FCC’s deregulation of business data lines could mean a price hike


If you operate a small or medium-size U.S. business, you can expect to pay more for broadband services in the near future because the U.S. Federal Communications Commission plans to deregulate providers of business data lines, critics of the proposal say.

Users of ATMs, shoppers in stores that use credit card scanners, and mobile phone customers could also see prices go up after the FCC deregulates the so-called business data services (BDS) market. Schools and hospitals also depend on BDS for their broadband service, and prices could rise as much as 25 percent in areas where the FCC removes price caps, critics warn.

The FCC is scheduled to vote Thursday on a proposal from Republican Chairman Ajit Pai that would deregulate large parts of the BDS market, which generates an estimated US$45 billion a year for AT&T, Verizon, and other telecom carriers. Incumbent telecom carriers welcome the plan, saying there’s plenty of competition in the BDS market, sometimes called special access.

Small businesses, ATM providers, and other customers who depend on low-speed, sub-50Mbps broadband service are most likely to be hit with cost increases because 86 percent of those low-speed customers across the U.S. have only one broadband option, said Chip Pickering, CEO of INCOMPAS, a trade group for small telecom carriers.

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