber optics.
- Comcast, Time Warner Cable, and other cable firms announced plans to dramatically expand their use of Wi-Fi to cover ever larger areas with fast wireless access.
- Comcast and Verizon each signed agreements with Netflix, providing for direct connections between their broadband networks and Netflix’s content delivery network. For Netflix, bandwidth costs should go down, and performance should improve. Contrary to much of the commentary, the interconnection and peering markets are wide and deep and, despite one high-profile stand-off, are working well.
The number of options, and the capabilities of those options, is increasing. The continued investments in networks, devices, and services by content and software firms — and investments in content and software by network firms — show that the entire marketplace is growing in diversity and dynamism.
The scholars also resubmitted comments from earlier this year (1), along with two theoretical papers in support of the empirical observations above: “Broadband Competition in the Internet Ecosystem (2)” and “In Search of a Competition Doctrine for Information Technology Markets: Recent Antitrust Developments in the Online Sector (3).”
We applaud Congressmen Walden and Upton for their initiative and hard work, and look forward to following the #CommActUpdate process as it moves forward.