Scott Wallsten, who was Chief Economist of the US Broadband Plan, has just published Does Competition Between Cable and Fiber Increase Adoption? His conclusion:
the data shows [a second carrier] won’t bring down prices on the low-income end given that that’s the place we would get new adoption. … broadband adoption, all else equal, is not higher in tracts with cable and fiber providers than it is in tracts with only a cable provider or only a fiber provider.Wallsten
Comcast demonstrated how low prices can increase demand. The obvious explanation why adoption didn’t go up is two carrier markets have pretty much the same prices as pure monopolies. US cableco charge the same prices whether or not they have to compete with fiber.
For the last 15 years, I’ve watched cablecos and telcos raise prices in lockstep, generally at 3-5% per year. Ajit Pai became FCC Chair with a promise to bring down prices but instead saw an increase of 10%-20%, depending on what you measure,.His advocates answer back that prices had also gone up under his Democratic predecessor, Tom Wheeler.Continue reading