Cable Firms Fear Facing Subsidized Competitors

The Biden administration’s multitrillion-dollar infrastructure proposal includes $100 billion to bring high-speed broadband to every American, an idea that might be expected to win applause from those who provide the service.

But. reports Bloomberg,  cable companies such as Comcast Corp. and Charter Communications Inc. that connect about two-thirds of U.S. homes that have broadband service fear the plan’s specific call for “future-proof” technology could leave them facing subsidized competitors.

That’s because the traditional coaxial lines that cable companies still use to serve most of their subscribers don’t handle the upload speeds that consumer advocates say should be required to receive federal infrastructure aid. Many say subsidies should go only to systems that can download and upload traffic at speeds of at least 100 megabits per second.

Cable, with its limited bandwidth, can download at that speed but averaged only 11 megabits per second for uploads in 2019, according to a January report by the U.S. FCC. Carriers using fiber lines averaged 193.

The White House hasn’t defined the speed it wants. In announcing its “American Jobs Plan” on March 31 it called for bringing “affordable, reliable, high-speed broadband to every American.” It cited rural areas bereft of broadband, and urban areas where some shun broadband because of high prices. It flatly said: “Americans pay too much for the internet” and pledged to work for reduced prices.

Congress will ultimately decide whether to tie aid to the higher speeds. Four U.S. senators, including two Republicans, an independent and Democrat Joe Manchin, of West Virginia, earlier this year wrote to Biden administration officials in support of a 100/100 standard.

“There is no reason federal funding to rural areas should not support the type of speeds used by households in typical well-served urban and suburban areas,” the senators said in their March 4 letter

Cable providers say it doesn’t make sense to demand very fast uploads, since most home broadband traffic consists of video downloads where their download speeds often exceed 100 megabits. Rather than subsidizing new ultra-fast networks in areas already served by cable systems, the government should focus on areas without broadband, they argue.