In these hyper-partisan times, all can agree that investment in infrastructure benefits all Americans, creates jobs and strengthens the U.S. economy. All can also agree that policymakers should strive to create an investment-friendly regulatory environment that leads to more infrastructure deployment, not less. Federal Communications Commission Chairman Ajit Pai is doing just that, from easing the process to get necessary government approvals to build networks to his proposal to eliminate utility-style regulation of wireless broadband service.
No area is in more need of new infrastructure than the wireless telecommunications sector. Consider these facts:
- American consumers increasingly rely on wireless access to the internet to live their lives. Today, the average U.S. household owns 2.4 smartphones, and by 2022 the average home could have as many as 500 connected devices.
- Wireless traffic is almost doubling every year, placing ever-greater strains on the nation’s wireless networks. Between 2014 and 2015, mobile data usage in the United States more than doubled, increasing from 4.06 trillion to 9.65 trillion megabytes.
- Low-income Americans and minority populations in particular rely on wireless services. For example, 13 percent of Americans with an annual household income of less than $30,000 are completely smartphone-dependent, and they are more than four times as likely to use a smartphone to submit a job application. Further, Hispanic adults (64.8 percent), non-Hispanic black adults (52.1 percent) and non-Hispanic Asian adults (47.4 percent) are more likely than non-Hispanic white adults (46.6 percent) to live in wireless-only households.
This growing demand requires massive investment in the wireless network infrastructure of antennas, fiber and other equipment to support that demand — investment that has the potential to generate hundreds of thousands of new jobs, provide a jolt to the economy and promote U.S. technology leadership around the world. A recent economic study by Accenture concluded that deploying new “fifth generation” wireless networks will boost annual gross domestic product by $500 billion.
The FCC, under both Democratic and Republican administrations, has recognized the immense social and economic benefits of new wireless infrastructure, as well as the benefits that wireless access can bring to all communities. But as Pai has correctly observed, urgently needed investment in wireless networks is threatened by unnecessary regulatory burdens. Study after study has proved that regulation depresses investment, driving dollars elsewhere – or abroad. Mobilitie’s success as a company, the livelihood of those we employ, and the progress of companies delivering services over networks powered by our infrastructure, depends on carriers having the right incentives to invest.
Pai is launching two reviews of the biggest regulatory obstacles facing the wireless broadband industry: a mountain of unreasonable fees and unjustified delays imposed by some rent-seeking localities; and an unnecessarily complex utility-style regime that imposes extensive, yet unnecessary, restrictions on wireless networks in the name of “net neutrality.”
Unfortunately, some localities have not yet awakened to the tremendous benefits to their citizens of next-generation wireless networks. Rather than partnering with industry to deploy critically needed infrastructure, some localities are demanding exorbitant fees, imposing onerous regulations and even enacting moratoria that grind new investment to a halt. The Pai FCC is tackling this roadblock head-on by launching a proceeding that recognizes there “is an urgent need to remove any unnecessary barriers to such deployment, whether caused by Federal law, Commission processes, local and State reviews, or otherwise.” Relief can’t come soon enough.
Pai is also launching a proceeding today to eliminate utility-style regulation of wireless broadband networks, a regime that has no place in today’s hyper-competitive communications industry, where wireless providers vigorously compete for customers (witness the endless parade of ads), and customers reap the benefits of that competition through ever-expanding choices. At Mobilitie, we see firsthand the intense competition that is driving so many benefits to consumers. In this market, utility-style internet regulation has no place.
The issue has been properly framed as whether the federal government should be imposing burdensome utility regulations on a fiercely competitive market where internet openness has been the hallmark of the wireless industry for over a decade. It is beyond question that such heavy-handed regulation impairs investment – and equally beyond question that this investment is critical if the nation is to continue to lead the world.
In his very first speech after taking the reins as head of the agency, Pai told the FCC’s staff that “we must work to bring the benefits of the digital age to all,” a theme that continues to drive his agenda. In initiating these reviews, Pai and the FCC have embarked on the right course to promote investment in the communications networks the nation so urgently needs for its future while also maintaining the wireless industry’s commitment to a free and open internet for all consumers and companies.
Gary Jabara is the founder and CEO of Mobilitie, the largest privately held wireless telecommunications infrastructure and services firm in the United States.
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