WASHINGTON, D.C.—The FCC may be on the verge of relaxing regulations on
business data services, including how much they can charge
customers. A vote is scheduled for April 19 on a deregulation plan
that has been in the works for more than a decade.
Business data services are point-to-point connections used by
businesses, non-profits and government institutions that need to
send large volumes of data via secure lines. Traditionally,
the local exchange carriers that provide these services have been
subject to price regulations.
In his proposal before the Commission, FCC
Chairman Ajit Pai said the proposed deregulation "recognizes
the strong competition present in the business data services market
and modernizes the commission's regulatory structure
accordingly to bring ever new and exciting technologies, products
and services to businesses and consumers."
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 just a fundamental market reality that I think
is really influencing the commission here to deregulate that
shrinking market," according to Bonner. "And what
they've essentially done here, and I guess where there's
any controversy in their proposed order, is the commission is
essentially relaxing what their competitive market test is for ex
ante price cap regulation to the presence of simply one potential
competitor within essentially one half-mile."
Under the Pai plan, if a market has two service providers with a
half-mile, then that area is considered competitive and, thus,
subject to deregulation.
Bonner said that while some say that test isn't strict
enough, there doesn't appear to be a "groundswell of
Also, Bonner says, "To the FCC's credit, whether you
agree with the conclusion they're reaching or not, or whether
or not even their test is perfect or not," the plan will
provide clarity to a debate that has been going on for 12
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