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Wednesday, June 05, 2019

Wireline Not-Too-Much Competition Bureau

Yesterday's blog post had me reading Alenco v. FCC, where I came across this statement: "The FCC must see to it that both universal service and local competition are realized; one cannot be sacrificed in favor of the other."  And that got me thinking about overbuilding and competition.

The whole idea of controlling overbuilding is antithetical to the Telecommunications Act of 1996, which is the act that created the E-Rate.  The first words of that act: "An Act To promote competition and reduce regulation...."  The FCC's page on the Act says, "The goal of this new law is to let anyone enter any communications business -- to let any communications business compete in any market against any other."  [Side snark: "new law"?! Maybe it's time to refresh that page.]

That's the reason that the E-Rate is overseen by the FCC's Wireline Competition Bureau (WCB).  Congress realized that to provide a level playing field, the existing Universal Service rules were going to have to be rewritten, and while they were rewriting the Universal Service rules, they created 2 new programs: the E-Rate and Rural Healthcare.

The recent Petition for Rulemaking on overbuilding stands the whole competitiveness debate on its head.  When the Telecommunications Act was past, the goal was to force the ILECs (Incumbent Local Exchange Carriers, the Regional Bell Operating Companies (RBOCs) spun off from AT&T in 1984) to allow competitors to use their facilities.  In this case, the petitioners want to force competitors to use their facilities.  So the rules written then don't apply all that well to this situation.  When the Telecommunications Act was written, no one foresaw that overbuilding might one day be an option.

But it just seems very wrong to use the E-Rate to inhibit competition.  It seems wrong to use this program, created by the Telecommunications Act, to reduce competition by increasing regulation.

On a complete tangent, how did the 1984 breakup of the AT&T monopoly work out?  Not so good.

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