This isn't a problem that is going to be solved by placing regulations on the industry. Your example of past subsidies provides an excellent argument for this: given the political clout these entities hold and have in the past used to stilt legislation in their favor, what leads us to believe we're going to do any better with new regulations?
At the end of the day, the market is demanding better internet service. While telecommunications providers are certain to wage war against the injection against honest competition into their sector, things are actually looking pretty good in my mind. The FCC sees market demand and is working to tear down anti-competitive legislative barriers [1]. Smaller efforts such as Google Fiber are doing the hard work of convincing the public that better service is within reach.
http://www.slate.com/blogs/future_tense/2014/02/20/fcc_s_pla...