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Communications Provider: When it's Big News That There's No News in Wireless Competition

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July 08, 2011

Communications Provider: When it's Big News That There's No News in Wireless Competition

By David Sims, TMCnet Contributing Editor


According to communications provider industry observers at VentureBeat, the Federal Communications Commission’s Fifteenth Report on wireless competition contains no real news. That’s big, evidently.


It seems the FCC “has still not released a formal finding as to whether there is, or is not, effective competition in the Mobile Wireless industry,” according to Venture Beat, which adds by way of explanation that “lack of a finding does not help predict what the FCC will decide regarding the pending merger of AT&T (News - Alert) and T-Mobile.”

The FCC’s report claims that “the complexity of the various inter-related segments and services within the mobile wireless ecosystem” makes it difficult to issue a finding in this regard.

Point taken, but it’s hard to imagine a motivated private sector firm being unable to reach a finding in that length of time. In fact, as one reads the report, one sees that the FCC (News - Alert) isn’t even on top of the right numbers to use.

Venture Beat certainly does a good job hitting the highlights of the report:

Four operators have 90 percent of subscribers. AT&T and Verizon (News - Alert) have a combined 62 percent just between themselves.

Voice usage takes a dive. You probably already knew or could guess this, but the average monthly mobile voice usage per subscriber declined in 2009, while text and multimedia messaging usage increased. You might not have realized that 2009 was the first year annual voice revenues declined, from $118 billion to $113 billion, while data revenue jumped appreciably, from $32 billion to $42 billion.

Social networking drives mobile data usage. No shock there. Venture Beat cites comScore (News - Alert), which said “social networking ranked as the fastest-growing mobile content category between April 2009 and April 2010, with the number of mobile consumers using an application to access a social networking website increasing 240 percent to 14.5 million users.”

The FCC needs new data sources. Government is behind the times, as the FCC has used the Numbering Report/Utilization Forecast for many years to estimate the number of mobile wireless subscribers, Venture Beat says, explaining that it “tracks the number of phone numbers that have been assigned to mobile wireless devices,” but is an increasingly meaningless measurement, since as Venture Beat says, “consumers are now more likely to use more than one mobile device -- particularly non-voice devices like e-readers, tablets, and car navigation systems.” The FCC does use some new data, including the Herfindahl-Hirschman Index to size up market concentration, but could stand to overhaul their approach to metrics. As Venture Beat says, “perhaps there’s a start-up out there that can help the FCC measure network performance?”


David Sims is a contributing editor for TMCnet. To read more of David’s articles, please visit his columnist page. He also blogs for TMCnet here.

Edited by Jamie Epstein







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