PhotoThe Federal Communications Commission (FCC) will soon be holding auctions to award additional spectrum space to wireless carriers, and the Consumer Federation of America (CFA) says a recent study offers some valuable guidance for the commission.

The study -- Comparing Apples to Apples: How Competitive Provider Services Outpace the Baby Bell Duopoly -- concludes that unaffiliated wireless broadband service providers who compete against the “Baby Bells” offer products that are much more innovative and consumer-friendly.

"These findings reinforce our earlier analysis that placing limits on the amount of spectrum AT&T and Verizon can acquire in the upcoming auction of low frequency spectrum would strengthen competition and promote the public interest," CFA said in a statement. "The wireless broadband services offered by Sprint and T-Mobile match the 'Baby Bells' in their limited offerings, but their ‘unlimited’ services deliver lower cost and allow consumers to escape from the overage fees and contract locks that the Bells impose."

Significant differences

The study found statistically significant differences in the following attributes of broadband service:

  • monthly bill
  • cost per megabit
  • download speed
  • upload speed
  • presence of a data cap
  • type of data cap.

Comparing the wireless services offered by the Baby Bells to the other wireless service providers (Sprint and T-Mobile) CFA found that:

  • Non-Baby Bell U.S. wireless broadband service providers offer much more attractive service than services offered by Baby Bell wireless broadband providers.
  • Non-U.S. wireless broadband service providers offer much more attractive service than Baby Bell U.S. wireless service providers.

CFA said the argument fares quite well when careful comparisons are made about wireline broadband:

  • Municipal wireline broadband service providers offer much more attractive triple play services than other wireline broadband service providers in the U.S.
  • Non-U.S. wireline broadband service providers offer much more attractive triple play and broadband-only services than U.S. service providers.

CFA said findings that "the dominant incumbents charge more and deliver less attractive services reinforce our earlier conclusions that they are abusing their market power."

Since the Baby Bells already control a disproportionate share of the low frequency spectrum, rules that ensure a better balance in those spectrum holdings will be to the benefit of the consumer and the economy by strengthening competition in the wireless sector, the non-profit consumer advocacy organization concluded.


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