FCC Stays Neutral On State Of U.S. Wireless Competition

Is there enough competition among the wireless service companies in the U.S.? The Federal Communications Commission’s annual report on the matter, released yesterday, didn’t definitively answer that question. And its neutral stance is causing many to wonder how the regulatory agency will rule on the pending merger of AT&T and T-Mobile.

In its 304-page “15th Annual Mobile Wireless Competition Report,” the FCC acknowledge that the U.S. market for wireless service has become more concentrated, for the second consecutive year. But it stopped short of making a “formal finding” as to whether there is effective competition in the industry. According to the FCC report:

The mobile wireless ecosystem is sufficiently complex and multi-faceted that it would not be meaningful to try to make a single, all inclusive finding regarding effective competition that adequately encompasses the level of competition in the various interrelated segments, types of services, and vast geographic areas of the mobile wireless industry.

While the FCC didn’t come with an clear-cut determination about the state of wireless competition in the U.S., it is interesting that the report does indicate service has grown more concentrated over the years. AT&T’s marriage with T-Mobile is a good example of that trend–and why it wouldn’t be good, say consumer advocates.

Parul P. Desai, Communications Policy Counsel for Consumers Union, testified last month in a Congressional hearing on the merger:

There is a great deal of evidence and data to suggest this transaction will lead to a highly concentrated market, which will likely lead to higher prices and fewer choices for consumers.

What do you think? Did the FCC drop the ball on this report? Is there enough competition in the U.S. for wireless service today, and will there be if the AT&T and T-Mobile merger does happen?

15th Annual Mobile Wireless Competition Report (PDF)
FCC Report on Wireless Market Offers Few Clues on AT&T Bid for T-Mobile [Wall Street Journal]
FCC report dodges answers on wireless industry competition [Washington Post]
Concentrated, yes, but competitive? FCC mum on wireless industry [ZDNet]