Under a new FCC proposal, any area able to obtain wireless speeds of at least 10 Mbps down, 1 Mbps would be deemed good enough for American consumers. Under the previous FCC, wireless was deemed important, but not yet anywhere near a suitable replacement for fixed-line broadband, especially in more remote areas where cellular connectivity will likely remain spotty for decades to come.
The move directly caters to AT&T and Verizon, who have largely given up on rural and second and third-tier city fixed-line broadband deployment, arguing that existing, expensive wireless connectivity is “good enough”.
The US is ranked at 46th in wireless download speed at 23 Mbps. If US wireless companies were permitted and chose to drop to 10 MBps and still be classified as broadband then the US would drop to a world ranking of 101 which is the level of Nigeria.
A 2011 report, conducted jointly by Ericsson, Arthur D. Little and Chalmers University of Technology, in 33 OECD countries, quantifies the isolated impact of broadband speed, showing that doubling the broadband speed for an economy increases GDP by 0.3%. A 0.3 percent GDP growth in the OECD region is equivalent to USD 126 billion. This corresponds to more than one seventh of the average annual OECD growth rate in the last decade.
The study also shows that additional doublings of speed can yield growth in excess of 0.3 percent (e.g. quadrupling of speed equals 0.6 percent GDP growth stimulus) Both broadband availability and speed are strong drivers in an economy. Last year Ericsson and Arthur D. Little concluded that for every 10 percentage point increase in broadband penetration GDP increases by 1 percent.
Dropping from 25 Mbps to 10 Mbps would be about a 0.4% drop in GDP growth.
This would be the opposite of making the US economy future ready.
On the other hand it will make the choice to switch to Elon Musk and Google’s gigabit internet satellite network when it arrives easy.
Verizon and AT&T will not have any customer loyalty. This will be like the recent Netflix passing the total subscribers of all US cable companies.