Light Reading

Carriers Respond to FCC's Competition Concerns

Sarah Thomas
5/21/2010
50%
50%

It wasn't what the Federal Communications Commission (FCC) 's massive annual report on the state of the wireless industry said that has wireless operators up in arms; it's what it didn't say. The 308-page report heralded the successes of the industry, but for the first time, did not conclude that it is competitive.

To support its omission, the FCC pointed out that since 2003, market concentration has increased by 32 percent. It never came out and called the market uncompetitive, but focused instead on the fact that 60 percent of the nation's subscribers and revenue come from AT&T Inc. (NYSE: T) and Verizon Wireless . They continue to gain subscribers, while Sprint Corp. (NYSE: S) and T-Mobile US Inc. continue to bleed them. (See T-Mobile Hangs Growth Hopes on HSPA+ in US, Sprint Pins Hopes on WiMax Phone, AT&T Stays Mum on Tiered Mobile Data Pricing, and Verizon Reports Q1.)

The report included a number of interesting charts depicting various aspects of the wireless industry and competition, but also demonstrated there's a number of ways to define competition.



For that reason, the FCC was careful to just present the data and break down the different wireless service inputs, including spectrum, backhaul, handsets and mobile applications, but the wireless operators were equally as careful to quickly present their own definitions of competition.

Wireless industry wards off regulation
CTIA president and CEO Steve Largent sided with AT&T and Verizon, highlighting the industry's investments as evidence of competition. This included the $44 billion that the US wireless industry invested in networks and spectrum in 2008, which, Largent said, was significantly more than Germany, France, Italy, Spain, and the UK combined invested.

"We are very concerned, however, about the potential misuse of 'policy levers' that are referenced in the Report and believe that any attempt to add regulation to wireless as a result of this Report would be both misguided and harmful to consumers," Largent wrote on the CTIA blog.

Both Kathleen Grillo, Verizon senior vice president of federal regulatory affairs, and Robert Quinn, AT&T senior vice president of regulatory affairs, pointed out that the FCC has agreed with them for the past six reports and that reports of consumer satisfaction back up the competitiveness in the market. They also cited innovation in smartphones and applications as evidence of a competitive market. Quinn called the report "disappointing" and even "baffling" for contradicting its own evidence that the market is "working, delivering choices and value."

"For six successive reports, the FCC has confirmed what is obvious to any consumer who watches television, walks down a busy main street or reads a newspaper -- that the wireless market is intensely competitive, with new choices in services, applications, and devices available almost weekly," Quinn wrote.

Sprint was the only one that deviated from its larger competitors, applauding the FCC's recognition of the competitive environment. A spokesman defended Sprint's stance in his blog, cautioning that "you need to remember who owns Verizon Wireless and AT&T Mobility -- landline companies who benefit greatly from the current regulatory system."

A T-Mobile spokeswoman only deferred to the CTIA's canned comments on the matter.

Is regulation imminent?
The FCC has taken a more active interest in the wireless industry than past bodies that just rubber-stamped completion, says Craig Settles, CEO of broadband consultancy Successful.com. Chairman Julius Genachowski has been pushing for net neutrality regulation, which he believes should encompass wireless. (See FCC Chairman Defends Calls for Net Neutrality.)

The industry, meanwhile, continues to fight back against this, claiming that spectrum limitations exempt them from the rules of wired networks. As is clear in their rebuttals and definitions of competition, AT&T and Verizon fear they will be denied access to the multi-billion dollar spectrum auction planned for the end of next year. (See FCC Opens Up 25MHz in 2.3GHz Band.)

"If there wasn't the threat of net neutrality, this report would not raise as much concern and consternation in the industry as it has," Settles says. "But, because they know net neutrality is on the horizon -- they know there's a bunch of ticked-off customers driving this move toward net neutrality -- they are going into spasms. They view this thing as, if there's not competition, they will be regulated. That's straight direct line in their mind eyes, so they put forth all these talking points."

[Ed. note: This article is part one of a two-part series. Coming next: "Defining 'Competition.'"]

— Sarah Reedy, Senior Reporter, Light Reading Mobile

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Flash Poll
From The Founder
The Swedish vendor has undergone a significant transformation during the past few years, adjusting to the demands of next-generation communications companies.
LRTV Documentaries
The 3GPP's Road to 5G Standardization

4|17|15   |   4:43   |   (0) comments


Satoshi Nagata, chairman of the 3GPP's TSG-RAN group and a manager at NTT Docomo, explains the standardization process for 5G, as well as the biggest challenges and opportunities.
LRTV Documentaries
AlcaLu CTO Makes the Case for a New 5G Air Interface

4|16|15   |   3:54   |   (0) comments


Michael Peeters, CTO of wireless at Alcatel-Lucent, explains why 5G will require a new air interface to meet its diverse performance targets.
LRTV Documentaries
AlcaLu + Nokia: The New Uber-Vendor

4|15|15   |   2:42   |   (4) comments


Heavy Reading Senior Analyst Gabriel Brown discusses the technological and competitive opportunities and challenges if a merger between Alcatel-Lucent and Nokia comes to pass.
LRTV Huawei Video Resource Center
Huawei's Data Center Power Play

4|15|15   |   6:22   |   (0) comments


Huawei has developed industry-leading energy efficiency capabilities for its indoor and outdoor data center solutions, explains Dr. Fang Liangzhou, vice president of Huawei's Network Energy product Line.
LRTV Huawei Video Resource Center
Huawei’s Routers, Switches Get the Green Mark

4|15|15   |   2:02   |   (0) comments


TUV Rheinland's Frank Dudley explains how Huawei's routers and switches have been successfully tested by energy efficiency experts and have gained Green Mark Certification.
LRTV Documentaries
A Finn, a Frenchman & a Guy From New Jersey Walk Into a Merger...

4|15|15   |   3:17   |   (0) comments


Stop us if you've heard this one before... Light Reading CEO Founder & CEO Steve Saunders weighs in on the technical and cultural implications of a Nokia and Alcatel-Lucent merger.
LRTV Huawei Video Resource Center
Accounting for Better Solutions

4|10|15   |   02:31   |   (1) comment


Murad Yousuf, CTO at Saudi Arabia's Ministry of Finance (Dept. of Zakat & Income Tax), talks about the benefits of deploying router technology from Huawei.
LRTV Huawei Video Resource Center
What's in Store for Huawei & DataCore?

4|10|15   |   05:44   |   (0) comments


At the CeBIT trade show in Hannover, Germany, George Teixeira, CEO of software-defined storage (SDS) specialist DataCore Software, explains why he has just signed a partnership agreement with Huawei Technologies.
LRTV Huawei Video Resource Center
Du Puts Its Faith in Huawei's Routers

4|9|15   |   3:42   |   (0) comments


Adnan Masood, director of Enterprise MS Solutions Marketing at du, the United Arab Emirates (UAE) operator also known as Emirates Integrated Telecommunications Company, explains why his company chose to use Huawei's multifunctional AR routers as part of its managed enterprise services.
LRTV Huawei Video Resource Center
Huawei Gets Active in the Data Center

4|9|15   |   3:17   |   (0) comments


With enterprise users looking to maximize the use of their data center assets, Huawei’s Chief Architect & Technical Director of IT Data Center Solutions, Bruce Su, explains how the company's six-layer active-active data center solution is eradicating the need to deploy passive, redundant data center assets.
LRTV Huawei Video Resource Center
Blue Consult & Huawei for a Better Solution

4|8|15   |   4:01   |   (0) comments


Martin Rott, CEO, and Marc Metzler, head of sales virtualization, from Germany's Blue Consult discuss their collaboration with Huawei and TrendMicro to develop a secure, scalable IT platform that can meet the needs of the most demanding enterprise users.
LRTV Huawei Video Resource Center
Beach Petroleum on eLTE & Mining

4|8|15   |   3:09   |   (0) comments


Network systems integrator Jeremy Hamlyn explains how Huawei's secure packet-based trunking communications system, eLTE, can help remote communities and companies in the mining, oil and gas sectors, deploy efficient communications networks that are perfect for video and data as well as voice.
Upcoming Live Events
May 5, 2015, Hyatt McCormick Place, Chicago, IL
May 6, 2015, Georgia World Congress, Atlanta, GA
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
November 11-12, 2015, The Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
Network Instruments, a JDSU division, shares results from its 2015 State of the Network, a global survey on security.
Hot Topics
Verizon Scores New OTT Content Deals
Mari Silbey, Independent Technology Editor, 4/16/2015
Can WiFi Calling Find Its Voice?
Iain Morris, News Editor, 4/13/2015
Senator Proposes New 'Title X' for Net Neutrality
Carol Wilson, Editor-at-large, 4/13/2015
Nokia, Alcatel-Lucent in Merger Talks
Iain Morris, News Editor, 4/14/2015
Nokia & Alcatel-Lucent: What's Going On?
Ray Le Maistre, Editor-in-chief, 4/15/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Data Center Interconnect, or DCI, is one of the hottest sectors in telecom currently. Since coming back to Light Reading last year, prodigal-son style, I've ...
LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures.
Cats with Phones
Steve's Phone Click Here
Steve Saunders's personal phone.