The Federal Communications Commission is preparing to eliminate a requirement that Charter Communications compete against other ISPs with new broadband deployments spurred by its purchase of Time Warner Cable.

The FCC's approval of the merger last year required Charter to deploy broadband with download speeds of 60Mbps to at least 2 million residential and small business locations, of which at least 1 million must be in areas served by at least one other high-speed provider. Then-FCC Chairman Tom Wheeler, who was frustrated by cable companies' unwillingness to compete against each other, argued that having two high-speed providers in cities and towns would lower prices and give consumers more choice. ISPs often avoid each other's territories because it's easier to get customers in unserved areas.

But lobby groups for small and medium-sized ISPs objected to the merger requirement and asked the FCC to eliminate it. Newly appointed FCC Chairman Ajit Pai is ready to oblige, as multiple news reports say he has circulated an order to fellow commissioners that would eliminate the "overbuild" requirement.

The good news for Internet users seeking faster speeds is that Pai's order reportedly would not eliminate the requirement to deploy broadband to at least 2 million more locations. The merger approval required Charter to complete that build within five years.

"The 2 million buildout requirement remains, but according to the item that could now all be buildouts to currently unserved homes, with no overbuilding, though Charter could still choose to overbuild those one million. They are just no longer required to do so," Broadcasting & Cable reported yesterday.

An FCC official "said the rationale behind the order was to encourage Charter to build in unserved areas of the country, not places where customers can already access high-speed broadband," the news site Axios reported.

When contacted by Ars, the FCC provided no update on when the order might be approved.

The American Cable Association, which represents small and medium-sized providers, met with FCC officials last week to discuss its request to eliminate the overbuild condition. "The threat of government-mandated, uneconomic entry undermines the incentive for smaller operators to invest in expanding their networks to bring new and better broadband services to unserved or underserved populations," the group said in a filing after the meeting. The merger condition is "at cross-purposes with policymakers’ larger objective of bringing broadband to those without it."

Charter agreed to abide by the competition requirement in order to get its merger approved. CEO Tom Rutledge last year said his company would fulfill the overbuild requirement by entering the territory of phone companies like AT&T or Frontier rather than competing against other cable companies.

NTCA—The Rural Broadband Association, which represents small telcos, also asked the FCC to overturn the competition requirement. The idea should have majority support at the FCC, based on statements made by the commission's Republican members last year.

Pai voted against the Charter/Time Warner Cable merger, not because he was against the merger itself but because he opposed the conditions the FCC imposed upon Charter. The merger approval was "about imposing conditions that have nothing to do with the merits of this transaction," and "about the government micromanaging the Internet economy," a Pai spokesperson said at the time.

FCC Commissioner Michael O'Rielly, who now forms a 2-1 Republican majority with Pai, dissented in part from the merger while objecting to the overbuild requirement. The condition "diverts capital that the merged company could use to improve service to their existing customers or expand service to households without advanced services, harming these consumers," O'Rielly said at the time.

Disclosure: The Advance/Newhouse Partnership, which owns about 13 percent of Charter, is part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.