The FCC voted Friday to end regulations requiring incumbent telecommunications carriers to share their DSL broadband connections with competitors.
The FCC, in a 4-0 vote, removed regulations that allowed competitors such as EarthLink to offer DSL over lines owned by the four Baby Bells. While large ISPs such as EarthLink have negotiated agreements with the Bells, some consumer advocates and telecom observers predicted the FCC’s decision could kill off DSL service from small ISPs when the DSL network-sharing rules end in a year.
The FCC’s decision puts DSL regulation on equal footing with cable modem service after the Supreme Court in June rejected a challenge to an earlier FCC decision allowing cable companies to close off their networks to competitors.
FCC Chairman Kevin Martin called the decision “momentous,” with consumers benefiting from a “leveling of the playing field” between DSL and cable modem service. “Consumers will reap the benefits of increased Internet access competition and enjoy innovative high-speed services at lower prices,” he says.
The remaining Bells inherited much of their telecom networks from the breakup of the AT&T monopoly in the 1980s. In an effort to spur competition, the FCC and Congress have required them to share parts of their networks with competitors at discounted prices, but in the last two years, the Republican-led FCC has moved away from those regulations.
SBC and Verizon cheered the FCC’s decision, saying old rules requiring them to share parts of their networks with competitors discouraged them from investing in new products and offering new services. The decision will help the Bells meet President Bush’s goal of nationwide broadband availability by 2007, Verizon says.
EarthLink noted the current DSL line-sharing rules will stay in place for a year, and the company already has contracts with the Bells to provide DSL. “We have every confidence we’ll be able to extend those with them to offer DSL service,” says Dave Baker, vice president for law and public policy at EarthLink. “We have hundreds of thousands of customers, and the Bells will want to preserve them.”
Consumer groups suggested that DSL customers could still lose out. “Changing these rules is . . . anti-competitive and will lead to fewer choices in the marketplace, which means higher prices and worse service,” says Kenneth DeGraff, a policy advocate at Consumers Union.
