Tuesday, February 10, 2015

New Definition of "Broadband" Could Have Big Consequences

The Federal Communications Commission decision to redefine "broadband" might have consequences. Where the FCC had used a 4 Mbps definition, it now defines “broadband” as a minimum of 25 Mbps downstream.

With the new definition, about, 12 million U.S. households that previously qualified as having a broadband connection no longer have it.

All satellite broadband and most fixed wireless Internet service providers now sell “Internet access,” not “high speed” or “broadband” access. Many fixed network telcos likewise now do not sell “broadband.”

Paradoxically, 10 Mbps Ethernet no longer is “broadband,” either. The new definitions will mean a revising--downward--of U.S. “broadband” access connections.

Some think the new definition could derail the proposed Comcast bid to buy Time Warner Cable, as well.

Up to this point, Comcast has been careful to point out it would sell off three million video accounts, to keep total video accounts below the 30 percent market share level that the Federal Communications Commission historically has used as a limit for market share in linear video, mobility or fixed network communications.

The problem is is that some do not believe “video” is the key market where share is crucial.

With the new definition in place, Comcast’s share of broadband will  be 56.8 percent, up from 30.6 percent using the older definition.

That will be a problem.

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