The Federal Communications Commission — the traffic cop of the communications industry — just raised the speed limits on broadband. Its ruling on Thursday protects many of the fiber deployments by telephone companies from forced “open access” requirements. In short, the FCC made another positive step toward investment in an enabling technology.
The ruling fills an important void for increased investment in high-speed networks. The agency has been in the process of placing Jersey barriers between traditional local phone service and broadband, ensuring that open access rules meant for local phone service stay there. The FCC recognizes that there is hardly any “telephone” left in telephone companies. Cable, wireless, local phone, satellite and Internet service are all communications companies now, and their services are rapidly converging.
Thus far, telecommunications law has limited phone companies to driving a Porsche at 25 miles per hour. But this ruling changes the rules of the road — or at least the fiber superhighway — to the benefit of consumers. Fiber will enable increased quality of life for the homebound elderly, especially in communications with doctors and family. Broadband through the TV means competition for cable and satellite companies. Videoconferencing will provide opportunities for distance learning and corporate meetings. An always-on high-speed fiber connection will allow for remote monitoring of your home while at work or on vacation.
It would be easy to overlook this ostensibly narrow ruling, but its cause and effect is clear. Already some phone companies have announced large investments in fast-speed fiber. BellSouth, the company that petitioned the FCC for this ruling, said it will increase the number of homes equipped with fiber platforms by 40 percent in 2005. SBC will accelerate its plans to invest approximately $5 Billion into deploying fiber.
Eight years after the 1996 Telecommunications Act, policymakers are beginning to understand that people won’t invest in something they don’t control. Isn’t it amazing what happens when we allow industry to drive not with a compass, but with DVD navigational systems?
Braden Cox is technology counsel at the Competitive Enterprise Institute.