It wants the framework extended to all providers of such services - including cable operators, which it says have been taking market share in this area. Ex ante regulation, including price regulation, would be applied in relevant markets that are insufficiently competitive. In markets showing competition, the FCC would forebear from regulation and allow market forces to determine prices. In addition, there should be a relationship between wholesale and retail pricing for these services, which the new model should reflect, according to the letter from Verizon and Incompas. They said their proposal offers a way ahead after over ten years of discussion on the matter.
While no further details of the proposed regulation were provided, it has already raised opposition from cable operators. The American Cable Association said the "private deal" between Verizon and Incompas would subject new facilities-based operators to regulation. Many of these are smaller operators with no experience in such regulation that would face significant additional costs. This could slow their entry on the market and impact competition. "That is clearly not in the public interest, and ACA intends to oppose this private deal."
The Verizon statement comes the same day as the release of a study by industry group USTelecom suggesting the business broadband market is competitive and no further price regulation by the FCC is needed. The report by professor Hal Singer said that the regulation could hold back investment and the roll-out of fibre networks.
