I readily acknowledge I'm attacking your metaphor and not your argument here, but I'm curious about your perspective because I don't understand it.
You really think that if the government decided to stop regulating car safety tomorrow that car manufactures would STOP putting seatbelts and safety features in cars?
You realize that seatbelts were invented by the industry right? You know all those cool new driver assist saftey features that are poping up in cars? Those don't exist because they were regulated into existence. They are there because the market wants them people want them and will pay money for them so the industry is responding to it.
Regulations are for addressing tragedies of the commons, externalities, and market failures. Your smoking metaphor is a GOOD example because there are externalities that can't be addressed by the market. But this belief that companies whole purpose isn't to give it's customers what they want (yes so they can make a profit) is bonkers to me.
Now if you want to talk about how a lot of ISP's have a quasi-monopoly, then hell yes let's have that discussion. I'm right there with you, and those companies have done a lot to try and prevent creative solutions to the last mile problem(municipal fiber). Those are the sorts of things the FCC should be working to straiten out.