One of the many government programs that you pay for is the "Connect America Fund." This fund is paid for with some of those added fees on your phone bill. The fund has the intent of bringing subsidized Internet access to disconnected families, particularly in rural areas.
Today, the program guarantees that networks maintained with subsidized funds must offer speeds of at least 4Mbps. While this speed does fall within the FCC's definition of broadband, the commission believes that it does not provide enough speed for modern Internet usage. Accordingly, they are increasing the required speeds,
The FCC will now require companies receiving Connect America funding for fixed broadband to serve consumers with speeds of at least 10 Mbps for downloads and 1 Mbps for uploads. That is an increase reflecting marketplace and technological changes that have occurred since the FCC set its previous requirement of 4 Mbps/1 Mbps speeds in 2011.
That is quite an increase, theoretically. An increase of 150% in download speeds would be enough to excite any customer, but the destination speed is not exactly impressive. FCC Chairman Tom Wheeler said,
When 60 percent of the Internet's traffic at prime time is video, and it takes 4 or 5Mbps to deliver video, a 4Mbps connection isn't exactly what's necessary in the 21st century.
That comment is interestingly accurate. In scanning the plans offered by our local cable provider, I see that 15Mbps is the slowest plan they offer. However, our service exists within a densely populated area, which has a lot of potential customers. With customers comes revenue, and with revenue comes viable upgrades. In the rural areas, most of the revenue is coming from the Connect America Fund, which will, obviously, limit the capabilities of said service.
In forcing this upgrade without providing additional funds to make it possible, the FCC could possibly be hurting the residents of these rural areas. AT&T, Verizon, and the National Cable & Telecommunications Association have all argued that the forced upgrade is a bad idea, and that 4Mbps is a usable speed, even in modern times. Sure, you might not get Netflix at full HD, but considering you're living in a sparsely populated area, the fact that you're not forced to use dial-up anymore should be a win.
If the revenue brought into these companies is not enough to justify the cost of the upgrades, it would be a better business move for the providers to shut down operations rather than upgrade. That would force customers in these rural areas to have to switch back to dial-up, certainly guaranteeing that they would not be able to watch any streaming video, a major point of Wheeler's intents here.