CWA's support of AT&T/DIRECTV merger based on fallacious logic

CWA says AT&T-DIRECTV merger will advance broadband buildout, help consumers, Workers | Speed Matters - Internet Speed Test: The AT&T/DIRECTV merger will improve the economics for AT&T’s investment in high-speed broadband, the critical infrastructure for the 21st century, CWA said. Video is the major driver of broadband expansion, producing the revenue stream to support investment in high-speed networks. As a stronger video competitor, a merged AT&T/DIRECTV will have the economic incentives to increase investment in the high-capacity networks that are so essential to drive economic growth, jobs, and the social benefits enabled by high-speed digital technology.

So asserts the Communications Workers of America in comments filed with the U.S. Federal Communications Commission in support of AT&T's acquisition of DIRECTV.

The problem is the logic does not hold up. AT&T's deriving additional revenues from DIRECTV video services does not necessarily mean those additional funds will be invested in landline Internet infrastructure.

And why should that be the case, AT&T will likely ask itself once the deal goes through, when satellite does the job of delivering video content to residential premises? Instead, any video revenue bump from the deal will likely be plowed into earnings and dividends, not CAPex.

CWA calls its broadband survey results "deeply troubling"

The Communications Workers of America has been hounding the telcos that employ them to get off the dime and upgrade their broadband networks. CWA accurately complains that current telco broadband deployments are a disorganized "hodge podge" that leaves many customers mired in broadband black holes while others get service.

To build its case, the union recently conducted a web-based survey in which visitors tested their broadband connection speeds and recorded their location.

The results, CWA concludes are "deeply disturbing," showing a median download speed of 1.9 megabits per second (mbps), which it called "positively sluggish" compared to other countries. In France, for example, the median download speed is 17 mbps, 45 mbps in South Korea and 61 mbps in Japan.

The 1.9 mbps median speed means half of those who took the CWA speed test are higher than that number and half are lower. Had more dial up users taken the test, the median speed would be even lower, CWC noted. Only five percent of the test takers used dial up connections, compared to 30 to 40 percent of the country who are still using dial up CWA said.

The CWA survey results feature a map of the U.S. that allows users to check average reported download and upload speeds by state, county and ZIP code.

CWA President Larry Cohen blamed weak regulatory policy for America's broadband gap. "Our nation's current plan of allowing the market to determine who gets true high speed and who doesn't is bad public policy," he said.

CWA said it's delivering the report to every member of Congress and added it supports pending Senate legislation, the Broadband Data Improvement Act that would require the federal government to collect and evaluate detailed data on the current state of high speed internet deployment.