What the Broadband Industry Really Needs Isn’t Net Neutrality. It Needs Competition.

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Will strong net neutrality rules reduce the incentive for cable companies to invest in high-speed network infrastructure? Maybe, though similar rules certainly haven’t had that effect in the cell phone market. Of course, the cell phone market is intensely competitive, and that’s probably the real difference between the two. As Tim Lee notes today, Comcast’s cable division is immensely profitable—certainly profitable enough to fund plenty of new high-speed infrastructure. But why should they bother?

Comcast’s high profits are evidence of high barriers to entry in the broadband industry. Ordinarily, a company that consistently made billions of dollars in profits would attract new competitors seeking to capture a piece of the market.

But with a few exceptions — such as Google’s projects in Kansas City and elsewhere — this hasn’t really happened. In most parts of Comcast’s service territory, consumers’ only alternative for broadband service is the local phone company.

Conversely, Comcast doesn’t seem interested in trying to steal market share from rivals. Comcast could expand into the service territory of neighboring cable companies or it could spend money building a next-generation fiber optic network the way Verizon and Google have done. Instead, they’ve chosen to spend more money rewarding shareholders than investing in their networks.

Given current political realities, strong net neutrality rules are a good idea. But an even better idea would be to forget about net neutrality and open up local markets to real competition. I think we’d find out pretty quickly that broadband suppliers have plenty of money for infrastructure upgrades if the alternative is a steadily shrinking market share as competitors start eating their lunch.

Competition is good. Big companies don’t like it, and our approach to antitrust enforcement has unfortunately lost sight of competition as a sufficient raison d’être. That’s too bad. It’s the cure for a lot of ills and a way to keep the rest of the regulatory state relatively light. It’s well past time for us to rediscover this.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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