Phone Monopolies Deregulated at a Stroke

While no one was looking, the FCC has suddenly deregulated the Bells, allowing them to keep their monopoly powers and exploit them as far as they can.

The action was technically a non-action, an exemption from common carrier status for all Verizon  "enhanced services," meaning all Internet broadband.

By acting through an exemption, the FCC prevents the courts from trying to reverse any aspect of this new policy. It means that network neutrality is dead. It means Verizon, which sought the exemption, can now refuse to inter-connect with other Internet networks, that it can eliminate Competitive Local Access Carriers at a stroke.

Given the dominant position Verizon has "won" in the market (through lobbying, refusal to follow previous laws, and defiance of earlier laws) it means that company can now define the U.S. Internet in any way it wants, restricted only by its own greed, and there is not a damned thing anyone can do about it.

In the short run.

Democrat Michael Copps, who has been on the FCC longer than any other current member, was apoplectic:

There is no appealable  Order.  There is no document, no stitch of analysis, no trace of  discussion, nothing that a court can use to gauge where the  Commission is coming from.  And by failing to act through a normal  proceeding, the Commission jeopardizes many Congressional policies  that are at the core of its statutory duties.  I find no basis to  support an approach that puts so much at riskL

Please remember, this is the diplomatic language used in objecting to what the FCC majority did. This is probably not how Copps really feels, and it's certainly not the way Verizon foes like Bruce Kushnick feel.

Is there a silver lining in this terribly dark cloud? (The illustration is from the linked article.)

Yes, there is.

There is an enormous opportunity here for competitors like Level 3 and Google to set up competing access networks throughout Verizon's service territory. All they need to do is advertise "Real Internet Service" and explain what that means, then write it into their contracts.

While this will greatly inconvenience millions of people, and result in monopoly rents, high prices, and continued bandwidth hoarding for a few years, it actually will accelerate the move to competitive networks and, I think, mark the beginning of the end of the Bells.

That's my hope, anyway.

Comments

[Jesse Kopelman]

If things became completely deregulated, that would be fine as Bells and Cablecos would have to change their ways or go out like PanAm. What is bad is this current climate of unclear regulation that favors whoever spends the most on lobbying. In general I am against regulation, but if we are going to have it, and we probably are, it needs to go hardest against the big guys.