By Oliver McPherson-Smith, American Consumer Institute
Video conferences, online classrooms, and telehealth have all become mainstream in 2020. This huge change has been made feasible by federal policies that focus on getting the most value out of America’s telecommunications resources. To replicate this success and avoid future waste, access to American spectrum needs to be competitive.
The global coronavirus pandemic has provided America’s communications infrastructure with a dramatic stress test. With offices, shops, and entertainment venues closed, consumers have rapidly become reliant upon phone and internet providers. To keep Americans connected during the crisis, the Federal Communications Commission (FCC) facilitated temporary access to additional spectrum for dozens of wireless internet service providers and mobile companies.
The FCC’s focus on allocating resources where they are most needed has paid dividends for consumers. Recent analysis by CTIA, a wireless industry group, illustrates how mobile download speeds have remained stable throughout the crisis despite the surge in demand. While ‘business as usual’ might not seem exceptional at first glance, it represents a stand-out performance when compared to the large and protracted falls in download speeds experienced across Europe and other developed countries.
Interestingly, in addition to reduced mobile download speeds, house-bound consumers in Europe also endured a wholesale reduction in the quality of video streaming services. Under pressure from European Union officials who were concerned about overloading their infrastructure, Netflix, YouTube, and Amazon Video temporarily reduced the streaming quality of their videos. At the request of the French government, similar fears prompted the delay of the launch of the Disney+ streaming service in France.
However, access to reliable and fast internet is not just important for entertainment services, but telehealth, teleconferencing, distance learning, e-commerce and a host of other applications.
In the United States, mobile data provides an e-lifeline to lower-income consumers. According to research by Pew in 2019, approximately a quarter of surveyed households with income below $30,000 relied on smartphones for internet access. According to a similar survey in 2015, almost a third of consumers in the same income bracket used a smartphone to submit a job application in the past year. In the midst of the enduring economic fallout of the COVID-19 crisis, reliable mobile data connections will no doubt help countless Americans weather the economic downturn.
Given the vital importance of accessible and affordable mobile internet, the FCC needs to keep competition at the heart of its spectrum policy. Unfortunately, the FCC’s decision in April to give away 1,200 megahertz of unlicensed spectrum missed an opportunity to auction off a valuable resource for the most productive use. While the move might help to win the short-run battle for faster Wi-Fi, it risks losing the long-run war for 5G deployment. The FCC’s announcement earlier this month that it will push ahead with C-band auctions in December is a small comfort for consumers. It is now more important than ever for the FCC to focus on auctioning as much mid-band spectrum as possible, and without delay.
When access to America’s spectrum is awarded for the most productive uses, consumers enjoy stable and accessible internet. Both in times of crisis and prosperity, the FCC should prioritize getting the most value out of the country’s telecommunications infrastructure. Putting competition at the heart of the FCC’s policies keeps American consumers online.
Oliver McPherson-Smith writes for the American Consumer Institute, a nonprofit educational and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on Twitter @ConsumerPal