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Saturday, Mar 28, 2015

Big Cable, Big TV and Big Internet could use more competition

Bloomberg View

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T-Mobile, the underdog of the U.S. mobile-phone market, has caused a ruckus by offering to reimburse early termination fees for new customers who walk away from contracts with other U.S. carriers. John Legere, T-Mobile’s business-casual chief executive officer, unveiled the plan in an R-rated speech last month.

“This industry blows,” said Legere, who has been in the telecommunications business for more than three decades. “It’s just broken. It needs change.”

It does. In many parts of Europe and Asia, consumers get faster networks at lower cost, and have more freedom to watch what they want, when they want. What to do?

This is mostly a problem for T-Mobile, of course. It has to come up with the money it needs to compete. But the airwaves are public, so there is also a role for the FCC to play. It may want to consider, for example, limiting its auctions to bidders who aren’t already dominant in a market.

The U.S. Internet and telecommunications ecosystem works very well — for those who can afford it. Big TV, Big Cable and Big Internet could use better competition.

Vigorous antitrust enforcement and lower barriers to entry can help enable that disruption.

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