Your reasoning would be fine, were it not for the fact that an ISP's mere existence in an area, no matter how crappy, generally satisfies FCC's mandate to promote/fund broadband penetration. So, Crappy-ISP, LLC existing and being able to pencil-whip FCC filings about minimum speed expectations across its coverage area means the FCC will make no effort to provide funds for Less-Crappy-ISP, LLC or Moderately-Crappy-ISP, LLC to come in and fill gaps.