EXPERTS ADVISE FCC ON HOW TO REFINE WIRELESS COMPETITION DATA
Several industry experts and consumer group representatives told FCC Thurs. they would like to see Commission gather more “granular” data on status of wireless competition. Several speakers at FCC forum on data-gathering on commercial mobile radio services (CMRS) stressed that such information was particularly important as Commission altered how it reviewed wireless mergers once spectrum cap was phased out in Jan. 2003. Forum placed emphasis on how to analyze data on wireless competition in rural and other historically underserved areas. Much of information that FCC now has when it compiles annual report on CMRS competition is either focused on national statistics or, in some cases, more urban markets, said Deputy Wireless Bureau Chief James Schlichting. “In the rural areas, we are very interested in finding out how we can measure how markets are performing, the number of competitors, the prices that are available for consumers, the service quality, the coverage, the features and options that are available to consumers and the level of subscribership,” he said.
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“I don’t think the Commission can rely on the presence of multiple carriers in part of a market as a proxy for competition in that marketplace,” said Chris Murray, Consumers Union telecom fellow. “You can’t say that because there are 3 or 5 or 6 carriers in a county that everyone in that county has access to 3 or 5 or 6 carriers.” Murray said annual reports by FCC on state of CMRS competition tended to assume that increases in usage equated to increases in competition. “Usage increase doesn’t necessarily mean more competition,” he said. It also would be helpful to have reports look at coverage in individual markets in more “granular” way. One possibility would be to have researchers in field examining wireless network coverage first hand, he said. Murray said that to fund effort, Congress could direct National Research Council to study issue. Report also could make finer distinctions between business and residential users. “It would be very useful to examine meaningful competition if the Commission took a stab at what a ‘usable minute’ is,” Murray said. He said that recently most major wireless carriers also had expanded definition of “peak minutes,” trend that could help drive increases in average revenue per user, he said.
FCC should minimize reliance on data supplied by industry, which has incentive to “paint an overly rosy, overly competitive picture,” Murray said. If industry data are used, they should include information such as internal coverage studies that carriers use to assess holes in coverage areas of their networks, he said. “The report needs to establish a baseline,” he said. “It needs to establish a quantifiable, numerical threshold for where competition ends.” Report should assess both current status of marketplace and create baseline to determine if there’s point at which market no longer is competitive, Murray said.
Arguments for industry to gather its own data, process in which CTIA has engaged since 1985, and contentions that FCC should do more to collect its own numbers “are both right,” said Greg Rosston, deputy dir.-research fellow at Stanford Institute for Economic Policy Research. There are examples at other agencies where industry that has been deregulated, such as airlines, has had to continue to submit very detailed data to federal regulators, Rosston said. Many of data that are part of CMRS annual report appear to come from local competition report and universal service filings, he said. “I would love to have data that is much more granular than what CTIA reports,” he said. “There is a lot more that you could do if you had data on a market-by-market basis.” More detailed information could be helpful to FCC when evaluating impact of proposed wireless mergers when spectrum cap sunsets in Jan. 2003, he said. Increased reporting requirements could raise questions about how such information is kept confidential and how it is used, Rosston said. Also, more detailed reporting requirements could be particularly hard for rural carriers with fewer resources to pay for collection, he said. Rosston said there was “philosophical question” whether FCC should be collecting information on deregulated industry.
“The question becomes what your goal is,” Rosston said. “Is your goal to find out whether people have coverage or whether people have effective competition?” Robert Roche, CTIA vp-policy & research, stressed that CMRS industry still was at early stage, with significant build-out in markets continuing. Current wireless penetration rate of 45% took wireline industry much longer to achieve, he said. “Measures of competition… can’t really be reduced to a strict number,” he said. Single index or measure can’t be used as “thermometer” to analyze when industry is below effective level of competition, Roche said. “This really is something that is a moving target, it’s an evolving target, not only among the providers but also in the minds of the public.” Refined measures to assess competition shouldn’t limit ways in which industry may develop, he said. “We need to be careful that how we define things don’t limit our choices,” Roche said.
Western Wireless Dir.-Federal Govt. Affairs Mark Rubin told FCC that having current data was critical to policy decisions. Many times, report on state of industry can be outdated before it is released, he said. To address that issue, Rubin suggested that FCC and state PUCs attempt to complete notices of inquiry, notices of proposed rulemakings and other rulemakings within 6-month time frame when feasible. If decisions in such rulemakings are more transparent and timely, wireless carriers are more likely to be more willing to provide information and data, he said.