Federal Communications Commission DA 14-1862 1 Before the Federal Communications Commission Washington, D.C. 20554 in the Matter
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Federal Communications Commission DA 14-1862 Before the Federal Communications Commission Washington, D.C. 20554 ) In the Matter of ) ) Implementation of Section 6002(b) of the ) WT Docket No. 13-135 Omnibus Budget Reconciliation Act of 1993 ) ) Annual Report and Analysis of Competitive ) Market Conditions With Respect to Mobile ) Wireless, Including Commercial Mobile Services ) SEVENTEENTH REPORT Adopted: December 18, 2014 Released: December 18, 2014 By the Chief, Wireless Telecommunications Bureau: TABLE OF CONTENTS Heading Paragraph # I. INTRODUCTION ..................................................................................................................................1 II. COMPETITIVE DYNAMICS WITHIN THE INDUSTRY ................................................................10 A. Service Providers............................................................................................................................11 1. Facilities-Based Providers .......................................................................................................11 2. Resale and MVNO Providers...................................................................................................15 3. Other Providers........................................................................................................................17 B. Connections, Net Additions, Churn................................................................................................19 1. Subscribers and Total Connections, and Net Additions ..........................................................19 2. Subscribers and Net Additions.................................................................................................23 3. Churn .......................................................................................................................................26 C. Market Shares and Concentration ..................................................................................................29 D. Financial Indicators ........................................................................................................................34 1. Revenue and ARPU.................................................................................................................34 2. Average Revenue per Unit (ARPU) by Provider.....................................................................38 3. Wireless Telephone Services CPI............................................................................................40 4. Profitability Metrics.................................................................................................................42 III. OVERALL MOBILE WIRELESS INDUSTRY METRICS................................................................44 A. Network Coverage..........................................................................................................................45 1. Overall Network Coverage ......................................................................................................46 2. Network Coverage and Roaming.............................................................................................57 3. Network Coverage by Technology ..........................................................................................58 4. Network Coverage by Income Levels......................................................................................60 5. Commission Actions Related to Coverage, Technology and Roaming...................................61 B. Connections and Subscribers..........................................................................................................66 1. Connections and Subscribers by Geography ...........................................................................66 1 Federal Communications Commission DA 14-1862 2. Connections and Subscribers by Demographics......................................................................67 C. Consumers and Mobile Wireless....................................................................................................69 1. Usage .......................................................................................................................................70 2. Handsets...................................................................................................................................75 3. Mobile Applications.................................................................................................................77 4. Consumer Access to Information.............................................................................................82 5. Intermodal Developments........................................................................................................86 IV. INPUT MARKETS...............................................................................................................................87 A. Spectrum.........................................................................................................................................88 1. Importance of Spectrum for the Provision of Mobile Wireless Services.................................89 2. Facilitating Access to Spectrum...............................................................................................93 3. Analysis of Spectrum Holdings .............................................................................................104 B. Non-Spectrum Input Segments.....................................................................................................108 1. Wireless Infrastructure...........................................................................................................108 2. Backhaul ................................................................................................................................116 C. Downstream Mobile Wireless Ecosystem....................................................................................120 V. PRICING LEVELS AND TRENDS...................................................................................................126 A. Postpaid Service ...........................................................................................................................128 1. Equipment Installment Plans .................................................................................................129 2. Changes in Monthly Pricing of Postpaid Plans......................................................................135 3. Impact of EIPs on Consumer Costs .......................................................................................140 4. Promotions and Incentives.....................................................................................................144 5. Evolution of Data Pricing Models .........................................................................................147 6. Other Developments ..............................................................................................................152 B. Prepaid Service.............................................................................................................................154 1. Prepaid Plan Choices .............................................................................................................159 2. Availability of Handsets ........................................................................................................162 3. Service Coverage ...................................................................................................................163 4. Data Speeds and Data Allowances ........................................................................................164 C. Price Indicators for Mobile Data ..................................................................................................165 1. Postpaid Smartphone Data Price............................................................................................166 2. Prepaid Smartphone Data Price .............................................................................................167 VI. NON-PRICE RIVALRY ....................................................................................................................168 A. Investment ....................................................................................................................................169 B. Network Coverage and Technology Upgrades.............................................................................173 1. Current Coverage by Provider ...............................................................................................174 2. Coverage and Roaming..........................................................................................................180 3. Service Provider Network Deployments................................................................................182 C. Quality of Service.........................................................................................................................189 1. Network Speed.......................................................................................................................193 2. Latency...................................................................................................................................204 D. Differentiation in Mobile Wireless Handsets/ Devices ................................................................208 E. Advertising and Marketing...........................................................................................................212