Tuesday, July 2, 2019
Benton Urges FCC to Reject Proposal that Would Harm Competition and Consumers
On July 1, 2019, the Benton Foundation urged the Federal Communications Commission to dismiss a proposal that would require E-Rate program participants to pay more than is required by mandating less competition than is available. The FCC's E-Rate program makes broadband and telecommunications services more affordable for schools and libraries around the country. A petition filed by three Texas carriers calls on the FCC to prohibit E-Rate subsidies from going toward building or extending networks in areas where fiber already exists. Benton opposes the proposal:
- The proposed E-Rate rule changes contemplate circumstances in which the most cost-effective solution is the “special construction” of fiber, rather than use of an incumbent network. But the petitioners’ would bar the most cost-effective solution in order to protect their own interests, which would force the E-Rate program to pay more than it needs to pay. That is the outcome that would be wasteful.
- The petition calls on the FCC to “discourage overbuilding.” There’s a better word for the construction of new networks than “overbuilding.” The word is “competition.” “Overbuilding” is an engineering concept; competition is an economic concept that helps consumers by shifting the focus from counting broadband networks to counting the dollars that consumers save (or schools and the E-rate program save) when they have competitive choices.
The FCC previously considered and rejected similar requests in 2014 as a part of its E-Rate Modernization Order. There are no new laws, facts, or substance that merit a new rulemaking, nor is there a need for new safeguards.
Benton, a non-profit, operating foundation, believes that communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities to bridge our divides. Our goal is to bring open, affordable, high-capacity broadband to all people in the U.S. to ensure a thriving democracy.
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