The state of the telecom industry is strong. The economic explosion that was unleashed by the breakup of AT&T and the passage of the Telecommunications Act of 1996 is continuing to have positive effects on American competitiveness and growth. Gone are the days where innovation proceeded at a snail’s pace, replaced today with new products and services that come to market at breakneck speed. Just last year members of the Broadband Coalition took award-winning and market-leading positions in the industry. Innovations like burstable bandwidth (Dynamic Capacity), 100G network speeds coast to coast, and the launch of broadband over copper at 100 Mbps are the most recent examples, and all are evidence that to become relevant – or just maintain viability – you must innovate.
It’s not just the products themselves that are innovative, but it’s how they’re delivered and packaged as well. Back before AT&T was broken up, consumers had difficulty attaching a device of their choice to the network; there was no incentive for efficiency or price competition because AT&T owned all the customers; and long distance calling was so expensive, people would start timers to not exceed their budget. Now, thanks to competitive entry after the breakup and the ’96 Act, long distance charges are an afterthought, people and businesses buy their services in bundles, and users churn through telecom devices at a pace that outstrips seasonal fashion turnover. And what we consume over broadband and the business we conduct is beyond the imagination of anyone that tried to predict what the 21st Century would look like from their insular monopoly surroundings of the early 1990’s.
Thankfully, times do change and hopefully we’ve left those monopoly days in the past. What doesn’t change is the reality that competition produces innovation – regardless of industry. In fact, comparing the last 17 years of unprecedented telecom innovations and number of new companies to the staid century that preceded it is evidence of this innovation and the benefits that flow from it. It’s also evidence that the pro-competitive framework that was established in 1996 is worth preserving. It seems obvious, but as we celebrate the Act’s 17th anniversary, and take a measure of the state of the union of these United States, we must be watchful of the threats over the horizon by big telecom; one that is desirous of reassembling the monopoly it felt was wrongly ripped away. Only now instead of a chokehold on telephone calls and long distance, it will now control broadband, video and wireless services. In short, it would be a telecom juggernaut so massive as to dwarf the monopoly that was broken up nearly three decades ago, bringing back the bad old days of stranded innovation and lack of choice.
Ronald Reagan famously said that “Freedom is never more than one generation away from extinction,” and that “It must be fought for, protected, and handed on for them to do the same, or one day we will spend our sunset years telling our children and our children's children what it was once like in the United States where men were free.” Truer words could not be spoken, and frankly they also apply to today’s state of the telecom industry. We must preserve the very competition the spurs innovation today, or we may one day describe to our children an industry that once flourished and produced fruit for millions of Americans, but has fallen into stasis because the important competitive framework that led to those amazing, innovative achievements was dismantled.