FCC Drops Business Access Reform

Donald Trump is already having an impact on telecom policy: In a surprising move today, the FCC dropped plans to pass reform of the Business Data Services (BDS) market, following pressure from Congressional Republicans to pull back.

The BDS reform, which was opposed by incumbent telecom and cable providers, would have reduced the cost of last-mile access for competitive service providers in areas where only an incumbent provides those connections. BDS is a $45-billion-dollar market. (See FCC Prepares to Vote on Price Regulation and FCC's Wheeler: We'll Move Fast on Biz Service Regulations.)

According to multiple reports, including this one from Reuters, Federal Communications Commission (FCC) Chairman Tom Wheeler pulled the long-anticipated reform plan from today's agenda, in the wake of pressure from members of both House and Senate committees that oversee the commission. In separate letters, three different committee chairs had asked Wheeler to drop the BDS vote, which was expected to pass along party lines, by a 3-2 vote.

The thinking is that the FCC should not be undertaking actions that don't fit the nation's new political direction. Trump spoke vigorously against government regulation as a candidate, and the BDS rules would have imposed further regulation via price caps on BDS in areas that the commission determined to be "non-competitive."

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Incumbents other than Verizon Communications Inc. (NYSE: VZ) -- which had teamed up with Incompas , a policy organization supporting the competitive services industry, to draft a reform plan -- no doubt cheered the decision, although quietly. Incompas released a statement calling the move a broken promise that damages the "competition legacy" Wheeler laid out.

"Failure to act tarnishes this FCC’s competition legacy and punishes small businesses, schools and libraries who have been promised faster speeds, lower prices and more competition," Incompas CEO Chip Pickering said in a statement. "The voters have insisted that Washington is broken. They want more competition and better pricing. The market is rigged for broadband monopolies. It’s time for FCC leadership, in the mold of Teddy Roosevelt and Ronald Reagan, willing to fight for competition for all."

Wheeler and crew had hoped to push through their competition agenda before any transition took place, whether to a Clinton or Trump administration. Trump's victory clearly ended those hopes.

— Carol Wilson, Editor-at-Large, Light Reading

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