FCC's Access Proposal Gets 'Special' Attention

The FCC's special access (business broadband) reform proposal introduced Friday drew an early crowd after FCC chairman Tom Wheeler outlined the proposal—circulated to the other commissioners April 7—in a blog post.

"Sprint commends Chairman Wheeler for moving forward today on what we have long believed to be one of the most fundamental reforms necessary for broadband competition and 21st century innovations like advanced mobile broadband services and the Internet of Things," the company said in a statement. "High-speed, dedicated 'special access' connections are critical inputs to nearly every application and service that powers our economy and the overwhelming monopoly or duopoly control over those connections has cost our economy $150 billion in the last five years alone.

"The Chairman's recommendation today moves to end that enormous drag on our economy, ushering in a new framework supported by rules that look forward not backward, towards competition and away from market failure and artificial technology or legal distinctions."

"In a blog post today, Chairman Wheeler signaled that relief is finally on its way to the long-suffering market for high-speed, dedicated broadband connections," said Competify, whose members include Public Knowledge, Level 3 and INCOMPAS, which represents competitive telecom carriers.

"Based on the largest and most comprehensive data collection ever conducted on this dysfunctional market, the differential diagnosis revealed a disease of monopoly-duopoly control affecting a staggering 97% of markets across the country," the group said. "In his move towards the cure today, Chairman Wheeler proposed a comprehensive treatment that will deliver a 21st-century framework to end the scourge of this disease on all sectors of the broadband economy and drive innovations like the Internet of Things and 5G to consumers and businesses across the country."

“Chairman Wheeler today announced policy reform efforts intended to end a decade of delay and unleash a century of choice and innovation," said Broadband Coalition spokesman Jeff Sharp—the group represents competitive broadband providers. "The FCC is also taking additional steps to address anti-competitive terms and conditions that lock up customers and lock out competition. The Broadband Coalition welcomes pro-consumer action and looks forward to working with the entire FCC to promote more competition and choice for our customers."

Verizon and INCOMPAS this week offered up their own compromise on special access that tracked with the FCC proposal, and both weighed in with separate statements.

“In the more than 10 years that the FCC has been examining these business data services, the marketplace has changed dramatically," said Kathy Grillo, senior VP and deputy general counsel at Verizon. "Customers have moved past legacy services and are choosing better, faster services like Ethernet. We welcome Chairman Wheeler’s proposal and support his commitment to resolve these issues promptly and fairly." Wheeler planned to vote on the proposal at the FCC's April meeting and wanted to vote out an order this year.

"We are encouraged that he has proposed a path towards a balanced framework that would put all providers on equal footing under the same set of rules," said Grillo. "It would also rely on competition, rather than regulation, whenever possible. The framework recognizes that many different companies compete today to serve business customers and that the Commission should approach the marketplace in a technology-neutral manner.  We will work with the Commission and other stakeholders as it further develops its new approach over the coming months.”

“We have a business data revolution, and competition is the key. That is the message from Chairman Wheeler today who continues to remain steadfast in his support for competition policy," said INCOMPAS CEO Chip Pickering. “By ending anti-competitive lock-up provisions, the FCC is speeding the deployment of new, advanced networks and is providing relief to mobile and business customers hungry for more competition."

“No American business large or small, in services or manufacturing, should be held hostage to unfairly high rates for critical data transport simply because there is no competitive alternative and only crippled regulation," said Ed Black, president of the Computer & Communications Industry Association.

“After a decade of delays, the FCC has the data to analyze the special access marketplace and institute reforms that will promote competition, speed deployment of faster networks, and ultimately promote innovation and economic growth," he said. "CCIA applauds Chairman Wheeler’s proposal and urges the FCC to ensure that businesses and competitors are no longer gouged by a few incumbents for accessing this crucial broadband input.  We are glad to see that the FCC will vote later this month to begin the process of bringing real change to this market.  By reforming this market, the FCC can lower costs for consumers, incentivize the deployment of next generation networks, and facilitate economic growth.”

“I thank Chairman Wheeler and the FCC for including special access on the Agenda for the Commission’s April Open Meeting," said Competitive Carriers Association President Steven Berry. "After 11 long years, it is more than time for the broken special access regime to be reformed.  Wheeler appropriately noted today the growing dependence of wireless carriers on business data services for backhaul as networks move to 5G, and CCA looks forward to working with the FCC to establish policies that support competition and expanded services for consumers.”  

Cable operators, who face potential new regulations on their business-class service, were not equally celebratory about the prospect.

While neither the National Cable & Telecommunications Association nor the American Cable Association had immediate reaction to the FCC's proposal, both had weighed in on the Verizon/INCOMPAS proposal that also suggested extending regulations to cable operators.

ACA president Matt Polka said extending regs to cable ops will "impose costs on...new entrants—many of whom are small providers that have no experience with common carrier rate regulation—slowing their entry and their efforts to bring competition and innovative services to market. That is clearly not in the public interest."

“The ‘principles’ suggested by Verizon — INCOMPAS seem at odds with sound economics and a policy of promoting market-driven, facilities-based competition," NCTA said. "Cable operators are new entrants in the business services market, and are investing heavily in building their own facilities to serve business customers.  They are providing precisely the type of facilities-based competition that the Chairman has praised. The FCC should reject any call [it has not] to impose new, onerous regulations on an industry that is stepping up to offer meaningful choices to business customers.  The FCC will not achieve competition if it burdens new facilities-based entrants with regulation.”

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.