Category Archives: Regulation

Is it Time to End Asymmetric Regulation?

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This week, USTelecom filed a petition with the Federal Communications Commission requesting the agency to issue a declaratory ruling that incumbent local exchange carriers (ILECs) are no longer subject to dominant carrier regulation when providing interstate mass market and enterprise switched access services.  As the Commission begins to evaluate USTelecom’s petition, we need to keep in mind that the policy question at the heart of this proceeding is not necessarily one of de-regulation per se (although deregulation is the end objective of USTelecom’s petition), but one of regulatory symmetry.  That is, does it make sense to maintain asymmetric regulation for Continue Reading »

When the CLECs Jumped the Shark…

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Last month, I authored a blog entitled It’s Time to Start the Conversation on the IP Transition where I argued that we could no longer postpone the development of a cohesive regulatory paradigm to manage the complicated issue of facilitating the transition from legacy TDM networks to the more efficient IP-based networks.  This view is shared by FCC Commissioner Ajit Pai,who has long-proposed the creation of an “IP Transition Taskforce.”  And now, the chorus of supporters widens to include FCC Chairman Julius Genachowski, who announced today that the FCC intends to form an agency-wide “Technology Transitions Policy Task Force” that Continue Reading »

Economic Theory in Action: The FCC’s Assault on the Mobile Broadband Consumer…

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Recently, I spotted an interesting blog by Scott Wallsten at the Technology Policy Institute.  In this blog, Scott discusses the FCC’s recent decision that Verizon violated the open access rules of the 700 MHz C-Block auction by charging its customers an additional $20 per month on its data plans to tether a device.  In response, Verizon paid a fine and now allows tethering on all new data plans.  However, Scott observes that: Verizon effectively abandoned the post-paid market for light users after the FCC decision.  Verizon no longer offers individual plans.  Even consumers with only a single smartphone must purchase Continue Reading »

Professor Susan Crawford and the Looming “Cable Monopoly”…

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Next month, a new book entitled Captive Audience:  The Telecom Industry and Monopoly Power in the New Gilded Age (Yale University Press 2012) from Cardozo Law School Professor Susan Crawford will hit the bookshelves.  According to her publisher’s blurb, Professor Crawford’s book will examine how the United States has “created the biggest monopoly since the breakup of Standard Oil a century ago.”  But what is this “monopoly” to which Professor Crawford refers?  While the publisher’s promotional blurb is silent on this question, according to a 2010 paper authored by Professor Crawford in the Yale Law and Policy Review, it appears Continue Reading »

George and Larry’s Excellent Peruvian Broadband Adventure…

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Last week, George and I returned from an amazing trip to Peru where we held two days of workshops with OSIPTEL—the Peruvian telecoms regulator—as part of a project for USAID.  As we covered a wide range of topics, we were once again reminded that while language and individual political nuances among various countries may differ, the fundamental economics—and concurrent complex policy issues—facing telecom regulators remain universal.  That is, how do we get more broadband deployed when it isn’t necessarily profitable to do so? In light of this universal question, we spent a significant amount of time talking about the economics Continue Reading »

The Curious Case of the FCC’s Spectrum Screen NPRM…

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With the ever-present specter of spectrum exhaust hanging over the wireless industry, policymakers are constantly faced with the corresponding question of how to allocate spectrum among competing providers to ensure that market does not devolve into one with “excessive” concentration under Section 309(j)(3)(B) of the Communications Act.  Since the 1990’s, the FCC has tried a variety of approaches—from outright spectrum caps to the current and more flexible case-by-case “spectrum screen”—to try to manage its statutory charge.  As to be expected given the huge stakes at hand, stakeholders vehemently disagree as to the best approach moving forward (particularly with the new Continue Reading »

The FCC’s Special Access Fiasco: No Data and Wrong Policy Question…

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Late Wednesday night, the Federal Communications Commission released a Report and Order that would suspend, on an “interim” basis, its rules for automatic grants of pricing flexibility for special access services “in light of significant evidence” that the current deregulatory trigger—i.e., two competitors have collocated in a single Metropolitan Statistical Area (“MSA”)—is “not working as predicted.”  In particular, the Commission found that the geographic territories contained in most MSAs are “overly broad” and, in contrast, most competitive entry is occurring only in areas with “extremely concentrated demand.”  Although the Commission concedes that it “currently lack[s] the necessary data to identify Continue Reading »

How the FCC “Rigs the Game” for Broadband Regulation Under Section 706…

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Over the last several years, we have seen the Federal Communications Commission put forth a rather clever argument to expand its regulatory authority over broadband services.  The argument goes basically like this:  Under Section 706(a) of the Communications Act, the Commission “shall encourage the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans … by utilizing … price cap regulation, regulatory forbearance, measures that promote competition in the local telecommunications market, or other regulating methods that remove barriers to infrastructure investment.”  As part of its mandate, Section 706(b) requires the Commission to conduct a regular Continue Reading »

Susan Crawford and the Economics of the Wireless Industry…

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Last week, Professor Susan Crawford authored an op-ed entitled What’s Good for Verizon and AT&T Is Terrible for American Consumers.  While Professor Crawford’s emotional argument is a bit scattered, her depiction of an industry in transition provides a useful foundation for discussing the future of broadband in the United States. First, Professor Crawford argues that wireless broadband is a “commodity,” and one that consumers are increasingly using as a substitute for traditional “voice” and “texting” services.  This substitution is arguably true and, as such, we should therefore expect to see broadband providers increasingly employing and experimenting with a variety of Continue Reading »

What the United States Can Learn From OFCOM’s Olympic Spectrum Plan…

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With the Olympic Games opening tonight, it doesn’t take a PhD in electrical engineering to recognize that the broadband infrastructure in the United Kingdom will be stretched to its limits.  According to a recent article, in order to accommodate the huge spike in expected traffic, the Olympics network will span 30,000 connections across 94 locations and will include: 5,500 kilometres of new fiber optic cables; 2,200 switches; 1,800 wireless access points; 7,000 cable TV sockets; 16,500 telephones; and 65,000 active network ports (active connections). But with nearly a million people expected to attend the Games—nearly all of which will be Continue Reading »