FCC Set to Vote on Business Data Services Deregulation Move

April 19, 2017 at 1:27 pm ET

Federal Communications Commission Chairman Ajit Pai’s proposed rules to deregulate the business data services market are still scheduled for a vote at the agency’s open meeting on Thursday, despite calls for delay from the tech industry, Democrats in Congress and the Small Business Administration Office of Advocacy.

An FCC spokesman confirmed to Morning Consult Wednesday morning that the order “remains on the agenda at this time” for the next day. Business data services refer to the high-speed data lines that hospitals, schools and companies use to transmit information quickly. They’re also used to connect ATMs, cell towers and staples of daily commerce.

The FCC has set price caps in many areas in an effort to promote competition. But Pai argues that removing the regulations will allow the market to flourish.

That approach to the $45 billion BDS industry, though, has drawn criticism.

Ed Black, president and chief executive of the Computer and Communications Industry Association, said in a Tuesday statement the agency overlooked “compelling data” that shows a lack of competition in the industry. CCIA represents Sprint Corp., PayPal Holdings Inc. and BT Group plc.

The FCC cites data collected in an “extensive record” showing there is “strong competition” in the BDS marketplace, and says easing regulations will allow companies to deploy next-generation technologies.

Former FCC Chairman Tom Wheeler, who led the commission under President Barack Obama, long pushed for regulations that would have applied price caps to the fees telecom companies charge for business data services, due to what he dubbed “limited” competition. But the agency never voted on a final set of rules.

AT&T Inc. supports Pai’s plan, saying in a Wednesday post that it “will ensure that the BDS marketplace will continue to flourish in areas where competition has taken hold and that existing controls remain in place where the Commission determines that competition is still needed.”

The Small Business Administration’s Office of Advocacy met with FCC officials to request the agency delay the vote, voicing concerns about the level of competition in the market. If BDS prices increase significantly, a small business could choose to downgrade its service to reduce costs.

House Energy and Commerce Communications and Technology Subcommittee ranking member Mike Doyle (D-Pa.) and Sen. Ed Markey (D-Mass.) also called on Pai to delay the vote. The pair argued in a Tuesday letter that there should be “more protections for competitors and small businesses, not greater market control by incumbents.”

Arkansas Republican Sens. Tom Cotton and John Boozman, as well as Rep. French Hill, wrote to Pai on Monday requesting the addition of a “reasonable transition period” so that small businesses can prepare if prices increase following the passage of the rules.

 

Correction: A previous version of this article misstated when lawmakers wrote their letters to Pai.

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