Complete Story
06/30/2016
ACA To FCC: Don’t Rate Regulate BDS Providers Bringing Competition To The Market
PITTSBURGH, June 29, 2016 - The American Cable Association urged the Federal Communications Commission to retain its time-tested methods of not regulating the provision of Business Data Services (BDS), or special access, by cable and other competitive providers. Such an about-face in fundamental policy would run counter to solid economic and antitrust principles and undermine existing and future investment and the development of competition.
For decades, the FCC has consistently adopted regulatory frameworks in non-competitive BDS markets that target the dominant provider for oversight while leaving the new entrants essentially free from regulation.
"This approach has resulted in enormous investment in new networks, more innovative services, and increased competition. It would be a grave error for the FCC to turn its back on these significant benefits and reverse course," ACA President and CEO Matthew M. Polka said. "Because the FCC has failed to provide a sound economic rationale to support such a dramatic shift in policy or set forth potential benefits for consumers, the agency should summarily reject this misguided concept."
ACA set forth its views in comments filed on June 28 in connection with an FCC proposal to abandon its long-standing "light touch" approach to the regulation of non-dominant BDS providers, including cable operators. ACA estimates that its members are spending tens of millions and potentially as much as $300 million annually to deploy fiber-rich facilities to support the provision of BDS, according to an analysis that was included with the comments. These investments have led to smaller competitive providers reducing prices by more than 50% over the past five years, far more than would result from any reduction from proposed regulation.
The FCC dominant/non-dominant approach to regulation, in place for almost four decades, is rooted in sound and compelling economics since it provides entrants with incentives to commit effort, initiative, and financial investment and avoids needlessly burdening them with regulation.
