Not a surprise in the current deregulatory climate, but the FCC released a statement on Thursday saying there is “substantial and growing competition in the market for business data services,” and therefore it is easing “outdated pricing rules to enable continued robust growth in the market.”
Also not a surprise, but the vote went strictly along party lines 2 to 1, as the sole Democratic Commissioner Mignon Clyburn offered a blistering dissent.
“The order uses as justification to deregulate the existence of competitors that no longer compete in the market and the fact those former competitors have been purchased by the very incumbents they are supposedly competing against magically gets lost in this analysis,” Clyburn says. “Most heartbreaking is that today’s action ruthlessly targets areas that most desperately need help. Those places must now brace themselves for an unconscionable 60 percent price hike, which is what we saw the last time we deregulated this broadly.”
She adds that she thinks the blame for the rate spikes she expects to see “is squarely on us.”
The Commission’s official statement around the policy says it relied on more than 10 years of study of the business data services (BDS) market and a public record garnered from numerous requests for comment in making the decision. “Given that competition, the order finds that legacy regulation inhibits the investment required for the transition of BDS from legacy TDM networks to high-speed Ethernet connectivity. In response, the Order modernizes regulation in significant portions of the market,” it says.
David L. Cohen, senior EVP and chief diversity officer at Comcast commented that he views the FCC’s action as a positive step toward ensuring continued investment in new broadband facilities, driving economic growth, and creating jobs.
“Businesses today have more options for data services at better prices than at any other time in history, and we want the market to remain competitive and innovative for both the benefit of business customers and consumers,” Cohen says. “We applaud the FCC’s decision to help the business data market continue to flourish by minimizing burdensome and investment-killing regulations, specifically on new entrants. As a newer entrant in many markets, Comcast is committed to bringing more services to more business locations throughout the U.S. in the months and years ahead.”
Expect many pro and con opinions to flow in around this decision over the next few days, which we will share here at CED.
Filed Under: Industry regulations