Did you know the U.S. Federal Communications Commission issues an annual report on the state of competition in the wireless industry? According to Reuters, the report covering 2008-2009 issued on Thursday marked the first time since 2002 the FCC did not describe the wireless industry as having “effective competition.”

FCC Commissioner Michael J. Copps issued a statement on the report, calling part of the findings “sobering.”

“The Report confirms something I have been warning about for years—that competition has been dramatically eroded and is seriously endangered by continuing consolidation and concentration in our wireless markets.”

The commissoners were not in agreement regarding the lack of competition – which may account for the ommission of the key phrase, “effective competition” in the report.

Commissioner Meredith A. Baker welcomes the dialogue “with those that have concerns.” In a statement, she said, “I see nothing in this Report that should lead us to question the overall competitiveness and vitality of the mobile wireless industry in the U.S.  Indeed, this Report cannot provide factual support for any shift in the flexible manner in which we auction, license, or regulate wireless services.”

According to Reuters, Robert Quinn, AT&T senior vice president of federal regulatory policy, said the FCC’s decision was a dramatic break from years of solid precedent.

“We can’t help but worry that this seems intended to justify more regulation in a market where it is clear beyond doubt that regulation is simply unwarranted,” Quinn said.

While the ability for consumers to switch providers has gotten easier in the past few years, choices are still limited. Consumers are overwhelmed and hindered by rising wireless costs, inconsistent service, and skyrocketing early termination fees to get out of a contract that is not being maintained by the company.

Robert M McDowell, an FCC commissioner, said in a statement, “the vast majority of consumers have a meaningful opportunity to change providers if they cannot withstand a “bill shock” or are unhappy with their mobile broadband experience.”

Stories can be found on the Internet describing consumers who pay close to $200 a month but don’t get any service in their household.  Does this customer have a choice? Yes – but it’s not one that consumers see as an actual choice, or even a meaningful opportunity.

For many, that “meaningful” opportunity of choosing to switch is like choosing between the lesser of two (or three, or four) evils.

Wireless companies don’t wish to see further regulation. If it were to happen, they may be forced into upgrading their towers and services, allowing customers who experience habitual loss of service to end a contract without penalty, and acknowledging customer service complaints.

Competition is good for the market – good for the consumer. And right now there is a lack of effective competition.