With Chairman Michael Powell reduced to casting a dissenting vote, the Federal Communications Commission has undone years of promoting a robust, competitive atmosphere for providers of business-class services. Powell is right to call for a reversal of the recent FCC decision changing line-sharing rules for voice and data. Continuing the federal line-sharing structure would help promote competition, create more choices for services and motivate Regional Bell Operating Companies to continue broadband build-out. All these things are vital to business.
The ordered elimination of broadband line-sharing rules leaves incumbent carriers in charge of the pipes and the service, potentially reducing competition and leading to higher prices for high-speed Internet access. Today, some 40 percent of DSL service rides on lines leased from RBOCs, but now the future of that competitive landscape is in doubt; the competitors only choice is to sue the FCC for striking down this essential requirement, and we look to the courts to make right what the commission has undone.
The FCC has also ordered that future broadband deployments with newer technologies such as fiber optics remain largely unregulated. This could undermine competition in an immature market and could result in monopolization of local broadband. The board has said repeatedly that last-mile loops create a bottleneck for broadband. Regulation that guarantees multiple last-mile carriers will help alleviate that bottleneck.
In addition, rates paid to RBOCs by competitive carriers serving high-capacity voice loops for business users will now be set by individual states, leaving much uncertainty in an important area. The Supreme Court ordered the FCC to find a way to support the fundamental competitive tenets of the Telecommunications Act of 1996 with a ruling on unbundling these lines; instead, the FCC has opted not to decide but to shift the burden.
Further reading
The commission can still change course, but if it doesnt, the courts must order the commission to make good on its responsibility to consumers and to enterprise telecom users, whose access to competitive telecom services has so important a role to play in the future of our economy.
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