Alongside competition you also need a level of transparency. The consumer needs to be able to get proper information about what they are buying. There's laws around that already, but they often need to be accompanied by regulations that define what that means for a particular industry (I'm being a bit vague here because I'm not American, so I don't know the precise issues in the US).

Before Joan Citizen signs up for on a 24 month contract with Super-Cheap-ISP, she needs to know that they throttle Netflix (because that way they keep their bandwidth requirements down and their prices low). That might be exactly the tradeoff she wants, but she needs to be able make an informed decision.