Still a Threat: Net Neutrality … Plus: Here Comes "Broadband Together!"

The internet performed well during our recent experience of almost everyone working from home. It handled stress easily … mostly because it was designed and built to do so. Today, our current broadband internet (like about 70% of it) rides on what was once the cable TV companies. Most of the rest comes from telcos like AT&T and Verizon. And looking to gain ground quickly are 5G cellular providers like, again, AT&T and Verizon joined by T-Mobile.

Our recent pandemic experience boosted Netflix big time as streaming continued to erode the once-dominant linear TV market and nudged programmers to rush to stream, too. All of which helped birth the new concept of bingeing a season in a single long day and night while also (again following Netflix) changing business models, moving from wholesale-only to retail, too. If you have any doubt about this, just consider the news from Nielsen (via The Hollywood Reporter) that more consumers watched streaming than over-the-air networks last May.

That all upended a whole lot of business plans.

Cable, of course, is up with exclusive franchises. Which made good sense given that payouts would tend to be small for those who would build a new road alongside the first one. Widening the road, though, brought more traffic … which brought local competitors … which for a long time struggled. Then something interesting happened. Some over-builders began to succeed. The most obvious current example: WOW, Wide Open West. WOW sold almost 325,000 of its broadband subscribers divided between Astound Broadband and Atlantic Broadband for 11x cash flow. That compares to WOW's stock price at the time of 8x cash flow.

This calls into question the argument against overbuilding: that it is merely duplicative and thus a waste of money.

Meanwhile, all of the maps purporting to show where broadband customers actually reside are all wrong. So, too, is any attempt to really figure out what's available and really ascertain the cost with all of the details.

And now, the President also wants to revive the "Fixed Broadband Customer Disclosure" form mandate to help eliminate unexpected charges.

Naturally, Consumer Reports is attempting to lend a hand … as Axios reported, the consumer advocate launched an initiative last Tuesday to collect and analyze cost data by getting tens of thousands of customers to share their monthly bills for home (not office) internet. They're also asking about any competition. It'll be interesting to see if they can ascertain what each fee is actually paying for. Many customers have broadband bundled with various cable programming tiers. Plus, there's the advent of 5G to consider.

In short, the industry (whatever definition is used) is in flux. So heads up, folks. You all need to pay attention as this winds its way through the political woods.

Random Notes

The Federal Confusion Commission is well-named. As of today, the FCC has two Republicans, two Democrats and a vacancy. Until the President appoints a fifth commissioner … and he or she gets approved, nothing can happen. Just one more cheery little note for your files.

(A small aside: T-Mobile had once gingerly attempted to quietly wink at rules against adding free dedicated access to once forbidden extras … only to its own subscribers. It dropped those not long ago in anticipation of Net Neut.)

And, oh yeah, the specter of nationalization looms over all of this. Not today perhaps. But legislators in Florida, Virginia, Arkansas and Maryland are among almost 40 state legislators introducing bills to protect competition, monitor data privacy and/or regulate speech. In Ohio, Attorney General Dave Yost filed a lawsuit in state court asking for the state judge to declare Google's search engine a "common carrier." Now, wouldn't that be interesting … maybe someday, those edge dwellers will face bigger bills.

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