Effects of Market Structure on Broadband Quality in Local U.S. Residential Service Markets

Abstract

Does entry and exit of competitors from broadband services markets have large effects on the quality of broadband plans offered to consumers? Answers to this question inform design of subsidies to improved broadband in underserved areas, and antitrust policy. The authors investigate quality effects of entry (or exit) in 2014 legacy (cable and digital subscriber line) duopoly residential markets. Entry or exit by legacy technology providers had large impacts on 2018 service quality, though impacts diminished rapidly with continued entry. Entry by a single fiber Internet service provider (ISP) had no impact on available quality; entry by more fiber ISPs had modest but statistically significant effects.