Time to End the FCC’s Designated Entity Program

[Commentary] New entrants to the broadband access business will be ones with radically disruptive technology, not a discount on one input. The designated entity (DE) program has a history of either being manipulated by large companies, or heaping largess on individual insiders who reap the upside with large profits and incomes.

This doesn’t even account for why public policy should favor small business in the first place. As the Information Technology & Innovation Foundation has pointed out, compared to medium and large business, small business pays lower wages, is less productive, patents less, does less research and development, and exports less and yet they are continually provided an array of distortionary benefits, including lower tax rates, less regulation and in the case of the Federal Communications Commission spectrum auctions, massive subsidies in the form of DE credits. In short, we can expand the regulatory miasma, making ever more complicated rules to try to avoid these outcomes, or we can recognize this is no longer an arena for small businesses.


Time to End the FCC’s Designated Entity Program