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Democratic Senators Have BDS Reform Issues - Broadcasting & Cable

Democratic Senators Have BDS Reform Issues

Urge FCC to include latest cable data
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A group of Democratic senators (and one independent) are urging the FCC to factor in more recent cable business data service (BDS) information into their calculation for revamping its rules on business broadband service.

That came in a letter to FCC chairman Tom Wheeler, according to the Invest in Broadband for America coalition, which was formed to urge the FCC to "get its facts right" before proceeding.

In their letter, the senators, from rural states, said: “As you work toward a final rule, it is especially important for the Commission to use all the available data, including the data submitted earlier this year by the major cable operators, to both measure competitive markets accurately and ensure that the regulations for noncompetitive markets are based on the real cost to provide service, especially in low-density, high cost rural markets.”

They are only the latest to suggest the FCC needs to incorporate that information into its proposed reforms of what used to be called special access but has been rebranded.

Related: FCC Pressed to Re-Vet BDS Study

The FCC is phasing out the presumption of regulating the rates of historically "dominant carriers"—the ILECs (incumbent local exchange carriers)—as a way to boost competition from "nondominant" CLECs (competitive local exchange carriers) and from cable competitors, and instead regulating any of them as it deems necessary to boost competition.

BDS lines are dedicated connections used by businesses and institutions to deliver voice and data traffic, including for ATMs and credit card transactions. The regs have been applied to the larger incumbent local exchange carriers (ILECs)—Verizon, AT&T, CenturyLink and Frontier among them—but the chairman thinks they should apply across the board where more competition is needed.

The FCC's goal is to increase competition in the BDS market.

As part of that years-long data collection, some major cable operators initially had provided data on where they were actively providing competitive BDS service but did not include places where they were capable of providing it but weren’t.

Cable operators have been pushing back on the BDS reform proposal since the FCC is proposing including their business broadband service, which has traditionally been treated as the de facto nondominant competitor to the ILECs service, in the regulatory mix based on an approach that tries to identify what player lacks sufficient competition, incumbent telco, competitive telco, or cable operator, and regulate accordingly.

Incumbent telcos CenturyLink, AT&T, Frontier Communications, FairPoint, Consolidated Communications, and Cincinnati Bell have asked the FCC to revisit the decision.

The Broadband Coalition, which supports the FCC's proposal, saw the letter not as a call for delay, but a call to action on more competition in BDS services.

"“We welcome and applaud the Senators’ support for competition policy that will help rural communities and small businesses. The FCC has compiled the most comprehensive data collection in history, which clearly shows overwhelming market power, indicating monopoly and duopoly control are driving up prices for business customers, schools and libraries."

The Senators did not explicitly call for delay, but just said the FCC needed to make sure it had all the info it needed to make its decision. The coalitions clearly have a different view of whether that was the case when the FCC proposed the changes.

"“Separately, calls for delay by incumbent provider CenturyLink are a sad and empty attempt to keep consumers trapped in last century’s monopoly," the coalition added. "Thankfully, the FCC is poised to unleash the future of competition, lower prices and new network growth.”

Under FCC rules, those incumbent telcos are required to lease BDS lines to competitors, like cable operators. But the FCC deregulated AT&T and others' special access lines in 2009 in cases where competitive triggers are met.

Those lines are the "last mile" dedicated broadband lines to businesses, which incumbent local exchange carriers have dominated.

Signing on to the letter, according to the ILEC-backed Invest in Broadband for America coalition, were Jon Tester (D-Mont.), Maria Cantwell (D-Wash.), Patty Murray (D-Wash.), Heidi Heitkamp (D-N.D.), Michael Bennet (D-Colo.), Amy Klobuchar (D-Minn.), Bob Casey (D-Pa.), Angus King Jr. (I-Maine), and Tammy Baldwin (D-Wis.).

Related: Telco Coalition Forms To Oppose FCC Business Broadband Proposal

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