PublishedApril 8, 2016

FCC Chairman Moves to End a Decade of Delay on Special Access

Washington, D.C. — FCC Chairman Tom Wheeler announced a proposal today to update rules on the high-speed broadband connections that companies use to transmit data on everything from credit card sales to movies.  Wheeler is asking the FCC to replace the current patchwork of regulations and update them for the 21st Century.

If approved by the FCC, the new regulatory framework would help network providers expand their networks, promote the development of 5G wireless, and support the Internet of Things (IoT) – all of which create tremendous opportunities for competition, innovation, economic growth, and job creation.

Because only a few incumbents control what’s been called “special access” services, this $40 billion market has featured anti-competitive terms and conditions, often called “lock-up” agreements.  Every day, nearly all Americans use these high-capacity broadband lines without even realizing it.  Most consumers do not know that the wireless networks they use to watch streaming videos, post pictures, or even make phone calls rely on these circuits that are usually controlled by a few incumbents able to charge whatever they like.

Back in 2005 the FCC opened a proceeding to address the lack of competition, but real change has been elusive.  Based on numbers filed with the FCC and now publicly available, 97% of all locations only have access to services from one or two providers.  Because there is such limited competition among special access circuits in many areas, these incumbent carriers charge monopoly rents, keeping costs artificially high for competitors and consumers.

The following comments can be attributed to Computer & Communications Industry Association President & CEO Ed Black:

“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.

“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.

“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.”

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