Senators are angry about an FCC rule that says your internet should be fast

Federal Communications Commission (FCC) Chairman Tom Wheeler is working to get faster internet into your home, and six senators are so angry about his methods that they wrote him a public letter asking him to stop.

The Senators argue that the FCC's new 25 megabytes-per-second (Mbps) broadband minimum places an unreasonable burden on cable companies. Previously, internet service providers (ISPs) only had to reach 4 Mbps — barely enough to watch many videos on YouTube — to call their packages broadband. That meant many consumers bought services advertised as "broadband" that can't meet the basic performance standards of the modern internet. Wheeler's redefinition changes that.

Here's how this spat developed, and what it means for your service.

You may remember Wheeler as the FCC chairman who declared "I'm not a dingo." during 2014's net neutrality debate:

Wheeler may or may not be an Australian canid, but he's proven himself not to be a complete servant of the ISPs. Back in 2014, when the FCC only planned to raise broadband minimums to 10 Mbps, the major providers objected. AT&T wrote an 18-page comment on the FCC's website. Here's an excerpt:

AT&T data show that, in areas where its customers have access to a service that offers download speeds greater than 10 Mbps, many consumers choose to buy services with lower download speeds. Indeed, even in areas where only a 6 Mbps service is available, a substantial portion of consumers choose to purchase a lower-speed service.

AT&T argues that because many people opt for cheaper 4 Mbps "broadband" plans over faster packages, consumers must not really want faster internet speeds.

Verizon echoed AT&T's argument in a separate comment, also arguing that a changed standard would confuse consumers. The National Cable and Telecommunications Association (NCTA), representing the cable companies, added that the limited presence of HD video on the internet rendered higher speeds unnecessary.

Wheeler went ahead and approved the move to 25 Mbps anyway.

How six senators got involved

These are the senators who signed a January 21 letter to Tom Wheeler: Steve Daines (R-Montana), Roger Wicker (R-Mississippi), Roy Blunt (R-Missouri), Deb Fischer (R-Nebraska), Ron Johnson (R-Wisconsin), and Cory Gardner (R-Colorado). They broadly fall in line with the ISPs and reject Wheeler's move.

The Senators' objections break down into four points:

• The stricter broadband standard is arbitrary and doesn't reflect "what most Americans call broadband".
• A 25 Mbps standard far exceeds the requirements of a single device streaming Netflix, and Amazon recommends only 3.5 Mbps for videos.
• Higher costs of reaching 25 Mbps will lead providers not to offer broadband at all.
• The FCC offers a relaxed 10 Mbps standard for some rural providers seeking federal subsidies. This is inconsistent and unfair to rural users.

These arguments offer an alternately sophisticated and ignorant overview of the problems facing broadband expansion in America. Let's examine them each on their merits.

Are Americans satisfied with their existing broadband?

It's hard to say without precise polling how Americans feel about 4 Mbps speeds versus 10 or 25 Mbps options. However, it's pretty easy to make judgments about how those disparities affect them.

Since the 2015 broadband reclassification, the Pew Research Center asked non-broadband adopters whether they feel disadvantaged by their lack of access. Their overwhelming answer was "yes", particularly in areas of health, employment, and education:

Pew's questions did not get into the weeds of broadband speed standards. But Americans clearly see high-speed internet as essential to many basic tasks of modern life.

Pew

When the option is available, about 30% Americans opt for at least 25 Mbps home broadband. That's according to a January 2015 FCC statement reported in Ars Technica. If that number seems low, it's likely because most Americans are priced out of faster broadband services.

Thirty-three percent of Americans without broadband surveyed told Pew pollsters that home broadband was just too expensive for them. An additional 10% couldn't even afford a computer to get online.

In an email to Tech Insider, Alee Lockman, an aid to Senator Daines, argued that the large group of Americans who opt for lower internet speeds are deprived of their consumer freedom by the new rules.

"Senator Daines believes that consumers should be the ones determining what they need for broadband speeds, not the government," she said. "According to the FCC’s own data, 71% of consumers who do have access to 25/3 speeds choose not to purchase it, which tells us there is little demand for the benchmark set by the Commission."

(The "3" in "25/3" refers to the 3 Mbps upload speeds mandated under the FCC rule change.)

However, consumers may not know what constitutes "high speed internet" when they sign up for services. And service providers may go out of their way to obscure matters.

Say you live in zip code 97401, in the city of Eugene, Oregon. Time Warner offers you a range of plans below FCC standard from a 6 Mbps "basic" service up to a 20 Mbps "Turbo Package". But then one day you move to New York City. "Basic" service surges to 10 Mbps, while even one hop up the cost ladder gets you 50 Mbps. A budget-conscious Oregonian might assume 25 Mbps is far beyond their needs and means, while New Yorkers can easily double the FCC standard without feeling wasteful.

Time Warner Cable

A reasonable person might conclude that many Americans choose slower services because ISPs market true broadband as a luxury in underserved areas.

But is 25 Mbps still way too high?

This argument from the letter, pointing out that a Netflix stream uses only a fraction of a 25 Mbps connection's bandwith, seems like a bit of a red herring.

Imagine a family of four: two parents, a teenager, and a child. If they're all gathered around a laptop playing a movie on Netflix, five or six Mbps should be more than enough. But say one parent is job hunting online while another watches a presidential debate stream and pays electronic bills. In the next room, the teenager is watching videos for a group project and chatting about it with the other students. Down the hall the child is Skyping with grandma. That family has likely blazed past 25 Mbps through normal use. 

Will the new regulation force ISPs to cut broadband altogether?

It's hard to guess how any corporation will behave under new regulations.

But one effect of the 25 Mbps standard for calling a service "broadband" will be to highlight the lack options people in much of the country have for high-speed service.

Under the 4 Mbps standard, Verizon can claim it faces healthy competition across the country as long as there are plenty of local providers that meet that low bar. But the new standard highlights the huge swaths of the country where individual ISPs function as broadband monopolies.

Further, this part of the letter's argument relies on the assumption that without government intervention ISPs will continue to invest in and expand broadband service. This tracks with how the corporations want you to imagine things will work.

Here's a chart from the NCTA of their broadband investments:

NCTA

That chart looks promising. Only $5.7 billion in 1996, but $245 billion in 2015? Impressive! But this is really just an example of disingenuous chart-making, as Matthew Yglesias showed over at Vox. The growth curve tracks cumulative investment — the total money ever spent to expand broadband. They could only spend a penny in 2016 and it would still go up. Plus, it rolls the last six years together for the final figure while previously jumping in increments of five and four. This gives the illusion of an exponential growth curve.

In reality, the companies spent $84.9 billion together from 2010 to 2015. That's $14.15 billion per year. But between 2005 and 2009 they spent $95.5 billion. That's $19.1 billion per year. In other words, this chart shows broadband investment dropping by 26% in the years leading up to the new regulation. Not a cheery trend for ISP deregulation advocates.

Does the FCC have a double standard for rural areas?

Yes.

However, it's unclear whether that's the FCC's fault. Under the new rules, only 25 Mbps connections count as "broadband". But the agency touted subsidies for companies providing 10 Mbps service in rural areas as increasing broadband deployment. The senators correctly point out that this seems on its face to contradict the FCC's mandate to safeguard universal service across the country.

But the reality is that universal service doesn't exist across the country because the private ISPs tasked with its spread haven't reached that bar. Broadband is already much faster and cheaper in New York City than Chicago, and it's not even available in much of Montana.

About 34 million Americans lack access to 25 Mbps broadband. While 96% of the urban population has at least one high-speed option, 39% of rural Americans have to settle for less. On tribal lands the number is even higher: 41%. The so-called "availability gap" closed only 3% in 2014.

There are real cost burdens for ISPs – which the senators identify – in expanding access in rural areas. So it makes sense that even as the FCC raises national standards, companies moving the needle at the internet's far reaches get a break.

In that light, this part of the senator's argument is confusing. As the FCC works to move the US up in the global broadband competition (we currently rank 13th), should urban standards slow until rural areas catch up? Or should we ignore the rest of the letter and assume the senators are advocating massive hike in rural standards and government spending?

A generous reading understands the letter as an argument about priorities. Maybe, instead of focusing resources on improving speeds in relatively well-serviced urban markets, the FCC should devote its energies to expanding rural access. Lockman said as much in her email.

"By setting this 25/3 benchmark, the Commission is forcing businesses to offer more capacity to households who already have broadband, rather than focusing efforts on providing much-needed service to the millions of Americans who remain unconnected," she said.

However, it's still unclear how rural consumers are specifically disadvantaged by the higher standard, or whether the FCC's attention is so limited that it can only accomplish one task before moving on to the next. Time will certainly tell.

You can read the senators' letter below: