Unlocking Set Top Box Won't Come Quickly

So the FCC agrees that it is time to let consumers choose which box they want to use to access their cable TV programming.  Good news for TiVo, bad news for cable operators making tons of dollars by "renting" their cable boxes to subscribers.  But don't expect that the FCC vote means anything changes anytime soon.  According to Multichannel, an addition vote won't come til Spring at the earliest.  And then it will take time to implement.

As Multichannel tells us, that could take another 3 years if not longer.  Of course cable operators may simply take the fight to the courts, delaying the start for more years.  Till then, some cable operators have already enabled TiVo as an alternative cable box, others have not.  Some allow a CableCard to unscramble signals but limit the boxes ability to use all the features, notably on demand.  The bottom line, the unlocking of the cable box is many, many years away. 

NAB Wants To Leverage Merger To Reform Broadcast Rules

The National Association of Broadcasters (NAB) hopes to gain rules reform for broadcast ownership by tying its attempt to the Charter -Time Warner Cable merger efforts.  And the NAB hopes it has some leverage to suspend merger talks till it gets its own reforms.  While the link may not be apparent, the need for new rules is.  Still, it is unlikely that the FCC will pay attention to such a move.

Consolidation in the cable industry makes sense, especially given the connectivity issues to create efficiency for wire and wireless speed and usage.  Separately, broadcast ownership rules should also be reviewed given the changing relationship between broadcaster and viewer.  The rise of broadband applications have created new opportunities that compete head on with broadcasters. 

So if the NAB feels the need to argue for more reforms given the changing landscape, they should.  But their argument should in no way be linked to what the FCC is reviewing to allow Charter and Time Warner Cable to merge. 

An Apple TV Subscription Service

Yesterdays announcement of the Comcast Stream OTT service for cord cutters to get some TV networks and more, may be more a defensive strategy.  Not just against the increasing loss of cable subscribers to cord cutting, but to the rise of competitive OTT services.  While Sling TV does not offer broadcast nets and TabletTV relies on a digital antenna to capture OTA digital broadcast nets, the real competitor has yet to announce. 

Many outlets have been reporting that Apple is successfully negotiating broadcast network and affiliate deals for local broadcast market channels.  That means a person living in Des Moines would get their local ABC affiliate while the person in Syracuse would get their local ABC network.  With deals being finalized, Apple is said to have the platform ready to go to give consumers a low cost streaming line-up of channels for access across all devices.  It just may be that Comcast knows more of Apple's streaming plan as a result of its ownership of the NBC Broadcasting Network.  And knowing that NBC has FCC requirements to force it to follow what other broadcasters agree to may be why Comcast has announced its Stream service quickly.  Apple may make its own announcement later this Fall per The New York Post. 

The days of jiggling an antenna on the roof to get best signal quality may be decades behind us; still, the transmission of TV signals continues to improve dramatically.  The rise of streaming enables more interactive options, more screen choices, more flexibility, and perhaps more revenue opportunities too.  And Apple could change the very notion of what a cable franchise once meant.

Approval Expected For AT&T - DirecTv Merger

According to reports, the FCC will be approving the merger of AT&T and DirecTv sometime next week. While it has been more than a year since its announcement, the need for the FCC to first address the Comcast bid for Time Warner Cable likely was a factor in moving forward with this acquisition.  Still, little seems to be in the way for a new AT&T/DirecTv to begin.

Certainly next on the FCC plate is Charter's bid for Time Warner Cable.  Unlike the issues surrounding Comcast, the FCC is also likely to approve this deal, too.  Many don't expect final approval for Charter and TWC till year end if not early 2016.  Once completed, the big three of Comcast, Charter, and AT&T will dominate the cable distribution industry.  And then we can watch to see what happens to Dish Network, Cablevision, Cox, FIOS, and the other players.

Will AT&T And DirecTv Merge?

Now that the Comcast and Time Warner Cable deal is kaput, attention turns to the next media merger.  While a merger would create a cable subscription behemoth larger than Comcast is currently, it would not impact the size of their broadband subscriber base.  That factor was the key stumbling block to Comcast getting its deal done.  DirecTv, as a satellite company, does not offer broadband service.  AT&T does.  Is that enough for the FCC to okay this merger?  Netflix doesn't think so.

In today's New York Times, Netflix "argued that a combined AT&T and DirecTV would have the ability and incentive to use its heft to harm online video distributors like Netflix to protect its core TV business." Actually, creating a video entity larger than Comcast might actually enhance competition.  Fundamentally, DirecTv and AT&T bring two different platforms together, satellite and fiber while the Comcast Time Warner Cable deal would have expanded their fiber distribution platform to control more than 50% of the broadband market.   Two very different outcomes.

Still, when looking at the merger of AT&T and DirecTv, the synergies that come into play seem more about negotiating cable content and getting more economies of scale on their contracts.  As to the broadband side of their business, AT&T still must rely completely on their own cellular and U-verse platforms to compete.  Of course should DirecTv satellites someday be able to provide two way broadband access to the internet, then new concerns might arise.  At the same time, Lightsquared and Dish have been currently unsuccessful in this approach.  Once spectrum opens to enable such opportunity, it would open new competition into the marketplace to challenge a merged AT&T - DirecTv entity.  And isn't that what the FCC really hopes happens in the broadband marketplace. 

Future Of Advertising - Mobile And Social

As we engage more and more with our mobile devices, our smartphones and tablets, they become a much larger focal point for reach and frequency. More Facebook users access their accounts via through mobile rather than a computer. In fact, in Q1 of this year, Facebook's "mobile advertising revenue represented roughly 73% of advertising revenue", as mentioned in Business Insider. And given Facebook innovations, videos now automatically run as you begin to scroll down the timeline, hoping to snare you to watch and turn up the volume.  I know that I am like the majority, accessing these and other social media sites like Twitter, Pinterest, Instagram, and others on my iPad or iPhone.  And whether it is a display ad, or sponsored content, or other banner or video, this is where the future lies.  We are easily reached, personalized, and presented with relevant and hopefully engaging messages.  

And so other ad platforms may need to worry as usage patterns shift and so to the flow of ad dollars from one bucket to another.  Cord cutting on cable TV is not just an issue for subscription dollars but advertising dollars as well.  As higher percentages of our time are spent on our mobile devices and interacting with others via social platforms, so to will ad spend. 

It is why TV Everywhere is so important  for content providers.  And why many today have apps for authenticated viewing on mobile devices.  It is why the DOJ and the FCC are looking so hard at the Comcast - Time Warner Cable merger and that together they would control a majority of the broadband pipeline in the US.  Monopolistic pricing, controlled or limited access to content, and lack of a competitive threat are key concerns.  

And as I look at the growth of mobile, I am struck with an interesting idea.  For companies like Netflix, Amazon, Hulu, and others delivering content to mobile devices, the thought of complementing these services with social networks for its members to discuss content that they have consumed on their respective apps. Consider a Netflix social app that is easily accessed and used to reach other "fans" of House Of Cards, Orange Is The New Black, Unbreakable Kimmy Schmidt or other series and where they can discuss in detail.  Such a companion site would also enable these content providers to add an advertising revenue stream into their mix.  It may be a niche social platform at first but may just drive future growth.

For it is the increasing usage of mobile platforms in our daily lives and our desire to interact with others online that is driving new opportunities for advertising.  At the same time, traditional ad platforms, threatened by this new growth, must continue to play in the new space and become ubiquitous across all platforms, print, TV, radio, digital. By being accessible via the mobile platform, advertisers too will gain with better data based on individual preferences, not household ones.  And it is that one-on-one relationship that we have on our mobile devices that is the future of advertising. 

Cable Mergers Derailed?

Will Comcast be allowed to acquire Time Warner Cable?  Will AT&T pick up DirecTv?  And does Charter get to buy Bright House Networks?  While the process seems to have been going on for an interminably lengthy amount of time, recent news has emerged that the DOJ might not be in favor of consolidation.  Comcast is scheduled to meet tomorrow with the Department of Justice to demonstrate why the merger should proceed.And should it not, it seems the above deals would fall apart as well.

The biggest concern seems not about carrying cable channels but having a powerful grip on the wired broadband marketplace in the US.  While competition has already been limited for broadband access, and Comcast and Time Warner Cable never competing with each other in any market, their combined entity would hold a powerful monopoly across the country.  And while DSL is a competitive option, the potential of cellular and wireless competitors could one day become a stronger force.

A bigger stumbling block may be the Comcast ownership of content including NBCUniversal and its broadcast and cable networks.  Already we have heard that issues with NBC carriage on OTT services like Sling TV and Apple TV.  In LA, Time Warner Cable airs Dodger games on its own cable line-up but has been unable to come to fair terms with the other cable providers in the market to air its sports network.  Would the DOJ or FCC require Comcast to relinquish majority control of their content networks as a compromise to their acquisition efforts?

With meetings this week, we will wait and see what happens next.  I suspect that ultimately approvals will occur. 

How Big Could Charter Cable Get

Considering that the FCC has yet to approve the Comcast-Time Warner Cable deal, Multichannel is already speculating just how big could Charter get.  Once that deal is approved, and many believe that if it wasn't the FCC would have already said no, Charter Cable would move forward with its deal for Bright House Networks and acquire subs from the TWC consolidation to exceed a 10 million cable subscriber base.  

Given Malone's penchant for growth, this domestic drive for a larger cable footprint could lead to more consolidation.  According to the article, the next targets could include "Suddenlink Communications (private), Mediacom Communications (private), Cable One (planned to be spun off from Graham Holdings as a separate public company this year) and Cablevision Systems (public), with the latter possibly involved in a later system swap with Comcast."  But first, Charter would have to successfully integrate the Bright House properties before chasing after these names.  

How would the cable landscape look after AT&T acquires DirecTV and Comcast acquires Time Warner Cable, here you go:

MVPD                                                  Subscribers

Comcast/Time  Warner  Merger*         30,000,000

AT&T/DirecTV  Merger*                         26,300,000

Dish Network                                           14,000,000

Charter/Bright  House Merger*           10,000,000+

Verizon                                                        5,600,000

Cox                                                               4,100,000

Cable Consolidation Confirmed For Charter

Three weeks ago, I mentioned in my blog that Charter Cable was kicking the tires on Bright House Networks.  Today it has been confirmed that Charter will acquire Bright House with a combined subscriber base exceeding 7 million homes.  Bright House parent, Advance-Newhouse will own about 25%, and Liberty about 25% of the new MPVD.

Most interestingly, this acquisition is contingent on the Comcast acquisition of Time Warner Cable.  Should that not happen, this deal could likely be kaput.  Bright House has benefited from their current relationship with Time Warner through a programming partnership that enables them to get the same license fee rates as TWC.  That programming deal would likely expire when or if the Comcast deal is approved.  Combining with Charter post approval would create a larger entity that could likely retain those better licensing terms.

So just to count all the cable acquisition deals in front of the FCC to date, we have Comcast and Time Warner Cable, AT&T and DirecTV, and now Charter and Bright House.  Three and counting...one can only wonder who the next likely target will be. 

Apple's Subscription Platform A Disruptive Force

Given the Apple infrastructure of retail, a full line of products from Apple TV to Apple Watch, plus its iTune interface and AirDrop capability, it is no wonder that the news of it's entry into an online cable subscription service has created quite a stir.  From traditional cable operators, like Comcast, to other technological rivals, like Google, Amazon, and Microsoft, Apple has challenged their current business models.  How?  Let us see.

Comcast may be concerned on a number of fronts.  While NBC is currently not in the mix for services on the new Apple subscription platform, they may be forced to launch based on their agreements with the FCC.  According to the NY Post, "As part of Comcast’s deal to acquire NBCUniversal in 2011, the cable giant agreed it would make its content available to online video distributors on a “comparable” basis to its rivals."  For Comcast, the debut of Apple TV could cause a rash of cord cutting as consumers decide they prefer the TV Everywhere advantage of Apple, the simplicity of use across all their devices, and the mobility.  They also undercut Comcast with lower subscription fees for a scaled down but desirable list of networks.  Add HBO Now and Netflix and consumers mayjust prefer the Apple TV box or iPad or iPhone over a cable TV box tethered to a single television set.  How does Comcast compete?  With an Apple launch scheduled for the Fall, they have about 6 months to build a new business and marketing plan.

As to the other streaming networks, Apple will compete with Sling TV and Playstation Network.  Amazon may feel they have lost a step.  They have the smart phone and tablet devices, but don't have the broadcast nets and most of their streaming is tied to their Prime subscription model.  Microsoft has XBox, but they have already disbanded the content side of that business to concentrate on cloud computing.  Building an infrastructure of content partners and a streaming subscription service may not be part of their current focus.  And Google has concentrated on building out fiber in limited markets.  They have Google Play and can reach outside the Apple closed infrastructure through the open Android platform.  But by being open, it may lose some control.

Still, the speed of change has increased greatly and mass adoption continues to occur at a quicker and quicker rate.  All of these technology companies have the ability to commit to change and focus on driving digital consumption.  And moving off of cable boxes and onto personalized devices delivers richer data about who is watching, when, where, and how, coupled with the same users using these same devices to make purchasing decisions.  Apple's infrastructure and usage base could potentially give them a huge edge in capturing a sizable subscription audience and rich data to drive advertising revenue. 

Apple To Become Online Cable Operator

For years it has been speculated that Apple wanted to get into the television viewing business.  But in the last few years, the word television has changed its definition.  Watching content, whether on cable TV or through Netflix, whether on a big screen set or on a mobile device, all seems to fall under the umbrella of television viewing.  Rumors that Apple wanted to build big screen sets or a cable friendly set top box have all been bandied about.  The latest news might just be the direction Apple has decided to take.

The Wall Street Journal says that "The technology giant is in talks with programmers to offer a slimmed-down bundle of TV networks this fall, according to people familiar with the matter. The service would have about 25 channels, anchored by broadcasters such as ABC, CBS and Fox and would be available on Apple devices such as the Apple TV, they said."  Like Sling TV and Playstation Network, announced at the CES, and other aggregators, Apple hopes that its Apple TV device, recently reduced in price from $99 to $69 is the means to drive adoption.  Under the Apple ecosystem, subscribers of the service would be able to view content on any of its devices, from iPod to iPhone, from iPad to Apple TV.  Truly a TV Everywhere approach!

Interestingly, the one content provider not included at the moment is NBCUniversal, home of the NBC broadcast channel, Bravo, Syfy, USA, CNBC, and others.  Also NBCU is owned by Comcast, the largest cable operator, soon to be larger with the acquisition of Time Warner Cable.  While the new service is not planned to launch till later in the year, so too is the approval of the cable operator merger with the FCC.  Could this issue add an extra wrinkle to the approval process?  We must wait and see.

For consumers seeking a cheaper alternative with a smaller set of channels but access to content anywhere and everywhere, and additive premium content from Netflix and HBO Now, this new subscription service could be highly welcomed by the millennial audience.  Ideally this online audience would prefer to pick and choose the nets it wants within the package.  The concern over time will be as more nets do deals to be on the subscription service causing Apple to need to raise its monthly fees.  That is one of the issues that led to cable cord cutting.  That, and the inability to watch content away from home.  With this new online subscription service, TV Everywhere becomes a true reality. 

More Cable Consolidation In 2015

With Comcast buying Time Warner Cable and AT&T buying DirecTv, the cable oligopoly continues to grow smaller.  The latest acquisition plan comes from Charter Communications.  There is speculation that they will bid to acquire Bright House Networks, a mid-size cable operator with about 2.5 million subscribers.  That could potentially bring Charter to over 6 million subscribers as well as increase the size of its footprint. 

Putting another cable operator in play also brings up the notion that other cable operators could be buyers or sellers.  Of those, the biggest question mark is Cablevision Systems, with over 2.5 mm subscribers, mainly in the New York DMA and a highly desirable market.  Cox Communication, with over 4 million customers and systems spread across the US, from New England to California, could also be of interest.  There are still a number of smaller cable operators with more regional footprints that might finally decide to seek a buyout partner.

While the FCC still mulls the fate of the two big acquisitions above, as well as work with new net neutrality rules, their plate could only get fuller.  Cable and broadband infrastructure across the US requires size to gain efficiency.  These deals only seek to build larger footprints to capitalize on cost efficiencies and revenue gains.

 

FCC Rules ISPs Are A Utility

The internet is now classified as a regulated utility and net neutrality is enabled.  Certainly, for content creators and consumers, content must now flow freely and equally to your devices.  But what was the problem and do these regulations really solve them.  Weren't we getting access to all our content already?  Did you really see that certain content was not getting to you? 

While nothing will change immediately, what will not be a surprise will be how many lawsuits will arise to fight this new law before it can initiate.  Given how long it takes decisions to get through the court system, it should be tied up for quite a while.  The greatest example is the Janet Jackson Super Bowl example regarding on air decency.  That case took years to finally decide that there was no fine to be levied.  Still it clogged up the courts.  So too will this new internet regulation law.

The hope is that during that time that new innovation arises to improve speed and efficiency of broadband, new competitors grab a share of the marketplace via a wired and wireless approach, and that the fast pace of change in this industry makes the law irrelevant before it has time to take effect.  My biggest concern is that regulation only slows down innovation and growth, doesn't drive a competitive marketplace, or lower prices.  Yes, net neutrality as a concept is a good thing; all content should be able to reach its destination as fast as possible.  But wrapped in other regulations, the internet as a communication highway only gets hurt more. 

Net Neutrality Vote

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. 

Could Net Neutrality Regulation Hurt Innovation?

As the FCC ponders enacting tough new laws on equal access to the internet, many wonder if government interference and tight regulations will instead choke the technology and limit growth.  Many look at other utility companies and the effect regulation has had to stifle innovation.  There are arguments on both sides depending on who benefits from FCC involvement.  Still, one hates to see a free economy hampered when government controls the business decisions surrounding the internet's development and evolving growth.

Is the current internet broken that net neutrality laws are necessary to fix?  Or can competition from wire and wireless providers create a better industry to drive innovation and growth.  While the current industry may be deemed too much an oligopoly, the FCC might better spend its time enabling companies to invest in alternative infrastructures.  Google, for one, is slowly building alternative internet pipelines in certain markets.  Opening new spectrum for wireless internet is another opportunity to enhance market competition.  Push tax benefits for those companies that make investments that improve the accessibility and reliability of networks. 

Laws and regulations that restrict do little to drive growth in the marketplace.  Time and time again we have seen our public utilities challenged with a heavy government hand that slows decision making to a crawl and limits the ability to upgrade and support new technological improvement.  More should be done to propel our internet infrastructure to 21st century standards, but regulation does not seem to be the right move. 

Broadband To Be Considered A Utility Service

As our President faces the last 2 years of office, he no longer has to worry about reelection, rather about his legacy.  And so, as it pertains to the world of the web, he is pushing all out for full net neutrality.  Like water, electricity, and gas and oil to the home, Obama and the FCC want to regulate broadband service just as fiercely. 

Net neutrality assures that no matter what the content, whether a simple email message or full HD video, the internet would treat both pieces of data exactly the same, transmitting them at the same speed as everything else.  No blocking of content, no throttling or slow down of speed of certain data.  All will be treated exactly the same.

But it is that same heavy use of government oversight and regulation that can also slow down or even stop a free economy from doing what it does best, innovate to create new solutions to old problems.  With such freedom comes new opportunities, new industries, and new businesses.  But add government to the mix and while data is free, innovation may be what gets throttled instead.  That is certainly the line that broadband providers like Comcast and others fear buy a heavily regulated broadband industry.

Content creators and other users of the web hope that net neutrality assures that their work gets equal access and that they do not have to resort to paying broadband providers to get into the HOV lane.  Netflix agreed to pay providers to assure that their subscription service wasn't penalized; they would love to not have to pay for play. 

Is there a middle ground that assures equal access without over regulating the process?  Ultimately, a solution is needed.  Broadband access has become more essential to the home then ever before.  Some might even rank it above heat and water.  Still, at the end of the day, what is most needed is to lower barriers to entry in broadband platforms and encourage more competition.  That is ultimately what will enable consumers to find the best possible value for the best price. 

Will FCC Approve Cable Mergers?

The FCC is back on the clock but no decisions will happen in 2014 regarding the two mergers on the docket, Comcast acquiring Time Warner Cable, and AT&T acquiring DirecTv.  Per Business Week, it is unlikely that any such approval or disapproval will happen till March at the earliest. 

Consolidation offers great cost efficiencies but it can also hurt competition and lower prices.  Given the high barriers of entry in the industry and limited competition due to franchise approvals in every community, consumers have already experienced limited choice for cable or satellite.  These two mergers do little to worsen the already limited playing field.

The FCC may be less concerned with cable and more concerned with broadband access.  Still, there is limited competition with buyer and seller in this market as well.  DirecTv doesn't even offer a broadband business and Comcast and Time Warner do not compete against each other.  Comcast would control a vast majority of the US market seeking to access cable and broadband.  But I don't believe it will stop these mergers from occurring.  Opening spectrum, encouraging new entrants to enter the space, and supporting investment in new wireless and broadband technologies to improve connectivity and speed are what consumers really want. 

Obama Wants Net Neutrality

With two years left on his presidency, President Obama has decided now is the time to speak out on net neutrality.  He has asked the FCC to pursue full net neutrality and to enable free and equal internet traffic for all.  Whether a data heavy, video driving site like Netflix or a low graphics, easy downloaded website, consumers should be able to access both equally as fast.  No HOV lanes, no slow downs by ISPs.  I'm almost surprised that he didn't try to have all broadband as a utility, subject to the same rules as water, gas, and electric.

The real challenges for the US regarding internet access are speed and price.  Shouldn't more be done to encourage wire and wireless competition.   Is net neutrality the better policy course to driving innovation and superior service?  Shouldn't the FCC focus instead on opening up more spectrum for more ISPs to enter and compete for users.  If internet speeds can be improved, then all traffic will thrive, whether they are in a slower or faster lane.  Then how fast any one piece of content is over another will be meaningless if there is no perceptible difference. 

FCC Puts Cable Mergers On Hold, But Should Approve Them

The FCC review of the Comcast - Time Warner Cable and AT&T - DirecTv mergers has been temporarily suspended.  According to Reuters, "The FCC, which will determine whether the deals are in the public interest, said it will pause its self-imposed, 180-day shot-clock deadline to decide how to handle highly confidential documents related to agreements with media companies." Content companies simply don't want to make public who gets charged what for their networks.  

Simply put, the cost that Disney or Discovery or Scripps or any other network charges for each of their networks will be less for an operator the size of Comcast then for an operator the size of Cablevision.  It is one of the dirty little secrets of contract negotiation.  Larger operators get charged less per subscriber because on the aggregate level, they pay a large total sum for all their subscribers.  The larger their reach, the better the deal they can negotiate.  And monthly costs for cable programming can get expensive as operators multiply it by all the channels they bundle to consumers.  It is why their is the latest contract fight between Turner and Dish.

At some point, the clock on these mergers will resume and the FCC will be asked to approve or disapprove each respective merger.  Ultimately, both efforts should be approved.  Size efficiencies are necessary to assure blanket coverage of cable and broadband across the country.  Disruptive technology assures that content companies can reach consumers outside the cable paradigm.  Netflix, Hulu, Amazon, and even CBS and HBO GO are great examples.  I believe these mergers actually improve the competitive front in the cable/broadband space with fewer, although more powerful competitors.  Will prices rise; they always do.  But the cable industry is simply following the industry life cycle curve that many other industries also face.  As they mature, the number of companies competing become fewer, yet bigger.  Look no further than industries like Airlines, Oil, and even Media.  It is the norm.  What is also true is that disruptive changes always occur that lead to new businesses and new competitors.  And that is what makes our free economy work. 

Does Wireless Need Net Neutrality?

Net neutrality has been a hot topic.  While the FCC attempts to revise its rules, many are still unclear what it all means.  In essence, net neutrality for the internet means that all web sites would have equal access to consumers accessing them, whether the data is light use email or heavy use video streaming.  Netflix, leading the way with heavy usage, has made deals with cable companies to assure that it gets premiere broadband access.  And while they can afford it, many argue that lack of net neutrality favors big business at the expense of start up web companies.

But as net neutrality rules are being reworked, you would be surprise to hear that these rules have been strictly toward wired broadband connections.  The mobile space has been mainly unregulated in the broadband space.  According to the NY Times, that exemption is being reviewed.  "On Tuesday, the Federal Communications Commission will hold a round-table discussion to examine whether proposed net neutrality rules should cover mobile broadband."  With so many consumers accessing the web through their cellular connections verse a WIFI one, it is hard to believe that the two platforms were being treated differently. 

Technological change as wireless carriers have upgraded their systems has led to such a move. And again, according to the NY Times, "Now, with advanced LTE networks complete, a growing portion of consumers use mobile as their primary method of connecting to the Internet, meaning a wireless exemption would leave those consumers without net neutrality protection."  And as younger consumers cut the cord on cable connections, their cellular subscription becomes their primary communication, information, and entertainment portal."  If my children didn't have access to WIFI inside the house, they would definitely be using their cellular connection.  In fact, I sometimes check that their smartphones are still connected to the WIFI so that our cell bill doesn't get impacted.

Does wireless need net neutrality?  All broadband, whether wireless or wired, should be treated similarly.  While I oppose to much government regulation and prefer an open economy to manage supply and demand, broadband has become as essential a basic right as shelter, food, and the right to education.  I would prefer that the FCC spend more time lowering the barrier to entry to enable more companies to compete in the broadband space.  The rise of competition is the best means to assure consumers right to choose a source for their broadband connection.