Lately, our cell phone provider has been sending us messages telling us that we are reaching our covered monthly limit on our internet usage. And the culprits tend to be our kids who forget to turn on their WIFI on their cell phones to watch You Tube or Netflix. Truth is there are a limited number of providers for broadband service and so prices continue to rise. Cable operators have done the best job of delivering high speed broadband service across a majority of the nation. Telephone companies have managed with DSL service but it doesn't deliver the same speed as cable. In some markets, FIOS and U-verse have overbuilt larger cities with alternative high speed service, many with fiber right to the home. And some regional providers like RCN, WOW, and other also offer cable, broadband, and phone.
But newer competition is rare. The biggest entrant so far has been Google Fiber, starting first in Kansas City and expanding into a few other markets. After that you have cell phone companies with data plans that get quickly used up on video consumption. I know from firsthand experience. Their speed is also no match to cable yet but the hope is that they can become a better provider.
Today, broadband, like food, water and shelter, is being treated very much like a utility and so the government seems determined to regulate it as one. Hence the vote today by the FCC to reclassify broadband service as such and assure that that all content delivered across the internet is delivered identically, whether a video stream or email message. That is net neutrality. But the concern of big government regulation in business is that it limits new entrants, innovation, and disruption.
Consumers have very little choice in deciding what broadband service provider to use. Where we live determines who is capable of supporting us. Cable operators still strike franchise agreements to exclusively cover cities and towns. More competition is needed. New spectrum needs to be opened up. Investments in technology to increase speed and capacity should be encouraged. Net neutrality laws may seem like a short term fix but not a long term solution. And as we continue to become a more connected universe, it is the long term that is more at stake.