Menu
The FCC aims to restore competition in the business broadband market, may help slash costs

The FCC aims to restore competition in the business broadband market, may help slash costs

Business groups want the FCC to limit the rates large carriers can charge

The U.S. Federal Communications Commission will take steps to restore competition in the market for broadband services used by businesses, potentially saving them billions in costs.

For years, groups have called on the FCC to cap the rates charged by Verizon and AT&T, the two carriers that dominate the market.

At a meeting on April 28, the FCC will consider an order that looks at the charges for dedicated connections paid by offices, retailers, banks, schools, hospitals and other types of customer, FCC Chairman Tom Wheeler said.

For more than a decade, critics of Verizon and AT&T have pushed the FCC to address these so-called "middle-mile" data connections, which link ATMs, credit-card scanners, mobile towers and many office broadband networks.

"If we want to maximize the benefits of business data services for U.S. consumers and businesses, we need a fresh start," Wheeler wrote in a blog post Friday. 

Less than 5 percent of business broadband locations nationwide have more than two carriers offering services, according to FCC figures.

Wheeler will propose new regulations for business broadband, often called special access services, to encourage competition.

"Government must ensure that non-competitive markets don’t harm consumers and businesses or stifle innovation," he said. "I propose to identify those markets that are competitive, and those that are not, and to adopt a tailored regulatory framework to mirror those distinctions."

Earlier this week, the Consumer Federation of America released a study estimating that the incumbent carriers have overcharged businesses by US$75 billion for broadband services over the past five years.

The problem affects consumers as well, because businesses often pass on the extra costs, said Mark Cooper, director of research at the consumer group.

Verizon and AT&T dispute the figures. The special access services, based largely on copper-wire networks, are becoming less important in the broadband market overall, they say.

The broadband market has "changed dramatically" in the past decade, said Kathleen Grillo, Verizon's deputy general counsel for public policy and government affairs. 

"Customers have moved past legacy services and are choosing better, faster services like Ethernet," she said in a statement. Verizon is encouraged that Wheeler's plan would "rely on competition, rather than regulation, whenever possible," she added.

Part of the problem is that competitors to the large carriers are not building out their networks, added USTelecom, a trade group representing the large carriers. "The failure of some competitors to invest and build facilities to connect their business customers to nearby fiber ... is a business decision not a market failure," the trade group wrote in a blog post.

Several companies and advocacy groups praised Wheeler's move. 

"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," Ed Black, president and CEO of the Computer and Communications Industry Association, a tech trade group, said in a statement.


Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Featured

Slideshows

Sizing up the NZ security spectrum - Where's the channel sweet spot?

Sizing up the NZ security spectrum - Where's the channel sweet spot?

From new extortion schemes, outside threats and rising cyber attacks, the art of securing the enterprise has seldom been so complex or challenging. With distance no longer a viable defence, Kiwi businesses are fighting to stay ahead of the security curve. In total, 28 per cent of local businesses faced a cyber attack last year, with the number in New Zealand set to rise in 2017. Yet amidst the sensationalism, media headlines and ongoing high profile breaches, confusion floods the channel, as partners seek strategic methods to combat rising sophistication from attackers. In sizing up the security spectrum, this Reseller News roundtable - in association with F5 Networks, Kaspersky Lab, Tech Data, Sophos and SonicWall - assessed where the channel sweet spot is within the New Zealand channel. Photos by Maria Stefina.

Sizing up the NZ security spectrum - Where's the channel sweet spot?
Kiwi channel comes together for another round of After Hours

Kiwi channel comes together for another round of After Hours

The channel came together for another round of After Hours, with a bumper crowd of distributors, vendors and partners descending on The Jefferson in Auckland. Photos by Maria Stefina.​

Kiwi channel comes together for another round of After Hours
Consegna comes to town with AWS cloud offerings launch in Auckland

Consegna comes to town with AWS cloud offerings launch in Auckland

Emerging start-up Consegna has officially launched its cloud offerings in the New Zealand market, through a kick-off event held at Seafarers Building in Auckland.​ Founded in June 2016, the Auckland-based business is backed by AWS and supported by a global team of cloud specialists, leveraging global managed services partnerships with Rackspace locally.

Consegna comes to town with AWS cloud offerings launch in Auckland
Show Comments