The Federal Communications Commission (FCC) has suspended “special access” rules that favored incumbent carriers. These special access providers will no longer enjoy pricing flexibility when provisioning high capacity circuits to competitive providers and enterprise customers.
According to the original rules lain down in 1999, the FCC would regulate special access rates. However, if certain geographic areas met prerequisite competitive showings, the FCC would also provide carriers with pricing flexibility. This allowed carriers to offer “special access” services to their customers at unregulated rates.
From backhauling traffic from cell towers for wireless providers, to connecting the facilities of competitive carriers to enterprise customers, and transporting Internet traffic from various facilities to carrier points of presence, special access serves as the telecom industry’s middle mile workhorse.
Special access providers are usually large incumbent carriers. Their customers have claimed that special access providers raise prices above competitive levels even if there are no real competitors in the area.
The response from special access providers is that the market for special access is indeed competitive and that they are still subject to rate regulation from the FCC.
The recent FCC order suspends pricing flexibility while the government agency works on a new regulatory framework for special access. To achieve this, the FCC will issue a data collection order within 60 days. Carriers and other stakeholders will be asked to provide information on how to properly regulate the special access market.