FCC to reduce price regulation in business data market

Commissioner Mignon Clyburn, who dissented on the order, said that the order favors large service providers at the expense of small businesses.

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.

"Instead of looking out for those millions of little guys, the commission has once again chosen to side with the interests of a handful of multibillion-dollar providers", Clyburn said in her dissenting statement.

Today, the Federal Communications Commission approved a controversial Order deregulating incumbent pricing power in the business data services ("BDS") market. Especially hard-hit would be those in rural areas: "Cash-strapped hospitals, schools, libraries and police departments will pay even more for vital connectivity, and soon we will see pressure on our rural health care funding, resulting in less bandwidth".

It marked a significant step in FCC Chairman Ajit Pai's aggressive agenda to roll back many existing telecommunications rules and Obama era regulations.

Republican commissioners argued that pricing regulations are largely outdated, with high-speed fiber and cable services beginning to compete with traditional copper-based BDS networks, sometimes called special access.

The commission also will not regulate prices for TDM services at speeds below 45 Mbps in markets that are determined to be competitive.

Where price cap regulation remains, the cap will be reduced by 2% annually to reflect productivity gains. Price caps, he went on, discourage network operators from investing in modern networks like fiber.

"Today's FCC action protects monopoly over free markets", Pickering said. "At the wallets of every American consumer", she said.

The independent U.S. Small Business Administration's office of advocacy, which asked for a delay on the FCC vote a week ago, has shared Clyburn's concerns about price hikes.

FCC Chairman Ajit Pai said he plans to take a new look at the current overall limit on companies owning stations serving no more than 39 percent of US television households.

The National Association of Broadcasters high-fived the 3-2 vote to reinstate the discount.

Later this year, the FCC pledges to take a more holistic approach to re-examining both the UHF discount and the 39% ownership cap placed on broadcasters. Exempt from the new rule are stations that receive funding from the CORPORATION FOR PUBLIC BROADCASTING. "Communities are enriched by the promotion of diversity of viewpoints, and consolidation would limit programming options for viewers and undermine local news editorial operations", Clyburn said. When the FCC eliminated the discount, it grandfathered Ion so that it would not have to spin off stations to get below the 39% cap.

The commission determined that last year's action had the "effect of substantially tightening the national cap for companies without any analysis of whether this tightening was warranted given current marketplace conditions".

"The last thing we should do is penalize people like that with unnecessary regulatory burdens, particularly when those burdens could deter them from volunteering in the first place", Pai said.

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