[1st-mile-nm] ITIF Broadband Policy Paper and Forum

[Richard Lowenberg]

A new paper from the ITIF's Rob Atkinson,
and a link to papers and presenters from their recent forum,
"Building the Broadband Economy and Society: A Forum"
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"The Role of Competition in National Broadband Policy"
Rob Atkinson,
Information Technology & Innovation Foundation

www.itif.org/index.php?id=87

There is perhaps no issue more central to the debate about broadband
policy than the state of and role of competition. Indeed, the issue of
competition drives many of the debates over broadband, including net
neutrality, wireless spectrum auctions, municipal broadband, and
unbundling proposals. Although some advocates claim that the current state
of broadband competition is more than adequate, others decry market
conditions and seek proactive public policies to spur more competition.
Yet almost everyone involved in broadband policy in the United States
agrees that regardless of the current state of competition, more
competition is better. The stated reason is that more competition leads to
lower prices, higher speeds, broader deployment, more innovation, and
better customer service.

Yet, the Washington consensus in favor of more broadband competition
ignores the fact that broadband displays natural monopoly or duopoly
characteristics. Because of the nature of the broadband industry, there
are significant tradeoffs between more competition and goals of
efficiency, innovation, low prices, and higher speeds and broader
deployment. Thus, it's a mistake for policymakers to assume that if they
simply push the competition lever, all the problems with broadband policy
will be solved. Some problems will recede, but others are likely to
emerge. The bottom line is that if policymakers want to maximize not only
societal welfare but also consumer welfare, they must balance the push for
more competition with the need to maintain and create an efficient
broadband industry structure.

This paper starts by reviewing the affordability of broadband in the
United States. It then postulates two starkly different views toward
broadband competition: the engineers' view and the economists' view.
Finally, it reviews the four main policy options toward broadband
competition: 1) keep the same number of pipes; 2) spur the deployment of
more pipes; 3) force incumbents to open up existing pipes to competitors,
and 4) regulate duopoly pipes. Although each policy track will achieve
some benefits, each also brings with it costs and risks. Policymakers need
to balance the desire for more competition to enhance consumer welfare in
the broadband realm with the need for the most efficient broadband
industry structure.

Read the full text of this report (PDF)

Related Links:
"Building the Broadband Economy and Society: A Forum"
October 19, 2007

See video and other details from recent ITIF Forum.


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Richard Lowenberg
P.O.Box 8001, Santa Fe, NM 87504
505-989-9110,  505-603-5200 cell

New Mexico Broadband Initiative
www.1st-mile.com/newmexico
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