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The Internet Innovation Alliance is a broad-based coalition of business and non-profit organizations that aim to ensure every American, regardless of race, income or geography, has access to the critical tool that is broadband Internet. The IIA seeks to promote public policies that support equal opportunity for universal broadband availability and adoption so that everyone, everywhere can seize the benefits of the Internet - from education to health care, employment to community building, civic engagement and beyond.

The Podium

Thursday, August 23

Halting Deregulation of Special Access Will Slow Transition to Next-generation Networks

By Bruce Mehlman

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Yesterday along a 3-2 party-line vote, the FCC opted to suspend a thirteen-year-old special access regulatory framework without an adequate evidentiary record or market analysis.

For would-be investors, innovators and entrepreneurs, government has once again injected uncertainty into the broadband marketplace, undermining a forward transition across the country to IP-based technologies that enable efficiency and better capabilities for consumers through high-speed broadband networks.

This is a mistake.

America’s special access market is competitive and has contributed to ongoing private-sector investment in upgraded networks. Take T-Mobile, for example, which is able to choose from over a dozen different backhaul providers — from local exchange carriers, to Ethernet wireless providers and cable companies — to keep its customers connected. And that’s just one company in a truly vibrant industry.

Instead of hitting the brakes on special access deregulation and increasing regulatory uncertainty that undermines economic activity, the FCC should encourage the private investment America needs to finally kick free of the technologies of the past, to the benefit of consumers.The future of communication is in bytes — IP-based wired and wireless networks — not the copper-based, networks that offered dial-up, for example.

As pointed out by Sprint, the advantages of Ethernet backhaul over special access are tremendous:

The company [Sprint] might pay $1,500 per month for T1 backhaul at a tower site. That T1 might deliver 4.5 MB of backhaul capacity. When Sprint switches to Ethernet…for the same price of $1,500 per month, Sprint will get almost 20 times the backhaul bandwidth at that location.

Everyone knows healthy competition leads to a healthy market. That’s why the FCC’s focus on the already healthy and competitive special access market is, frankly, a bit baffling and misguided. Technology is fast moving, and the Commission should take care to not bog down innovation with regulatory uncertainty.

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