Published: Sat, April 22, 2017
Technology | By Timothy Carter

US FCC scraps most business data service regulations

US FCC scraps most business data service regulations

Federal Communications Commissioner Mignon Clyburn ripped the FCC's decisions Thursday to soften regulations on business data services and to reinstate a rule that could increase TV station mergers.

Commissioners voted 2-1 during the FCC's monthly open meeting to lift agency restrictions on large business data services (BDS) providers like AT&T and Verizon. "In reality, price regulation threatens competition and investment because regulators will struggle to set the right price".

"But these legacy networks, which operate on yesterday's copper-based "TDM" technologies at relatively low speeds, are becoming increasingly obsolete", the agency said in a statement after the vote.

High-bandwidth applications, like video and teleconferencing, are driving demand for high-speed Ethernet packet-based networks. At present, BDS is a $45 billion market opportunity per annum. A county would also be classified as competitive if 75 percent of census blocks are served by a cable provider.

The FCC's decision to reduce price controls on bulk broadband access _ known as business data services _ came after Wheeler had proposed to tighten them previous year. Democrats in Congress have raised their fears with the commission that more consolidation could harm consumers. They and others asked the FCC to delay Thursday's vote in favor of gathering more data on the market.

"The last thing we should do is penalize people like that with unnecessary regulatory burdens, particularly when those burdens could deter them from volunteering in the first place", Pai said.

The moves came as Pai is expected to soon try to roll back the controversial net neutrality rules for online traffic that were pushed through by former chairman Tom Wheeler.

The U.S. Federal Communications Commission has voted to deregulate the providers of the business data lines connecting broadband service to many small businesses, schools, hospitals, and ATM machines.

"For a time, the FCC drank deep of heavy-handed economic regulation of the BDS market", he said.

The move marks yet another departure from the Obama FCC, which sought to strengthen regulations and price caps in ILECs in response to complaints from CLECs about unfair prices and contract terms.

The commission also adopted a request for comment seeking input on when carriers must obtain FCC permission to alter or discontinue a service and a notice of inquiry that seeks comment on using FCC preemption authority to prohibit the enforcement of state and local laws that pose broadband deployment barriers.

"For small businesses trying to connect to the Internet, the price of BDS can be the difference between a firm remaining in business or closing its doors - and Pai just gave BDS providers free reign to squeeze these businesses (and their customers) even tighter".

Womble Carlyle Telecom attorney Doug Bonner tells Law360 that while some may not be happy with the proposed changes, the FCC needed to update its rules to reflect the evolving marketplace.

That's important for major companies like Sinclair Broadcast Group, Fox Television Stations, Nexstar, and ION Media Networks in making sure that they fall within the media ownership cap - in which no one company can own stations that collectively reach more than 39% of the country.

Like this: